What warranty does a Checkers franchisee provide regarding third-party rights related to materials created on their behalf?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.03 Information Exchange. You must promptly disclose to us all recipes, processes, ideas, concepts, advertising and promotional materials, website pages and content, methods, techniques or materials used or useful to a fast-food restaurant business, whether or not constituting protectable intellectual property, that you create, or that are created on your behalf or for your benefit by your Owners or employees, in connection with the development or operation of your Restaurant (collectively, the "Materials"). Any such Materials will be deemed our sole and exclusive property, part of the System, and works made-for-hire for us. To the extent that any one of the Materials does not qualify as a "work made-for-hire" for us (as such term is defined under Section 101 of the U.S. Copyright Act), by way of this paragraph you irrevocably convey, grant, transfer and assign ownership of the Material(s), and all related rights to the Materials, both during and after the Term,
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
The 2025 Checkers Franchise Disclosure Document outlines the franchisee's responsibilities regarding materials created for their restaurant. Specifically, Checkers requires franchisees to disclose all recipes, processes, ideas, advertising materials, website content, methods, techniques, or materials used in their restaurant's development or operation, regardless of whether they are protectable intellectual property. These disclosed items are referred to as "Materials."
According to the FDD, any "Materials" created by the franchisee, their owners, or employees are deemed Checkers' sole and exclusive property and are considered "works made-for-hire." This means Checkers owns the rights to these materials from the moment they are created. If any of the "Materials" do not legally qualify as "works made-for-hire" under U.S. Copyright law, the franchisee irrevocably assigns all ownership and rights to those "Materials" to Checkers, both during and after the franchise term.
This clause ensures that Checkers maintains control over the System and any innovations or creative content developed within the franchise network. It also protects Checkers from potential legal issues related to intellectual property rights. A prospective franchisee should be aware that any materials they develop for their Checkers restaurant, even if created independently, will become the property of the franchisor.