As a Hardees franchisee, can I contest Hardees' interest in the trade secrets and confidential information that comprise the Hardee's System?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
You acknowledge that the trade secrets derive independent economic value from not being generally known to and not readily ascertainable to others. You agree to hold in confidence and agree not to disclose or in any way make available to any unauthorized person any trade secret or any information regarding any trade secret or any proprietary information made available to you by us. You may disclose trade secrets only to your employees and agents with a legitimate need to know, each of whom you will warrant will be subject to this confidentiality requirement. You also agree not to contest our interest in the trade secrets and confidential and proprietary information that comprise the Hardee's System.
Source: Item 14 — Patents, Copyrights, and Proprietary Information (FDD pages 61–62)
What This Means (2025 FDD)
According to the 2025 Hardees FDD, as a franchisee, you specifically agree not to contest Hardees' interest in the trade secrets, confidential information, and proprietary information that make up the Hardee's System. This encompasses a broad range of information, including manuals, formulas, methods, customer data, vendor lists, pricing, and policies. The OPM (Operation Procedures Manual) is a key component, containing detailed standards for restaurant management, operations, product specifications, and other proprietary details.
This agreement extends to all trade secrets that provide Hardees with an economic advantage due to their confidentiality. Franchisees are permitted to disclose these trade secrets only to employees and agents with a legitimate need to know, provided those individuals are also bound by confidentiality requirements. This ensures that the Hardees System's proprietary information remains protected and is not disseminated to unauthorized parties.
The agreement not to contest Hardees' interest in these trade secrets is a standard clause in franchise agreements. It protects the franchisor's investment in developing the system and prevents franchisees from using confidential information to compete against the brand or share it with competitors. By agreeing to this clause, franchisees acknowledge the value and importance of the Hardees System's proprietary information and commit to maintaining its confidentiality.