BAbove average51/100FDD 2026
Boulder Designs®: Litigation & Risk
Home Services · 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)
- None
- Franchisor or officer bankruptcy
- Verdict score
- 51 / 100
- FranchiseVerdict composite · higher is better
- Rating
- B
- A / B / C / D / F verdict grade
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
- Not waived
- 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
- TX
- State whose law governs disputes. Relevant if you're not based there
Extracted from FDD Item 3
Litigation Detail
4 cases: (1) Jablonowski v. Mogavero et al. (2018) - former franchisee suit; settled $120,000; (2) Boulder v. Town & Country Lawn Care (2020) - trade secret/breach; settled $20,000; (3) Boulder v. Sanford and Red Art (2021) - trade secret/breach; settled with termination fee; (4) Boulder/Border Magic v. Unlimited Concrete Designs (2022) - noncompete enforcement; dismissed April 2024
What drove the 51/100 verdict
Risk Score Breakdown
- 01MINORNo financial performance disclosure (Item 19) prevents ROI validation against $147k-$173k investment
- 02MINORDeceptive trade practices lawsuit by former franchisee signals potential misrepresentation in FDD or recruitment
- 03MINORThree franchisor lawsuits against franchisees indicate enforcement issues, trade secret disputes, and possible financial underperformance
- 04MINORSlow unit growth (6.5% YoY) with only 82 units suggests market saturation or franchisee dissatisfaction
- 05MINOREscalating minimum royalty fees ($750→$950→$1,500) combined with 7% gross revenue floor creates unpredictable cost structure
- 06HIGHGoing Concern marked FALSE is atypical for healthy franchise systems and may indicate franchisor financial instability
- 07MINORHigh franchise fee ($63,000) relative to system size and growth rate increases breakeven burden
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.