B65/100FDD 2026
Abbey Road Institute — Litigation & Risk
Education - Tutoring & Test Prep · FDD Items 3, 4 & 5
Lower Risk
No litigation cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
65 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
2 yrs
Post-termination restriction on similar businesses
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
New York
State whose law governs disputes — relevant if you're not based there
What drove the 65/100 rating
Risk Score Breakdown
- 01MINORNo Item 19 financial performance disclosure — cannot validate revenue/profitability claims despite $517K-$2.46M investment requirement
- 02MINORUnprotected territory creates direct competition risk; franchisees can cannibalize each other's markets
- 03MEDOnly 7 units with 20% YoY growth is modest expansion for a 10-year-old brand; suggests limited scalability or market demand
- 04MINORHigh franchise fee ($250K) relative to unit count indicates dependency on new franchisee recruitment rather than system profitability
- 05MED8-12% royalty rate on undisclosed revenues creates unpredictable cash flow burden for franchisees
- 06HIGHNo 'Going Concern' status may indicate recent financial instability or restructuring at corporate level
Severity inferred from FDD text — not a regulatory or legal classification
Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice — consult a franchise attorney before signing any franchise agreement.