What is the consequence if an immediate family member of an Itan employee uses or discloses Confidential Information?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
You could circumvent the intent of this Agreement by disclosing Confidential Information to immediate family members (i.e., parent, sibling, child or grandchild) and it would be difficult for us to prove your breach.
For that reason you are presumed to have breached this Agreement if an immediate family member uses or discloses Confidential Information.
You may rebut this presumption with evidence conclusively showing you did not disclose Confidential Information to the family member.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, if an immediate family member (defined as a parent, sibling, child, or grandchild) of an Itan franchisee uses or discloses confidential information, the franchisee is presumed to have breached the agreement. This presumption exists because Itan recognizes the difficulty in proving whether the franchisee directly disclosed the confidential information to the family member.
However, the franchisee has the opportunity to rebut this presumption. To do so, the franchisee must provide conclusive evidence demonstrating that they did not, in fact, disclose the confidential information to the family member. The FDD does not specify what form of evidence would be deemed 'conclusive,' leaving that determination to Itan and potentially the courts.
This clause places a significant responsibility on Itan franchisees to ensure the confidentiality of information within their families. Failure to maintain this confidentiality, even indirectly through a family member's actions, can lead to the franchisee being held liable for breach of contract, unless they can provide sufficient evidence to the contrary. This is stricter than many franchise agreements, which typically focus on the direct actions of the franchisee and their employees.