What costs is the Del Taco franchisee responsible for if they violate the confidentiality or non-compete agreements?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
signate Del Taco as a third party beneficiary of such covenants with the independent right to enforce them. Notwithstanding any other provision of this Agreement, there may be certain, limited circumstances where applicable law allows for the disclosure of certain trade secrets, as specified in the Manuals.
- 10.2 Irreparable Injury. Franchisee acknowledges that any failure to comply with the requirements of this Section 10 will cause Del Taco irreparable injury, and Franchisee agrees to pay all court costs and reasonable attorney's fees incurred by Del Taco in obtaining specific performance of, or an injunction against violation of, the requirements of this Section 10.
- 10.3 Information Exchange. Franchisee agrees to disclose to Del Taco all ideas, concepts, methods, techniques and products conceived or developed by Franchisee, its affiliates, owners, agents, or employees during the term of this Agreement relating to the development and/or operation of the Restaurant, and Del Taco shall be the sole owner of any such ideas, concepts, methods, techniques and products, which shall be deemed a work made for hire (or to the extent the work may not be deemed a "work made for hire" under applicable law, Franchisee hereby irrevocably assigns to Del Taco, for no additional consideration, all right, title and interest in and to any patents, trademarks, copyrights, trade secrets and any other proprietary rights), and there
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to the 2025 Del Taco Franchise Disclosure Document, a franchisee acknowledges that failure to comply with confidentiality and non-compete requirements will cause irreparable injury to Del Taco. As a result, the franchisee agrees to pay all court costs and reasonable attorney's fees incurred by Del Taco in obtaining specific performance or an injunction against the violation of these requirements. This means that if a franchisee breaches the confidentiality or non-compete agreements, they will be responsible for covering Del Taco's legal expenses in pursuing court orders to enforce the agreements.
Del Taco also states that the existence of any claims the franchisee may have against Del Taco does not constitute a defense against the enforcement of the covenants in Section 10, which covers confidentiality and non-compete obligations. The franchisee agrees to pay all costs and expenses, including reasonable attorneys' fees, incurred by Del Taco in connection with the enforcement of this section. This reinforces that even if the franchisee has grievances against Del Taco, they are still obligated to cover Del Taco's legal costs if they violate the confidentiality or non-compete terms.
Furthermore, the franchisee acknowledges that violating the terms of Section 10 would result in irreparable injury to Del Taco, for which no adequate remedy at law may be available. Therefore, the franchisee consents to the issuance of an injunction prohibiting any conduct in violation of these terms. This highlights the seriousness with which Del Taco views these agreements and the willingness of the franchisee to accept injunctive relief as a remedy. The remedies available to Del Taco are in addition to other rights and remedies and do not serve as an election of remedies or a waiver of any other rights.