Is an Itan franchisee prohibited from using or referencing confidential information to independently develop similar information?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
Confidential Information does not include information that: (a) is now, or subsequently becomes, generally available to the public (except as a result of a breach of confidentiality obligations by you, Franchisee or Franchisee's owners, employees or other constituents); (b) you can demonstrate was rightfully in your possession, without obligation of nondisclosure, before we (or any person associated with us) or Franchisee (or any person associated with Franchisee) disclosed the information to you; (c) is independently developed by you without any use of, or reference to, any Confidential Information; or (d) is rightfully obtained from a third party who has the right to transfer or disclose the information to you without breaching a confidentiality covenant imposed on such third party.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, there are stipulations regarding the use of confidential information. While franchisees are generally prohibited from using or referencing confidential information, there is an exception.
Specifically, the FDD states that confidential information does not include information that is independently developed without any use of, or reference to, any confidential information. This implies that an Itan franchisee is not prohibited from independently developing similar information, as long as the development is done without using or referencing Itan's confidential information.
This provision protects the franchisee's ability to innovate and create independently, while also safeguarding Itan's proprietary information. It is important for prospective franchisees to understand what constitutes confidential information under the franchise agreement to ensure they do not inadvertently violate the terms of the agreement.