Can a City Wide franchisee contest the validity or ownership of the Marks during or after the term of the agreement?

According to City Wide's 2025 Franchise Disclosure Document, franchisees are prohibited from contesting the validity or ownership of the Marks, both during and after the term of the franchise agreement. Specifically, the franchisee acknowledges that City Wide is the licensee of the Marks and that City Wide Franchise Holding Company, Inc. owns these Marks. City Wide has the exclusive right to sub-license the use of the Marks in the United States, Canada, and Mexico. The franchisee's right to use the Marks is solely derived from the franchise agreement and is limited to conducting the franchised business in compliance with the agreement's standards and operating procedures.

Any unauthorized use of the Marks by the franchisee constitutes a breach of the agreement and an infringement of City Wide's rights. All goodwill established through the franchisee's use of the Marks will benefit City Wide exclusively, and the agreement does not grant the franchisee any goodwill or other interests in the Marks. The franchisee agrees not to contest the validity or ownership of the Marks or assist others in doing so, both during and after the agreement's term.

This provision is typical in franchise agreements, as franchisors need to protect their brand and trademarks. By agreeing not to contest the Marks, franchisees acknowledge the value and importance of the brand to the City Wide system. This restriction ensures that franchisees do not undermine the brand's integrity or create confusion in the marketplace. Franchisees should understand that this obligation extends beyond the termination or expiration of the franchise agreement, reinforcing the franchisor's long-term control over its intellectual property.