Regarding infringements or challenges to the Licensed Marks, is a Dryer Vent Squad franchisee permitted to communicate with anyone other than the Franchisor and its counsel?
Dryer_Vent_Squad Franchise · 2024 FDDAnswer from 2024 FDD Document
If Franchisee is sued in a legal proceeding or is threatened with legal action and/or a notice of infringement by a third party where the claims and/or causes of action directly relate to a third party claiming trademark infringement, unfair competition, and/or trademark dilution as a result of Franchisee's use of the Licensed Marks in accordance with the terms of this Agreement and the System (the "IP Claim"), then Franchisor shall indemnify Franchisee for the reasonable and direct costs incurred by Franchisee and/or a judgment entered against Franchisee, provided: (a) Franchisee immediately notified Franchisor of the IP Claim by a written notice sent to Franchisor via priority overnight courier; (b) Franchisee provided and afforded Franchisor the absolute opportunity and right to defend against the IP Claim and to select and appoint legal counsel of Franchisor's choosing; and (c) Franchisee utilized the Licensed Marks in accordance with the terms of this Agreement and the System. Franchisee agrees that time is of the essence with respect to notifying Franchisor of the IP Claim in accordance with this Agreement, including this Article 11.E.
Source: Item 23 — RECEIPTS (FDD pages 51–207)
What This Means (2024 FDD)
According to the 2024 Dryer Vent Squad Franchise Disclosure Document, if a Dryer Vent Squad franchisee faces a legal proceeding or threat related to trademark infringement from using the Licensed Marks, the franchisee must immediately notify Dryer Vent Squad. The franchisee must provide Dryer Vent Squad with the opportunity and right to defend against the claim and to select legal counsel.
Specifically, Dryer Vent Squad will indemnify the franchisee for reasonable and direct costs if the franchisee is sued for trademark infringement, unfair competition, or trademark dilution due to the use of Dryer Vent Squad's Licensed Marks, provided the franchisee adheres to the agreement and system standards. This indemnification covers reasonable and direct costs incurred by the franchisee or any judgment against them.
However, the FDD excerpts provided do not explicitly state whether a Dryer Vent Squad franchisee is permitted to communicate with parties other than the franchisor and its counsel regarding infringements or challenges to the Licensed Marks. A prospective franchisee should seek clarification from Dryer Vent Squad on the specific protocols for communication in such situations to ensure compliance with the franchise agreement and to protect their interests.