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B65/100FDD 2025

Butterfly Home Care — Litigation & Risk

Home Services - Other · 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
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
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
Virginia
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MEDOnly 1 franchised unit disclosed with unknown growth trajectory — suggests early-stage system with unproven scalability
  2. 02HIGHGoing Concern status is FALSE — indicates potential financial instability or uncertainty at franchisor level
  3. 03MINORItem 19 (financial performance representations) appears absent — no validated earnings claims to support $1.97M net income average
  4. 04MINORHigh franchise fee ($58,000) relative to single operating unit — raises questions about franchisor's revenue model sustainability
  5. 05MINORWide investment range ($108,150–$204,100) with only 1 unit suggests poor data standardization and operational inconsistency
  6. 06MINOR6% royalty on Net Billings (not Gross Revenue) — favorable to franchisee but may indicate franchisor cash flow vulnerability

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.