What is the consequence of failing to notify the Coffee News franchisor about adverse legal actions?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.11 Notification of Violations.
Franchisee shall immediately notify Franchisor of any apparent infringements of or challenges to the use of the "Coffee News" name or Format or Franchisee's Franchised business in the region covered by this Agreement.
Franchisee shall not communicate with any person other than Franchisor, 2703203 Manitoba Inc., and its counsel in connection with any such infringement, challenge or claim.
Franchisee agrees that 2703203 Manitoba Inc. shall have sole discretion to take such action as it deems appropriate and the right to exclusively control any litigation or other administrative claim or action relating to any such infringement, challenge or claim.
Any money, damages or other benefits arising out of such infringement, challenge or claim shall accrue to 2703203 Manitoba Inc.
Franchisee agrees to execute any and all instruments and documents, render such
assistance and perform such acts as may, in the opinion of the counsel of 2703203 Manitoba Inc., be necessary or advisable, to protect and maintain the interests of 2703203 Manitoba Inc., Franchisor and its franchisees in any litigation or administrative proceeding or to otherwise protect and maintain the interest of 2703203 Manitoba Inc. and Franchisor in the "Coffee News" name and Format or their businesses.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
Based on the 2025 Coffee News Franchise Disclosure Document, franchisees are obligated to notify the franchisor of any apparent infringements or challenges to the use of the "Coffee News" name or format. The franchisee must immediately inform the franchisor of any issues related to the brand or franchised business within their designated region.
According to the FDD, the franchisee is prohibited from communicating with anyone other than the franchisor, 2703203 Manitoba Inc., and its counsel regarding any infringement, challenge, or claim. This restriction ensures that all communications are managed through the appropriate channels, allowing for a coordinated and strategic response. The franchisor, specifically 2703203 Manitoba Inc., retains the sole discretion to take any action it deems necessary and has the exclusive right to control any litigation or administrative claim related to such infringements or challenges.
Furthermore, any monetary benefits, damages, or other advantages resulting from an infringement, challenge, or claim will accrue to 2703203 Manitoba Inc. The franchisee is required to execute any documents and provide assistance as deemed necessary by the counsel of 2703203 Manitoba Inc. to protect the interests of the franchisor and its franchisees. This includes participating in litigation or administrative proceedings and generally supporting the franchisor's efforts to maintain the integrity of the "Coffee News" name and format. The FDD does not explicitly state the consequences of failing to notify the franchisor.