What is the franchisee's obligation regarding notifying Crisp & Green of a claimed breach of the agreement?
Crisp_Green Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Item 13 of the Disclosure Document is amended by the addition of the following paragraphs:
"We will protect your right to use the trademarks, service marks, trade names, logotypes or other commercial symbols or indemnify you from any losses, costs or expenses arising out of any claim, suit or demand regarding the proper use of the name.
As required by the Minnesota Franchise Act, Minn. Stat. § 80C.12(g), we will reimburse you for any costs that you incur in the defense of your right to use the Marks, so long as you were using the Marks in the manner that we authorized, and so long as we are timely notified of the claim and given the right to manage the defense of the claim including the right to compromise, settle or otherwise resolve the claim, and to determine whether to appeal a final determination of the claim."
Source: Item 23 — RECEIPTS (FDD pages 66–252)
What This Means (2024 FDD)
Based on the 2024 Crisp & Green Franchise Disclosure Document, there is no explicit obligation for the franchisee to notify Crisp & Green of a claimed breach of the agreement. However, in the addendum for Minnesota, Item 13 discusses trademark protection, stating that Crisp & Green will reimburse a franchisee for costs incurred in defending their right to use the marks, provided the franchisee was using the marks as authorized.
In Minnesota, this reimbursement is contingent upon the franchisee timely notifying Crisp & Green of any claim, allowing them to manage the defense, including the right to compromise or settle the claim, and to decide whether to appeal any final determination. This suggests that while not a universal obligation, notifying Crisp & Green of claims related to trademark use is essential for franchisees in Minnesota to receive reimbursement for defense costs.
Therefore, while the FDD does not specify a general duty to notify Crisp & Green of breaches, franchisees, particularly those in Minnesota, should be aware of the notification requirements related to trademark claims to ensure they can avail themselves of the franchisor's support and reimbursement for defense costs. It would be prudent for prospective franchisees to clarify with Crisp & Green the specific notification requirements and procedures for various types of potential breaches or claims to ensure compliance and protect their rights.