Does the franchise agreement for Chocolate Fish Coffee require franchisees to notify them of similar trademarks?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
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.
Source: Item 13 — TRADEMARKS (FDD pages 29–31)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, the franchise agreement does obligate franchisees to notify Chocolate Fish Coffee regarding the use of, or claims of rights to, trademarks that are identical or confusingly similar to the trademarks licensed to them. However, the agreement does not require Chocolate Fish Coffee to take any specific action upon receiving such notification.
This obligation is in place to allow Chocolate Fish Coffee to protect its trademarks. Chocolate Fish Coffee retains the right to control any administrative proceedings or litigation involving a trademark licensed to the franchisee. If a franchisee uses Chocolate Fish Coffee's trademarks in accordance with the franchise agreement, Chocolate Fish Coffee will defend the franchisee (at their own expense) against any legal action alleging infringement and will indemnify the franchisee for expenses and damages if the legal action is resolved unfavorably to the franchisee.
Chocolate Fish Coffee may also require a franchisee to modify or discontinue using a trademark, and the franchisee will bear the expense of doing so. This provision highlights the importance of franchisees adhering to Chocolate Fish Coffee's trademark guidelines and promptly reporting any potential conflicts or infringements to the franchisor.