If Dryject elects to protect the Dryject trademarks or protect a franchisee against claims of infringement, who has the right to control any administrative proceeding or litigation involving a trademark licensed by Dryject?

According to Dryject's 2025 Franchise Disclosure Document, if Dryject chooses to protect its trademarks or defend a franchisee against infringement claims, Dryject retains the right to control any administrative or legal proceedings related to the trademark licensed to the franchisee. This means that Dryject, not the franchisee, will direct the strategy and decision-making in such cases.

This provision is significant for prospective Dryject franchisees because it clarifies who has authority over trademark-related legal matters. While Dryject is not obligated to defend or indemnify franchisees against infringement claims, if they elect to do so, they maintain control over the legal process. Franchisees are required to promptly notify Dryject of any threatened or actual litigation involving the trademarks and must fully cooperate with Dryject in defending or settling the matter.

This arrangement is fairly typical in franchising. Franchisors usually want to control trademark litigation to ensure consistent brand protection and legal strategy. However, franchisees should be aware that Dryject is not required to take action, and the Franchise Agreement does not contain any provisions under which Dryject is required to defend or indemnify the franchisee against any claims of infringement or unfair competition arising out of the franchisee's use of the Marks.

Therefore, it is essential for potential Dryject franchisees to understand their responsibilities regarding trademark use and the potential costs associated with defending against infringement claims if Dryject does not intervene. Franchisees should factor in the risk of potential litigation expenses and consider obtaining their own legal counsel if trademark issues arise.