Does the Gold Star company represent that it has the rights to license the Marks to the franchisee?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6.7 Company Protection of Marks.
The COMPANY warrants and represents that it has such rights in and to the Marks so as to enable it to license FRANCHISEE's use of them in accordance with the terms of this Agreement and that such use will not infringe the legal or equitable rights of any persons, partnerships, limited liability companies or corporations.
The COMPANY agrees to take whatever actions it deems reasonably necessary to protect the Marks and the goodwill associated therewith.
The COMPANY retains the exclusive right, in its sole discretion exercised in good faith, to determine and undertake such actions, if any,
- as it deems appropriate to prevent the infringement of the Marks or the diminution of the goodwill in the Marks.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, Gold Star warrants and represents that it possesses the necessary rights to license its Marks to franchisees, enabling their use in accordance with the franchise agreement terms. Gold Star also assures that this use will not infringe upon the legal or equitable rights of other entities. This is a standard assurance in franchising, as franchisees need to be certain that they can legally operate under the brand's trademarks and service marks.
Gold Star also commits to taking actions it deems reasonably necessary to protect its Marks and the associated goodwill. This includes the right to determine and undertake actions to prevent infringement or diminution of goodwill in the Marks. This protection is crucial for maintaining brand consistency and preventing unauthorized use of the Marks by third parties.
However, the FDD also stipulates that if a franchisee fails to meet its obligations regarding the Marks, Gold Star's warranties and obligations become void concerning that particular event. Furthermore, Gold Star is not liable for damages, costs, or expenses related to any action involving the Marks or associated goodwill, except as specifically outlined in Section 6.8 of the agreement. This highlights the importance of the franchisee's compliance with the terms and conditions related to the use and protection of the Marks.