What constitutes a breach of The Standardx franchise agreement regarding the use of Proprietary Marks, Copyrighted Materials, or Confidential Information?
The_Standardx Franchise · 2025 FDDAnswer from 2025 FDD Document
f the Proprietary Marks, Copyrighted Materials, and Confidential Information and any goodwill established by that use are exclusively for Hyatt's and its Affiliate's benefit, and this Agreement does not confer any goodwill or other interests in the Proprietary Marks, Copyrighted Materials or Confidential Information upon Franchisee, other than the right to develop and operate the Hotel under this Agreement. Franchisee may not at any time during or after the Term contest or assist any other person or entity in contesting the validity, or Hyatt's and its Affiliate's ownership, of any of the Proprietary Marks, Copyrighted Materials, or Confidential Information.
- 11.2 Limitations on Franchisee's Use of Proprietary Marks. Franchisee shall use the Proprietary Marks, along with a Market Descriptor designated or approved by Hyatt, as the sole identification of the Hotel. The Market Descriptor is not a Proprietary Mark. Hyatt makes no representation concerning Franchisee's right to use any Market Descriptor requested by Franchisee and approved by Hyatt. Hyatt has the right to require Franchisee to change, or discontinue use of any previously-approved, Market Descriptor and to substitute an alternative Market Descriptor in its place as Hyatt deems necessary or advisable, and Franchisee agrees to promptly adhere to Hyatt's instructions in connection therewith. Franchisee (or the Management Company) must identify itself as the Hotel's independent owner (or operator) in the manner that Hyatt periodically
specifies. Franchisee may not use any Proprietary Mark (a) as part of any corporate or legal business name; (b) with any prefix, suffix, or other modifying words, terms, designs, or symbols (other than logos Hyatt licenses to Franchisee); (c) in providing or selling any unauthorized services or products; (d) as part of any domain name, homepage, meta tags, keyword, electronic address, or otherwise in connection with a website (unless Hyatt has approved such use in advance); or (e) in any other manner Hyatt has not expressly authorized in writing. Franchisee (and, if applicable, any restaurant operators at the Hotel) may use the Proprietary Marks in connection with any Hotel restaurant operations only with Hyatt's prior written consent and in compliance with all System Standards relating thereto. If Hyatt discovers Franchisee's unauthorized use of the Proprietary Marks, in addition to Hyatt's other rights and remedies under this Agreement and applicable law, Hyatt may require Franchisee to destroy (with no reimbursement from Hyatt) all offending items reflecting such unauthorized use.
Franchisee may not use any Proprietary Mark in advertising the transfer, sale, or other disposition of the Hotel or an ownership interest in Franchisee or any of its Owners without Hyatt's prior written consent, which Hyatt will not unreasonably withhold. Franchisee agrees to display the Proprietary Marks as Hyatt periodically prescribes at the Hotel and on advertising and other materials Hyatt periodically designates. Franchisee agrees to give the notices of trade and service mark registrations that Hyatt periodically specifies and to obtain any fictitious or assumed name registrations required under applicable law.
11.3 Notification of Infringements and Claims. Franchisee agrees to notify Hyatt immediately of any apparent infringement or challenge to Franchisee's use of any Proprietary Mark, Copyrighted Materials, or Confidential Information, or of any person's claim of any rights in any Proprietary Mark, Copyrighted Materials, or Confidential Information, and not to communicate with any person other than Hyatt, its Affiliates, and its and their attorneys, and Franchisee's attorneys, regarding any infringement, challenge, or claim. Hyatt and its Affiliates may take the action it and they deem appropriate (including no action) and control exclusively any Proceeding arising from any infringement, challenge, or claim or otherwise concerning any Proprietary Mark, Copyrighted Materials, or Confidential Information.
Source: Item 18 — OTHER INCOME (LOSS), NET (FDD pages 187–399)
What This Means (2025 FDD)
According to The Standardx's 2025 Franchise Disclosure Document, a franchisee's unauthorized use of the Proprietary Marks, Copyrighted Materials, or Confidential Information is a breach of the franchise agreement. The agreement specifies that the franchisee's right to use these items is solely derived from the franchise agreement itself and is limited to developing and operating the hotel according to the agreement and all System Standards.
Specifically, the franchisee cannot use any Proprietary Mark as part of any corporate or legal business name, with unauthorized prefixes, suffixes, modifying terms, designs, or symbols (other than licensed logos), in providing or selling unauthorized services or products, as part of any unauthorized domain name, homepage, meta tags, keyword, electronic address, or otherwise in connection with a website, or in any other manner not expressly authorized in writing by The Standardx. If The Standardx discovers unauthorized use, it can require the franchisee to destroy all offending items without reimbursement.
Furthermore, the franchisee (or any of its Owners) is prohibited from knowingly making any unauthorized use or disclosure of any part of the System Standards or any other Confidential Information. The franchisee also cannot contest The Standardx's ownership of the Hotel System or the validity of any Proprietary Mark, Copyrighted Materials, or Confidential Information, or attempt to register any Proprietary Mark or a derivative thereof. These restrictions apply both during and after the term of the franchise agreement, ensuring the protection of The Standardx's intellectual property and confidential business information.