FDD Items 3 & 4 · 2025 filing
Canteen litigation history
What Canteen disclosed about lawsuits, arbitrations and bankruptcy in the 2025 Franchise Disclosure Document. Item 3 lists the material legal actions a franchisor must report; Item 4 covers bankruptcy. This is the franchisor's own disclosure, not a court record, and not legal advice.
Items 3 (litigation) & 4 (bankruptcy) at a glance
What the filing discloses
- Cases disclosed
- 4
- Item 3, as counted in the filing
- Largest settlement, franchisor's own cases
- $6.9M
- As stated in Item 3
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2025
- Disclosures cover the prior ten years
Extracted from the 2025 Franchise Disclosure Document
Item 3: litigation
Three pending class action lawsuits alleging credit card surcharges without sufficient notice at vending machines (Jilek settled $6.94M pending final approval; Pemberton settled $5,000; Whitaker settled $5,000). One prior settled BIPA biometric case (Bryant, $6.8M total, Canteen share $1.22M).
Item 3 (litigation) · 4 matters disclosed · 3 pending listed
Litigation cases
The franchisor
Pending (3)
Jason Pemberton v. Compass Group USA, Inc. d/b/a Canteen
pendingBrought by a third party · filed 2022-10-20 · Circuit Court of the Third Judicial Circuit in Madison County, Illinois · 22-L-2022LA001328
“… filed in the Circuit Court of the Third Judicial Circuit in Madison County, Illinois (Case No. 22-L-2022LA001328) on October 20, 2022.”Page 13 of the 2025 FDD, Item 3
Joseph Whitaker v. Compass Group USA, Inc. d/b/a Canteen
pendingBrought by a third party · filed 2022-12-16 · Superior Court in Davidson County, North Carolina · 22-CVS-2576
“… filed in Superior Court in Davidson County, North Carolina (Case No. 22-CVS-2576) on December 16, 2022.”Page 13 of the 2025 FDD, Item 3
James Jilek, et al., v. Compass Group USA, Inc. d/b/a Canteen
pendingBrought by a third party · filed 2018-10-23 · United States District Court for the Western District of North Carolina Charlotte Division · 3:23-CV-818-RJC-DCK
“… United States District Court for the Western District of North Carolina Charlotte Division (Case No. 3:23-CV-818-RJC-DCK).”Page 13 of the 2025 FDD, Item 3
Outcome: “In April 2025, the parties entered into a settlement agreement wherein Canteen did not admit to any wrongdoing, fault, or liability, but agreed to a settlement of $6,940,000.00.”
Concluded (1)
Christine Bryant v. Compass Group USA, Inc. & 365 Retail Markets LLC
settledBrought by a third party · filed 2019-08-23 · United States District Court for the Northern District of Illinois · 1:19-cv-06622
“… United States District Court for the Northern District of Illinois (Case No. 1:19-cv-06622) (filed on August 23, 2019).”Page 14 of the 2025 FDD, Item 3
Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.
Disclosure signals that moved the score
How this shows up in the verdict
- Active litigation involving class actions (credit card surcharge notifications, Illinois Biometric Act) creates legal liability exposure and potential compliance costs
The verdict grade is FranchiseVerdict's editorial assessment across SBA loan performance, unit growth, revenue and disclosure signals. It is not investment advice.
Before you weigh a lawsuit
How to read Item 3
A franchisor must disclose pending actions and any material civil action involving the franchise relationship, plus convictions or civil judgments for fraud, unfair or deceptive practices, or franchise-law violations, going back ten years. A case the franchisor brought against a franchisee counts too. Item 3 does not include every dispute: settled claims below the materiality line and matters resolved in private arbitration can be absent.
Questions worth asking current and former franchisees, using the contact list in Item 20:
- Were you, or anyone you know in the system, party to a dispute with the franchisor?
- Was it resolved by settlement, arbitration or a court, and on what terms?
- Has the number of disputes gone up or down since you signed?