Are Crave franchisees and their principals prohibited from using confidential information after the franchise agreement term ends?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
lection guidelines and techniques, recipes, and the terms of your agreement with us, are considered confidential. You and each of your Principals are prohibited, during and after the term of your Agreement, from communicating, or using for the benefit of any other person or entity, and, after the term of your Agreement, from using for your or their own benefit, any confidential information, knowledge or know-how concerning the methods of operation of the Franchised Business that may be communicated to you or any of your Principals or that you may learn about. You and each of your Principals may divulge this confidential information only to your employees who must have access to it to operate the Franchised Business. Neither you nor your Principals are permitted at any time, without first obtaining our written consent, to copy, record or otherwise reproduce the materials or information nor make them available to any unauthorized person. If we ask, you must have your general manager and any of your personnel who have received or will have access to confidential information sign similar confidentiality covenants.
If you, your Principals, general manager, or employees develop any new concept, process or improvement in the operation or promotion of the Franchised Business, you must promptly notify us and give us all necessary information, free of charge. You, your Principals, general manager, and employees must acknowledge that any of these concepts, processes or improvements will become our property and we may give the information to other franchisees.
ITEM 15 OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS
You must designate and always retain an individual to serve as the general manager who will be a full-time employee responsible for the daily operation of the Franchised Business (the "General Manager"). The General Manager must have relevant food service experience, must satisfy our educational and business criteria as provided to you in the Manual or other written instructions, must satisfy the applicable training requirements in the Franchise Agreement, and must meet the qualifications, including completing all training and obtaining all certifications required by us to act as a General Manager. We recommend, but do not require, that you or one of the Principals acts as the General Manager.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 47–48)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees and their principals are indeed prohibited from using confidential information, both during and after the term of the franchise agreement. This restriction is in place to protect Crave's proprietary information and operational methods. Franchisees and their principals are barred from communicating or using confidential information for the benefit of others during the agreement's term. After the agreement ends, they cannot use this information for their own benefit. This includes any knowledge or know-how concerning the operation of the franchised business.
The FDD defines confidential information broadly, encompassing any information, knowledge, know-how, and techniques related to the Crave system. This includes the operations manual, plans, specifications, marketing strategies, site evaluation guidelines, recipes, and even the terms of the franchise agreement itself. Franchisees are only allowed to share this information with employees who need it to operate the business, and they must ensure that these employees also sign confidentiality agreements.
This perpetual restriction on the use of confidential information is a standard practice in franchising. It ensures that franchisees do not exploit Crave's trade secrets and operational knowledge to compete against the brand after leaving the system. The agreement explicitly states that these confidentiality covenants survive the expiration, termination, or transfer of the franchise agreement and are perpetually binding on the franchisee and their principals. This means that even after the franchise relationship ends, the franchisee and their principals remain legally obligated to protect Crave's confidential information.