What happens if a Gold Star franchisee fails to meet its obligations regarding infringement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 6.7 notwithstanding, if FRANCHISEE fails to meet its obligations under Sections 6.8 and 6.9 with respect to any particular event, the COMPANY's warranties and obligations under Sections 6.7 and 6.8 shall become void with respect to such particular event, and the COMPANY shall have no liability for costs incurred or damages awarded against FRANCHISEE. EXCEPT AS SPECIFICALLY SET FORTH IN SECTION 6.8, ABOVE, THE COMPANY SHALL NOT BE LIABLE TO FRANCHISEE FOR ANY DAMAGES, COSTS, OR EXPENSES WHATSOEVER, INCLUDING BUT NOT LIMITED TO, ANY LOSS OF PROFITS OR BUSINESS OPPORTUNITIES, OR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER RELATING TO ANY ACTION OR OTHER MATTER INVOLVING THE MARKS OR GOODWILL ASSOCIATED THEREWITH.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, if a franchisee fails to meet its obligations regarding infringement, Gold Star's warranties and obligations become void with respect to that particular event. Gold Star will not be liable for any costs incurred or damages awarded against the franchisee.
Specifically, Gold Star will not be liable to the franchisee for any damages, costs, or expenses, including any loss of profits or business opportunities, or incidental or consequential damages relating to any action or other matter involving the marks or goodwill associated with them. This means the franchisee is solely responsible for any legal or financial repercussions resulting from their failure to meet infringement obligations.
This section emphasizes the importance of franchisees adhering to trademark and intellectual property guidelines to protect both their own business and the overall brand. Franchisees should ensure they fully understand their obligations to avoid potential liabilities and ensure the continued protection of the Gold Star brand.