FDD Items 3 & 4 · 2024 filing

Comfort Inn litigation history

What Comfort Inn disclosed about lawsuits, arbitrations and bankruptcy in the 2024 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: 90; Item 3, as counted in the filing

Largest settlement, franchisor's own cases: None stated

Bankruptcy (Item 4): None; Franchisor, parent, predecessor or officer

Filing year: 2024; Disclosures cover the prior ten years

Extracted from the 2024 Franchise Disclosure Document

Item 3: litigation

Item 3 Section I: 3 pending cases (Knuth class action in Canada re DMF fees; Jai Sai Baba franchisee discrimination suit/arbitration; T&T Management breach case). Section II: Large number of actions by Choice to recover unpaid royalties/liquidated damages from individual franchisees in prior fiscal year (2023), plus 1 IP enforcement action. Section III: 4 resolved cases including a $779,398 judgment against Choice in Highmark Lodging and $85,000 settlement in Kohl case.

Item 3 (litigation) · 90 matters disclosed · 3 pending listed

Litigation cases

The franchisor

Pending (2)

T&T Management, Inc. v. Choice Hotels International, Inc., Country Inn & Suites by Radisson, Inc. and Sunshine Fund Port Orange, LLC
pending
filed 2023-06-26 · United States District Court for the Middle District of Florida · 6:23-cv-01187
“… United States District Court for the Middle District of F”Page 23 of the 2024 FDD, Item 3
Outcome: “The Court has not yet ruled on the pending Motions” (page 24)
Jai Sai Baba, LLC, et al. v. Choice Hotels International, Inc., et al.
pending
Brought by a third party · filed 2020-06-12 · United States District Court for the Eastern District of Pennsylvania · 2:20-cv-02823
“… United States District Court for the Eastern District of Pennsylvania, Case No. 2:20-cv- 02823 On June 12, 20”Page 23 of the 2024 FDD, Item 3
Outcome: “This case remains stayed, and the parties provide the Court with monthly status updates. T”
Within this matter, as the filing narrates it · 3 proceedings
- Choice Hotels International, Inc. v. DIP Hospitality, LLC, et al.
  pending
  Brought by the franchisor · names the franchisor · filed 2021-04-09 · American Arbitration Association · 01-21-0003-7036
  “The following arbitration is currently pending in conjunction with this case: Choice Hotels International, Inc. v. DIP Hospitality, LLC, et al. American Arbitration Association, Ca”Page 23 of the 2024 FDD, Item 3
  Outcome: “The arbitration hearing concluded in 2023, and the parties are waiting for an arbitration award”
- Dahya Investments Incorporated, et al. v. Choice Hotels International, Inc., et al.
  concluded
  names the franchisor · filed 2021-06-29 · American Arbitration Association; United States District Court for the District of Maryland, Southern Division · 01-21-0004-5563; 8:2023cv01685
  “… American Arbitration Association, Case #01-21-0004-5563 United States District Court for the District of M”Page 30 of the 2024 FDD, Item 3
  Outcome: “the Final Award was confirmed into a judgment on January 17, 2024 at”
- Highmark Lodging, LLC, et al. v. Choice Hotels International, Inc., et al.
  concluded
  names the franchisor · filed 2021-06-29 · American Arbitration Association; United States District Court for the Eastern District of Pennsylvania · 01-21-0004-5554; 5:20cv2823
  “… American Arbitration Association, Case #01-21-0004-5554 United States District Court for the Eastern District of Pe”Page 29 of the 2024 FDD, Item 3
  Outcome: “a final judgment was entered against Choice in the amount of $779,398.40 on March 4, 2024.” (page 30)
Counted as one matter, the way Item 3 groups it.

Concluded (2)

Sender Kohl v. Choice Hotels International, Inc.
concluded
filed 2018-10-29 · United States District Court for the Southern District of Florida, Fort Lauderdale Division, and American Arbitration Association · 0:18-cv-62597; 01-19-0000-1797
“… United States District Court for the Southern District of Florida, Fort Lauderdale Division, Case #0:18-cv-62597 and American Arbitration Ass”Page 29 of the 2024 FDD, Item 3
Outcome: “On August 25, 2021, the parties settled this dispu”
Wydredge, L.L.C., H & P Investments, Clayton Wyman, Barry Eldredge and James Rumpsa v. Choice Hotels International, Inc.
concluded
filed 2012-08-31 · American Arbitration Association · 16-114-000517-12
“… American Arbitration Association, Case # 16-114-000517-12 On August 3”Page 29 of the 2024 FDD, Item 3
Outcome: “On July 7, 2014, the parties settled this dispute.”

