Who owns the principal trademarks licensed to Desi District franchisees?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
Desi District, LLC, our affiliate, owns the trademarks described in this Item. Under an Intercompany License Agreement between us and Desi District, LLC, we have been granted the exclusive right to sublicense the trademarks to franchisees throughout the United States. The agreement is of perpetual duration. It may be modified only by mutual consent of the parties. It may be canceled by our affiliate only if (1) we materially misuse the trademarks and fail to correct the misuse, or (2) we discontinue commercial use of the trademarks for a continuous period of more than one year. The Intercompany License Agreement specifies that if it is ever terminated, your franchise rights will remain unaffected.
Source: Item 13 — TRADEMARKS (FDD pages 40–42)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, the principal trademarks are owned by Desi District, LLC, which is identified as an affiliate of the franchisor. Desi District, LLC has granted the franchisor the exclusive right to sublicense these trademarks to franchisees throughout the United States through an Intercompany License Agreement. This agreement is perpetual and can only be modified by mutual consent of both parties.
This arrangement means that while franchisees use the trademarks to operate their Desi District locations, the actual ownership resides with the affiliate company. The franchisor's right to sublicense ensures that franchisees have the legal permission to use the trademarks. The Intercompany License Agreement protects franchisees because it stipulates that their franchise rights will remain unaffected even if the agreement is terminated.
Desi District also commits to protecting the franchisee's right to use the principal trademarks and defending them against infringement claims. Franchisees are obligated to notify Desi District of any similar trademark uses or claims. However, Desi District is not required to take action upon notification but retains the right to control any legal proceedings involving the licensed trademarks. This framework ensures that Desi District maintains control over its brand identity and provides a level of legal protection for its franchisees.