What are the potential consequences for a Coffee News franchisee's employee violating the non-competition agreement?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall execute a non-disclosure or confidentiality agreement with its employees, officers, key personnel, agents, or stockholders, as the case may be, that such employees, officers, key personnel, agents, or stockholders, as the case may be, shall be bound by the contractual provisions contained in this paragraph, and will be liable for damages, reasonable attorney fees and court cost if the Franchisor has to enforce their contractual rights by legal actions.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
According to Coffee News's 2025 Franchise Disclosure Document, franchisees must ensure their employees, officers, key personnel, agents, or stockholders sign a non-disclosure or confidentiality agreement. This agreement binds them to the contractual provisions that protect Coffee News's confidential information, trade secrets, and operational methods.
If an employee violates this agreement, the franchisee can be held liable for damages, reasonable attorney fees, and court costs if Coffee News has to take legal action to enforce its contractual rights. This means that franchisees must actively monitor their employees' compliance with the non-disclosure and confidentiality agreements to avoid potential legal and financial repercussions.
This requirement underscores the importance of thorough employee training and oversight to protect Coffee News's proprietary information and maintain the integrity of the franchise system. Franchisees should consult with legal counsel to ensure their non-disclosure agreements are comprehensive and enforceable.