Is a Crawlspace Medic franchisee allowed to register or attempt to register the Intellectual Property in their name?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
chisee, Licensor and Franchisor are the owner of all right, title and interest in and to the Intellectual Property and the goodwill associated with and symbolized by them.
- 14.2. No Interference. Neither Franchisee nor any Principal shall take any action that would prejudice or interfere with the validity of Franchisor or Licensor's rights with respect to the Intellectual Property. Nothing in this Agreement shall give the Franchisee any right, title, or interest in or to any of the Intellectual Property or any of Franchisor's or Licensor's service marks, trademarks, trade names, trade dress, logos, copyrights or proprietary materials, except the right to use the Intellectual Property and the System in accordance with the terms and conditions of this Agreement for the operation of a Franchised Business and only at or from the Franchised Business location or in approved advertising related to the Franchised Business.
- 14.3. Goodwill. Franchisee understands and agrees that any and all goodwill arising from Franchisee's use of the Intellectual Property and the System shall inure solely and exclusively to the benefit of Franchisor and Licensor, and upon expiration or termination of this Agreement and the license herein granted, no monetary amount shall be assigned as attributable to any goodwill associated with Franchisee's use of the Intellectual Property.
- 14.4. Validity. Franchisee shall not contest the validity of, or Franchisor or Licensor's interest in, the Intellectual Property or assist others to contest the validity of, or Franchisor or Licensor's interest in, the Intellectual Property.
- 14.5. Infringement. Franchisee acknowledges that any unauthorized use of the Intellectual Property shall constitute an infringement of Franchisor or Licensor's rights in the Intellectual Property and a material event of default hereunder. Franchisee shall provide Franchisor or Licensor with all assignments, affidavits, documents, information and assistance Franchisor or Licensor reasonably requests to fully vest in Franchisor or Licensor all such rights, title and interest in and to the Intellectual Property, including all such items as are reasonably requested by Franchisor or Licensor to register, maintain and enforce such rights in the Intellectual Property.
- 14.6. Substitution. Franchisor reserves the right to substitute different Marks for use in identifying the System and the Franchised Business, if it in its sole discretion, determines that substitution of different Marks will be beneficial to the System. Franchisor will not be liable to Franchisee for any expenses, losses or damages sustained by Franchisee as a result of any additions, modifications, substitutions or discontinuation of the Marks. Franchisee covenants not to commence or join in any litigation or other proceeding against Franchisor for any of these expenses, losses or damages.
- 14.7. Franchisee's Use of the Intellectual Property.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2024 FDD)
According to the 2024 Crawlspace Medic Franchise Disclosure Document, franchisees are expressly prohibited from taking any actions that could negatively impact the franchisor's intellectual property rights. Crawlspace Medic, LLC retains ownership of all Intellectual Property, including trademarks, copyrights, trade secrets, service marks, trade dress and proprietary systems. Franchisees are only granted the right to use this Intellectual Property in accordance with the franchise agreement for operating their franchised business.
Specifically, franchisees cannot contest the validity of Crawlspace Medic's interest in the Intellectual Property or assist others in doing so. Unauthorized use of the Intellectual Property by a franchisee constitutes an infringement of the franchisor's rights and a material breach of the franchise agreement. Franchisees must also provide any assistance reasonably requested by Crawlspace Medic to help register, maintain, and enforce its rights to the Intellectual Property.
Furthermore, the franchise agreement states that franchisees cannot use the Crawlspace Medic marks, or any variations of them, as part of their corporate or legal name. This reinforces that the franchisee cannot represent themselves as the owner of the Intellectual Property. All goodwill arising from the franchisee's use of Crawlspace Medic's Intellectual Property benefits the franchisor, and no monetary value will be assigned to the franchisee for any goodwill associated with their use of it upon termination or expiration of the agreement.