Under what condition will Desi District indemnify a franchisee for expenses and damages related to trademark infringement?

According to Desi District's 2024 Franchise Disclosure Document, Desi District will indemnify a franchisee for expenses and damages related to trademark infringement if the franchisee uses Desi District's trademarks in accordance with the franchise agreement. Specifically, if a third party brings a legal action alleging trademark infringement due to the franchisee's use of Desi District's trademarks, and the legal action is resolved unfavorably to the franchisee, Desi District will cover the franchisee's expenses and damages.

This protection is a significant benefit for franchisees, as trademark infringement lawsuits can be costly. However, it's crucial for franchisees to adhere strictly to the guidelines outlined in the franchise agreement regarding trademark usage. Failure to comply with these guidelines could void Desi District's obligation to defend and indemnify the franchisee.

It is also important to note that Desi District retains the right to require a franchisee to modify or discontinue using a trademark, and the franchisee will bear the expense of doing so. This highlights the importance of franchisees staying informed about any changes or updates to trademark usage guidelines provided by Desi District. While Desi District does not know of any superior prior rights or infringing uses that could materially affect a franchisee's use of the principal trademarks, franchisees should remain vigilant and promptly report any potential trademark issues to Desi District, as required by the franchise agreement.