What is the first action a Dickeys Barbecue Pit customer must take when an IP Claim is threatened?
Dickeys_Barbecue_Pit Franchise · 2024 FDDAnswer from 2024 FDD Document
10.2 Spark's obligations set forth in this section are subject to your: (a) providing Spark prompt written notice that the IP Claim has been threatened or brought, whichever is sooner (the "Claim Notice"); (b) providing Spark exclusive control of the defense, appeal and/or settlement of the IP Claim; (c) cooperating with Spark with respect to the defense, appeal, and/or settlement; and (d) complying with all court orders. If your delay in providing the Claim Notice causes detriment to Spark with respect to the defense or resolution of the IP Claim, the obligations set forth in this section will not apply to the IP Claim. Notwithstanding any other provision of these Terms and Conditions, Spark is not responsible for any fees (including attorneys' fees), expenses, costs, judgments, or awards that are incurred prior to Spark's receipt of the Claim Notice from Customer. Spark will have the exclusive right to select counsel. Customer may, at Customer's sole expense, engage additional counsel of Customer's choosing for purposes of conferring with Spark's counsel.
Source: Item 23 — RECEIPTS (FDD pages 96–388)
What This Means (2024 FDD)
According to Dickeys Barbecue Pit's 2024 Franchise Disclosure Document, if a third party threatens an IP Claim against a franchisee, the franchisee must provide Spark (likely a third-party vendor) with prompt written notice. This notification is referred to as the "Claim Notice." This requirement is crucial because Spark's obligation to defend the franchisee against the IP Claim is contingent upon receiving this timely notice.
Specifically, Spark will defend the franchisee against the IP Claim at its own expense and cover any damages, costs, and attorney's fees awarded against the franchisee in a final court judgment or settlement, provided Spark has agreed to the settlement in writing. An "IP Claim" is defined as a lawsuit brought by a third party alleging that the franchisee's use of a product infringes on a valid U.S. patent or copyright.
However, if the franchisee delays in providing the Claim Notice and this delay causes detriment to Spark in defending or resolving the IP Claim, Spark's obligations to defend and indemnify the franchisee will not apply. Furthermore, Spark is not responsible for any fees, expenses, costs, judgments, or awards incurred before they receive the Claim Notice from the franchisee. This underscores the importance of immediately notifying Spark in writing upon becoming aware of a threatened or actual IP Claim to ensure coverage and support.