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D75/100FDD 2026

Cotti Coffee — Litigation & Risk

Food & Beverage - Coffee & Tea · 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
75 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
1 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
Delaware
State whose law governs disputes — relevant if you're not based there

What drove the 75/100 rating

Risk Score Breakdown

  1. 01MINORZero operating franchise units with unknown growth trajectory indicates either brand-new concept or failed system contraction
  2. 02HIGHGoing Concern status = FALSE suggests parent company financial distress or viability questions
  3. 03MINORNo average revenue or net income disclosure prevents ROI validation and profitability assessment
  4. 04MINORUnprotected territory creates direct competition risk from other franchisees and company-owned locations
  5. 05MINORTiered royalty structure (0-25% of margin above Base Amount) is non-standard and lacks transparency on 'Base Amount' threshold
  6. 06MINORHigh investment range ($259K-$608K) combined with zero unit validation creates significant downside risk
  7. 07MINOR5-year term is shorter than industry standard (typically 10 years), suggesting franchisor confidence issues
  8. 08HIGHNo disclosed litigation history unusual for established franchisor; may indicate inadequate disclosure or new entity

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.