Is Fitstop required to post a bond to obtain restraining orders or injunctions?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
her intellectual property rights associated with the same; (ii) any of the restrictive covenants contained in this Agreement; and (iii) any of Franchisee's payment obligations under this Agreement.
- ©2024 Fitstop USA, Inc. 19.3 Injunctive Relief. You acknowledge and agree that irreparable harm could be caused to us by your violation of certain provisions of this Agreement and, as such, in addition to any other relief available at law or equity, we shall be entitled to obtain in any court of competent jurisdiction, without bond, restraining orders or temporary or permanent injunctions in order to enforce, among other items, the provisions of this Agreement relating to: (i) your unauthorized use of the Proprietary Marks and Confidential Information (including any proprietary software used in connection with the Franchised Business); (ii) the in-term covenant not to compete, as well as any other violations of the restrictive covenants set forth in this Agreement; (iii) your obligation upon termination or expiration of this Agreement; (iv) disputes and controversies based on or arising under the Lanham Act, or otherwise
involving the Proprietary Marks, as now or hereafter amended; (v) disputes and controversies involving enforcement of our rights with respect to confidentiality under this Agreement;
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, Fitstop is entitled to obtain restraining orders or temporary or permanent injunctions without bond in any court of competent jurisdiction. This applies to enforce provisions of the Franchise Agreement relating to unauthorized use of Proprietary Marks and Confidential Information, in-term covenant not to compete, obligations upon termination or expiration of the agreement, disputes and controversies based on or arising under the Lanham Act, disputes and controversies involving enforcement of Fitstop's rights with respect to confidentiality, and to prohibit any act or omission by the franchisee that constitutes a violation of applicable law, threatens the Franchise System or threatens other System franchisees.
This means that Fitstop does not have to provide a financial guarantee or surety (a bond) to the court when seeking a restraining order or injunction against a franchisee. The franchisee's only recourse if such an injunction is entered is to seek its dissolution if they prevail in the proceeding.
This is a significant advantage for Fitstop, as obtaining a bond can be costly and time-consuming. It also places the franchisee at a disadvantage, as they must bear the burden of dissolving the injunction, even if they ultimately prevail in the dispute. Prospective franchisees should be aware of this provision and understand the potential implications before entering into a franchise agreement with Fitstop.