Moderate: Review
1 case disclosed in FDD Items 3 and 4.
FDD Items 3 & 4
Litigation Metrics
- Cases disclosed
- 1
- Total from FDD Items 3 and 4
- Bankruptcy (Item 4)
- None
- Franchisor or officer bankruptcy
- Verdict score
- 58 / 100
- FranchiseVerdict composite · higher is better
- Rating
- B
- A / B / C / D / F verdict grade
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Charge-off rate is the share of loans that were charged off or settled for less than the full balance.
- Total 7(a) loans
- 19
- Government-backed loans issued
- Charge-off rate
- 5.3%
- vs 16% franchise average
- 5-yr charge-off rate
- N/A
- Defaults
- 1 loans
- Loans charged off or defaulted
- Total loan volume
- $4.8M
- Avg loan size
- $251K
- Participating lenders
- 14
FDD Items 5, 6 & 17: What You Give Up
Contract Risk Indicators
- Mandatory arbitration
- Not required
- You retain the right to sue in court
- Franchisor can compete
- Yes
- Franchisor can open competing locations in or near your territory
- Right of first refusal
- No
- 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
Extracted from FDD Item 3
Litigation Detail
Health Mart's Parent (McKesson) is a defendant in extensive opioid-distribution litigation (National Prescription Opiate MDL) brought by states, subdivisions, tribes, and private plaintiffs; Parent settled with 48 states/DC for up to ~$5.9B through 2038, plus separate settlements with Alabama (~$99M), West Virginia (~$84M additional), and Native American tribes (~$84M additional); a Baltimore jury verdict of $192M was reduced to $37M via remittitur and is being appealed; approximately 3 controlled-substance cases remain pending in federal court.
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.