Does the Degree Wellness franchise agreement transfer legal liability from the franchisee to Degree Wellness with respect to the content of advertising or the implementation of any marketing program?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding the existence of such insurance, you are and will be responsible for all loss or damage and contractual liability to third persons originating from or in connection with the operation of the Franchise, and for all claims or demands for damages to property or for injury, illness or death of persons directly or indirectly resulting therefrom; and you agree to defend, indemnify and hold us harmless of, from, and with respect to any such claims, loss or damage, which indemnity shall survive the termination or expiration and non-renewal of this Agreement.
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees are generally responsible for liabilities arising from the operation of their franchise. Specifically, the franchisee is responsible for loss, damage, and contractual liability to third parties, including claims related to property damage, injury, illness, or death, originating from the operation of the Degree Wellness franchise. The franchisee agrees to defend, indemnify, and hold Degree Wellness harmless from such claims, and this obligation survives the termination or expiration of the franchise agreement.
This means that even though Degree Wellness may establish and administer an advertising fund and potentially provide additional marketing services, the franchisee ultimately bears the responsibility for any liabilities arising from their franchise's operations, including advertising and marketing activities. While Degree Wellness may maintain its own insurance, this does not reduce the franchisee's obligation to maintain adequate insurance coverage as specified in the franchise agreement. Franchisees are advised to consult with their own insurance agents, brokers, and attorneys to determine appropriate coverage levels beyond the minimum requirements set by Degree Wellness.
Degree Wellness does not assume direct or indirect liability or obligation to the franchisee with respect to the maintenance, direction, or administration of the advertising fund, except as expressly provided in the franchise agreement. This indicates that while Degree Wellness manages the advertising fund, franchisees cannot hold Degree Wellness liable for the fund's performance or the effectiveness of advertising campaigns. The franchise agreement specifies that the fund is intended to maximize recognition of the Degree Wellness marks and goodwill, but there is no guarantee that expenditures will be proportionate to contributions from franchisees in specific geographic areas or that any franchisee will directly benefit in proportion to their contribution.