FranchiseVerdict
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D75/100FDD 2024

Crowne Plaza — Litigation & Risk

Lodging - Hotels & Motels · FDD Items 3, 4 & 5

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Elevated Risk

62 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
62
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
Not required
You retain the right to sue in court
Jury trial waiver
Waived
You give up the right to a jury trial
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
Georgia
State whose law governs disputes — relevant if you're not based there

What drove the 75/100 rating

Risk Score Breakdown

  1. 01MEDMassive capital requirement ($16.7M+) with zero disclosed average net income creates severe ROI opacity and repayment risk
  2. 02MEDNegative unit growth (-2.3% YoY decline with 85 units) signals system contraction and reduced peer support network
  3. 03HIGHExtensive litigation across multiple jurisdictions including fraud allegations, statutory violations, data breaches, and kickback schemes demonstrates governance failures and legal exposure
  4. 04HIGHNo going concern status (False) suggests financial instability at corporate level, threatening franchisee support and brand viability
  5. 05MINORUnprotected territory invites cannibalization and direct franchisor competition in revenue streams
  6. 06MINORItem 19 financial performance absent—no disclosure of actual unit economics, profitability, or break-even timelines
  7. 07MINOR5% royalty on gross rooms revenue (not net) creates fixed cost burden regardless of profitability, amplifying downside risk

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.