Is Embassy Suites a fiduciary with respect to the Monthly Program Fees paid by franchisees?

According to Embassy Suites' 2025 Franchise Disclosure Document, Embassy Suites is not a fiduciary with respect to the Monthly Program Fees. The FDD states that the aggregate of Monthly Program Fees paid by System Hotels and/or Network Hotels does not constitute a trust or "advertising fund." As such, Embassy Suites has no obligation to make expenditures for a franchisee that are equivalent or proportionate to their payments, or to ensure that the Hotel benefits directly or proportionately from such expenditures.

Embassy Suites retains the sole right to determine how and when it spends these funds, including control over creative concepts, materials, media, advertising placement, and promotional program selection. They can also enter into arrangements with affiliates or third parties for various services. The fees are intended for the benefit of the overall system and network, not any single hotel or market.

Embassy Suites can allocate monies derived from Monthly Program Fees to any regions or localities as it deems appropriate. Any interest earned on unused Monthly Program Fees will be used before the principal. These fees do not cover participation in optional marketing programs or the cost of operating the Hotel in accordance with the Standards.