Does the Cilantro Taco Grill FDD specify who bears the cost of service of process for Cilantro Taco Grill?
Cilantro_Taco_Grill Franchise · 2024 FDDAnswer from 2024 FDD Document
GRILL FRANCHISE, THE FRANCHISED BUSINESS, THE PRODUCTS, THE PREMISES, OR ANY ASPECT OF THE REAL ESTATE CONNECTED TO FRANCHISEE'S FRANCHISED BUSINESS, WHETHER CAUSED BY FRANCHISEE, FRANCHISEE'S AGENTS OR EMPLOYEES, OR ARISING FROM FRANCHISEE'S ADVERTISING OR BUSINESS PRACTICES FRANCHISEE AGREES TO PAY FOR ALL THE CILANTRO TACO GRILL INDEMNITEES' LOSSES, EXPENSES (INCLUDING, BUT NOT LIMITED TO ATTORNEYS' FEES) OR CONCURRENT OR CONTRIBUTING LIABILITY INCURRED IN CONNECTION WITH ANY ACTION, SUIT, PROCEEDING, INQUIRY (REGARDLESS OF WHETHER THE SAME IS REDUCED TO JUDGMENT OR DETERMINATION), OR ANY SETTLEMENT THEREOF FOR THE INDEMNIFICATION GRANTED BY FRANCHISEE HEREUNDER. THE CILANTRO TACO GRILL INDEMNITEES SHALL HAVE THE RIGHT TO SELECT AND APPOINT INDEPENDENT COUNSEL TO REPRESENT ANY OF THE CILANTRO TACO GRILL INDEMNITEES IN ANY ACTION OR PROCEEDING COVERED BY THIS INDEMNITY. FRANCHISEE AGREES THAT TO HOLD THE CILANTRO TACO GRILL INDEMNITEES HARMLESS, FRANCHISEE WILL REIMBURSE THE CILANTRO TACO GRILL INDEMNITEES AS THE COSTS AND EXPENSES ARE INCURRED BY THE CILANTRO TACO GRILL INDEMNITEES.
Source: Item 23 — RECEIPT (FDD pages 52–208)
What This Means (2024 FDD)
According to the 2024 Cilantro Taco Grill Franchise Disclosure Document, franchisees are responsible for covering certain expenses related to legal actions. Specifically, the franchisee agrees to cover all losses and expenses, including attorney's fees, incurred by Cilantro Taco Grill in connection with any legal action, suit, or proceeding arising from the operation of the franchisee's Cilantro Taco Grill business. This includes claims related to the franchisee's business practices, advertising, or any aspect of the real estate connected to the franchise.
This obligation extends to reimbursing Cilantro Taco Grill for costs and expenses as they are incurred. Cilantro Taco Grill also retains the right to select and appoint independent counsel to represent them in any action or proceeding covered by this indemnity.
In practical terms, this means that if a franchisee is involved in a lawsuit or legal proceeding related to their Cilantro Taco Grill franchise, they will be responsible for covering Cilantro Taco Grill's legal costs, including attorney's fees, as well as any losses or liabilities incurred by Cilantro Taco Grill as a result of the legal action. This could potentially create a significant financial burden for the franchisee, especially if the legal action is protracted or results in a substantial judgment against the franchisee.