After termination of a Franchisee Affiliate's association with a Learningrx franchisee, is the Franchisee Affiliate prohibited from competing on the Internet or on any other Multi-Area Marketing channels used by Franchisor?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
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- This Covenant Not to Compete shall apply:
- a. during the term of Franchisee Affiliate's relationship, association with or employment by Franchisee anywhere within the United States; and,
- b. for the two years following the termination of Franchisee Affiliate's association with or employment by Franchisee:
- i. within Franchisee's Territory or any area serviced by Franchisee;
- ii. within counties adjacent to Franchisee's Territory or within a Territory then operated by or under development by Franchisor or another franchisee of Franchisor;
- iii. within a fifty mile radius from the boundary of Franchisees Territory or from any other franchised or company-owned LearningRx Training Center, or
- iv. on the Internet or on any other Multi-Area Marketing channels used by Franchisor.
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, a Franchisee Affiliate is restricted from competing on the Internet or through other multi-area marketing channels used by Learningrx for a period of two years after the termination of their association with a Learningrx franchisee. This restriction applies within the franchisee's territory, in adjacent counties, within a 50-mile radius of any Learningrx Training Center, and online. This non-compete provision aims to protect Learningrx's market presence and brand reputation.
This means that if a person is associated with a Learningrx franchisee (as an owner, manager, employee, etc.) and that association ends, that person cannot engage in a competitive business online or through other broad marketing channels utilized by Learningrx. A competitive business is defined as one that offers learning enhancement, brain training, or cognitive training courses, programs, or products. This restriction is in place to prevent former affiliates from leveraging their knowledge of Learningrx's system to unfairly compete with existing franchisees or with Learningrx itself.
The non-compete agreement ensures that Franchisee Affiliates cannot exploit confidential information or relationships gained during their association with Learningrx to start a competing business that could draw customers away from the Learningrx system. This protection extends to Learningrx's online marketing strategies, preventing former affiliates from using similar methods to compete. The restrictions are designed to protect the brand's market position and the investments made by other franchisees in the Learningrx system.
Prospective franchisees should carefully consider the implications of these non-compete clauses, especially concerning their affiliates. It is important to understand the scope and duration of these restrictions and how they might affect future business opportunities for both the franchisee and anyone associated with their Learningrx business. Franchisees should discuss these terms with any potential affiliates to ensure everyone understands their obligations and limitations under the franchise agreement.