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B55/100FDD 2024
Accurate Leak and Line — Litigation & Risk
Home Services - Plumbing & HVAC · 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
55 / 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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 55/100 rating
Risk Score Breakdown
- 01MINORNo net income disclosure (Item 19) prevents accurate ROI calculation and raises transparency concerns
- 02MEDOnly 8 units system-wide indicates extremely limited scale and unproven franchise model replicability
- 03MINORHigh initial investment ($133,700-$285,150) relative to micro-franchise size creates disproportionate risk
- 04MEDUnknown unit growth trajectory suggests stagnation or undisclosed closures in small franchise system
- 05MINORTiered royalty minimums ($0-$2,000/month) indicate inconsistent early-stage unit performance
- 06MINOR10-year term lock with protected territory may limit exit flexibility if underperforming
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.