FranchiseVerdict
CARRE D’ARTISTES logo
B66/100FDD 2025

Carre D’artistes — Litigation & Risk

Other · FDD Items 3, 4 & 5

Back to overview

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
66 / 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
Arizona
State whose law governs disputes — relevant if you're not based there

What drove the 66/100 rating

Risk Score Breakdown

  1. 01MINOROnly 1 unit reported with unknown growth trajectory suggests system collapse or severe underperformance
  2. 02HIGHThree concluded breach of contract litigations (2018) plus California DFPI consent order (2022) indicate persistent franchisor compliance and disclosure issues
  3. 03MINORNo Item 19 (financial performance) disclosure despite $786K average revenue claim — inability or unwillingness to substantiate earnings
  4. 04HIGHGoing Concern = False indicates financial instability at franchisor level
  5. 05MINORUnprotected territory creates direct competition risk and cannibalization potential
  6. 06MEDHigh initial investment ($251K–$512K) relative to single-unit system and undisclosed net income creates negative risk/reward ratio
  7. 07MINORCalifornia DFPI consent order regarding unaudited financial statements suggests material misrepresentation in past FDD offerings

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.