Is a City Wide franchisee allowed to engage in activities reasonably anticipated to result in public criticism?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.22 Best Interest of the System.
Franchisee will not engage in any activity, conduct or practice that is contrary to the best interest of CITY WIDE or Franchisee or that is reasonably anticipated to result in litigation with Franchisee's suppliers or customers, or in public criticism of CITY WIDE or the Franchised Business generally.
- 7.23 Notice of Legal Action.
Franchisee will notify CITY WIDE in writing within five (5) business days of receipt of service or notice of the commencement of any action, suit, or proceeding, and of the issuance of any order, writ, injunction, award, or decree of any court, agency, or other governmental instrumentality, including action against professional services/credentials of any employee or contractor associated with Franchisee, which may adversely affect the operation or financial condition of the Franchised Business.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, franchisees are restricted from engaging in activities that could harm the brand's reputation. Specifically, franchisees must not participate in any activity, conduct, or practice that is contrary to the best interests of City Wide or that could reasonably lead to litigation with suppliers or customers. More importantly, franchisees are prohibited from actions that could result in public criticism of City Wide or the franchised business in general. This provision aims to protect the brand's image and maintain positive relationships within the City Wide network.
This restriction means a City Wide franchisee needs to be cautious about their public behavior and business practices. Any actions that could potentially generate negative publicity or damage the brand's reputation are prohibited. This includes not only direct criticism but also activities that could reasonably be expected to lead to such criticism. For example, a franchisee publicly disputing with a supplier or engaging in controversial public debates could be seen as a violation of this clause.
The FDD also states that franchisees must notify City Wide in writing within five business days of receiving notice of any legal action that may adversely affect the operation or financial condition of the franchised business. This notification requirement ensures that City Wide is aware of any potential issues that could lead to public criticism or damage to the brand's reputation, allowing them to take appropriate action to mitigate any negative impact.
Overall, these stipulations highlight the importance City Wide places on protecting its brand image and maintaining positive relationships within its franchise network. Prospective franchisees should carefully consider these restrictions and ensure they are comfortable adhering to them before investing in a City Wide franchise.