Is Fly Fitness required to designate information as 'confidential' or 'proprietary' for it to be considered Confidential Information?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
During the term of the Franchise Agreement, you may have access to and become acquainted with our trade secrets, including, but not limited to, methods, formulas, processes, customer lists, vendor partnerships and/or relationships, sales and technical information, costs, product prices and names, software tools and applications, website and/or email design, products, services, equipment, technologies and procedures relating to the operation of your Fly Fitness outlet; systems of operation, services, programs, products, procedures, policies, standards, techniques, requirements and specifications which are part of the System; the Operations Manual; methods of advertising and promotion; instructional materials; marketing plans, business methods, research, development or know-how, any other information which we may or may not specifically designate as "confidential" or "proprietary", and the components of our System whether or not such information is protected or protectable by patent, copyright, trade secret or other proprietary rights (collectively called the "Confidential Information"). You agree that you will take all reasonable measures to maintain the confidentiality of all Confidential Information in your possession or control and that all such Confidential Information and trade secrets shall remain our exclusive property. You may never (during the Initial Term, any Renewal Term, or after the Franchise Agreement expires or is terminated) reveal any of our confidential information to another person or use it for any other person or business. You may not copy any of our Confidential Information or give it to a third party except as we authorize in writing to you prior to any dissemination. Your personnel who have access to our Confidential Information must sign our Confidentiality/Non-Competition Agreement (Franchise Agreement, Attachment 8).
You must promptly tell us when you learn about unauthorized use of any Confidential Information. We are not obligated to take any action but will respond to this information as we think appropriate.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 32–33)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, information does not need to be specifically designated as "confidential" or "proprietary" to be considered Confidential Information. The FDD specifies that during the Franchise Agreement term, franchisees gain access to trade secrets and other sensitive data related to the Fly Fitness outlet's operation. This includes methods, formulas, customer lists, vendor relationships, sales and technical information, costs, product prices, software, website design, operational systems, marketing plans, and know-how.
Fly Fitness considers all of these items Confidential Information, regardless of whether they are explicitly marked as such. Franchisees must take reasonable measures to protect this information's confidentiality and understand that it remains Fly Fitness's exclusive property. Franchisees are prohibited from revealing this information to others or using it for any other business, both during and after the franchise term. Copying or sharing the information with third parties is also forbidden without Fly Fitness's written authorization. Personnel with access to confidential information must sign a confidentiality agreement.
This policy is fairly standard in franchising, as franchisors need to protect their proprietary systems and methods. The broad definition of Confidential Information in the Fly Fitness FDD means that franchisees must exercise caution and diligence in handling any information related to the franchise, even if it doesn't seem obviously confidential. Franchisees are also obligated to promptly report any unauthorized use of Confidential Information they become aware of, though Fly Fitness is not obligated to take any specific action in response.