What does Chem Dry consider as 'Confidential Information'?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
5. CONFIDENTIAL INFORMATION
- CDI possesses (and will continue to develop and acquire) certain confidential information relating to, without limitation, the methods, techniques, formats, specifications, procedures, information, systems, sales and marketing techniques and knowledge of and experience in the development, operation and franchising of CHEM-DRY Businesses (the "Confidential Information"). CDI will disclose the Confidential Information to FRANCHISEE in the training program, the Manual and/or in guidance furnished to FRANCHISEE. FRANCHISEE acknowledges that the Confidential Information is proprietary and/or involves trade secrets of CDI and that FRANCHISEE will not acquire any interest in the Confidential Information, other than the right to utilize it as CDI specifies in the operation of the BUSINESS during the term of this Agreement. FRANCHISEE acknowledges and agrees that the Confidential Information is disclosed to FRANCHISEE only on the condition that FRANCHISEE agrees, and FRANCHISEE in fact does agree, that FRANCHISEE:
a. will not use or disclose Confidential Information in or to any other business or in any capacity;
b. will keep each item deemed to be part of Confidential Information absolutely confidential, both during and after this Agreement's Term;
c. will not make unauthorized copies of any Confidential Information disclosed via electronic medium or in written or other tangible form; and
d. will require each employee of the BUSINESS, at the time of employment, to sign a confidentiality agreement agreeing to maintain the confidentiality of the Confidential Information.
CDI has the right to regulate the form of agreements that FRANCHISEE uses.
FRANCHISEE agrees that the list of FRANCHISEE's current customers, former customers and those who have inquired about the services provided by the BUSINESS (the "Customer List") shall be included in the Confidential Information, shall be the property of CDI and shall constitute a trade secret of CDI.
FRANCHISEE agrees that it does not own the Customer List and that it will not disclose the Customer List, or any portion thereof, to any person or entity other than CDI or its designee, either during the term of this Agreement or thereafter.
FRANCHISEE agrees to only use the Customer List in the operation of the BUSINESS and in accordance with this Agreement.
Confidential Information does not include information, knowledge, or know how which FRANCHISEE can demonstrate lawfully came to FRANCHISEE'S attention before CDI provided it to FRANCHISEE directly or indirectly; which, at the time CDI disclosed it to FRANCHISEE, already had lawfully become generally known in the industry through publication or communication by others (without violating an obligation to CDI); or which, after CDI discloses it to FRANCHISEE, lawfully becomes generally known in the industry through publication or communication by others (without violating an obligation to CDI).
However, if CDI includes any matter in Confidential Information, anyone who claims that it is not Confidential Information carries the burden of proof that one of the exclusions provided in this paragraph applies.
Source: Item 23 — Receipts (FDD pages 68–264)
What This Means (2024 FDD)
According to Chem Dry's 2024 Franchise Disclosure Document, confidential information includes methods, techniques, formats, specifications, procedures, information, systems, sales and marketing techniques, and knowledge and experience in the development, operation, and franchising of Chem Dry Businesses. Chem Dry will disclose this information to the franchisee during the training program, in the manual, and through other guidance. The franchisee acknowledges that this information is proprietary and involves trade secrets of Chem Dry.
The franchisee is obligated to maintain the confidentiality of this information both during and after the term of the franchise agreement. This includes not using or disclosing the confidential information in any other business or capacity, keeping the information absolutely confidential, and not making unauthorized copies of any confidential information. The franchisee must also ensure that all employees sign a confidentiality agreement to maintain the confidentiality of the information.
Furthermore, Chem Dry considers the customer list, which includes current customers, former customers, and those who have inquired about Chem Dry's services, as confidential information and a trade secret of Chem Dry. The franchisee acknowledges that Chem Dry owns the customer list and agrees not to disclose it to any person or entity other than Chem Dry or its designee, both during and after the agreement. The franchisee can only use the customer list in the operation of the Chem Dry business and in accordance with the franchise agreement.
However, information is not considered confidential if the franchisee can demonstrate it lawfully came to their attention before Chem Dry provided it, if it was already generally known in the industry at the time of disclosure, or if it lawfully becomes generally known in the industry after disclosure without violating any obligation to Chem Dry. The burden of proof lies with anyone claiming that certain information is not confidential.