For how long is a receiving party obligated to protect the disclosing party's Confidential Information under the Even Hotels franchise agreement, and what is the exception for software?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
For Confidential Information that does not constitute a "trade secret" under applicable Law, these confidentiality obligations will expire three (3) years after the termination or expiration of this Agreement.
For Confidential Information that constitutes a "trade secret" under applicable Law, these confidentiality obligations will continue until such information ceases to constitute a "trade secret" under such applicable Law.
These confidentiality obligations will not restrict any disclosure required by Law, provided that Hotel gives prompt notice to IHG of any such legal requirement and reasonably cooperates with IHG at IHG's request and expense to resist such legal requirement or to obtain a protective order.
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to the 2025 Even Hotels Franchise Disclosure Document, the duration of confidentiality obligations depends on whether the information constitutes a trade secret. For confidential information that is not considered a trade secret under applicable law, the confidentiality obligations expire three years after the termination or expiration of the franchise agreement. However, for confidential information that qualifies as a trade secret under applicable law, the confidentiality obligations continue until the information no longer meets the legal definition of a trade secret.
The Even Hotels FDD states that these obligations do not restrict disclosures required by law, provided that the franchisee promptly notifies IHG of any such legal requirement and reasonably cooperates with IHG, at IHG's request and expense, to resist the legal requirement or obtain a protective order. This means that franchisees must balance their confidentiality obligations with any legal mandates to disclose information, ensuring they inform IHG to allow for potential legal intervention.
Notably, the provided excerpts do not specify a particular exception for software. The definition of "Confidential Information" is broad, encompassing various types of data and information, including technical specifications, source code, and databases, which could include software-related information. A prospective Even Hotels franchisee should seek clarification from the franchisor regarding whether software or specific types of software-related information are subject to different confidentiality terms or exceptions within the franchise agreement.