Is Fly Fitness liable for expenses incurred by the franchisee due to changes in the Marks?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisor reserves the right to substitute different Marks for use in identifying the System and the Franchised Business, if it in its sole discretion, determines that substitution of different Marks will be beneficial to the System.
Franchisor will not be liable to Franchisee for any expenses, losses or damages sustained by Franchisee as a result of any additions, modifications, substitutions, or discontinuation of the Marks.
Franchisee covenants not to commence or join in any litigation or other proceeding against Franchisor for any of these expenses, losses, or damages.
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness reserves the right to substitute different marks for use in identifying the system and the franchised business if it determines that doing so will benefit the system. However, Fly Fitness will not be liable to the franchisee for any expenses, losses, or damages sustained by the franchisee as a result of any additions, modifications, substitutions, or discontinuation of the marks. The franchisee also agrees not to commence or join in any litigation against Fly Fitness for any of these expenses, losses, or damages.
This means that if Fly Fitness decides to change its branding or trademarks, franchisees are responsible for covering any costs associated with updating signage, marketing materials, or other branded items. This could include expenses related to new designs, printing, and installation.
This clause protects Fly Fitness from potential financial claims by franchisees due to changes in the brand's marks. Prospective franchisees should consider this potential cost and factor it into their financial planning. It is a fairly common practice in franchising for the franchisor to retain control over branding and to not be held liable for these types of expenses.