What is a Del Taco franchisee's obligation regarding the use of Del Taco's confidential and proprietary information?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
el Taco may from time to time revise the contents of the Manuals, and Franchisee expressly agrees to make corresponding revisions to its copy of the Manuals and to comply with each new or changed standard immediately upon receipt of such revision.
10. Confidentiality and Covenants Not To Compete.
10.1 Confidential Information. Franchisee shall not, during the term of this Agreement or thereafter, communicate, divulge, or use for the benefit of any other person, persons, partnership, entity, association, or corporation any confidential information, trade secrets, knowledge, or know-how concerning the methods of operation of the business franchised hereunder which may be communicated to Franchisee or of which Franchisee may be apprised by virtue of Franchisee's operation under the terms of
this Agreement (the "Confidential Information"). Franchisee shall divulge such Confidential Information only to such of its employees as must have access to it in order to operate the Restaurant. Any and all information, knowledge, know-how, and techniques which Del Taco designates as confidential shall be deemed confidential for purposes of this Agreement, except information which Franchisee can demonstrate came to its attention prior to disclosure thereof by Del Taco; or which, at or after the time of disclosure by Del Taco to Franchisee, had become or later becomes a part of the public domain, through publication or communication by others. Any employee who may have access to any Confidential Information regarding the Restaurant shall execute a covenant that s/he will maintain the confidentiality of information they receive in connection with their association with Franchisee. Such covenants shall be on a form provided by Del Taco, which form shall, among other things, designate 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.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 41–42)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, franchisees have specific obligations regarding the use of confidential information, both during and after the franchise agreement. Franchisees must not communicate, divulge, or use any confidential information, trade secrets, knowledge, or know-how related to the operation of the Del Taco business for the benefit of any other person or entity. This includes information communicated to the franchisee or learned through their operation under the franchise agreement.
Franchisees are only allowed to share confidential information with employees who need access to it for restaurant operations. These employees must also agree to maintain the confidentiality of the information they receive, using a form provided by Del Taco. Del Taco is designated as a third-party beneficiary of these agreements, giving them the right to enforce them directly. The FDD specifies that any information Del Taco designates as confidential is considered confidential, unless the franchisee can prove they already knew it or it became public knowledge through no fault of their own.
The franchise agreement emphasizes that any failure to comply with these confidentiality requirements will cause irreparable harm to Del Taco. In such cases, the franchisee agrees to cover all court costs and reasonable attorney's fees incurred by Del Taco in enforcing these confidentiality provisions. This highlights the importance Del Taco places on protecting its confidential information and the potential legal and financial consequences for franchisees who violate these terms.