FDD Items 3 & 4 · 2026 filing

Ace Sushi litigation history

What Ace Sushi disclosed about lawsuits, arbitrations and bankruptcy in the 2026 Franchise Disclosure Document. Item 3 lists the material legal actions a franchisor must report; Item 4 covers bankruptcy. This is the franchisor's own disclosure, not a court record, and not legal advice.

Items 3 (litigation) & 4 (bankruptcy) at a glance

What the filing discloses

Cases disclosed: 5; Item 3, as counted in the filing

Largest settlement, franchisor's own cases: None stated

Bankruptcy (Item 4): None; Franchisor, parent, predecessor or officer

Filing year: 2026; Disclosures cover the prior ten years

Extracted from the 2026 Franchise Disclosure Document

Item 3: litigation

Item 3 discloses 5 actions: (1) Maryland Securities Division determination/consent order that AMG's Contracts for Services were unregistered franchises (2004-2005); (2) Rhode Island determination of franchise-law violation, $5,000 fine (2005); (3) Virginia State Corporation Commission action, $1,500 investigation costs + $15,600 penalty (2005-2006); (4) Washington DFI Securities Division consent order, $600 reimbursement (2006); and (5) Ngung Sang v. Ace Sushi Franchise Corp. (Iowa small claims, 2021), a former franchisee breach/fraud claim settled for $5,375 in 2022. The first four are regulatory/administrative orders against AMG (and Ace) relating to pre-franchise Contracts for Services; the fifth is a private franchisee small-claims action. "Other than these 5 actions, no litigation is required to be disclosed."

Item 3 (litigation) · 5 matters disclosed

Litigation cases

The franchisor

Concluded (4)

Ngung Sang v. Ace Sushi Franchise Corporation
concluded
Brought by a franchisee · filed 2021-12-03 · Polk County Iowa District Court - Small Claims Division · 675919
“… Polk County Iowa District Court – Small Claims Division, Case No. 675919.”Page 14 of the 2026 FDD, Item 3
Outcome: “On March 11, 2022, the parties participated in a mediation and entered into a Stipulated Agreement and Order for Continuance, pursuant to which we made a $5,375.00 payment to plaintiff and the case was dismissed.”
Commonwealth of Virginia, Ex Rel. State Corporation Commission v. ACE Sushi Franchise Corporation and Asiana Management Group, Inc., Defendants
concluded
Government or regulatory action · Virginia State Corporation Commission, Division of Securities and Retail Franchising · SEC-2006-00001
“State of Virginia. Commonwealth of Virginia, Ex Rel. State Corporation Commission v. ACE Sushi Franchise Corporation and Asiana Management Group, Inc., Defendants. (Case No. SEC-2006-00001).”Page 13 of the 2026 FDD, Item 3
Outcome: “We agreed to cease and desist from the offer and sale of franchises in violation of the Virginia Act, to offer all Virginia Licensees the right to rescind their Contracts for Services and paid investigation costs of $1,500 and a penalty of $15,600 for these violations.”
In the Matter of Determining Whether there has been a Violation of the Franchise Investment Protection Act Washington by: ACE Sushi Franchise Corporation, Asiana Management Group, Inc., their Agents and Employees, Respondents
concluded
Government or regulatory action · Washington Department of Financial Institutions, Securities Division · S-05-256-05-CO01
“State of Washington. In the Matter of Determining Whether there has been a Violation of the Franchise Investment Protection Act Washington by: ACE Sushi Franchise Corporation, Asiana Management Group, Inc., their Agents and Employees, Respondents. (Order Number S-05-256-05-CO01).”Page 13 of the 2026 FDD, Item 3
Outcome: “Ace and AMG agreed in the Consent Order to cease and desist from the offer and sale of franchises in violation of the Washington Act, to comply with the registration and Disclosure Document provisions of the Washington Act in the future and to reimburse the Securities Division $600 for its cost of investigation of the matter.” (page 14)
State of Rhode Island and Providence Plantations, Department of Business Regulation, Division of Securities
concluded
Rhode Island Department of Business Regulation, Division of Securities · 05-341
“State of Rhode Island Determination. State of Rhode Island and Providence Plantations, Department of Business Regulation, Division of Securities. (Order No. 05-341).”Page 13 of the 2026 FDD, Item 3
Outcome: “We agreed to cease and desist from the offer and sale of franchises in violation of the Rhode Island Act, to offer all Rhode Island Licensees the right to rescind their Contracts for Services and paid a fine of $5,000 for these violations.”

Parent, affiliates, master franchisor and subfranchisor

Concluded (1)

In The Matter of: Asiana Management Group, Inc. D.B.A. ACE Sushi, Respondent
concluded
Asiana Management Group, Inc. (AMG) · Maryland Securities Division; Office of the Attorney General of Maryland · 2004-0456 / 2005 WL 5159717 (Md.Sec.Div.)
“State of Maryland Determination. In The Matter of: Asiana Management Group, Inc. D.B.A. ACE Sushi, Respondent. (Case No. 2004-0456.2005 WL 5159717 (Md.Sec.Div.))”Page 13 of the 2026 FDD, Item 3
Outcome: “On February 10, 2005, AMG entered into a Consent Order with the Office of the Attorney General of Maryland and agreed to cease and desist from the offer and sale of franchises in violation of the Maryland Franchise Law,”

Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.

Disclosure signals that moved the score

How this shows up in the verdict

4 state regulatory orders (MD, RI, VA, WA) for franchise registration/disclosure violations suggest systemic compliance failures and potential fraud risk
1 franchise closure with small claims litigation suggests unit failure and potential payment disputes with franchisor

The verdict grade is FranchiseVerdict's editorial assessment across SBA loan performance, unit growth, revenue and disclosure signals. It is not investment advice.

Before you weigh a lawsuit

How to read Item 3

A franchisor must disclose pending actions and any material civil action involving the franchise relationship, plus convictions or civil judgments for fraud, unfair or deceptive practices, or franchise-law violations, going back ten years. A case the franchisor brought against a franchisee counts too. Item 3 does not include every dispute: settled claims below the materiality line and matters resolved in private arbitration can be absent.

Questions worth asking current and former franchisees, using the contact list in Item 20:

Were you, or anyone you know in the system, party to a dispute with the franchisor?
Was it resolved by settlement, arbitration or a court, and on what terms?
Has the number of disputes gone up or down since you signed?

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