What is the Fitstop franchisee's obligation regarding notifying Fitstop of any proceeding related to the Fitstop Marks?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
You must immediately notify us in writing if you become aware of any unauthorized use of our Marks or other proprietary information and you must permit us to participate in any litigation involving you and our Marks. We will take the action we think appropriate. We will indemnify, defend and hold you harmless in connection with any third-party claims that are brought against you that arise solely out of your authorized use of any Marks in the manner we prescribe, provided you notify us of the proceeding within three days and you have complied with our directions with regard to the proceeding. We have the right to control the defense and settlement of any proceeding.
We will not reimburse you for your expenses and legal fees for separate, independent legal counsel, unless we approve of your use of such counsel in writing prior to you engaging counsel. We will not reimburse you for disputes where we challenge your use of our Marks.
Source: Item 13 — TRADEMARKS (FDD pages 37–38)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee has specific obligations regarding the brand's trademarks. If a Fitstop franchisee becomes aware of any unauthorized use of Fitstop's Marks or other proprietary information, they must immediately notify Fitstop in writing. Furthermore, the franchisee must allow Fitstop to participate in any litigation involving the franchisee and Fitstop's Marks. Fitstop retains the right to decide what action it deems appropriate in such situations.
Fitstop will indemnify, defend, and hold the franchisee harmless in connection with third-party claims arising solely from the franchisee's authorized use of the Marks, provided the franchisee notifies Fitstop of the proceeding within three days and complies with Fitstop's directions regarding the proceeding. Fitstop also has the right to control the defense and settlement of any proceeding.
However, Fitstop will not reimburse the franchisee for expenses and legal fees for separate, independent legal counsel unless Fitstop approves the use of such counsel in writing before the franchisee engages them. Additionally, Fitstop will not reimburse the franchisee for disputes where Fitstop challenges the franchisee's use of the Marks. This arrangement is fairly typical in franchising, as the franchisor has a strong interest in protecting its trademarks and brand reputation, and needs to maintain control over any related legal proceedings.