What are the mutual obligations to protect a Kidokinetics franchisee's rights to use the copyrights?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
the Intellectual Property.
- 13.2 No Interference. Neither Franchisee nor any Principal will take any action that would prejudice or interfere with the validity of Franchisor's or Licensor's rights with respect to the Intellectual Property. Nothing in this Agreement gives the Franchisee any right, title, or interest in or to any of the Intellectual Property or any of Franchisor's or Licensor's service marks, trademarks, trade names, trade dress, logos, copyrights or proprietary materials, except the right to use the Intellectual Property and the System in accordance with the terms and conditions of this Agreement for the operation of a Kidokinetics Business and only at or from the Kidokinetics Business Location or in approved advertising related to the Kidokinetics Business.
- 13.3 Goodwill. Franchisee understands and agrees that any and all goodwill arising from Franchisee's use of the Intellectual Property and the System inures solely and exclusively to the benefit of Franchisor and Licensor, and upon expiration or termination of this Agreement and the license granted, no monetary amount will be assigned as attributable to any goodwill associated with Franchisee's use of the Intellectual Property.
- 13.4 Validity. The Marks are valid and serve to identify the System and those who are authorized to operate under the System and Franchisee shall not contest the validity of, or Franchisor's or Licensor's interest in, the Intellectual Property or assist others to contest the validity of, or Franchisor's or Licensor's interest in, the Intellectual Property.
- 13.5 Infringement. Franchisee acknowledges that any unauthorized use of the Intellectual Property constitutes an infringement of Franchisor's or Licensor's rights in the Intellectual Property and an event of default hereunder. Franchisee shall provide Franchisor or Licensor with all assignments, affidavits, documents, information and assistance Franchisor or Licensor reasonably requests to fully vest in Franchisor or Licensor all such rights, title and interest in and to the Intellectual Property, including all such items as are reasonably requested by Franchisor or Licensor to register, maintain and enforce such rights in the Intellectual Property.
- 13.6 Substitution. Franchisor reserves the right to substitute different Marks for use in identifying the System and the Kidokinetics Business if the current Marks no longer can be used by Franchisor, or if Franchisor, in its sole discretion, determines that substitution of different Marks will be beneficial to the System. In such event, Franchisor will require Franchisee, at Franchisee's expense, to discontinue or modify Franchisee's use of any of the Marks or to use one or more additional or substitute Marks no later than 10 days after notification thereof.
- 13.7 Franchisee's Use of the Intellectual Property. With respect to Franchisee's use of the Intellectual Property pursuant to this Agreement, Franchisee further agrees that:
- 13.7.1 Unless otherwise authorized or required by Franchisor, Franchisee shall advertise the Kidokinetics Business only under the Mark "Kidokinetics ®," and design. Franchisee must use only the Marks that Franchisor designates, and must use them only in the manner Franchisor authorizes and permits. Franchisee must use the Marks only for the operation of the Kidokinetics Business at the location approved by Franchisor and for advertising the Kidokinetics Business. Franchisee shall not use the Marks as part of its corporate or other legal name, and shall obtain the Franchisor's approval of its corporate or other legal name prior to filing it with the applicable
state authority. Franchisee shall comply with Franchisor's instructions in filing and maintaining the requisite trade name or fictitious name registrations, and shall execute any documents deemed necessary by Franchisor or its counsel to obtain protection of the Marks or to maintain their continued validity and enforceability. All fictitious names used by Franchisee will bear the designation "a franchisee of Kidokinetics Franchisee LLC". Franchisee must promptly register at the office of each county in which Franchisee's Kidokinetics Business operates, or at such other public office as provided for by the laws of the state in which Franchisee's Kidokinetics Business is located, as doing business under such assumed business name.
- 13.7.2 Franchisee shall identify itself as the owner of the Kidokinetics Business and as an independent Kidokinetics Franchise LLC franchisee in conjunction with any use of the Intellectual Property, including, but not limited to, uses on invoices, order forms, receipts and contracts, as well as the display of a notice in such content and form and at conspicuous locations or on any vehicle as Franchisor may designate in writing.
- 13.7.3 Franchisee shall not use the Intellectual Property to incur any obligation or indebtedness on behalf of Franchisor.
- 13.7.4 Any merchandise offered by Franchisee that utilizes the Marks, must be approved by Franchisor in writing prior to being sold by Franchisee and such approval may be granted or denied in Franchisor's sole and absolute discretion.
- 13.7.5 The license of the Marks granted to Franchisee hereunder is nonexclusive and Franchisor retains the right, among others, (i) to use the Marks itself in connection with selling products and services; (ii) to grant other licenses for the Marks; and (iii) to develop and establish other systems using the Marks, similar proprietary marks, or any other proprietary marks, and to grant licenses thereto without providing any rights therein to Franchisee.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 38–39)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, both the franchisee and franchisor have obligations regarding the protection of intellectual property. Kidokinetics retains ownership of all intellectual property, including trademarks, service marks, trade names, trade dress, logos, copyrights and proprietary materials. The franchisee is granted the right to use these assets only under the terms of the franchise agreement for operating a Kidokinetics business at the approved location.
The franchisee must not take any actions that could harm Kidokinetics's intellectual property rights. They are required to acknowledge the validity of Kidokinetics's intellectual property and cannot contest the franchisor's interest in it. The franchisee must also assist Kidokinetics in protecting its intellectual property by providing necessary documents and information to register, maintain, and enforce these rights. Unauthorized use of Kidokinetics's intellectual property by the franchisee constitutes a breach of the agreement.
Kidokinetics maintains control over its website, including the content and design. While Kidokinetics will provide the franchisee with a dedicated page on the website, the franchisee has no ownership rights to it and must adhere to Kidokinetics's guidelines for its content. The franchisee is also prohibited from registering any internet domain names that are similar to Kidokinetics's brand names. The franchisee is obligated to identify themselves as an independent Kidokinetics franchisee in conjunction with any use of the intellectual property.
The franchisee is required to indemnify Kidokinetics against any claims arising from the franchisee's use of the marks and confidential information, including claims of infringement of intellectual property rights owned by third parties. This means the franchisee is responsible for covering Kidokinetics's losses, including legal fees, if they misuse the intellectual property and cause harm to Kidokinetics or other parties.