Under the Kidokinetics franchise agreement, what happens if a franchisee uses the Intellectual Property without authorization?

According to the 2024 Kidokinetics Franchise Disclosure Document, any unauthorized use of the Intellectual Property by a franchisee constitutes an infringement of Kidokinetics' rights and is considered an event of default under the franchise agreement. This means Kidokinetics can take immediate action against the franchisee.

Kidokinetics also emphasizes the importance of protecting its Intellectual Property by stating that franchisees must not take any action that would prejudice or interfere with the validity of Kidokinetics' rights. Franchisees also acknowledge that all goodwill arising from their use of the Intellectual Property benefits Kidokinetics. This highlights the franchisor's control over its brand and the franchisee's limited rights to it.

Furthermore, the franchise agreement includes provisions to prevent unauthorized disclosure of Intellectual Property, even by family members. If a franchisee's immediate family member uses or discloses the Intellectual Property, the franchisee is presumed to have violated the agreement, although they can rebut this presumption with evidence. Kidokinetics also states that failure to comply with the agreement will cause substantial and irreparable damage to them and/or other Kidokinetics franchisees for which there is no adequate remedy at law. Therefore, any violation of this Agreement will entitle Kidokinetics to injunctive relief. This underscores the seriousness with which Kidokinetics views any breach of the agreement and its willingness to pursue legal remedies to protect its interests.