FranchiseVerdict
Ledo Pizza logo
B64/100FDD 2026

Ledo Pizza — Litigation & Risk

Food & Beverage - Full Service · FDD Items 3, 4 & 5

Back to overview

Moderate — Review

3 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
3
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
64 / 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
30
Government-backed loans issued
Default rate
19.2%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
5 loans
Loans charged off or defaulted
Total loan volume
$8.5M
Avg loan size
$283K
Participating lenders
17

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
Maryland
State whose law governs disputes — relevant if you're not based there

What drove the 64/100 rating

Risk Score Breakdown

  1. 01MINORDeclining unit count (-2.6% YoY) indicates system contraction and potential franchisee dissatisfaction
  2. 02HIGHActive trademark infringement litigation creates brand vulnerability and legal distraction for franchisor
  3. 03MEDNet income not disclosed despite $1.16M average revenue—suggests profitability concerns or franchisor opacity
  4. 04MINORHistorical securities violation (1989 Maryland Consent Order) indicates prior regulatory compliance issues
  5. 05HIGHGoing Concern status is FALSE—potential financial instability of franchisor itself
  6. 06MINORHigh investment range ($206K-$672K) with declining unit economics raises ROI sustainability questions
  7. 07HIGHMultiple litigation exposures (trademark suit, former affiliate disputes) signal operational/governance risks

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.