With whom is a Craters & Freighters franchisee permitted to communicate regarding any infringement, challenge, or claim related to Copyrighted Works, Confidential Information, or Trade Secrets?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
You must not directly or indirectly contest our rights to any of our Copyrighted Works, Confidential Information or Trade Secrets. You may not communicate with anyone except us and our counsel with respect to any infringement, challenge or claim. We will have discretion to take action as we deem appropriate regarding any infringement, challenge or claim, and the sole right to control exclusively any litigation or other proceeding arising out of any infringement, challenge or claim under any Copyrighted Works, Confidential Information or Trade Secrets.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 34–35)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, a franchisee is severely restricted in who they can communicate with regarding any potential infringement, challenge, or claim related to Craters & Freighters's Copyrighted Works, Confidential Information, or Trade Secrets. Specifically, the franchisee is only permitted to communicate with Craters & Freighters itself and its legal counsel. This restriction is in place to ensure that Craters & Freighters maintains complete control over how such matters are handled.
This provision has significant implications for a prospective Craters & Freighters franchisee. It means that if a franchisee becomes aware of a potential infringement or faces a challenge to their use of Craters & Freighters's intellectual property, they cannot discuss the matter with anyone outside of the franchisor and its counsel. This includes other franchisees, external legal advisors (unless approved by Craters & Freighters), or any other third party. The franchisee must rely solely on Craters & Freighters to take appropriate action.
The FDD also states that Craters & Freighters has the discretion to take action as it deems appropriate and has the sole right to control any litigation or proceedings arising from such issues. While Craters & Freighters may choose to protect its intellectual property, the Franchise Agreement does not obligate them to take any affirmative action. This means a franchisee could potentially face legal challenges without the guaranteed support of the franchisor.
This level of control over communication and legal action is not uncommon in franchising, as franchisors typically want to maintain a consistent and unified approach to protecting their brand and intellectual property. However, it is crucial for a prospective franchisee to understand the limitations this places on their ability to independently address such issues and to assess the potential risks involved.