Does the Del Taco franchise agreement specify that the franchisee will not receive additional compensation for ideas disclosed to Del Taco?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
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 are no restrictions on use, and no compensation shall be due to Franchisee.
Franchisee agrees to cooperate fully in obtaining any patents, trademarks or copyrights.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the franchise agreement stipulates that franchisees will not receive additional compensation for any ideas disclosed to Del Taco. The agreement states that any ideas, concepts, methods, techniques, and products conceived or developed by the franchisee during the term of the agreement relating to the restaurant's operation become the sole property of Del Taco.
This means that if a Del Taco franchisee develops a new operational method or product related to the restaurant, they must disclose it to Del Taco, and Del Taco will own it. The franchisee will not receive any additional payment or consideration for these ideas. The franchise agreement explicitly states that there are no restrictions on use of the ideas by Del Taco, and no compensation will be paid to the franchisee.
This clause also specifies that the franchisee must cooperate fully in obtaining any patents, trademarks, or copyrights related to these ideas. This obligation underscores that Del Taco has full ownership and control over any intellectual property developed by the franchisee in connection with the Del Taco restaurant. Prospective franchisees should be aware that any innovations they create related to the Del Taco business become the property of the franchisor without additional compensation.