FDD Items 3 & 4 · 2025 filing
Honest1 Auto Care litigation history
What Honest1 Auto Care disclosed about lawsuits, arbitrations and bankruptcy in the 2025 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 & 4 at a glance
What the filing discloses
- Cases disclosed
- 2
- Item 3, as counted in the filing
- Largest disclosed settlement
- None stated
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2025
- Disclosures cover the prior ten years
Extracted from the 2025 Franchise Disclosure Document
Item 3: litigation
Case 1 (Franchisor as plaintiff): H-1 Auto Care LLC v. Balhar Lasher et al. (NJ federal court, filed 2021) - breach of franchise agreements, trademark infringement, trade secret violations against former franchisees who opened competing centers. Case 2 (Franchisor as defendant): Charles D. Fasnacht III et al. v. H-1 Auto Care LLC (AAA arbitration, filed 2024) - former Region Developers claim wrongful termination of Region Developer Agreements.
Disclosure signals that moved the score
How this shows up in the verdict
- Active litigation on two fronts (franchisor lawsuit + regional developer arbitration with counterclaim) indicates operational/contractual friction and potential governance issues
- Going Concern status = False suggests potential financial stress at corporate level, raising sustainability questions
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?