What is the role of the 'TM Owner' in relation to Fitstop's intellectual property?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
TS, AND PROPRIETARY INFORMATION
We do not own any registered patents or pending patent applications that are material to the franchise. We and our affiliate (Fitstop IP Pty Limited a/k/a TM Owner) do claim common law copyright and trade secret protection for several aspects of the franchise System including our Manuals, training materials, advertising, and business materials. TM Owner owns such intellectual property rights and, similar to the Proprietary Marks, licenses this intellectual property to us.
There are no current determinations, proceedings or litigation involving any of our copyrighted materials. If you learn that any unauthorized third party is using any of our copyrighted materials, we request that you notify us of such unauthorized use. We may revise our System and any of our copyrighted materials in our
discretion, and may require that you cease using any outdated copyrighted material. You will be responsible for printing any revised or new advertising, marketing or other business materials.
During the term of the Franchise Agreement, you will receive information which we consider trade secrets and confidential information. You may not, during the term of the Franchise Agreement or any time after that, communicate, divulge, or use for the benefit of any other person, partnership, association, corporation, or limited liability company any of these trade secrets, copyrighted materials, methods and other techniques and know-how concerning the operation of the Franchised Business (the "Confidential Information"). You may divulge such Confidential Information only to your employees who must have access to it in order to fulfil their employment obligations.
Source: Item 14 — PATENTS, COPYRIGHTS, AND PROPRIETARY INFORMATION (FDD pages 38–40)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, the 'TM Owner,' identified as Fitstop IP Pty Limited, plays a central role in owning and licensing the intellectual property critical to the Fitstop franchise system. While Fitstop itself does not own registered patents, the TM Owner holds common law copyright and trade secret protections for various aspects of the franchise, including manuals, training materials, advertising, and business materials. This intellectual property is then licensed to Fitstop, allowing the company to grant franchisees the right to use these materials in operating their Fitstop businesses.
This arrangement means that Fitstop franchisees are using intellectual property ultimately controlled by the TM Owner. Fitstop retains the right to revise its system and copyrighted materials and can require franchisees to cease using outdated materials, with the franchisee bearing the cost of new materials. Franchisees also gain access to confidential information and trade secrets during the franchise term, which they are obligated to protect both during and after the term of the Franchise Agreement.
Furthermore, any new concepts, processes, or improvements developed by a franchisee or their employees in the operation or promotion of the Fitstop business become the sole property of Fitstop. The franchisee must notify Fitstop of such developments and assign all related intellectual property rights to them. This includes patents, trademarks, and copyrights. Fitstop can then use these improvements as they see fit, and franchisees waive any rights to restrain or claim moral rights over these developments.
This transfer of intellectual property rights to Fitstop is a standard practice in franchising, ensuring uniformity and control over the brand. However, it's crucial for prospective Fitstop franchisees to understand that any innovation they bring to the business becomes Fitstop's property, and they will not receive compensation or retain rights to these improvements.