Does a Crepe De Licious franchisee acquire any proprietary interest in the System?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
r services, or advertise products or services, within another franchisee's Territory. Other than the limited rights expressly granted to you under this Agreement, we (on behalf of ourselves and our affiliates) reserve all rights to use the Marks and System, including the following rights, in any manner and on any terms and conditions we deem advisable, and without granting you any rights, accommodation or compensation:
- (a) to own, franchise, establish and/or operate, and license others to establish and operate, businesses using the Marks and System outside the Territory regardless of the proximity to your Crepe de licious Business (even if there may be some impact to your Crepe de licious Business);
- (b) to contract and utilize third party delivery and ghost kitchen companies that may operate within or adjacent to your Territory regardless of the proximity to your Crepe de licious Business (even if there may be some impact to your Crepe de licious Business; you will have no right to be compensated from these third party sales which may occur within your Territory;
- (c) to use and license the use of other proprietary and non-proprietary marks or methods, which are not the same as or confusingly similar to the Marks, whether in alternative channels of distribution or in the operation of a business offering quick-service restaurants and related products and services, at any location, including within the Territory, which may be similar to or different from the Crepe de licious Business operated by you;
- (d) to sell or distribute, at retail or wholesale or otherwise, directly or indirectly, or license others to sell or distribute, any proprietary items (such as crepe ingredients, crepes, crepe-based food items and crepe sandwiches, and gelato) which bear any proprietary marks, including the Marks, through grocery stores, convenience stores, hotel shops and kiosks, theaters, malls, airports, gas stations, college campuses, sports venues, third party delivery companies, ghost kitchens, or other retail locations within or outside the Territory;
- (e) to own, acquire, establish and/or operate, and license others to establish and operate, businesses using any proprietary marks or systems (including the Marks and System) at any airport, train station, other transportation facility, arena, ballpark, stadium, racetrack, other sports facility, theater, auditorium, concert hall, theme park, amusement park, cruise ship, casino, or other entertainment facility, or within any outlet mall or other regional mall, within or outside the Territory;
- (f) to purchase or be purchased by, or merge or combine with, any business, including a business that competes directly with your Crepe de licious Business, wherever located;
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, franchisees do not acquire any proprietary interest in the Crepe De Licious system beyond the limited rights granted in the franchise agreement. Crepe De Licious retains all rights to the Marks and System, allowing them to use and license them as they see fit without providing franchisees any rights, accommodation, or compensation. This includes the rights to operate businesses using the Marks and System outside the franchisee's territory, even if it impacts the franchisee's business.
Crepe De Licious also retains the right to use third-party delivery and ghost kitchen companies within or adjacent to a franchisee's territory without compensating the franchisee for any sales occurring within their territory. They can also use and license other proprietary marks or methods that are not confusingly similar to the Marks, even within the franchisee's territory. Furthermore, Crepe De Licious can sell or distribute proprietary items bearing any proprietary marks through various retail locations, both within and outside the franchisee's territory.
Any improvements made to the Crepe De Licious system by a franchisee become the property of Crepe De Licious. Franchisees must disclose any improvements and obtain written approval before using them. Crepe De Licious and other franchisees can use these improvements without any obligation to pay royalties or fees to the originating franchisee. Crepe De Licious may also seek intellectual property protection for these improvements and consider them as trade secrets. In return, the franchisee may utilize any Improvement that may be developed by other franchisees and is authorized generally for use by other franchisees.
This arrangement is typical in franchising, where the franchisor maintains control over its brand and system to ensure consistency and protect its intellectual property. However, it means that a Crepe De Licious franchisee does not build equity in the brand itself and must rely on the terms of the franchise agreement for their rights to operate under the Crepe De Licious system.