What happens if Eos Worldwide's right to use a trademark is challenged?
Eos_Worldwide Franchise · 2025 FDDAnswer from 2025 FDD Document
ed affidavits for the Registered Marks. Following registration of the Pending Marks, and at the appropriate times, we intend to renew the registrations and to file all appropriate affidavits.
We do not have a federal registration for some of our principal trademarks. Therefore, our trademark does not have many legal benefits and rights as a federally registered trademark. If our right to use the trademark is challenged, you may have to change to an alternative trademark, which may increase your expenses.
We have the right to the use, license and sublicense the Marks as well applicable copyrights, patents, know-how and trade secrets owned and developed by EOS OpCo (including any intellectual property developed by us, the "Intellectual Property"), under a license agreement between us and EOS OpCo (the "License Agreement"). On February 15, 2021, EOS OpCo licensed to us a worldwide nonexclusive right to use, and sublicense the use of, the Marks, Intellectual Property and System in connection with the offer, sale and operation of EOS Worldwide businesses. The License Agreement is for a term of 99 years unless EOS OpCo or we terminate the license. However, termination of the license agreement will not affect existing Franchise Agreements. We will sub-license to you the right to use the Marks to operate your Franchised Business upon the terms of your Franchise Agreement.
With the exception of the License Agreement, there are no agreements currently in effect which significantly limit our rights to use or sub-license the use of the Marks in a manner material to your Franchised Business. There are no currently effective adverse material determinations of the USPTO, the Trademark Trial and Appeal Board, the trademark administrator of any state or any court, nor are there any pending infringement, cancellation or opposition proceedings or material litigation against us or our affiliates, involving the Registered Marks.
We may occasionally add additional trademarks for use with EOS Franchised Businesses which may not be federally registered, and those additions will be considered part of the Marks, will be licensed to you, and will be subject to the restrictions discussed below. If additional trademarks do not have a federal registration, those trademarks would not have many legal benefits and rights as those available for a federally registered trademark. If our right to use such a trademark is challenged, you may have to change to an alternative trademark, which may increase your expenses.
Use of the Marks
You must follow our rules when you use the Marks. You may not use the Marks as part of your corporate or any other legal name unless we authorize such use in writing in advance. We must approve your business entity name and all fictitious names under which you propose to do business in writing before use. You must identify yourself using your name either alone or a fictitious name that is in accordance with our Franchise System Standards, as allowed or required under applicable law.
Source: Item 13 — TRADEMARKS (FDD pages 47–51)
What This Means (2025 FDD)
According to the 2025 Eos Worldwide Franchise Disclosure Document, if the right to use a trademark is challenged, a franchisee may have to change to an alternative trademark, which may increase their expenses. This situation can arise particularly with trademarks that do not have federal registration, as these lack the full legal protections of federally registered trademarks. Eos Worldwide may also add additional trademarks for use with EOS Franchised Businesses which may not be federally registered. If additional trademarks do not have a federal registration, those trademarks would not have many legal benefits and rights as those available for a federally registered trademark. If Eos Worldwide's right to use such a trademark is challenged, a franchisee may have to change to an alternative trademark, which may increase their expenses.
If there is an apparent infringement or challenge to the use of any Mark, the franchisee must notify Eos Worldwide immediately. The franchisee is not allowed to communicate with anyone other than Eos Worldwide, their legal counsel, and the franchisee's legal counsel regarding the infringement, challenge, or claim. Eos Worldwide or its affiliates have the right to take any action they deem appropriate and will control any litigation or administrative proceeding arising from the infringement, challenge, or claim.
The Franchise Agreement requires Eos Worldwide to participate in the franchisee's defense and/or indemnify them for expenses or damages if the franchisee is party to an administrative or judicial proceeding involving a Mark or Intellectual Property licensed to them, provided the franchisee has used the Mark or Intellectual Property in compliance with the Franchise Agreement. Before entering into the Franchise Agreement, the FDD advises that franchisees should make every effort to confirm that there are no existing uses of the Marks or confusingly similar marks being used where they wish to do business and to immediately notify Eos Worldwide of any confusingly similar marks they discover.
If Eos Worldwide determines that it is advisable to modify or discontinue the use of any Mark, franchisees must comply with their directions within a reasonable time after receiving notice. The franchisee will bear the expense of changing any materials used in the operation of their Franchised Business, and Eos Worldwide is not obligated to reimburse the franchisee for any loss of revenue attributable to the modified or discontinued Mark or for any expenditure made to promote a modified or substitute trademark or service mark.