FDD Items 3 & 4 · 2026 filing

Hardee's litigation history

What Hardee's 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: 12; 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

HR is defendant in one pending case (Paradigm Investment Group v. HR, TRO/breach of contract dispute over franchise termination) and plaintiff in three pending cases against former/current franchisees (Arbor Capital Partners x2, and ARC Burger LLC) for breach of franchise/sublease/promissory note obligations; ARC Burger filed Chapter 7 bankruptcy during litigation. Concluded affiliate (CJR) litigation includes a $5.5M settlement with a Canadian Carl's Jr. developer (6Points) and smaller wage/hour class settlements.

Item 3 (litigation) · 12 matters disclosed · 5 pending listed

Litigation cases

The franchisor

Pending (4)

Hardee’s Restaurants LLC v. ARC Burger, LLC, et al.
pending
Brought against a franchisee · filed 2025-11-21 · Middle District of Tennessee · 3:25-cv-01359
“… Case No.: 3:25-cv-01359 (Middle District of Tennessee, filed November 21, 2025). On November 21, 2025, HR commenced an action against ARC Burger, LLC (“ARC Burger”) relating to ARC Burger’s monetary breaches of its Franchise Agreements, Lease and Sublease Agreements and Promissory Note with HR.”Page 24 of the 2026 FDD, Item 3
Hardee’s Restaurants LLC v. Arbor Capital Partners, LLC, et al.
pending
Brought against a franchisee · filed 2025-10-01 · Middle District of Tennessee · 3:25-cv-01135
“… Case No.: 3:25-cv- 01135 (Middle District of Tennessee, filed October 1, 2025). On October 1, 2025, HR commenced an action against Arbor Capital Partners LLC, Aihab Gerges, Edward Gerges and Gerges Gerges (collectively, “Arbor Capital”) relating to Arbor Capital’s monetary breaches of the Franchise Agreement and Sublease Agreement”Page 23 of the 2026 FDD, Item 3
Paradigm Investment Group, LLC v. Hardee’s Restaurants, LLC
pending
Brought by a franchisee · filed 2025-04-15 · United States District Court, Middle District of Tennessee · 3:25-cv-00419
“… (United States District Court, Middle District of Tennessee Case No.: 3:25-cv-00419, filed April 15, 2025). On April 14, 2025, Paradigm Investment Group, LLC (“Paradigm”) filed an Application for Temporary Restraining Order to prevent HR from terminating its franchise agreements.”Page 22 of the 2026 FDD, Item 3
Hardee’s Restaurants LLC v. Arbor Capital Partners, LLC, et al.
pending
Brought against a franchisee · filed 2024-07-12 · Circuit Court of the Seventh Judicial Circuit for Volusia County, Florida Circuit Civil Division · 2024 12342 CICI
“… Case No.: 2024 12342 CICI (Circuit Court of the Seventh Judicial Circuit for Volusia County, Florida Circuit Civil Division, filed July 12, 2024). On July 12, 2024, HR commenced an action against Arbor Capital Partners LLC, Aihab Gerges, Edward Gerges and Gerges Gerges (collectively, “Arbor Capital”).”Page 23 of the 2026 FDD, Item 3

Parent, affiliates, master franchisor and subfranchisor

Concluded (7)

