Must a Chicken Guy franchisee agree not to contest the franchisor's interest in the trade secrets?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Confidentiality
- (1) Franchisee acknowledges and agrees that: (a) Chicken Guy owns all right, title and interest in and to the System; (b) the System consists of trade secrets and confidential and proprietary information and know-how that gives Chicken Guy and its affiliates a competitive advantage; (c) Chicken Guy and its affiliates have taken all measures necessary to protect the trade secrets and the confidentiality of the proprietary information and know-how comprising the System; (d) all material or other information now or hereafter provided or disclosed to Franchisee regarding the System is disclosed in confidence; (e) Franchisee has no right to disclose any part of the System to anyone who is not an employee of Franchisee; (f) Franchisee will disclose to its employees only those parts of the System that an employee needs to know; (g) Franchisee will have a system in place to ensure its employees keep confidential Chicken Guy's trade secrets and confidential and proprietary information, and, if requested by Chicken Guy, Franchisee shall obtain from those of its employees designated by Chicken Guy an executed Confidential Disclosure Agreement in the form prescribed by Chicken Guy; (h) Franchisee will not acquire any interest in the System; and (i) Franchisee's use or duplication of the System or any part of the System in any other business would constitute an unfair method of competition, for which Chicken Guy would be entitled to all legal and equitable remedies, including injunctive relief, without posting a bond.
- (2) Franchisee shall not, during the term of this Agreement or at any time thereafter, communicate or disclose any trade secrets or confidential or proprietary information or know-how of the System to any unauthorized person, or do or perform, directly or indirectly, any other acts injurious or prejudicial to any of the Proprietary Marks or the System. Any and all information, knowledge, know-how and techniques, including all drawings, materials, equipment, specifications, recipes, techniques and other data that Chicken Guy or its affiliates designate as confidential, shall be deemed confidential for purposes of this Agreement.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 38–39)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, franchisees must acknowledge Chicken Guy's ownership and protection of its trade secrets. Franchisees agree that Chicken Guy owns all rights to the System, which includes trade secrets and confidential information that provides a competitive advantage. Franchisees also acknowledge that Chicken Guy has taken necessary measures to protect these trade secrets.
As part of the franchise agreement, franchisees cannot disclose any part of the System to unauthorized individuals and must ensure their employees maintain the confidentiality of Chicken Guy's trade secrets. Franchisees also agree not to acquire any interest in the System and understand that using or duplicating the System in any other business would be an unfair method of competition. Chicken Guy is entitled to legal and equitable remedies, including injunctive relief, if a franchisee violates these terms.
Furthermore, franchisees must not communicate or disclose any trade secrets or confidential information of the System to any unauthorized person, nor perform any actions that could harm the Proprietary Marks or the System, both during and after the term of the agreement. Any information designated as confidential by Chicken Guy is deemed confidential for the purposes of the agreement. This includes drawings, materials, equipment, specifications, recipes, techniques, and other data.