FDD Items 3 & 4 · 2022 filing
Halloween Express litigation history
What Halloween Express disclosed about lawsuits, arbitrations and bankruptcy in the 2022 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
- 3
- 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
- 2022
- Disclosures cover the prior ten years
Extracted from the 2022 Franchise Disclosure Document
Item 3: litigation
Colorado franchisee lawsuit (Crazy Willy's) for $300,000 alleging conversion, tortious interference, negligence, etc., dismissed for improper venue. Virginia Settlement Order (2008) for offering franchises before registration, $3,500 penalty. Washington Consent Order (2010) for similar violation, $1,500 penalty.
Item 3 (litigation) · 3 matters disclosed
Litigation cases
The franchisor
Concluded (3)
Crazy Willy’s Inc. et al. v. Halloween Express, et al.
dismissedBrought by a franchisee · filed 2012-05-14 · District Court, County of Boulder, State of Colorado (removed to U.S. District Court of Colorado, No. 1:12-cv-1496) · 2012-CV-370
“… No. 2012-CV-370 (District Court, County of Boulder, State of Colorado filed on May 14, 2012).”Page 9 of the 2022 FDD, Item 3
Outcome: “On March 18, 2013, the Colorado court dismissed the action as to Halloween Express, LLC in light of an exclusive venue provision in the franchise contracts requiring suit in the State of Ohio.”
In the matter of determining whether there has been a violation of the Franchise Investment Protection Act of Washington by Halloween Express, LLC
concludedGovernment or regulatory action · filed 2010-09-14 · State of Washington Department of Financial Institutions, Securities Division · S-10-212-10-CO01
“We entered into a Consent Order dated September 14, 2010 with the State of Washington Department of Financial Institutions Securities Division Order Number S-10-212-10-CO01 captioned In the matter of determining whether there has been a violation of the”Page 9 of the 2022 FDD, Item 3
Commonwealth of Virginia ex rel. State Corporation Commission v. Halloween Express, LLC
settledGovernment or regulatory action · filed 2008-09-17 · Commonwealth of Virginia State Corporation Commission · SEC-2008-00075
“We entered into a Settlement Order dated September 17, 2008 with the Commonwealth of Virginia State Corporation Commission in State Corporation Commission Case Number SEC-2008-00075 captioned Commonwealth of Virginia ex rel.”Page 9 of the 2022 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.
Disclosure signals that moved the score
How this shows up in the verdict
- Multiple litigation matters across three states (Colorado, Virginia, Washington) signal compliance issues and regulatory friction
The verdict grade is FranchiseVerdict's editorial assessment across SBA loan performance, unit growth, revenue and disclosure signals. It is not investment advice.
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?