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D75/100FDD 2025

Doriva Local Art Source — Litigation & Risk

Other · 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
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
Texas
State whose law governs disputes — relevant if you're not based there

What drove the 75/100 rating

Risk Score Breakdown

  1. 01MEDOnly 2 existing units indicates extremely limited system validation and growth trajectory
  2. 02MINORNo average revenue or net income disclosure (Item 19) prevents realistic ROI assessment on $87,050–$126,800 investment
  3. 03HIGHGoing Concern status is FALSE, suggesting potential financial instability or operational uncertainty at franchisor level
  4. 04MINORDual royalty structure (6% gallery vs. 10% e-commerce) creates complex accounting and incentivizes lower-margin local sales
  5. 05MINOR10-year term is unusually long without proven unit economics or franchisee success stories to justify commitment
  6. 06MINORArt/local gallery business model has historically low barriers to entry and high failure rates among independents

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.