Does the Chesters Agreement require the franchisor to protect the franchisee's right to use the Marks?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
The Agreement does not require us to protect your right to use the Marks listed above or to protect you against claims of infringement or unfair competition from your use of the Marks. You have no contractual obligation to notify us of any apparent infringement or challenge to your use of any Mark or of any person's claim of any rights in any Mark. In all these cases, we have the right to take the action we deem appropriate (including no action). Because we own the Marks, we would expect to control exclusively any litigation, USPTO proceeding, or other administrative proceeding arising from any infringement, challenge, or claim. We have no obligation to participate in your defense and/or indemnify you for expenses or damages if you are a party to an administrative or judicial proceeding involving a Mark we license to you or if the proceeding is resolved unfavorably toward you. You must cooperate with us in defending or settling litigation. Our Agreement does not address our right to change the Marks during the franchise term.
Source: Item 13 — TRADEMARKS (FDD pages 31–33)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the franchise agreement does not obligate Chesters to protect a franchisee's right to use the Marks. Furthermore, Chesters is not required to defend franchisees against claims of infringement or unfair competition arising from their use of the Marks.
While franchisees are not contractually obligated to inform Chesters of any potential infringement or challenges to their use of the Marks, or any claims regarding rights to the Marks, Chesters retains the right to take any action it deems appropriate, including no action at all. Chesters maintains exclusive control over any litigation, USPTO proceedings, or administrative actions resulting from infringement, challenges, or claims, as they own the Marks.
Chesters has no obligation to participate in a franchisee's defense or to cover expenses or damages if a franchisee is involved in an administrative or judicial proceeding related to the licensed Marks, especially if the outcome is unfavorable. However, franchisees are required to cooperate with Chesters in defending or settling any litigation. The agreement also does not address Chesters's right to change the Marks during the franchise term, which could impact a franchisee's business and marketing efforts.