Status not stated in the filing (7)

Choice Hotels International, Inc. v. 144 Investors, LLC and Surjeet Kaur (post-termination intellectual property enforcement)
Brought by the franchisor · filed 2023-08-11 · U.S. District Court Eastern District of New York (Brooklyn) · 1:23cv06066
“ACTIONS INITIATED BY CHOICE TO ENFORCE INTELLECTUAL PROPERTY RIGHTS – POST TERMINATION Defendant Venue Case Number Filing Date 144 Investors, LLC and Surjeet Kaur U.S. Di”Page 29 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. 67585 Hacienda, LLC and Calvin Chun
Brought by the franchisor · filed 2023-01-31 · American Arbitration Association · 01-23-0000-4410
“67585 Hacienda, LLC and Calvin Chun American Arbitration Association 01-23-0000-4410 January 31, 2023 Le Cercle Rouge, L”Page 24 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. Donald R. Dreiske, Lance B. Stuart, James R. Stuart, Harvey W. Lester and Rebecca Kenny
Brought by the franchisor · filed 2023-01-31 · American Arbitration Association · 01-23-0000-4309
“Donald R. Dreiske, Lance B. Stuart, James R. Stuart, Harvey W. Lester and Rebecca Kenny American Arbitration Association 01-23-0000-4309 January 31, 2023 67585 Hacienda,”Page 24 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. Jai Sai Baba, LLC, Dipesh Patel and MDPD13 Investments, LLC
Brought by the franchisor · filed 2023-01-19 · United States District Court for the District of Maryland, Southern Division, transferred to the United States District Court for the Eastern District of Pennsylvania, Philadelphia · 8:2023cv00146; 8:2023cv03360
“Jai Sai Baba, LLC, Dipesh Patel and MDPD13 Investments, LLC United States District Court for the District of Maryland, Southern Division, transferred to United States District Court for the”Page 24 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. Jeet Hospitality, Inc. and Indravaden Patel
Brought by the franchisor · filed 2023-02-02 · American Arbitration Association · 01-23-0000-4726
“Jeet Hospitality, Inc. and Indravaden Patel American Arbitration Association 01-23-0000-4726 February 2, 2023 Kei. V. Inc. and Sey”Page 24 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. Le Cercle Rouge, LLC, David Adehou and Milan G. Mody
Brought by the franchisor · filed 2023-01-31 · American Arbitration Association · 01-23-0000-4439
“Le Cercle Rouge, LLC, David Adehou and Milan G. Mody American Arbitration Association 01-23-0000-4439 January 31, 2023 Jeet Hospitality, Inc”Page 24 of the 2024 FDD, Item 3
Choice Hotels International, Inc. v. SC Hotel Group, LLC, SC Hotel Partners, LLC, Lajwanti Gandhi and Rolan Chowdhury
Brought by the franchisor · filed 2023-01-18 · Circuit Court for Montgomery County, Maryland · C15CV23000171
“SC Hotel Group, LLC, SC Hotel Partners, LLC, Lajwanti Gandhi and Rolan Chowdhury Circuit Court for Montgomery County, Maryland C15CV23000171 January 18, 2023 Jai Sai Baba”Page 24 of the 2024 FDD, Item 3

Parent, affiliates, master franchisor and subfranchisor

Pending (1)

Norma Knuth v. Radisson Hotels International, Inc., et al.
pending
Brought by a third party · Country Inn & Suites by Radisson, Inc. (“Country”) · filed 2014-12-05 · Court of Queen’s Bench for Saskatchewan · QBG No. 2560 of 2014
“… Court of Queen’s Bench for Saskatchewan, Court File No. QBG No. 2560 of 2014 On December 5, 2014, Norma Knuth f”Page 22 of the 2024 FDD, Item 3
Outcome: “The class has yet to be certified” (page 23)

This list shows 12 of the 90 matters Item 3 discloses; the rest are in the filing.

3 of the proceedings above are indented under the matter they belong to because the filing narrates them inside it — an appeal, a consolidated case, a related arbitration. Each carries its own quote and page. They are counted with their matter, not as extra matters, so this list and the 90 Item 3 discloses agree.

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.

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?

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