Is unauthorized use or disclosure of confidential information prohibited for a Hydrodog franchisee?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
e, and they do agree, that you and they:
- (a) Will not use any Confidential Information in any other business or capacity;
- (b) Will keep the Confidential Information strictly confidential during and indefinitely after this Agreement's term;
- (c) Will not make unauthorized copies of any Confidential Information disclosed via electronic medium or in written or other tangible form; and
- (d) will adopt and implement all reasonable procedures that we periodically prescribe to prevent unauthorized use or disclosure of Confidential Information, including, without limitation, restricting its disclosure to Franchised Business personnel and others needing to know such Confidential Information to operate your HydroDog Business, and requiring all employees and independent contractors having access to Confidential Information to sign confidentiality and non-competition agreements in a form acceptable to us. We have the right to regulate the form of confidentiality and non-competition agreement that you use and to be a third-party beneficiary of that agreement with independent enforcement rights.
You must disclose to us all ideas, techniques, services and products concerning the development and operation of your HydroDog Business that you or your employees conceive or develop during the term of this Agreement. You must grant to us and agree to obtain from your owners, employees, contractors, and agents a perpetual, irrevocable, royalty-free, non-exclusive, transferable, and worldwide right to use, modify, exploit, and sublicense these ideas, techniques, innovations, improvements and products concerning the development and operation of Franchised Business that you or your employees, contractors, or agents conceive or develop during the term of this Agreement in all pet-related product and service businesses. We will have no obligation to make any lump sum or on-going payments to you with respect to any idea, concept, method, technique or product. You must agree that you will not use nor will you allow any other person or entity to use any of these ideas, techniques or products without obtaining our prior written approval. Such ideas, techniques, services and products will be deemed to be our sole and exclusive property, part of the System, and works made-for-hire for us. To the extent any item does not qualify as a "work made-for-hire" for us, by this paragraph you assign ownership of that item, and all related rights to that item, to us and agree to sign whatever assignment or other documents we request to evidence our ownership or to help us obtain intellectual property rights in the item.
"Confidential Information" does not include information, knowledge or know-how which: (a) at or prior to the time of receipt was in the public domain; (b) at or prior to the time of receipt by you or the signing of this Agreement, whichever occurred first, was known to you and in actual commercial use by you or generally within the industry, in the manner and combination disclosed;
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, franchisees are explicitly prohibited from the unauthorized use or disclosure of confidential information. Franchisees must not make unauthorized copies of confidential information, whether disclosed electronically or in written form. They are also required to implement reasonable procedures to prevent unauthorized use or disclosure, including restricting access to Hydrodog business personnel and requiring employees and independent contractors to sign confidentiality and non-competition agreements. Hydrodog retains the right to regulate the form of these agreements and act as a third-party beneficiary with independent enforcement rights.
The FDD specifies that franchisees will not acquire any interest in the confidential information, and using or duplicating this information in any other business constitutes unfair competition. Franchisees are obligated to safeguard the confidentiality of the information and must not disclose it to any other person or entity or use it for any purpose outside their work with Hydrodog under the Franchise Agreement. They must also adhere to all procedures prescribed by Hydrodog to prevent unauthorized use or disclosure.
Confidential information includes, but is not limited to, methods, formats, specifications, standards, systems, procedures, sales and marketing techniques, market research, promotional programs, client communication programs, the System itself, plans, specifications, size and physical characteristics of Hydrodog businesses and vehicles, territory selection criteria, design of equipment, furniture, forms, materials and supplies, training programs, pet grooming techniques, and the client database. Franchisees acknowledge that the client database is Hydrodog's property and a trade secret, which cannot be disclosed, sold, assigned, transferred, or conveyed to any other person. A breach of this section can result in immediate termination of the Franchise Agreement.
Furthermore, franchisees and their owners must deal exclusively with Hydrodog and cannot hold interests in or perform services for a Competitive Business during the term of the agreement. This exclusive relationship is in place to protect confidential information and encourage a free exchange of ideas within the Hydrodog franchise system. The term 'Competitive Business' is broadly defined to include any business offering similar pet-related products and services.