What specific sections outline the Gold Star franchisee's obligations regarding infringement and cooperation?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6.10 Franchisee's Failure to Cooperate.
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.
6.11 Notice to the Public. FRANCHISEE will identify itself to the public as the owner of the Store in at least one conspicuous location in the Store and in any other documentation that the COMPANY may reasonably specify. FRANCHISEE will not use the Marks or the System to incur any obligation or indebtedness on behalf of the COMPANY, or in connection with any activity that may harm, tarnish or impair the COMPANY's reputation, name, service, Marks or System. The COMPANY assumes no liability to FRANCHISEE or any third party with respect to the quality of any materials, supplies, food items, sauces, or services or any other items provided or promoted by the COMPANY and as distributed or provided by FRANCHISEE under the name GOLD STAR CHILI or any other Mark, and FRANCHISEE will indemnify, hold harmless and insure the COMPANY against any liability, loss or expense (including reasonable attorney fees) arising out of FRANCHISEE's use of the Marks or the System.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to the 2025 Gold Star Franchise Disclosure Document, Section 6.10, titled 'Franchisee's Failure to Cooperate,' outlines the consequences if a franchisee does not meet their obligations under Sections 6.8 and 6.9. Specifically, Gold Star's warranties and obligations under Sections 6.7 and 6.8 become void concerning the particular event, and Gold Star has no liability for costs or damages awarded against the franchisee. Furthermore, except as specifically set forth in Section 6.8, Gold Star is not liable to the franchisee for any damages, costs, or expenses, including loss of profits or business opportunities, relating to any action involving the marks or goodwill associated with them.
Section 6.11, titled 'Notice to the Public,' states that the franchisee must identify themselves as the owner of the store in a conspicuous location and in any other documentation specified by Gold Star. The franchisee cannot use the marks or the system to incur any obligation on behalf of Gold Star or in connection with any activity that may harm Gold Star's reputation, name, service, marks, or system. Gold Star assumes no liability to the franchisee or any third party regarding the quality of materials, supplies, food items, sauces, services, or any other items provided or promoted by Gold Star and distributed by the franchisee under the Gold Star Chili name or any other mark. The franchisee must indemnify, hold harmless, and insure Gold Star against any liability, loss, or expense arising out of the franchisee's use of the marks or the system.
In practical terms, these sections emphasize the franchisee's responsibility to protect Gold Star's brand and reputation. Failure to cooperate in legal matters or misuse of the trademarks can result in the franchisee bearing all associated costs and liabilities. The franchisee also takes on the responsibility of informing the public of their ownership and ensuring that their operations do not negatively impact Gold Star's brand. This is a common arrangement in franchising, where the franchisor relies on its franchisees to uphold brand standards and protect its intellectual property.