Can a Craters & Freighters franchisee contest the validity of the Marks during or after the agreement?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.3 No Contest. Franchisee agrees that, during the term of this Agreement and after its termination or expiration and non-renewal, Franchisee will not directly or indirectly contest or aid in contesting the validity of the Marks or the ownership or rights of the Marks by Franchisor. Furthermore, Franchisee intends and hereby concedes that any commercial use Franchisee may make of the Marks will contribute and inure to the commercial use and benefit of Franchisor, which Franchisor may claim to strengthen and further secure ownership of the Marks. In the event that Franchisee acquires any rights, title or interest in the Marks, Franchisee agrees to assign and hereby assigns all such rights, title, or interest to Franchisor.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, a franchisee is prohibited from contesting the validity of the Marks, both during the term of the Franchise Agreement and after its termination or expiration. This includes directly or indirectly contesting or aiding others in contesting the validity of the Marks or Craters & Freighters' ownership rights.
This provision ensures that Craters & Freighters maintains control and protection over its trademarks and brand identity. Any commercial use of the Marks by the franchisee is intended to benefit Craters & Freighters, reinforcing their ownership. Should a franchisee acquire any rights or interest in the Marks, they are obligated to assign those rights to Craters & Freighters.
This type of clause is standard in franchise agreements to protect the franchisor's intellectual property. It prevents franchisees from undermining the brand's value by challenging the trademarks. A prospective Craters & Freighters franchisee should understand that they cannot dispute the validity or ownership of the Craters & Freighters Marks at any time during or after their franchise agreement.