Under what condition is Cinnabon required to indemnify a franchisee against trademark infringement claims in Minnesota?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
The Minnesota Department of Commerce requires us to indemnify Minnesota franchisees against liability to third parties resulting from claims by third parties that the franchisee's use of our trademark infringes on trademark rights of the third party. We do not indemnify against the consequences of a franchisee's use of our trademark except in accordance with the requirements of the Franchise Agreement; and, as a condition to indemnification, you must: (i) provide prompt notice to us of any such claim; (ii) tender the defense of the claim to us; and (iii) cooperate with us in the defense against the claim. If we accept the tender of defense, we have the right to manage the defense of the claim including the right to compromise, settle, or otherwise resolve the claim, and to determine whether to appeal a final determination of the claim.
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to the 2025 Cinnabon Franchise Disclosure Document, Minnesota franchisees receive specific protections regarding trademark infringement claims. The Minnesota Department of Commerce mandates that Cinnabon indemnify its Minnesota franchisees against liabilities arising from third-party claims that the franchisee's use of the Cinnabon trademark infringes upon the trademark rights of another party.
However, this indemnification is not unconditional. Cinnabon does not provide indemnity if the franchisee's use of the trademark does not adhere to the Franchise Agreement's requirements. Furthermore, the franchisee must fulfill certain obligations to be eligible for indemnification. These include providing prompt notification to Cinnabon of any such claim, tendering the defense of the claim to Cinnabon, and cooperating with Cinnabon in defending against the claim.
If a franchisee meets these conditions, Cinnabon reserves the right to manage the defense of the claim. This includes the authority to compromise, settle, or otherwise resolve the claim, as well as to determine whether to appeal any final determination related to the claim. This addendum ensures that Minnesota franchisees have some protection against trademark infringement claims, while also outlining the responsibilities and limitations of both the franchisee and Cinnabon in such situations.