FDD Items 3 & 4 · 2026 filing

Floor Coverings International litigation history

What Floor Coverings International disclosed about lawsuits, arbitrations and bankruptcy in the 2026 Franchise Disclosure Document. Item 3 lists the material legal actions a franchisor must report; Item 4 covers bankruptcy. This is the franchisor's own disclosure, not a court record, and not legal advice.

Items 3 (litigation) & 4 (bankruptcy) at a glance

What the filing discloses

Cases disclosed: 6; Item 3, as counted in the filing

Largest settlement, franchisor's own cases: None stated

Bankruptcy (Item 4): None; Franchisor, parent, predecessor or officer

Filing year: 2026; Disclosures cover the prior ten years

Extracted from the 2026 Franchise Disclosure Document

Item 3: litigation

FCI is plaintiff in 6 pending federal court actions (N.D. Georgia) against former franchisees for breach of post-term restrictive covenants, trademark infringement, misappropriation of trade secrets, and/or collection of monies owed; 2 of these (Justice, Bae) involve franchisee counterclaims alleging breach of contract/fraud. No bankruptcy disclosed. No litigation against FCI by third parties or regulators disclosed.

Item 3 (litigation) · 6 matters disclosed · 2 pending listed

Litigation cases

The franchisor

Pending (2)

Floorcoverings International, Ltd. v. Robert Bae
pending
Brought by the franchisor · filed 2025-09-29 · U.S.D.C. N.D.G.A. · 1:25-cv-0557
“… No. 1:25-cv-0557 (U.S.D.C. N.D.G.A.). On September 29, 2025, FCI filed an action against its former franchisee Robert Bae for collection of monies owed.”Page 12 of the 2026 FDD, Item 3
Floorcoverings International, Ltd. v. Tim Justice
pending
Brought by the franchisor · filed 2025-02-06 · U.S.D.C. N.D.G.A. · 1:25-cv-00585
“… No. 1:25-cv-00585 (U.S.D.C. N.D.G.A.). On February 6, 2025, FCI filed an action against its former franchisee Tim Justice asserting claims for breach of the post-term restrictive covenant, trademark”Page 12 of the 2026 FDD, Item 3

Status not stated in the filing (4)

Floorcoverings International, Ltd. v. Hawthorne
Brought by the franchisor · filed 2025 · U.S.D.C. N.D.GA. · 1:25-cv-05576
“… No. 1:25-cv-05576 (U.S.D.C. N.D.GA.) for collection of monies owed. Floorcoverings International, Ltd. v. Thiaw, No. 1:25-cv-05552 (U.S.D.C.”Page 12 of the 2026 FDD, Item 3
Floorcoverings International, Ltd. v. Lacrosse
Brought by the franchisor · filed 2025 · U.S.D.C. N.D.GA. · 1:25-cv-05574
“… No. 1:25-cv-05574 (U.S.D.C. N.D.GA.) for collection of monies owed. Floorcoverings International, Ltd. v. Hawthorne, No. 1:25-cv-05576 (U.S.D.C.”Page 12 of the 2026 FDD, Item 3
Floorcoverings International, Ltd. v. Molock
Brought by the franchisor · filed 2025 · U.S.D.C. N.D.GA. · 1:25-cv-02204
“… No. 1:25-cv-02204 (U.S.D.C. N.D.GA.) for breach of the restrictive covenant, violation of trade secret acts, trademark infringement, and damages.”Page 12 of the 2026 FDD, Item 3
Floorcoverings International, Ltd. v. Thiaw
Brought by the franchisor · filed 2025 · U.S.D.C. N.D.GA. · 1:25-cv-05552
“… No. 1:25-cv-05552 (U.S.D.C. N.D.GA.) for”Page 12 of the 2026 FDD, Item 3

Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.

Before you weigh a lawsuit

How to read Item 3

A franchisor must disclose pending actions and any material civil action involving the franchise relationship, plus convictions or civil judgments for fraud, unfair or deceptive practices, or franchise-law violations, going back ten years. A case the franchisor brought against a franchisee counts too. Item 3 does not include every dispute: settled claims below the materiality line and matters resolved in private arbitration can be absent.

Questions worth asking current and former franchisees, using the contact list in Item 20:

Were you, or anyone you know in the system, party to a dispute with the franchisor?
Was it resolved by settlement, arbitration or a court, and on what terms?
Has the number of disputes gone up or down since you signed?

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