Does Chocolate Bash protect franchisees against claims of trademark infringement?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
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Protection of Rights
We protect your right to use the principal trademarks listed in this Item, and we protect you against claims of infringement or unfair competition arising out of your use of the trademarks, to the extent described in this section.
The franchise agreement obligates you to notify us of the use of, or claims of rights to, a trademark identical to or confusingly similar to a trademark licensed to you. The franchise agreement does not require us to take affirmative action when notified of these uses or claims. We have the right to control any administrative proceedings or litigation involving a trademark licensed by us to you.
If you use our trademarks in accordance with the franchise agreement, then (i) we will defend you (at our expense) against any legal action by a third party alleging infringement by your use of the trademark, and (ii) we will indemnify you for expenses and damages if the legal action is resolved unfavorably to you.
Under the franchise agreement, we may require you to modify or discontinue using a trademark, at your expense.
Superior Prior Rights and Infringing Uses
We do not know of either superior prior rights or infringing uses that could materially affect your use of the principal trademarks.
Source: Item 13 — TRADEMARKS (FDD pages 26–28)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, Chocolate Bash offers some protection to franchisees against trademark infringement claims. If a franchisee uses Chocolate Bash's trademarks in accordance with the franchise agreement, Chocolate Bash will defend the franchisee (at Chocolate Bash's expense) against any legal action by a third party alleging trademark infringement. Chocolate Bash will also indemnify the franchisee for expenses and damages if the legal action is resolved unfavorably to the franchisee.
However, the franchise agreement obligates the franchisee to notify Chocolate Bash of any use of, or claims to, a trademark that is identical or confusingly similar to the trademarks licensed to the franchisee. It is important to note that Chocolate Bash is not required to take any affirmative action upon receiving such notification. Chocolate Bash retains the right to control any administrative proceedings or litigation involving a trademark licensed to the franchisee.
It is also important to note that Chocolate Bash may require the franchisee to modify or discontinue using a trademark, and the franchisee will bear the expense of doing so. Chocolate Bash states that they are not aware of any superior prior rights or infringing uses that could materially affect a franchisee's use of the principal trademarks. This suggests Chocolate Bash has taken steps to ensure the trademarks are legally defensible. Prospective franchisees should carefully review the franchise agreement and discuss trademark protection with Chocolate Bash to fully understand their rights and obligations.