factual

Are there any agreements that limit Gold Star's ability to license its trademarks to franchisees?

Gold_Star Franchise · 2025 FDD

Answer from 2025 FDD Document

There are no agreements currently in effect that significantly limit the rights of Gold Star to use or license the use of the primary trademarks, service marks, names, logos and symbols licensed to, and to be used by, you to identify the Franchise business, in any manner material to the Franchise.

You must notify Gold Star promptly of any claim, demand or legal action by any third party involving the Marks or any potentially infringing use of the Marks, or any mark, name, logo or symbol identical to or confusingly similar to any of the Marks. Under the Franchise Agreement, Gold Star agrees to take whatever actions it deems reasonably necessary to protect the Marks and the goodwill associated therewith. Gold Star retains the exclusive right, in its sole discretion exercised in good faith, to determine and undertake the actions, if any, that it deems appropriate to prevent the infringement of the Marks or the diminution of the goodwill in the Marks. If a third party brings a legal action against you challenging your right to use the Marks as authorized by the Franchise Agreement, Gold Star may, in its sole discretion, assume your defense utilizing counsel of Gold Star's choice and must indemnify you against all damages for infringement for which you are held liable in that action arising out of your authorized use of the Marks pursuant to and in compliance with the Franchise Agreement, if the following conditions are satisfied: (a) you provide Gold Star with timely notice of the institution of the action, (b) you cooperate fully with Gold Star's counsel in defending against the action and (c) Gold Star retains ultimate control over the strategy involved in defending against and/or resolving the action. If Gold Star undertakes the defense or prosecution of any litigation pertaining to the right to use the Marks, you must execute all documents and do all acts and things as may be necessary, in the opinion of counsel for Gold Star, to carry out the defense or prosecution, whether the action is in the name of Gold Star, or in your name. Gold Star is not responsible for the cost of any independent legal counsel retained by you in any litigation. Except as set forth above, Gold Star will not be liable to you for any damages, costs, expenses, loss of profits or business opportunities, or incidental or consequential damages of any kind regarding or under any action or other matter involving the Marks. If you fail to meet any of your obligations described in this paragraph, Gold Star's obligations and warranties are void regarding the event at issue and Gold Star has no liability for costs incurred by or damages awarded against you.

Source: Item 13 — Trademarks (FDD pages 37–40)

What This Means (2025 FDD)

According to Gold Star's 2025 Franchise Disclosure Document, there are no agreements that significantly limit Gold Star's right to use or license its primary trademarks, service marks, names, logos, and symbols to franchisees in any manner material to the franchise. This indicates that Gold Star has the authority to allow franchisees to use its brand identifiers without significant external restrictions. This is a positive sign for prospective franchisees, as it suggests that Gold Star has control over its brand and can grant franchisees the necessary rights to operate under the Gold Star name.

Gold Star also requires franchisees to promptly notify them of any claims, demands, or legal actions by third parties involving the trademarks. Gold Star retains the exclusive right to take actions it deems reasonably necessary to protect the marks and associated goodwill. If a third party sues a franchisee for trademark infringement related to their authorized use of the marks, Gold Star may assume the defense and indemnify the franchisee against damages if the franchisee provides timely notice, cooperates fully with Gold Star's counsel, and allows Gold Star to control the defense strategy.

However, Gold Star is not responsible for the cost of independent legal counsel retained by the franchisee and will not be liable for damages, costs, expenses, loss of profits, or business opportunities related to actions involving the marks, except as specifically outlined. The franchisee's failure to meet their obligations voids Gold Star's obligations and warranties regarding the event, relieving Gold Star of liability for costs or damages awarded against the franchisee. This highlights the importance of franchisees adhering to the franchise agreement and promptly reporting any potential trademark issues to Gold Star to ensure they can receive support and protection.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.