FranchiseVerdict
Junk King logo
B60/100FDD 2026

Junk King — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

Back to overview

Moderate — Review

4 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
4
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
60 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
66
Government-backed loans issued
Default rate
6.5%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
2 loans
Loans charged off or defaulted
Total loan volume
$15.0M
Avg loan size
$228K
Participating lenders
28

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

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
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
Texas
State whose law governs disputes — relevant if you're not based there

What drove the 60/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status is FALSE — indicates potential financial instability at corporate level
  2. 02MINORSystem is shrinking: only 1.8% YoY growth with 172 units suggests stalled expansion and possible closures
  3. 03HIGHMultiple litigation cases with fraud/misrepresentation allegations and settlements indicate pattern of franchisor-franchisee disputes
  4. 04MEDNet Income not disclosed in Item 19 — prevents validation of $553,959 average revenue claim and true profitability
  5. 05MINORHigh initial investment ($121,200–$236,000) with 8% royalty creates breakeven pressure in declining system
  6. 06MINORHistory of franchisor territorial repurchases suggests franchisee underperformance or franchisor buyback strategy to recover units

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.