Is a Dermani Medspa member allowed to divert potential customers from the Franchised Business to a Competitive Business?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
(b) Member covenants and agrees that during the term of the Area Development Agreement, except as otherwise approved in writing by Franchisor, Member will not, either directly or indirectly, for him or herself, or through, on behalf of, or in conjunction with any person, persons, partnership, corporation, or entity:
(iii) divert or attempt to divert any actual or potential business or customer of the Franchised Business to a Competitive Business;
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to the 2025 Dermani Medspa FDD, a member is prohibited from diverting or attempting to divert any actual or potential business or customer of the Franchised Business to a Competitive Business during the term of the Area Development Agreement. This restriction is part of the covenants not to compete, ensuring that members remain committed to the success of the Dermani Medspa franchise.
This restriction is in place to protect Dermani Medspa's market share and prevent members from using the franchisor's resources and reputation to benefit a competing business. The term "Competitive Business" refers to medical spa centers or businesses that offer medical spa products or services substantially similar to those offered by Dermani Medspa.
This covenant not to compete extends to both direct and indirect actions, meaning a member cannot circumvent the restriction by acting through another person or entity. This provision aims to ensure the member's full dedication to the Dermani Medspa franchise during the agreement term. Franchisees should be aware of these restrictions and ensure they do not engage in any activities that could be construed as diverting business to a competitor, as this could result in a breach of contract.