B59/100FDD 2025
Dope CFO — Litigation & Risk
Business Services - Tax & Financial · FDD Items 3, 4 & 5
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
59 / 100
FranchiseVerdict composite
Rating
MODERATE
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
Non-compete
2 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
Nevada
State whose law governs disputes — relevant if you're not based there
What drove the 59/100 rating
Risk Score Breakdown
- 01MINORNo average revenue or net income disclosure (Item 19) — impossible to assess ROI or profitability
- 02HIGHGoing concern status is FALSE — suggests financial instability at franchisor level
- 03MINORUnprotected territory creates direct competition risk between the 14 existing franchisees
- 04MINORHigh growth rate (116.7% YoY) with only 14 units is statistically volatile and difficult to validate
- 05MINORRelatively high franchise fee ($65,000) paired with minimum royalty ($500/month) with no performance data to justify costs
- 06MINORVery small system (14 units) limits network effects, support infrastructure, and brand recognition
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.