What is the franchisee's obligation regarding the confidentiality of Jersey Mikes proprietary information after the Franchise Agreement terminates?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
SEY MIKE'S franchises.
Proprietary Information
Your entire knowledge of the operation of a JERSEY MIKE'S Restaurant, including the knowledge or know-how regarding the specifications, standards and operating procedures of a JERSEY MIKE'S Restaurant is derived from information disclosed to you by Company, and certain of this information is proprietary, confidential and a trade secret of Company. You will maintain the absolute confidentiality of all proprietary information during and after the term of the Franchise Agreement and will not use any of this information in any other business or in any manner not specifically authorized or approved in writing by Company.
You will divulge confidential information only to your employees who must have access to it in order to operate the Franchised Restaurant. Any information, knowledge and know-how, including drawings, materials, equipment, techniques, restaurant systems, product formulae, recipes, methods, procedures and other data (including customer data) will be deemed confidential for pur poses of the Franchise Agreement, except information which you can demonstrate came to your attention, had become a part of the public domain, through publication or communication by others; or which, after disclosure to you by Company, becomes a part of the public domain, through publication or communication by others, so long a s such disclosure was not caused by you. Company is the sole owner of all confidential information.
All your employees having access to confidential information, agreements or other proprietary information of Company will sign confidentiality with confidentiality obligations no less stringent than those contained in your Franchise Agreement. Company may seek equitable relief for any breach of the terms of Sections 6, 7 and 8 of the Franchise Agreement.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 55–56)
What This Means (2025 FDD)
According to Jersey Mikes' 2025 Franchise Disclosure Document, franchisees have an ongoing responsibility to protect the franchisor's confidential information, even after the franchise agreement ends. Specifically, the franchisee must maintain absolute confidentiality of all proprietary information both during and after the term of the franchise. This includes not using any of this information in any other business or in any way not explicitly authorized or approved in writing by Jersey Mikes. This obligation extends beyond the termination of the agreement.
Jersey Mikes considers a wide array of information as confidential. This includes knowledge about restaurant specifications, standards, and operating procedures. It also encompasses drawings, materials, equipment, techniques, restaurant systems, product formulas, recipes, methods, procedures, and other data. The franchisee can only share confidential information with employees who need it to operate the Jersey Mikes restaurant.
There are limited exceptions to this confidentiality requirement. Information is not considered confidential if the franchisee can prove it was already known to them before Jersey Mikes disclosed it, or if it has become part of the public domain through no fault of the franchisee. However, the franchisee bears the burden of demonstrating these exceptions. Furthermore, all employees with access to confidential information must sign confidentiality agreements with terms no less strict than those in the Franchise Agreement.
This stringent confidentiality requirement is typical in franchising, as the franchisor's proprietary information is a key asset. Jersey Mikes can seek legal remedies, including equitable relief, for any breaches of these confidentiality terms. This underscores the importance of franchisees understanding and adhering to these obligations to protect both themselves and the Jersey Mikes system.