FranchiseVerdict
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D70/100FDD 2025

Inner Image Transitional Sober Living — Litigation & Risk

Other · FDD Items 3, 4 & 5

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Lower Risk

No litigation cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
70 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
2 yrs
Post-termination restriction on similar businesses
Franchisor can compete
Yes
Franchisor can open competing locations in or near your territory
Right of first refusal
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
California
State whose law governs disputes — relevant if you're not based there

What drove the 70/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status = False indicates potential franchisor financial distress or operational instability
  2. 02MINOROnly 6 total units in system with unknown growth trajectory suggests minimal scale and unproven replicability
  3. 03MINORZero financial disclosure (no Item 19 average revenues/net income) prevents ROI validation and hides performance data
  4. 04MEDHigh initial investment ($68,750-$105,000) paired with 5% royalty on undisclosed revenues creates uncertain cash flow recovery
  5. 05MINOR10-year term locks franchisee into relationship with unstable franchisor; no exit clarity if company fails
  6. 06MINORExtremely small franchisee base (6 units) limits peer support network and franchisor accountability
  7. 07MINORSober living facilities are heavily regulated; compliance costs and legal liability exposure not addressed

Severity inferred from FDD text — not a regulatory or legal classification

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.