If Embassy Suites affiliates with another business, can they use the System in that business?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
The standard Franchise Agreement permits us to own, operate, manage, franchise, license, lease, or affiliate or associate with any Other Business of any nature, whether in the lodging or hospitality industry or not, and whether under the Brand, a competitive brand, or otherwise, at any time and in any location. We and our affiliates have the right to engage in any Other Businesses, even if they compete with your Hotel, the Brand, System Hotels, or Network Hotels, and whether we or our affiliates start those businesses, or purchase, merge with, acquire, are acquired by, come under common ownership with, affiliate or associate with, such Other Businesses.
We may also: (a) modify the System by adding, altering, or deleting elements of the System; (b) use or license to others all or part of the System; (c) use the facilities, programs, services and/or personnel used in connection with the System in Other Businesses; and (d) use the System, the Brand, and the Marks in the Other Businesses. You acknowledge and agree that you have no
rights to, and will not make any claims or demands for, damages or other relief arising from or related to any of the foregoing activities, and you acknowledge and agree that such activities will not give rise to any liability on our part, including, but not limited to, liability for claims for unfair competition, breach of contract, breach of any applicable implied covenant of good faith and fair dealing, or divided loyalty. "Other Businesses" means any business activity we or our affiliates engage in, other than the licensing of your Hotel.
Source: Item 12 — TERRITORY (FDD pages 67–70)
What This Means (2025 FDD)
According to Embassy Suites's 2025 Franchise Disclosure Document, Embassy Suites retains broad rights to use the System in other business ventures, even those that might compete with a franchisee's hotel. The Franchise Agreement permits Embassy Suites to own, operate, manage, franchise, license, lease, or affiliate with any other business, regardless of its nature or location. This includes businesses within the lodging or hospitality industry, whether operating under the Embassy Suites brand, a competitive brand, or otherwise.
Embassy Suites and its affiliates have the right to engage in any business activities, even if they directly compete with a franchisee's hotel, the Embassy Suites brand, or other hotels within the Embassy Suites system. This right extends to businesses that Embassy Suites or its affiliates start, purchase, merge with, acquire, or become affiliated with. Furthermore, Embassy Suites may modify the System, use or license parts of it to others, and utilize the System's facilities, programs, services, and personnel in these other businesses.
Specifically, Embassy Suites can use the System, the Brand, and the Marks in these other business ventures. As a franchisee, you acknowledge that you have no rights to make claims for damages or other relief arising from these activities. This includes claims for unfair competition, breach of contract, breach of good faith, or divided loyalty. The term "Other Businesses" encompasses any business activity that Embassy Suites or its affiliates engage in, excluding the licensing of your specific hotel. This broad latitude granted to Embassy Suites means that franchisees must be prepared to face potential competition from other ventures affiliated with Embassy Suites, with limited recourse to legal remedies.