Under what conditions will Flowerama not defend or indemnify a franchisee against third-party claims of trademark infringement?
Flowerama Franchise · 2024 FDDAnswer from 2024 FDD Document
We have the right to control any administrative proceedings or litigation involving a trademark licensed by us to you. If you learn of any claim against you for alleged infringement, unfair competition, or similar claims about the Marks, you must promptly notify us. We will promptly take the action we consider necessary to defend you. We must indemnify you for any action against you by a third party based solely on alleged infringement, unfair competition, or similar claims about the Marks. We will have no obligation to defend or indemnify you if the claim against you relates to your use of the Marks in violation of the Franchise Agreement, or your gross negligence or willful misconduct with respect to your actions pursuant to the Franchise Agreement.
Source: Item 13 — TRADEMARKS (FDD pages 54–57)
What This Means (2024 FDD)
According to Flowerama's 2024 Franchise Disclosure Document, Flowerama will typically indemnify a franchisee against third-party claims of trademark infringement, unfair competition, or similar claims related to the Flowerama Marks. This means Flowerama will cover the franchisee's legal costs and any damages awarded if a third party sues the franchisee for using the Flowerama Marks.
However, Flowerama outlines specific circumstances where it will not provide this defense or indemnification. Flowerama is not obligated to defend or indemnify a franchisee if the claim against the franchisee relates to the franchisee's use of the Flowerama Marks in violation of the Franchise Agreement. This could include using the marks in a way that is not authorized or approved by Flowerama, or using them in connection with the sale of unauthorized products or services.
Additionally, Flowerama will not defend or indemnify a franchisee if the claim arises from the franchisee's gross negligence or willful misconduct in actions related to the Franchise Agreement. This provision protects Flowerama from liability for a franchisee's intentional or reckless actions that lead to a trademark infringement claim. Prospective franchisees should carefully review the Franchise Agreement and adhere to Flowerama's standards to avoid these situations and ensure they are protected by Flowerama's indemnification.