What do the 'Marks' refer to in the Chocolate Fish Coffee franchise agreement?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
- B. The System includes (1) methods, procedures, and standards for developing and operating a Chocolate Fish Coffee business, (2) plans, specifications, equipment, signage and trade dress for Chocolate Fish Coffee businesses, (3) particular products and services, (4) the Marks, (5) training programs, (6) business knowledge, (7) marketing plans and concepts, and (8) other mandatory or optional elements as determined by Chocolate Fish Franchising from time to time.
- C. The parties desire that Chocolate Fish Franchising license the Marks and the System to Franchisee for Franchisee to develop and operate a Chocolate Fish Coffee business on the terms and conditions of this Agreement.
ARTICLE 12. MARKS
- 12.1 Authorized Marks. Franchisee shall use no trademarks, service marks or logos in connection with the Business other than the Marks. Franchisee shall use all Marks specified by Chocolate Fish Franchising, and only in the manner as Chocolate Fish Franchising may require. Franchisee has no rights in the Marks other than the right to use them in the operation of the Business in compliance with this Agreement. All use of the Marks by Franchisee and any goodwill associated with the Marks, including any goodwill arising due to Franchisee's operation of the Business, will inure to the exclusive benefit of Chocolate Fish Franchising.
- 12.2 Change of Marks. Chocolate Fish Franchising may add, modify, or discontinue any Marks to be used under the System. Within a reasonable time after Chocolate Fish Franchising makes any such change, Franchisee must comply with the change, at Franchisee's expense.
12.3 Infringement.
12.3 Infringement.
- (a) Defense of Franchisee. If Franchisee has used the Marks in accordance with this Agreement, then (i) Chocolate Fish Franchising shall defend Franchisee (at Chocolate Fish Franchising's expense) against any Action by a third-party alleging infringement by Franchisee's use of a Mark, and (ii) Chocolate Fish Franchising will indemnify Franchisee for expenses and damages if the Action is resolved unfavorably to Franchisee.
- (b) Infringement by Third Party. Franchisee shall promptly notify Chocolate Fish Franchising if Franchisee becomes aware of any possible infringement of a Mark by a third party. Chocolate Fish Franchising may, in its sole discretion, commence or join any claim against the infringing party.
- (c) Control. Chocolate Fish Franchising shall have the exclusive right to control any prosecution or defense of any Action related to possible infringement of or by the Marks.
- 12.4 Name. If Franchisee is an entity, it shall not use the words "Chocolate Fish Coffee" or any confusingly similar words in its legal name.
Source: Item 23 — RECEIPTS (FDD pages 41–119)
What This Means (2024 FDD)
According to the 2024 Chocolate Fish Coffee Franchise Disclosure Document, the 'Marks' refer to the trademarks, service marks, and logos that franchisees are authorized to use in connection with their Chocolate Fish Coffee business. The franchise agreement specifies that franchisees can only use the 'Marks' specified by Chocolate Fish Coffee and in the manner that Chocolate Fish Coffee requires.
Chocolate Fish Coffee franchisees do not acquire any rights in the 'Marks' beyond the right to use them while operating their business in compliance with the franchise agreement. All goodwill associated with the 'Marks', including any goodwill arising from the franchisee's operation of the business, accrues exclusively to the benefit of Chocolate Fish Coffee. This means that the brand recognition and customer loyalty built by the franchisee ultimately benefit the franchisor.
Chocolate Fish Coffee retains the right to add, modify, or discontinue any 'Marks' used within the system. Franchisees are obligated to comply with these changes at their own expense within a reasonable timeframe after Chocolate Fish Coffee implements them. If a franchisee uses the 'Marks' in accordance with the agreement, Chocolate Fish Coffee will defend the franchisee against any third-party action alleging infringement and will indemnify the franchisee for expenses and damages if the action is resolved unfavorably. Franchisees must promptly notify Chocolate Fish Coffee of any potential infringement of a 'Mark' by a third party, and Chocolate Fish Coffee has the exclusive right to control any legal action related to infringement of the 'Marks'. Furthermore, if the franchisee is an entity, it cannot use "Chocolate Fish Coffee" or any confusingly similar words in its legal name.