What evidence can a Kidokinetics franchisee furnish to rebut the presumption that they disclosed intellectual property to a family member?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
with you any documents or data or copies containing or pertaining to any Intellectual Property.
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- Immediate Family Members. You acknowledge you could circumvent the purpose of this Agreement by disclosing Intellectual Property to an immediate family member (i.e., spouse, parent, sibling, child, or grandchild). You also acknowledge that it would be difficult for us to prove whether you disclosed the Intellectual Property to family members. Therefore, you agree you will be presumed to have violated the terms of this Agreement if any member of your immediate family uses or discloses the Intellectual Property. However, you may rebut this presumption by furnishing evidence conclusively showing you did not disclose the Intellectual Property to the family member.
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- Covenants Reasonable. You acknowledge and agree that: (i) the terms of this Agreement are reasonable both in time and in scope of geographic area; and (ii) you have sufficient resources and business experience and opportunities to earn an adequate living while complying with the terms of this Agreement. YOU HEREBY WAIVE ANY RIGHT TO CHALLENGE THE TERMS OF THIS AGREEMENT AS BEING OVERLY BROAD, UNREASONABLE, OR OTHERWISE UNENFORCEABLE.
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- Breach. You agree that failure to comply with this Agreement will cause substantial and irreparable damage to us and/or other Kidokinetics franchisees for which there is no adequate remedy at law. Therefore, you agree that any violation of this Agreement will entitle us to injunctive relief.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, a franchisee acknowledges that they could circumvent the agreement by disclosing Intellectual Property or Know-how to an immediate family member, which includes a spouse, parent, sibling, child, or grandchild. Kidokinetics also recognizes that proving such a disclosure to family members would be difficult. Therefore, if any member of the franchisee's immediate family uses or discloses the Intellectual Property or engages in prohibited activities, the franchisee will be presumed to have violated the terms of the agreement.
However, the franchisee has the opportunity to challenge this presumption. To do so, they must furnish evidence that conclusively demonstrates they did not disclose the Intellectual Property or Know-how to the family member in question. The FDD does not specify what form this evidence should take, but it must be strong enough to conclusively prove that no disclosure occurred.
This clause places a significant responsibility on Kidokinetics franchisees to safeguard the brand's Intellectual Property and Know-how, even within their own families. It also highlights the importance of maintaining detailed records and implementing strict confidentiality measures to protect against potential breaches and to provide a basis for rebutting any presumption of disclosure. A prospective franchisee should seek clarification from Kidokinetics regarding what constitutes acceptable evidence to rebut the presumption of disclosure to a family member.