Using the brand after termination: what the Lanham Act says
What two Lanham Act sections say about using a mark without consent, the injunction presumption in section 1116, and why former franchisees are warned about it.
Franchisors often send a termination notice that warns the former franchisee to stop using the brand. The warning rests on trademark law. An IFA-hosted article by two franchise lawyers says notices should warn of Lanham Act infringement if the franchisor's trademarks are used after termination. This page sets out what the statute says. Whether it applies to a given former franchisee is a question for a lawyer licensed in the state.
What sections 1114 and 1125(a) say
Section 32 of the Lanham Act (15 U.S.C. 1114) makes a person liable in a civil action by the registrant when, without consent, they use in commerce "any reproduction, counterfeit, copy, or colorable imitation of a registered mark" in connection with goods or services where the use is "likely to cause confusion."
Section 43(a) (15 U.S.C. 1125(a)) reaches use of a mark or false designation that is likely to cause confusion, or to deceive as to "the affiliation, connection, or association" of one person with another, and lets anyone likely to be damaged sue.
Neither statute mentions franchises. How courts apply them to former franchisees comes from court decisions, which this site has not summarized, so it makes no claim about outcomes.
Why injunctions come up
Section 1116 lets courts grant injunctions "according to the principles of equity" to prevent violations of a registered mark. A plaintiff gets a rebuttable presumption of irreparable harm on a finding of a violation (for a permanent injunction) or of likelihood of success on the merits (for a preliminary injunction). The IFA-hosted article calls remaining open after termination without the protection of an injunction the most dangerous outcome for the franchisee, which is the authors' characterization. The federal test for a preliminary injunction is covered in preliminary injunction and TRO in franchise disputes.
A contract clause on challenging the marks
Courts also look at the agreement. In the New York decision NGM Mgt. Group, LLC v. Bareburger Group, LLC (2024), the franchise agreements said franchisees "shall not contest the validity of or our interest in the Marks." The court enforced that clause against franchisees who had alleged the franchisor misrepresented its trademark ownership. That result turns on its facts and New York law.
What to look at in your own papers
Item 17 of the disclosure document has a row for the franchisee's obligations on termination or non-renewal, and your agreement spells them out. The FTC's consumer guide warns that if a franchise is terminated, the franchisee is "likely to lose" the entire investment, which is why the post-termination terms deserve a careful read. Your notice may also list what it asks you to stop using. See what a default notice states and post-termination non-compete.
Where this came from
- 15 U.S.C. 1114 (checked 28 October 2026).
- 15 U.S.C. 1125 (checked 28 October 2026).
- 15 U.S.C. 1116 (checked 28 October 2026).
- IFA site, "Handling Defaults and Terminations Effectively" (checked 28 October 2026).
- NGM Mgt. Group, LLC v. Bareburger Group, LLC, 2024 NY Slip Op 00979 (checked 28 October 2026).
- 16 CFR 436.5(q), Item 17 (checked 28 October 2026).