What is the Craters & Freighters franchisee's obligation regarding communication with others about infringement claims?
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, franchisees are prohibited from contesting the validity, ownership, or rights of the Craters & Freighters trademarks, both during and after the franchise agreement. Franchisees acknowledge that any commercial use of the trademarks benefits Craters & Freighters. If a franchisee somehow acquires any rights to the trademarks, they must assign those rights to Craters & Freighters.
This means a Craters & Freighters franchisee cannot take any action that challenges Craters & Freighters's ownership or use of its brand name and logos. This obligation extends beyond the term of the franchise agreement, even after termination or expiration. This is a standard clause in most franchise agreements, as the protection of the brand's intellectual property is crucial for the entire franchise system.
For a prospective franchisee, this clause reinforces the importance of respecting and protecting the Craters & Freighters brand. It prevents franchisees from attempting to undermine the brand or claim ownership of its associated goodwill. It also ensures that Craters & Freighters maintains control over its trademarks and can enforce its rights against infringers without internal challenges from its own franchisees.