FranchiseVerdict
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A53/100FDD 2025

Bake Cheese Tart — Litigation & Risk

Food & Beverage - Bakery · FDD Items 3, 4 & 5

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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
53 / 100
FranchiseVerdict composite
Rating
STRONG
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
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
California
State whose law governs disputes — relevant if you're not based there

What drove the 53/100 rating

Risk Score Breakdown

  1. 01MINOROnly 1 franchised unit reported — indicates minimal system growth and unproven franchise model scalability
  2. 02MEDNet income not disclosed in FDD Item 19 — impossible to assess actual profitability or validate $771k average revenue claim
  3. 03MEDHigh initial investment range ($205k-$440k) relative to disclosed average revenue with unknown profit margins creates ROI uncertainty
  4. 04MINOR5% royalty on gross revenues (not net) is favorable, but lacks transparency on actual franchisee take-home after CoGS and labor
  5. 05MINORSingle unit makes validation nearly impossible — cannot compare performance across multiple locations or market conditions

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.