After the Ella Cafe franchise agreement expires, can the franchisee continue to use the Ella Cafe Marks?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
14.9 Effect of Termination. Upon termination or expiration of this Agreement, all obligations that by their terms or by reasonable implication survive termination, including those pertaining to non-competition, confidentiality, indemnity, and dispute resolution, will remain in effect, and Franchisee must immediately:
(i) pay all amounts owed to Franchisor based on the operation of the Business through the effective date of termination or expiration.
(ii) return to Franchisor all copies of the Manual, Confidential Information and any and all other materials provided by Franchisor to Franchisee or created by a third party
for Franchisee relating to the operation of the Business, and all items containing any Marks, copyrights, and other proprietary items; and delete all Confidential Information and proprietary materials from electronic devices;
(iii) notify the telephone, internet, email, electronic network, directory, and listing entities of the termination or expiration of Franchisee's right to use any numbers, addresses, domain names, locators, directories and listings associated with any of the Marks, and authorize their transfer to Franchisor or any new franchisee as may be directed by Franchisor, and Franchisee hereby irrevocably appoints Franchisor, with full power of substitution, as its true and lawful attorney-in-fact, which appointment is coupled with an interest; to execute such directions and authorizations as may be necessary or appropriate to accomplish the foregoing; and
(iv) cease doing business under any of the Marks.
14.10 Remove Identification. Within 30 days after termination or expiration, Franchisee shall at its own expense "de-identify" the Location so that it no longer contains the Marks, signage, or any trade dress of an Ella Coffee House business, to the reasonable satisfaction of Franchisor.
Franchisee shall comply with any reasonable instructions and procedures of Franchisor for deidentification.
If Franchisee fails to do so within 30 days after this Agreement expires or is terminated, Franchisor may enter the Location to remove the Marks and de-identify the Location.
In this event, Franchisor will not be charged with trespass nor be accountable or required to pay for any assets removed or altered, or for any damage caused by Franchisor.
- 14.11 Unfair Competition.
If Franchisee operates any other business, Franchisee shall not use any reproduction, counterfeit, copy or colorable imitation of the Marks, either in connection with such other business or the promotion thereof, that is likely to cause confusion, mistake or deception, or that is likely to dilute Franchisor's rights in the Marks.
Franchisee shall not utilize any designation of origin, description or representation that falsely suggests or represents an association or connection with Franchisor.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, franchisees are explicitly prohibited from using Ella Cafe's marks upon the expiration or termination of their franchise agreement. The franchisee must stop using all of Ella Cafe's marks immediately. This includes trade names, service marks, trademarks, logos, emblems, and indicia of origin.
Within 30 days of the agreement's expiration or termination, the franchisee is responsible for removing all Ella Cafe branding from the location. This includes marks, signage, and any trade dress associated with Ella Cafe. The de-identification must be completed to Ella Cafe's satisfaction. If the franchisee fails to do so, Ella Cafe has the right to enter the location and remove the marks themselves, without being held liable for trespass or any damages incurred during the process.
Furthermore, the franchisee is obligated to notify all relevant entities, such as telephone, internet, email, and directory services, about the termination or expiration of their right to use any numbers, addresses, domain names, or listings associated with Ella Cafe's marks. They must also authorize the transfer of these assets to Ella Cafe or a new franchisee. The franchisor is appointed as the attorney-in-fact to execute these transfers. After the agreement ends, the franchisee is prohibited from using any similar marks that could cause confusion or dilute Ella Cafe's rights, even in connection with other businesses.