F78/100FDD 2026
Border Magic — Litigation & Risk
Home Services - Lawn & Landscaping · FDD Items 3, 4 & 5
Moderate — Review
4 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
4
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
78 / 100
FranchiseVerdict composite
Rating
AVOID
STRONG / MODERATE / CAUTION / AVOID
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.
Total 7(a) loans
10
Government-backed loans issued
Default rate
33.3%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$1.4M
Avg loan size
$141K
Participating lenders
8
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Not required
You retain the right to sue in court
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
3 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 78/100 rating
Risk Score Breakdown
- 01MEDUnit count declined 18.8% YoY (26 units) indicating systemic franchisee challenges or franchisor support failures
- 02MEDNo Item 19 financial performance data disclosed—inability to validate investment ROI claims or average unit economics
- 03HIGHMultiple litigation cases alleging fraud, deceptive practices, breach of fiduciary duty, and improper royalty retention suggest franchisor credibility issues
- 04MINORMinimum royalty structure ($750→$950→$1,500/month) creates $9,000–$18,000 annual fixed costs regardless of revenue generation
- 05HIGHGoing concern status indicates financial instability at franchisor level, raising questions about support, marketing, and long-term viability
- 06HIGHSignificant settlements ($6,624–$60,000) paid in litigation suggest pattern of disputes over contractual obligations and transparency
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.