Is Spray Net required to post a bond to obtain injunctive relief against a franchisee?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
attempt to mediate a controversy, dispute, or claim through mediation as set forth in this Section 21(C) if such controversy, dispute, or claim concerns an allegation that a party has violated (or threatens to violate, or poses an imminent risk of violating): (i) any federally protected intellectual property rights in the Proprietary Marks, the System, or in any Confidential Information or other confidential information; (ii) any of the restrictive covenants contained in this Agreement; and (iii) any of Franchisee's payment obligations under this Agreement.
- D. Injunctive Relief. Franchisee acknowledges and agrees that irreparable harm could be caused to Franchisor by Franchisee's violation of certain provisions of this Agreement and, as such, in addition to any other relief available at law or equity, Franchisor shall be entitled to obtain in any court of competent jurisdiction, without bond, restraining orders or temporary or permanent injunctions in order to enforce, among other items, the provisions of this Agreement relating to: (i) Franchisee's use of the Proprietary Marks and Confidential Information (including any proprietary software used in connection with the Franchised Business); (ii) the in-term covenant not to compete, as well as any other violations of the restrictive covenants set forth in this Agreement; (iii) Franchisee's obligations on termination or expiration of this Agreement; (iv) disputes and controversies based on or arising under the Lanham Act, or otherwise involving the Proprietary Marks,
as now or hereafter amended; (v) disputes and controversies involving enforcement of the Franchisor's rights with respect to confidentiality under this Agreement;
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, whether Spray Net is required to post a bond to obtain injunctive relief against a franchisee depends on the jurisdiction and the specific circumstances. Specifically, the standard franchise agreement states that Spray Net is entitled to seek restraining orders or temporary or permanent injunctions without bond. However, the Minnesota addendum clarifies that a court will determine if a bond is required.
For franchisees operating outside of Minnesota, Spray Net states that it can seek injunctive relief without being required to post a bond. This means a franchisee could be subject to a court order without Spray Net having to provide financial assurance to cover potential damages if the injunction is later found to be wrongfully issued. This could create a significant financial risk for the franchisee.
However, for franchisees in Minnesota, the decision to require a bond rests with the court. This provides an additional layer of protection for Minnesota franchisees, as the court will assess the necessity of a bond on a case-by-case basis. This difference highlights the importance of understanding the specific addenda applicable to your state when evaluating the franchise agreement.