Who owns the rights to the Marks, patents, and copyrights licensed under the Gold Star agreement?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
As agreed to in Section 6 of this Agreement, all rights to any Marks, patents and copyrights licensed hereunder belong to the COMPANY exclusively, and upon expiration or termination of this Agreement, the COMPANY may, if FRANCHISEE does not do so, execute in FRANCHISEE's name, at FRANCHISEE's expense and on FRANCHISEE's behalf any and all documents necessary to end and cause the discontinuance immediately of FRANCHISEE's use of or right to use the Marks, patents and copyrights and the COMPANY is hereby irrevocably appointed and designated as FRANCHISEE's attorney-in-fact to do so.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, the company exclusively owns all rights to the Marks, patents, and copyrights licensed under the franchise agreement. Specifically, Section 6 of the franchise agreement details the ownership and use of these Marks. Upon the expiration or termination of the franchise agreement, Gold Star has the authority to ensure the franchisee discontinues the use of these Marks, patents, and copyrights. Gold Star can even execute documents on behalf of the franchisee to enforce this discontinuation, acting as the franchisee's attorney-in-fact.
This means that a Gold Star franchisee's right to use the brand's intellectual property is strictly limited to the duration of the franchise agreement. The franchisee cannot claim any ownership or rights to the Marks, patents, or copyrights, and all associated goodwill benefits Gold Star exclusively. This is a standard practice in franchising, where the franchisor retains control over its brand and intellectual property to maintain consistency and protect its value.
Gold Star also has the right to modify or discontinue the use of any Marks at its sole discretion. If this happens, the franchisee is obligated to comply with Gold Star's instructions at their own expense. This provision underscores the franchisor's control over the brand's image and marketing strategy, and the franchisee's responsibility to adapt to any changes implemented by Gold Star. Franchisees are also required to notify Gold Star of any potential infringements or legal challenges to the Marks.
Gold Star warrants that it has the rights to license the Marks to franchisees and that this use will not infringe on the rights of others. Gold Star also agrees to take necessary actions to protect the Marks and associated goodwill. This provides some assurance to the franchisee that they are legally entitled to use the Marks as authorized in the franchise agreement. However, the franchisee must cooperate with Gold Star in any legal defense or prosecution related to the Marks, as specified in the agreement.