FDD Items 3 & 4 · 2025 filing
Corner Bakery Cafe litigation history
What Corner Bakery Cafe 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 & 4 at a glance
What the filing discloses
- Cases disclosed
- 3
- Item 3, as counted in the filing
- Largest disclosed settlement
- $974K
- As stated in Item 3
- Bankruptcy (Item 4)
- Disclosed
- 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 Item-3 matters disclosed: (1) Nerco, LLC et al. v. Voodoo Licensing Southern, LLC et al. (S.D. Ala.), a pending action involving VP of Franchise Development Thomas Harper's prior role, alleging fraud/breach; settlement conference scheduled April 2025. (2) State of Delaware ex rel. French v. Card Compliant, LLC et al. — qui tam gift-card action against predecessor CBC, settled 2018 ($700,000). (3) Buon Hospitality, Inc. v. CBC Restaurant Corp. et al. — franchisee FPR/fraud suit against predecessor, settled 2015 (CBC paid $974,498.52).
Disclosed in the 2025 Franchise Disclosure Document
Item 4: bankruptcy
The filing discloses a bankruptcy involving the franchisor, its parent, a predecessor or an officer. Read Item 4 of the FDD for the party, the court and the dates.
Disclosure signals that moved the score
How this shows up in the verdict
- Pending litigation against VP of Franchise Development involving fraud allegations raises concerns about sales practices and disclosed financial projections to prospective franchisees
- Two prior settled litigations involving gift card reporting and unauthorized financial performance representations indicate pattern of regulatory/disclosure issues
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?