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B65/100FDD 2025

Brain Tune Café — Litigation & Risk

Food & Beverage - Coffee & Tea · 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
65 / 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
Wyoming
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern warning indicates the franchisor may have financial viability issues despite not disclosing litigation
  2. 02MEDOnly 7 units system-wide suggests minimal scale, limited support infrastructure, and unknown/stagnant growth trajectory
  3. 03MINORAverage net income of $63,792.92 on $231,546 revenue (27.5% net margin) is exceptionally high and potentially unrealistic—warrants verification of accounting methodology
  4. 04MEDNo Item 19 financial performance representations disclosed—franchisor unwilling to substantiate the claimed averages
  5. 05MINORHigh initial investment ($213,300–$291,400) relative to system size creates risk if franchisor lacks operational stability
  6. 06MED5% royalty on gross revenue (not net) compounds risk if unit-level profitability declines

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.