A35/100FDD 2026
Domino's Pizza — Litigation & Risk
Food & Beverage - Pizza · FDD Items 3, 4 & 5
Elevated Risk
6 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
6
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
35 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.
Total 7(a) loans
747
Government-backed loans issued
Default rate
10.7%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
79 loans
Loans charged off or defaulted
Total loan volume
$177.0M
Avg loan size
$237K
Participating lenders
200
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
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
What drove the 35/100 rating
Risk Score Breakdown
- 01MINORSlow unit growth of only 2.9% YoY suggests market saturation or franchisee underperformance
- 02HIGHSignificant litigation including securities class action, derivative lawsuits, and joint employer claims creates legal/operational uncertainty
- 03MINORNet income margin of only 1.08% (14.7K on 1.37M revenue) indicates razor-thin profitability after royalties
- 04MINORHigh capital requirement ($107K-$743K) paired with low average net income creates extended ROI timeline
- 05HIGHJoint employer litigation could increase labor compliance costs and corporate liability exposure for franchisees
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.