Under what circumstances is a Dermani Medspa franchisee NOT required to indemnify the Indemnified Parties for claims, obligations, and damages?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.3.1. You agree to indemnify, defend, and hold harmless the Indemnified Parties against, and to reimburse any one or more of the Indemnified Parties for, all claims, obligations, and damages directly or indirectly arising out of the Franchised Business's operation and/or any operations of the dermani MEDSPA®s you manage, the business you conduct under this Agreement, or your breach of this Agreement, unless the claims, obligations, or damages are determined to be caused solely by our gross negligence or willful misconduct in a final, unappealable ruling issued by a court of competent jurisdiction.
"Indemnified Parties" – us, our affiliates, and our and their respective members, shareholders, directors, officers, employees, agents, successors, assignees and designees.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to Dermani Medspa's 2025 Franchise Disclosure Document, a franchisee is generally required to indemnify the Indemnified Parties (which include Dermani Medspa, its affiliates, and their respective members, shareholders, directors, officers, employees, agents, successors, assignees, and designees) against claims, obligations, and damages arising from the operation of the Franchised Business, the franchisee's business conduct, or any breach of the Franchise Agreement.
However, the franchisee is not required to indemnify the Indemnified Parties if the claims, obligations, or damages are determined to be caused solely by Dermani Medspa's gross negligence or willful misconduct. This determination must be made in a final, unappealable ruling issued by a court of competent jurisdiction. This means that a franchisee's obligation to indemnify Dermani Medspa does not extend to situations where Dermani Medspa itself is directly and solely responsible for the damages due to its own gross negligence or intentional misconduct.
This provision is fairly standard in franchise agreements, as it seeks to protect the franchisor from liabilities arising from the franchisee's operation of the business while acknowledging that the franchisor should be responsible for its own actions. A prospective Dermani Medspa franchisee should understand this indemnification clause and consider the potential risks and costs associated with it, especially in the context of operating a medical spa where potential liabilities could be significant.