Does the Checkersrallys franchise agreement confer any goodwill or other interests in the Marks to the franchisee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
red (whether through acquisition of assets, ownership interests or otherwise, regardless of the form of transaction), by a business providing products and services similar to those provided at "Checkers" or "Rally's"-branded restaurants, or by another business, even if such business operates, franchises and/or licenses Competitive Businesses in the Protected Area.
You acknowledge and agree that, except as expressly granted to you in Section 2.02 hereof, your rights hereunder are non-exclusive and you have no rights under this Agreement to participate in or benefit from any other business activity we or our Affiliate may undertake, regardless of whether such activity involves the Marks or the System. You waive, to the fullest extent permitted under applicable law, all claims, demands, or causes of action arising from or relating to any of the foregoing activities by us or any of our Affiliates in connection with our reserved rights under this Section 2.03.
3. DEVELOPMENT OF THE FRANCHISED RESTAURANT.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to the 2025 Checkersrallys Franchise Disclosure Document, the franchisee does not receive goodwill or interests in the Checkersrallys marks, except as expressly granted in Section 2.02 of the franchise agreement. The agreement specifies that the franchisee's rights are non-exclusive, and they cannot participate in or benefit from any other business activity undertaken by Checkersrallys or its affiliates, even if it involves the Marks or the System. The franchisee also waives any claims related to Checkersrallys's business activities.
Furthermore, the franchisee acknowledges Checkersrallys's protectable legal interests in the System, customers, confidential information, and the goodwill associated with the Marks. The franchisee's agreement includes representations, covenants, and warranties necessary to protect Checkersrallys's interests. This encompasses precluding direct and indirect competition, binding individuals with legal or beneficial interests, and preserving the goodwill associated with the Marks.
This means that while franchisees benefit from the established Checkersrallys brand and system, they do not gain ownership or exclusive rights to the associated goodwill or trademarks. Checkersrallys retains control over the brand and can engage in other business activities, even those involving the Marks, without providing direct benefits to the franchisee. Prospective franchisees should understand that their rights are limited to the specific terms outlined in the franchise agreement and do not extend to broader ownership or control of the Checkersrallys brand assets.