After the Pearce Bespoke franchise agreement expires, can the franchisee divulge confidential information?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
ned the Personal Guaranty attached hereto as Attachment B agree to use and permit the use of Franchisor's Confidential Information (as defined below) solely in connection with the operation of the Pearce Bespoke Franchise. Franchisee and Personal Guarantors further agree that they will never, during the initial term or any renewal term of this Agreement, or any time after this or any renewal Franchise Agreement expires or terminates, or Franchisee's rights under this Agreement or any renewal Franchise Agreement are assigned or terminated, divulge or use any of Franchisor's Confidential Information for the benefit of any third party (including any person, business entity or enterprise of any type or nature), nor will Franchisee or Personal Guarantors directly or indirectly aid such third party to imitate, duplicate or "reverse engineer" any of Franchisor's Confidential Information. "Confidential Information" means all information, knowledge, trade secrets, or know-how utilized by the Business System, or which otherwise concerns Franchisee's or Franchisor's systems of operation, programs, services, products, customers, practices, materials, books, records, manuals, computer files, databases, or software. Confidential Information includes (without limitation): all elements of the Business System and all products, services, equipment, technologies, policies, standards, requirements, criteria and procedures that now or in the future are part of the Business System; Franchisor's Operations Manual (including supplements to the Manual);
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, franchisees are prohibited from divulging confidential information even after the franchise agreement expires or terminates. The FDD specifies that franchisees and personal guarantors agree they will never divulge or use any of Pearce Bespoke's confidential information for the benefit of any third party at any time after the agreement expires or terminates. This restriction extends to aiding any third party in imitating, duplicating, or reverse engineering any of Pearce Bespoke's confidential information.
Confidential information is broadly defined to include all information, knowledge, trade secrets, or know-how utilized by the Business System, or which otherwise concerns the franchisee's or franchisor's systems of operation, programs, services, products, customers, practices, materials, books, records, manuals, computer files, databases, or software. This definition covers a wide array of business-related data and processes, ensuring that franchisees cannot use this information to compete with Pearce Bespoke or assist others in doing so.
The FDD does state that confidential information does not include information that the franchisee can demonstrate came to their attention before Pearce Bespoke disclosed it, or information that has become part of the public domain through publication or communication by others, provided that the franchisee or their personal guarantors did not cause the information to become public. This exception provides some leeway for information that was already known or has become publicly available through legitimate means.