If a Crave Cookies franchisee violates the public figure policy, what are the potential consequences?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
We occasionally enlist the services of public figures and brand influencers to promote our brand. Any official representation by a public figure must be approved in writing by Crave Cookies Franchising.
ARTICLE 9. MARKETING
9.1 Approval and Implementation. Franchisee shall not conduct any marketing, advertising, or public relations activities (including in-store marketing materials, websites, online advertising, social media marketing or presence, and sponsorships) that have not been approved by Crave Cookies Franchising. Crave Cookies Franchising may (but is not obligated to) operate all "social media" accounts on behalf of the System, or it may permit franchisees to operate one or more accounts. Franchisee must comply with any System Standards regarding marketing, advertising, and public relations, include any social media policy that Crave Cookies Franchising may prescribe. Franchisee shall implement any marketing plans or campaigns determined by Crave Cookies Franchising.
(i) Franchisee misrepresented or omitted material facts when applying to be a franchisee, or breaches any representation in this Agreement;
B. Escalation of Penalties:
- I. If the infraction is not corrected within the specified timeframe, penalties will escalate according to the severity tier.
- a. First Offense: Verbal warning or a formal written warning, documented in the franchisee's file.
b. Second Offense:
- i. Mild Infraction: Official warning and mandatory review meeting.
- ii. Moderate Infraction: Fine or suspension of certain privileges; mandatory training (online, virtual, or in-person) may be required.
- iii. Severe Infraction: Immediate fine and mandatory meeting with corporate within 24 hours.
c. Third Offense:
- i. Mild Infraction: Fine of $100 and submission of a comprehensive improvement plan.
- ii. Moderate Infraction: Fine of $1,000 and follow-up audit within 30 days, along with a detailed improvement plan. For maintaining a 4.5-star rating, mandatory hiring of a reputation management and improvement company.
- iii. Severe Infraction: Fine of $5,000 and consideration for termination of the franchise agreement.
Source: Item 18 — PUBLIC FIGURES (FDD page 38)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, franchisees must have written approval from Crave Cookies Franchising for any official representation by a public figure. While the FDD does not explicitly detail the consequences of violating the public figure policy, it does outline potential penalties for violations of marketing and advertising standards, which could apply.
Specifically, franchisees must have marketing, advertising, and public relations activities approved by Crave Cookies Franchising. Failure to comply with system standards regarding marketing and advertising can lead to penalties. These penalties can escalate with repeated offenses. A first offense may result in a verbal or written warning. A second offense could lead to an official warning, a mandatory review meeting, a fine, or suspension of certain privileges, and mandatory training. A third offense could result in fines ranging from $100 for mild infractions to $5,000 for severe infractions, along with mandatory improvement plans and audits. For maintaining a 4.5-star rating, mandatory hiring of a reputation management and improvement company.
Furthermore, the FDD states that Crave Cookies Franchising may terminate the franchise agreement without an opportunity to cure the breach if the franchisee misrepresents or omits material facts or knowingly submits false information. While not directly related to the public figure policy, these clauses highlight the importance of adhering to the franchisor's standards and policies. Franchisees should seek clarification from Crave Cookies Franchising regarding the specific consequences of violating the public figure policy to fully understand their obligations and potential risks.
In summary, while the FDD does not explicitly state the consequences for violating the public figure policy, the consequences for violating marketing and advertising standards could apply, including warnings, fines, mandatory training, and potentially termination of the franchise agreement for egregious or repeated violations.