If Embassy Suites modifies the System, can I claim damages?
Embassy_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
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, franchisees explicitly agree that they cannot claim damages if Embassy Suites modifies the System. Embassy Suites retains the right to add, alter, or delete elements of the System, and franchisees acknowledge they have no rights to claim damages related to these changes. This includes claims for unfair competition, breach of contract, breach of good faith, or divided loyalty.
This provision in the Franchise Agreement means that as an Embassy Suites franchisee, you bear the risk of any negative impact resulting from changes Embassy Suites makes to its operating system, brand standards, or other elements of the franchise. You will not be able to seek compensation for losses you incur due to these modifications. This is a significant risk factor to consider, as changes to the System could potentially affect your hotel's profitability or competitive position.
Embassy Suites also reserves the right to use or license the System to others, and to use the System, Brand, and Marks in other businesses. Franchisees agree they cannot make claims for damages related to these activities, further emphasizing the broad discretion Embassy Suites has in managing its brand and system without liability to franchisees. Prospective franchisees should carefully consider the potential impact of these provisions on their investment and business operations.