What are the required actions a Dq Treat Participating Location must take to be eligible for intellectual property infringement indemnification by PAR?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
If a third-party alleges that Participating Location's use of the Licensed Software or the SSS (other than related to the Participating Location Data) infringes, misappropriates or otherwise violates that party's patent, copyright or other intellectual property or proprietary right, PAR shall defend and indemnify Participating Location against that claim at PAR' expense and pay all costs, damages, and attorney's fees, that a court finally awards or that are included in a settlement approved by PAR, provided that Participating Location:
- i. promptly notifies PAR in writing of the claim; provided however, failure to provide prompt notice shall not relieve PAR of its indemnification obligations, unless such delay results in material prejudice to PAR; and
- ii. allows PAR to control, and cooperates with PAR in, the defense and any related settlement.
If such a claim is made, PAR could continue to enable Participating Location to use the Licensed Software or SSS or to modify it. If PAR determines that these alternatives are not reasonably available, PAR may terminate the SSS (without any liability to Participating Location except with respect to PAR's indemnification obligations herein) upon prior notice to Participating Location and with the return of any prepaid and unused SSS Service Fees. Notwithstanding the foregoing, PAR will not have any indemnification obligations hereunder to the extent such infringement is caused by: the modification of the SSS by Participating Location or a third party at Participating Location's request; the use of the SSS in conjunction with equipment or software not provided or approved by PAR; or use of the SSS inconsistent with its intended purpose or which is not in conformance with PAR's reasonable instructions. THE FOREGOING STATES THE ENTIRE LIABILITY OF PAR TO PARTICIPATING LOCATION CONCERNING WARRANTIES OF INTELLECTUAL PROPERTY RIGHTS AND INDEMNIFICATION OF INTELLECTUAL PROPERTY INFRINGEMENT, INCLUDING, BUT NOT LIMITED TO, PATENT, COPYRIGHT, TRADEMARK, TRADE DRESS AND TRADE SECRETS.
Source: Item 17 — The following paragraph is added to the end of Item 17 of the Disclosure Document: (FDD pages 70–378)
What This Means (2025 FDD)
According to the 2025 Dq Treat FDD, a Participating Location must take specific actions to be eligible for intellectual property infringement indemnification by PAR. If a third party claims that the Participating Location's use of licensed software or the SSS infringes on intellectual property rights, PAR will defend and indemnify the Participating Location against the claim, covering costs, damages, and attorney's fees awarded by a court or included in a PAR-approved settlement.
To be eligible for this indemnification, the Participating Location must promptly notify PAR in writing of the claim. However, a delay in providing prompt notice will not relieve PAR of its indemnification obligations unless the delay results in material prejudice to PAR. Additionally, the Participating Location must allow PAR to control the defense and any related settlement, and must cooperate with PAR in these efforts.
However, PAR is not obligated to provide indemnification if the infringement is caused by the Participating Location modifying the SSS, or by a third party at the Participating Location's request. Indemnification is also void if the SSS is used with equipment or software not provided or approved by PAR, or if the SSS is used inconsistently with its intended purpose or not in conformance with PAR's reasonable instructions. This outlines the full extent of PAR's liability to the Participating Location regarding intellectual property rights warranties and indemnification for intellectual property infringement, including patents, copyrights, trademarks, trade dress, and trade secrets.
This means that Dq Treat franchisees must adhere to PAR's guidelines and promptly report any potential intellectual property infringement claims to ensure they can receive protection and support from PAR. Franchisees should also avoid unauthorized modifications or uses of the SSS to maintain their eligibility for indemnification.