What must a Hyper Kidz franchisee do if there is an apparent infringement of the marks?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
You must immediately notify us of any apparent infringement of or challenge to your use of any Mark or claim by any person of any rights in any Mark. You may not communicate with anyone except us and our counsel with respect to any infringement, challenge or claim. We will have sole discretion to take any action we deem appropriate in connection with any infringement, challenge or claim, and we have the sole right to exclusively control any litigation or other proceeding arising out of any infringement, challenge or claim relating to any Mark. You must sign any and all instruments and documents, give assistance, and do any acts and things as may in the opinion of our counsel be necessary or advisable to protect and maintain our interests in any litigation or proceeding or otherwise to protect and maintain our interests in the Marks. We will reimburse you for the reasonable out-of-pocket expenses you incur and pay in complying with these requirements; except if any action we take with respect to any claim or proceeding results in any
monetary recovery for you which exceeds your costs, then you must pay your own costs and share pro-rata in our costs up to the amount of the monetary recovery.
The Franchise Agreement does not require us to take affirmative action when notified of any infringements of or challenges to the Marks, but we intend to vigorously defend the Marks. We have the right to control any litigation or administrative proceedings involving the Marks. We will indemnify you against and reimburse you for all damages for which you are held liable in any proceeding arising out of your use of any Mark pursuant to and in compliance with the Franchise Agreement, and for all costs you reasonably incur in the defense of any claim in which you are named as a party, if you have promptly notified us of the claim, have given us sole control of the defense and settlement of the claim and have otherwise complied with your Franchise Agreement. If any action taken by us relating to a claim or proceeding results in any monetary recovery for you which exceeds your costs, then you must pay your own costs and share pro-rata in our costs up to the amount of the monetary recovery.
Source: Item 13 — TRADEMARKS (FDD pages 36–38)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, franchisees are required to take specific actions if they observe any potential infringement of the Hyper Kidz trademarks. The franchisee must immediately inform Hyper Kidz of any apparent infringement, challenge to the use of any mark, or claim by any person of rights to any mark. It is critical that the franchisee only communicates with Hyper Kidz and their counsel regarding the infringement, challenge, or claim.
Hyper Kidz retains sole discretion over any action taken in response to the infringement, challenge, or claim, including exclusive control over any related litigation or proceedings. The franchisee is obligated to sign any documents, provide assistance, and perform any actions deemed necessary by Hyper Kidz's counsel to protect the brand's interests in any litigation or proceeding.
Hyper Kidz will reimburse the franchisee for reasonable out-of-pocket expenses incurred while complying with these requirements. However, if any action results in monetary recovery for the franchisee that exceeds their costs, the franchisee must cover their own costs and share proportionally in Hyper Kidz's costs, up to the amount of the monetary recovery. While Hyper Kidz is not obligated to take action when notified of infringements, they intend to vigorously defend their marks.