Is a Degree Wellness franchisee required to implement procedures to prevent unauthorized disclosure of Confidential Information?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
The Confidential Information is proprietary, and, except to the extent that it is or becomes generally known in the industry or trade, is our trade secret, and is disclosed to you solely for your use in the operation of your franchise during the term of the franchise. You (1) must not use, directly or indirectly, the Confidential Information in any other business or capacity or for any purpose other than as needed in the development or operation of your franchise during the term of the franchise; (2) must maintain the confidentiality of the Confidential Information during and after the term of the franchise and not directly or indirectly publish or otherwise disclose it to any third party; (3) must not make unauthorized copies of any portion of the Confidential Information disclosed in written form or another form or media; and (4) must adopt and implement all reasonable procedures, including any that we may prescribe periodically, to prevent the unauthorized use or disclosure of any of the Confidential Information, including restrictions on disclosure to your employees and the use of nondisclosure clauses in employment agreements with your employees.
Source: Item 14 — Patents, Copyrights, and Proprietary Information (FDD pages 47–48)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees are required to take specific steps to protect the franchisor's confidential information. Degree Wellness considers its confidential information proprietary, treating it as a trade secret that is disclosed to franchisees solely for use in operating their franchise during the franchise term.
Degree Wellness mandates that franchisees not use the confidential information in any business other than their franchised location. Franchisees must maintain the confidentiality of this information both during and after the franchise term, and they are prohibited from disclosing it to any third party. Additionally, franchisees cannot make unauthorized copies of any confidential information provided in written, electronic, or other formats.
Most importantly, Degree Wellness franchisees must adopt and implement reasonable procedures to prevent any unauthorized use or disclosure of confidential information. These procedures include placing restrictions on disclosing information to employees and using non-disclosure clauses in employment agreements with employees. This requirement ensures that franchisees take proactive measures to safeguard Degree Wellness's proprietary information, which is a common practice in franchising to protect the brand's competitive advantage.