Does Learningrx reserve the right to sell dissimilar services to those which a Learningrx franchisee will sell?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
As noted above, and as specified in the Franchise Agreement, we will not establish, franchise or license others to establish a LearningRx Center in the Territory during the term of the Franchise Agreement so long as you are in compliance with the Franchise Agreement. However, and despite those promises and obligations, we and our affiliates retain all rights with respect to LearningRx Centers, the System, the
Marks, the sale of similar or dissimilar services, and any other activities we deem appropriate whenever and wherever we desire, including:
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- to own, franchise, license or operate LearningRx Centers or remote training services at any location outside of the Territory, regardless of the proximity to your LearningRx Center.
We will not establish within your Territory another franchisee or company-owned outlet which may also use the Marks;
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- to use the Marks and the System to sell any products or services, similar to those which you will sell, except products provided "trainer to student," through any alternate channels of distribution within or outside of the Territory.
This includes, but is not limited to, retail locations and other channels of distribution such as stores, shops, kiosks, malls, airports, and college campuses, at special events, and other channels of distribution such as, television, mail order, catalog sales, wholesale to unrelated retail outlets, or over the Internet.
We exclusively reserve alternative channels of distribution such as the Internet, catalog sales, telemarketing or other direct marketing, as channels of distribution for us.
You may not independently use alternative channels of distribution to make sales within or outside your Territory;
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- to use and license the use of other proprietary and non-proprietary marks or methods which are not the same as or confusingly similar to the Marks, whether in alternative channels of distribution or in the operation of a business offering educational services, at any location, including within the Territory, which may be similar to or different from the business operated by you;
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- to purchase or be purchased by, or merge or combine with, any business, including a business that competes directly with the LearningRx Center you operate, wherever located;
Source: Item 12 — TERRITORY (FDD pages 33–35)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, Learningrx retains significant rights regarding the sale of services, both similar and dissimilar, to those offered by its franchisees. Specifically, Learningrx reserves the right to sell similar services through alternate channels of distribution, such as retail locations, stores, shops, kiosks, malls, airports, special events, television, mail order, catalog sales, wholesale to unrelated retail outlets, or over the Internet, both within and outside the franchisee's territory.
Learningrx also retains the right to use and license other proprietary and non-proprietary marks or methods, even those that are not similar to the franchisee's marks, to offer educational services at any location, including within the franchisee's territory. This means that Learningrx could potentially introduce new services or brands that compete with the franchisee's Learningrx center, even within the territory granted to the franchisee.
Furthermore, Learningrx reserves the right to purchase or merge with any business, including those that directly compete with a franchisee's Learningrx center, regardless of location. They can also acquire and convert other businesses offering educational services to the Learningrx system, even if those businesses are competitors or independently operated. These rights allow Learningrx considerable flexibility in its business operations and future strategies, which could impact a franchisee's market and competitive landscape.
These stipulations highlight the importance of a prospective franchisee understanding the scope of the territory granted and the potential for Learningrx to engage in activities that could affect the franchisee's business. It is crucial to recognize that the territory is not entirely exclusive and that Learningrx retains broad rights to operate and expand its services through various channels, even within the franchisee's territory.