Is the Flowerama franchisee's license to use the Marks exclusive?
Flowerama Franchise · 2024 FDDAnswer from 2024 FDD Document
- a. Grant. Franchisor hereby grants Franchisee during the term of the Franchise Agreement, a limited, non-exclusive and personal license to use the Marks, the Trade Practices and the System exclusively in connection with the continuous operation of a Franchised Unit throughout the term of the Franchise Agreement at the Franchised Location identified on Exhibit A, attached to the Franchise Agreement and incorporated into the Franchise Agreement by reference.
Franchisee understands and acknowledges that the Franchise Agreement does not confer upon Franchisee any territorial exclusivity, and that Franchisee may face competition from other franchisees, from outlets that Franchisor owns, or from other channels of distribution or competitive brands that Franchisor controls.
b. Reservation of Rights. Franchisee acknowledges and agrees that notwithstanding the provisions of Paragraph 2(a) above, Franchisor shall hold and retain the unrestricted right to develop, own and operate, by itself, through its affiliates, or by its franchisees, and to grant others the right to develop, own and operate and issue licenses and franchises to others to develop, own and operate:
(i) Flowerama units and other businesses or systems, including, without limitation, retail flower shops which operate under the marks and trade names of Franchisor's affiliates, utilizing the System and Trade Practices anywhere.
(ii) Other methods and channels of distribution utilizing the Marks, the System and Trade Practices and/or the marks and trade names of Franchisor's affiliates, including the "1-800-Flowers" trademarks, trade names and service marks, anywhere, including, without limitation, toll-free "1-800", "1- 888", "1-866" and "1-877" telephone numbers, domain names, URLs, on-line computer networks and services, the Internet (including, without limitation, any so-called "virtual stores"), kiosks, carts, concessions, satellite units, other mobile, remote, limited service or non-permanent facilities or other retail operations as a part of larger retail venues such as department stores, supermarkets, shopping malls or in public areas such as amusement parks, airports, train stations, public facilities, college and school campuses, arenas, stadiums, hospitals, office buildings, convention centers, airlines (in-flight service) and military bases.
c. Notice of Claim.
In the event of any claim of infringement of or challenge to Franchisee's use of the Marks, Franchisee shall immediately notify Franchisor in writing of the facts of such claim or challenge.
Franchisor shall use commercially reasonable efforts to protect and defend Franchisee's use of the Marks as licensed hereunder.
- d. Reimbursement to Franchisee.
Franchisor shall cause the 1-800-Flowers Marketing Fund to reimburse Franchisee for all damages for which it is held liable in any proceeding described in Section 2(c) above; however, the foregoing obligation of Franchisor to protect,
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 72–77)
What This Means (2024 FDD)
According to the 2024 Flowerama FDD, the franchisee receives a limited, non-exclusive, and personal license to use the Marks, Trade Practices, and System. This license is specifically for operating a Franchised Unit at the location detailed in Exhibit A of the Franchise Agreement, lasting throughout the agreement's term. The Marks include the trade names, trademarks, and service marks "FLOWERAMA" and "FLOWERAMA OF AMERICA".
This means a Flowerama franchisee does not have exclusive rights to the Flowerama marks in a given territory. The franchisee may face competition from other franchisees, outlets owned by Flowerama, or other distribution channels or competitive brands that Flowerama controls. Flowerama retains the right to develop, own, and operate Flowerama units and other businesses, including retail flower shops under affiliated marks, utilizing the System and Trade Practices anywhere.
Flowerama also reserves the right to use the Marks through other distribution methods and channels, including toll-free numbers, domain names, online services, the Internet, kiosks, carts, satellite units, and other retail operations in various venues. This broad reservation of rights means that Flowerama can leverage its trademarks across multiple platforms and locations, potentially creating competition for individual franchisees.
In the event of a claim of infringement related to the use of the Marks, the Flowerama franchisee must notify Flowerama in writing. Flowerama will then use commercially reasonable efforts to protect and defend the franchisee's use of the Marks, provided the franchisee has strictly followed the Franchise Agreement, any addenda, and Flowerama's rules and regulations. The 1-800-Flowers Marketing Fund may reimburse the franchisee for damages they are held liable for in such proceedings, subject to the franchisee's compliance with the agreement and notification requirements.