Larry Rice v. By The Rio, LLC, Carl’s Jr. Restaurants LLC, and DOES 1-10
settled
Carl’s Jr. Restaurants LLC (CJR) · filed 2019-01-15 · United States District Court, District of Colorado · 1:19-cv-00129-STV
“… (United States District Court, District of Colorado, Case No 1:19-cv-00129-STV, filed January 15, 2019). On January 15, 2019, Larry Rice, a former employee of a Carl’s Jr. franchisee, filed a lawsuit in the federal district court for the District of Colorado.”Page 25 of the 2026 FDD, Item 3
Outcome: “On or about April 1, 2019, the parties reached an agreement to settle the litigation with the following terms: (a) Defendants will pay Rice $2,500 and attorneys’ fees in the aggregate amount of $7,500, (b) CJR will amend its franchise agreements with the Colorado franchisee named in the lawsuit to remove non-solicitation/no-hire provisions, and (c) CJR agreed not to enforce the disputed provision in existing ...”
New York v. Dunkin’ Brands, Inc.
concluded
Government or regulatory action · Dunkin Brands, Inc. (DBI), an Affiliated Program · filed 2019-09-26 · N.Y. Supreme Court for New York County · 451787/2019
“… (N.Y. Supreme Court for New York County, Case No. 451787/2019, filed September 26, 2019). In this matter, the N.Y. Attorney General (“NYAG”) filed a lawsuit against our affiliate, DBI, related to credential-stuffing cyberattacks during 2015 and 2018.”Page 27 of the 2026 FDD, Item 3
Outcome: “Under the consent order, DBI agreed to pay $650,000 in penalties and costs, issue certain notices and other types of communications to New York customers, and maintain a comprehensive information security program through September 2026, including precautions and response measures for credential-stuffing attacks.”
The People of the State of California v. Arby’s Restaurant Group, Inc.
settled
Government or regulatory action · Arby’s Restaurant Group, Inc. (ARG), an Affiliated Program under common Roark control · filed 2019-03-19 · California Superior Court, Los Angeles County · 19STCV09397
“… (California Superior Court, Los Angeles County, Case No. 19STCV09397, filed March 19, 2019). On March 11, 2019, our affiliate, Arby’s Restaurant Group, Inc. (“ARG”), entered into a settlement agreement with the states of California, Illinois, Iowa, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina,”Page 26 of the 2026 FDD, Item 3
The People of the State of California v. Dunkin’ Brands, Inc.
settled
Government or regulatory action · Dunkin Brands, Inc. (DBI), an Affiliated Program · filed 2019-03-19 · California Superior Court, Los Angeles County · 19STCV09597
“… (California Superior Court, Los Angeles County, Case No. 19STCV09597, filed on March 19, 2019.) On March 14, 2019, our affiliate, Dunkin Brands, Inc. (“DBI”), entered into a settlement agreement with the Attorneys General of 13 states and jurisdictions concerning the inclusion of “no-poaching” provisions in Dunkin’ restaurant”Page 26 of the 2026 FDD, Item 3
Ashlie Harris v. CJ Star, LLC, Carl’s Jr. Restaurants LLC, and DOES 1-10
settled
Carl’s Jr. Restaurants LLC (CJR) · filed 2018-08-03 · United States District Court, Eastern District of Washington, Spokane Division · 2:18-cv-00247
“… (United States District Court, Eastern District of Washington, Spokane Division, Case No 2:18-cv-00247, filed August 3, 2018). On August 3, 2018, Ashlie Harris, a former employee of a Carl’s Jr. franchisee, filed a lawsuit in the federal district court for the Eastern District of Washington.”Page 25 of the 2026 FDD, Item 3
Outcome: “On or about April 1, 2019, the parties reached an agreement to settle the litigation with the following terms: (a) Defendants will pay Harris $5,000 and attorneys’ fees in the aggregate amount of $20,000, (b) CJR has obtained amendments of the existing franchise agreements with Washington franchisees to remove non-solicitation/no-hire provisions, to the extent such provisions existed in the first place, and (c) CJR ...”
6Points Food Services Ltd. v. Carl’s Jr. Restaurants LLC, et al.
settled
Brought by a franchisee · Carl’s Jr. Restaurants LLC (CJR) · filed 2015-12-23 · Sup. Ct. of Justice, Ontario · 15-543370 (consolidating 15-543370 and 16-546487)
“… No. 15-543370 (Sup. Ct. of Justice, Ontario). This proceeding was a consolidation of two actions commenced by 6Points Food Services Ltd. (“6Points”), a Canadian Carl’s Jr. developer and franchisee, in the Sup. Ct. of Justice, Ontario (No. 15-453370 and No. 16-546487).”Page 24 of the 2026 FDD, Item 3
Outcome: “On or about October 12, 2022, the parties reached an agreement to settle the litigation with the following terms: (a) defendants agreed to pay Franchisee Parties $5,500,000 US dollars, (b) the parties agreed to mutual releases of any and all claims, including claims arising from this litigation, all without any admission of liability on any party.” (page 25)
In the Matter of Jimmy John’s Franchisor SPV LLC
concluded
Government or regulatory action · Jimmy John’s Franchisor SPV LLC (JJF), an Affiliated Program · Securities Commissioner of Maryland · 2025-0122
“… (Securities Commissioner of Maryland, Case No. 2025-0122). On March 28, 2022, JJF filed a Franchise Disclosure Document (FDD) with the Maryland Securities Division as part of a notice of exemption from franchise registration. In this filing, JJF listed the former franchisees but omitted the required contact information for the majority of those”Page 27 of the 2026 FDD, Item 3
Outcome: “Under the terms of the Consent Order, JJF agreed to pay a $30,000 civil monetary penalty, to permanently cease and desist from the offer or sale of franchises in violation of the Maryland Franchise Law, and to disclose the existence of the Consent Order in future franchise disclosure documents. * * * Other than these twelve (12) actions, no litigation is required to be disclosed in this Item.”

Officers and directors (individuals, not the company)

Pending (1)

EYM Pizza of Georgia, LLC et al. v. Pizza Hut, LLC
pending
Brought by a franchisee · Diane Simrall (Item 2: Vice President - Finance), named personally for her prior role at Pizza Hut, LLC · filed 2024-07-01 · United States District Court for the Northern District of Texas · 3:24-cv-16770
“… (United States District Court for the Northern District of Texas as Civil Action No. 3:24-cv-16770). On July 1, 2024, plaintiffs EYM Pizza of Georgia, LLC, EYM Pizza of Illinois, LLC, EYM Pizza of SC, LLC, and EYM Pizza of Wisconsin, LLC (collectively, “EYM”), former franchisees of Pizza Hut LLC (“PHLLC”) filed a second Petition and Emergency”Page 26 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.

Disclosure signals that moved the score

How this shows up in the verdict

Pending litigation by franchisor against Arbor Capital Partners for breach and conversion suggests operational disputes with other franchise partners

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?

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