Can a Chicken Guy franchisee initiate legal action regarding infringement of the Proprietary Marks without Chicken Guy's approval?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall not make any demand or serve any notice, orally or in writing, or institute any legal action or negotiate, compromise or settle any controversy with respect to any such infringement without first obtaining Chicken Guy's written approval.
Chicken Guy shall have the right, but not the obligation, to bring such action or take such steps as it may deem advisable to prevent any such infringement and to join Franchisee as a party to any action in which Chicken Guy is or may be a party and as to which Franchisee is or would be a necessary or proper party.
Franchisee also shall promptly notify Chicken Guy of any litigation (including administrative or arbitration proceedings) of which Franchisee is aware instituted against Chicken Guy, its affiliates or Franchisee relating to the Proprietary Marks.
Franchisee shall execute any and all instruments and documents, render such other assistance and do any acts and things as may, in the opinion of Chicken Guy's counsel, be necessary or advisable to protect and maintain Chicken Guy's interests in the Proprietary Marks, including, without limitation, Chicken Guy's interests in litigation or proceedings before the U.S.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, a franchisee is not allowed to initiate any legal action regarding infringement of the Proprietary Marks without first obtaining written approval from Chicken Guy. This includes making demands, serving notices, or negotiating settlements related to any infringement. This requirement ensures that Chicken Guy maintains control over the protection and enforcement of its Proprietary Marks.
This provision is included in the franchise agreement to protect the brand's intellectual property and ensure consistent legal strategies. By requiring franchisees to obtain written approval before taking any action, Chicken Guy can ensure that all legal efforts align with the company's overall brand protection strategy. This also prevents franchisees from taking actions that could potentially harm the brand or create legal complications.
Chicken Guy retains the right, but not the obligation, to take legal action against infringers. The company can also include the franchisee in any legal action as a necessary party. Franchisees are obligated to assist Chicken Guy in protecting the Proprietary Marks by executing necessary documents and providing assistance in legal proceedings. Additionally, franchisees must promptly inform Chicken Guy of any litigation against them or Chicken Guy related to the Proprietary Marks.
In practical terms, a Chicken Guy franchisee must immediately report any suspected infringement of the Proprietary Marks to Chicken Guy. The franchisee must then wait for Chicken Guy's written approval before taking any further action, such as sending a cease and desist letter or filing a lawsuit. Failure to comply with these requirements could result in a breach of the franchise agreement.