What is the obligation of Cicis franchisees regarding the confidentiality of the Confidential Information after the Franchise Agreement expires or terminates?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
You and your owners will not acquire any interest in the Confidential Information other than the right to use it in operating the Restaurant. You must maintain the absolute confidentiality of the Confidential Information during and after the expiration or termination of the Franchise Agreement. You and your Owners, your employees and independent contractors must adopt and implement reasonable procedures to prevent unauthorized use or disclosure of the Confidential Information. You and your owners can divulge this Confidential Information only to individuals or entities specifically authorized by us in advance, or to your employees or contractors who must have access to it to operate the Restaurant, however, such individuals or entities must be under a duty of confidentiality no less restrictive than your obligations to us under the Franchise Agreement. We may require you to have your employees and contractors execute individual undertakings and shall have the right to regulate the form of and be a party to or third-party beneficiary under any such agreements. Neither you nor your owners are permitted to make unauthorized copies, record or otherwise reproduce the materials or information or make them available to any unauthorized person.
Source: Item 14 — PATENTS, COPYRIGHTS, AND PROPRIETARY INFORMATION (FDD pages 42–43)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, franchisees and their owners must maintain absolute confidentiality of the Confidential Information both during and after the expiration or termination of the Franchise Agreement. This obligation extends to preventing unauthorized use or disclosure of the Confidential Information by implementing reasonable procedures. Franchisees can only share Confidential Information with individuals or entities specifically authorized by Cicis in advance, or with employees or contractors who need access to it to operate the Restaurant, provided these individuals are under a duty of confidentiality no less restrictive than the franchisee's obligations.
This means that even after a Cicis franchise closes or the agreement ends, the former franchisee is legally bound to protect Cicis's proprietary information. This includes trade secrets, operational methods, marketing strategies, and other confidential data that gives Cicis a competitive advantage. The franchisee must ensure that their owners, employees, and independent contractors also adhere to these confidentiality requirements.
Cicis retains the right to require employees and contractors of the franchisee to execute individual confidentiality undertakings, and Cicis can regulate the form of these agreements or even be a party to or a third-party beneficiary under them. This allows Cicis to directly enforce confidentiality obligations against individuals working for the franchisee. Franchisees are not allowed to make unauthorized copies, record, reproduce, or make the materials or information available to any unauthorized person.
For a prospective Cicis franchisee, this highlights the importance of understanding and adhering to confidentiality obligations. Failure to maintain confidentiality could result in legal action from Cicis. Franchisees should ensure they have robust procedures in place to protect Confidential Information and that all relevant parties are aware of and comply with these obligations, even after the franchise agreement concludes.