Can Crave grant licenses for the use of its trademarks to entities other than franchisees?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
The license to use the Marks granted in the Franchise Agreement is non-exclusive to you. We have and retain certain rights in the Marks including the following:
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- To grant other licenses for the use of the Marks in addition to those licenses already granted or to be granted to franchisees;
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- To develop and establish other systems using the Marks or other names or marks, and to grant licenses or franchises in those systems without providing any rights to you; and
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- To engage, directly or indirectly, at wholesale, retail or otherwise, in (a) the production, distribution, license and sale of products and services and (b) the use of the Marks and any and all trademarks, trade names, service marks, logos, insignia, slogans, emblems, symbols, designs and other identifying characteristics we may develop for that purpose.
Source: Item 13 — TRADEMARKS (FDD pages 46–47)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave retains the right to grant licenses for the use of its trademarks to entities other than its franchisees. This means that Crave is not restricted to only allowing franchisees to use its trademarks and can authorize other businesses or individuals to use them as well.
This has several implications for prospective Crave franchisees. First, it means that the franchisee's license to use the Crave trademarks is non-exclusive. Crave can grant similar licenses to others, potentially including businesses that compete with the franchisee. Second, Crave can develop other systems using the same trademarks or different ones and grant licenses or franchises in those systems without providing any rights to the existing franchisees. This could lead to the introduction of new Crave-branded businesses that operate differently from the traditional franchise model.
Furthermore, Crave retains the right to engage directly or indirectly in the production, distribution, licensing, and sale of products and services using the trademarks. This could involve Crave itself entering the market as a competitor to its franchisees or licensing the trademarks to large retailers or other businesses that could significantly impact the franchisees' market share. While this is a right retained by Crave, the FDD does not specify how often Crave exercises this right or the criteria used to determine when to grant licenses to entities other than franchisees.
Prospective franchisees should carefully consider these factors and evaluate the potential impact on their business before investing in a Crave franchise. It would be prudent to inquire with Crave about their plans for licensing the trademarks to other entities and the potential impact on existing franchisees.