Under what condition will Cool Binz indemnify and hold a franchisee harmless against reasonable litigation expenses related to an infringement, challenge, or claim?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
You must notify us immediately of any apparent infringement or challenge to your use of any Mark, or of any claim by any person of any rights in any Mark, and not to communicate with any person other than us and our attorneys, and your attorneys, in any infringement, challenge, or claim. We have sole discretion to take the action we deem appropriate and the right to control exclusively any litigation, U.S. Patent and Trademark Office ("USPTO") proceeding, or any other administrative proceeding arising out of any infringement, challenge, claim or otherwise relating to any Mark. Provided that you have timely notified us of the claim or proceeding and complied with this Agreement as we determine in our sole discretion, we shall indemnify and hold you harmless against reasonable litigation expenses incurred in connection with any such infringement, challenge or claim. If we, in our sole discretion, determine that you have not used the Marks in accordance with this Agreement, you will bear the cost of such defense, including the cost of any
judgment or settlement. You must sign any and all instruments and documents, render the assistance, and do the acts and things that, in the opinion of our attorneys, may be necessary or advisable to protect and maintain our interests in any litigation or USPTO or other proceeding, or otherwise to protect and maintain our interest in the Marks, including, without limitation, becoming a nominal party to any legal action. Except to the extent that such litigation is the result of your use of the Marks in a manner inconsistent with the terms of this Agreement, we agree to reimburse you for your out-of-pocket costs in performing such acts.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, Cool Binz will indemnify and hold a franchisee harmless against reasonable litigation expenses if the franchisee notifies Cool Binz immediately of any apparent infringement or challenge to the use of any mark, or any claim by any person of any rights in any mark. The franchisee must not communicate with anyone other than Cool Binz, their attorneys, and the franchisee's attorneys regarding the infringement, challenge, or claim.
Cool Binz has sole discretion to take action and the right to control exclusively any litigation, U.S. Patent and Trademark Office ("USPTO") proceeding, or any other administrative proceeding arising out of any infringement, challenge, claim or otherwise relating to any Mark. The franchisee must have also complied with the Franchise Agreement, as determined by Cool Binz in its sole discretion.
However, if Cool Binz determines that the franchisee has not used the marks in accordance with the agreement, the franchisee will bear the cost of the defense, including the cost of any judgment or settlement. The franchisee is also required to sign documents and render assistance to protect Cool Binz's interests in any litigation or USPTO proceeding. Cool Binz will reimburse the franchisee for out-of-pocket costs in performing such acts, except if the litigation results from the franchisee's use of the marks in a manner inconsistent with the terms of the agreement.