Does 'Confidential Information' for Southern Steer include trade secrets?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) "Confidential Information" means and includes all of the business, technology, marketing, operational and proprietary information developed, created, owned or licensed by the Franchisor including, but not limited to, the following: (a) all plans and specifications relating to the construction of any Southern Steer Business, drawings and renderings, FF&E specifications and pricing, the names of all Approved Suppliers and Designated Suppliers, pricing information for any Foods, Beverages and Products sold to any Southern Steer Business, unpublished menus and menu designs, and all food recipes and cooking techniques, (b) all business information, financial data and information, practices, procedures, processes, "know how" and business and operational systems of the Franchisor, (c) all marketing strategies, programs, and concepts, training programs, Brand Manual and materials, and operational and business development concepts, including but not limited to all store design, schematics, construction documents, and artwork, (d) all exclusive sales and marketing processes taught to the Franchisee's personnel during any training programs, (e) all training programs and materials, (f) all Trade Secrets, intellectual property, proprietary databases, computer processes, computer systems, computer software programs and all source codes for all computer software programs (excluding commercially available off-the-shelf third-party software programs), (g) all copyrighted materials that have not been publicly disclosed by the Franchisor which are marked as "confidential," (h) all patents of the Franchisor, including pending patents, (i) all password-protected websites designed, created and developed by the Franchisor, including all passwords, text, content, color schemes, images, graphics, information, look and feel, layout, methodology, metrics, graphical interfaces and functionality, and (j) all other written materials disclosed to the Franchisee which have been designated as "confidential" by the Franchisor.
Source: Item 5 — and 7 of the FDD, Section 3.1 of the Franchise Agreement and Section 4.1 of the Multi-Unit Development Agreement are hereby amended to state that payment of the initial franchise fee and development fee will be deferred until We have satisfied Our pre-opening obligations, and You have commenced business operations. (FDD pages 168–290)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, the definition of "Confidential Information" explicitly includes trade secrets. This means that franchisees and their employees will have access to sensitive information considered proprietary to Southern Steer. This information is not limited to, plans, specifications, drawings, pricing, recipes, techniques, business information, financial data, marketing strategies, training programs, databases, computer software, copyrighted materials, patents, and password-protected websites.
Southern Steer emphasizes the importance of protecting this information, as unauthorized disclosure or use of confidential information and trade secrets would cause irreparable harm to the company. Franchisees are responsible for ensuring that anyone with access to this information, including employees, maintains its confidentiality during and after their association with the franchise. This obligation extends beyond the initial and any subsequent terms of the Franchise Agreement.
The FDD also defines "Trade Secrets" as information, including systems, patterns, compilations, programs, methods, techniques, or processes, that derive independent economic value from not being generally known and are subject to reasonable efforts to maintain secrecy. This definition aligns with standard legal definitions of trade secrets and highlights the franchisor's commitment to protecting its competitive advantage. Franchisees must understand that they are entrusted with safeguarding these trade secrets, and any breach of confidentiality could have significant legal and financial consequences.
Given the broad scope of "Confidential Information" and the specific inclusion of trade secrets, prospective Southern Steer franchisees should carefully review the non-disclosure and non-compete clauses in the Franchise Agreement. Understanding these obligations is crucial for avoiding potential disputes with the franchisor and ensuring compliance with the terms of the franchise agreement. Franchisees should also implement appropriate measures to protect confidential information within their own operations, such as employee training and data security protocols.