What standard of care must an Even Hotels franchisee use to protect Confidential Information?

According to Even Hotels' 2025 Franchise Disclosure Document, franchisees must use commercially reasonable care and discretion to protect Confidential Information from unauthorized use, disclosure, publication, or dissemination. This standard must be no less than the level of care the franchisee uses to protect its own confidential information of a similar nature. This means Even Hotels franchisees are expected to safeguard confidential data with at least the same diligence they would apply to their own sensitive business information.

The FDD defines "Confidential Information" as any data disclosed by IHG or its affiliates that is marked confidential, reasonably identifiable as confidential, or should reasonably be understood as confidential given its nature and the circumstances of disclosure. This includes, but isn't limited to, information related to the Next-Gen Payments Solution and the Hotel Agreement. Franchisees can only disclose this information to employees, contractors, and professional advisors who need to know it for their work related to the agreement, and who are also bound by confidentiality obligations at least as protective as those in the agreement.

These confidentiality obligations have different durations depending on whether the information constitutes a "trade secret" under applicable law. For information that is not a trade secret, the obligations expire three years after the termination or expiration of the franchise agreement. However, for information that does qualify as a trade secret, the confidentiality obligations continue until the information no longer meets the legal definition of a trade secret. The franchisee is responsible for any breaches of these confidentiality obligations by its agents, affiliates, and any third parties to whom they disclose the information.

It's important to note that these obligations do not restrict disclosures required by law, provided that the franchisee promptly notifies IHG of the legal requirement and reasonably cooperates with IHG to resist the requirement or obtain a protective order. Upon IHG's request, the franchisee must either return or destroy all copies of the Confidential Information and certify in writing that they, their affiliates, agents, and recipients have complied with this requirement. This comprehensive approach to confidential information underscores the importance IHG places on protecting its proprietary assets and maintaining a competitive edge in the hospitality market.