In the event of legal action regarding Spray Net's proprietary marks, what is the franchisee obligated to do?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
s an infringement of Franchisor's exclusive right to use the Proprietary Marks and, during the term of this Agreement and after the expiration or termination hereof, Franchisee covenants not to directly or indirectly commit an act of infringement, contest or aid in contesting the validity or ownership of Franchisor's Proprietary Marks, or take any other action in derogation thereof.
- L. Notification of Infringement. Franchisee shall notify Franchisor within three (3) calendar days of any suspected infringement of, or challenge to, the validity of the ownership of, or Franchisor's right to use, the Proprietary Marks licensed hereunder. Franchisee will not communicate with any persons other than Franchisor or Franchisor's legal counsel in connection with any such infringement, challenge, or claim. Franchisee acknowledges that Franchisor has the right to control any administrative proceeding or litigation involving the Proprietary Marks. In the event Franchisor undertakes the defense or prosecution of any litigation relating to the Proprietary Marks, Franchisee agrees to execute any and all documents and to do such acts and things as may be necessary in the opinion of counsel for Franchisor to carry out such defense or prosecution.
- M. Indemnification Regarding Marks. Franchisor will indemnify and defend Franchisee against any third-party claim brought against Franchisee that arises solely out of Franchisee's authorized use of the Proprietary Marks licensed under this Agreement in connection with the Franchised Business, provided: (i) such use is in full compliance with Franchisor's standards and specifications; and (ii) Franchisee notifies Franchisor in writing of this third-party claim within three (3) calendar days of receiving notice or otherwise learning of the claim. Franchisor will have complete control over the defense and, if appropriate, settlement negotiations and resolution regarding the claims described in this Section, including the right to select legal counsel Franchisor deems appropriate. Franchisee must fully cooperate with Franchisor in connection with Franchisor's defense or settlement of any third-party claim that Franchisor determines to take control of under this Section 7. Notwithstanding anything in this Section to the contrary, Franchisor's liability under this Section shall be limited to no more than the Initial Franchise Fee paid under this Agreement.
- N.
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, if there is a suspected infringement or challenge to the validity or ownership of Spray Net's proprietary marks, the franchisee must notify Spray Net within three calendar days. The franchisee is prohibited from communicating with anyone other than Spray Net or its legal counsel regarding the infringement, challenge, or claim. Spray Net retains the right to control any administrative proceeding or litigation involving its proprietary marks.
Spray Net franchisees must also agree to cooperate with and assist Spray Net in any legal action brought by or against either party concerning the protection and preservation of the proprietary marks, system, manuals, and other intellectual property. This cooperation includes executing documents and performing actions deemed necessary by Spray Net's counsel to carry out the defense or prosecution of such legal action.
Spray Net will indemnify and defend the franchisee against third-party claims arising solely from the franchisee's authorized use of the proprietary marks, provided that the use complies with Spray Net's standards and specifications, and the franchisee provides written notification of the claim within three calendar days of receiving notice. Spray Net has complete control over the defense and settlement negotiations, including the right to select legal counsel. However, Spray Net's liability is limited to no more than the initial franchise fee paid under the agreement.