Are Crepe De Licious franchisees responsible for the actions of their affiliates and employees?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
2. Background. You are an employee, independent contractor, agent, representative, or supplier of Franchisee. Because of this relationship, you may gain knowledge of our Intellectual Property. You understand that protecting the Intellectual Property is vital to our success and that of our franchisees, and that you could seriously jeopardize our entire Franchise System if you were to use such Intellectual Property in any way other than as described in this Agreement. In order to avoid such damage, you agree to comply with this Agreement.
3. Know-How and Intellectual Property: Nondisclosure and Ownership. You agree: (i) you will not use the Intellectual Property in any business or capacity other than for the benefit of the Crepe de licious Business operated by Franchisee or in any way detrimental to us or to the Franchisee; (ii) you will maintain the confidentiality of the Intellectual Property at all times; (iii) you will not make unauthorized copies of documents containing any Intellectual Property; (iv) you will take such reasonable steps as we may ask of you from time to time to prevent unauthorized use or disclosure of the Intellectual Property; and (v) you will stop using the Intellectual Property immediately if you are no longer an employee, independent contractor, agent, representative, or supplier of Franchisee. You further agree that you will not use the Intellectual Property for any purpose other than the performing your duties for Franchisee and within the scope of your employment or other engagement with Franchisee.
The Intellectual Property is and shall continue to be the sole property of Crepe Delicious Holding USA, Inc. You hereby assign and agree to assign to us any rights you may have or may acquire in such Intellectual Property. Upon the termination of your employment or engagement with Franchisee, or at any time upon our or Franchisee's request, you will deliver to us or to Franchisee all documents and data of any nature pertaining to the Intellectual Property, and you will not take with you any documents or data or copies containing or pertaining to any Intellectual Property.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
The 2025 Crepe De Licious Franchise Disclosure Document includes a sample System Protection Agreement that outlines the responsibilities of a franchisee's employees, independent contractors, agents, representatives, or suppliers. This agreement aims to protect Crepe De Licious's intellectual property by ensuring that these individuals do not misuse or disclose confidential information.
According to the agreement, these individuals must not use Crepe De Licious's intellectual property in any way that is detrimental to Crepe De Licious or the franchisee. They are obligated to maintain the confidentiality of the intellectual property, avoid making unauthorized copies of documents containing it, and take reasonable steps to prevent its unauthorized use or disclosure. Furthermore, they must cease using the intellectual property immediately upon termination of their relationship with the franchisee.
The agreement also stipulates that all intellectual property remains the sole property of Crepe Delicious Holding USA, Inc., and any rights these individuals may acquire in the intellectual property are assigned to Crepe De Licious. Upon termination of their employment or engagement, they must return all documents and data pertaining to the intellectual property. This agreement suggests that Crepe De Licious franchisees have a responsibility to ensure that their employees and affiliates protect the franchisor's intellectual property.
While the System Protection Agreement highlights the franchisee's responsibility in ensuring their employees and affiliates protect Crepe De Licious's intellectual property, the FDD does not explicitly state whether franchisees are liable for all actions of their affiliates and employees. It is recommended that prospective franchisees seek clarification from Crepe De Licious regarding the full extent of their liability for the actions of their employees and affiliates.