FDD Items 3 & 4 · 2025 filing

Lice Clinics of America litigation history

What Lice Clinics of America 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 (litigation) & 4 (bankruptcy) at a glance

What the filing discloses

Cases disclosed: 7; Item 3, as counted in the filing

Largest settlement, franchisor's own cases: None stated

Bankruptcy (Item 4): Disclosed; Franchisor, parent, predecessor or officer

Filing year: 2025; Disclosures cover the prior ten years

Extracted from the 2025 Franchise Disclosure Document

Item 3: litigation

California Consent Order (2017) - $50K penalty, franchise law violations; Virginia Settlement Order (2018) - $15.5K penalty, unregistered franchise sales; Washington Consent Order (2018) - $9,725 investigative costs, unregistered franchise sales; 4 suits filed in 2024 against franchisees to enforce non-compete and collect royalties

Item 3 (litigation) · 7 matters disclosed · 4 pending listed

Litigation cases

The franchisor

Pending (4)

Larada Sciences, Inc. v. Kelli Washington, an individual, and Brandon Washington, an individual
pending
Brought against a franchisee · filed 2024-11-26 · Third Judicial District Court of Utah · 240909556
“On November 26, 2024, we filed a suit to collect royalty payments in Larada Sciences, Inc. v. Kelli Washington, an individual, and Brandon Washington, an individual, No. 240909556 (Third Judicial District Court of Utah).”Page 13 of the 2025 FDD, Item 3
Larada Sciences, Inc. v. Kristi Winkler, an individual; and Chris Winkler
pending
Brought against a franchisee · filed 2024-10-16 · Third Judicial District Court of Utah · 240908330
“On October 16, 2024, we filed a suit to collect royalty payments in Larada Sciences, Inc. v. Kristi Winkler, an individual; and Chris Winkler, No. 240908330 (Third Judicial District Court of Utah).”Page 13 of the 2025 FDD, Item 3
Larada Sciences, Inc. v. LCA- SC LLC, a limited liability corporation
pending
Brought against a franchisee · filed 2024-11-19 · Third Judicial District Court of Utah · 240909337
“On November 19, 2024, we filed a suit to collect royalty payments in Larada Sciences, Inc. v. LCA- SC LLC, a limited liability corporation, No. 240909337 (Third Judicial District Court of Utah).”Page 13 of the 2025 FDD, Item 3
Larada Sciences, Inc. v. The MIH Group, LLC
pending
Brought against a franchisee · filed 2024-06-10 · United States District Court of Utah · 2:24-cv-00414-TS
“On June 10, 2024, we filed a suit to enforce our non-compete rights in Larada Sciences, Inc. v. The MIH Group, LLC, No. 2:24-cv-00414-TS (United States District Court of Utah).”Page 13 of the 2025 FDD, Item 3

Concluded (3)

Commonwealth of Virginia, ex rel., State Corporations Commission v. Larada Sciences, Inc. and Claire Roberts
settled
Government or regulatory action · filed 2018-06-20 · Virginia Division of Securities and Retail Franchising (State Corporation Commission) · Sec-2017-00047
“Prior to submitting an initial franchise application for our franchise offering in the State of Virginia, we initiated discussions with the Virginia Division of Securities and Retail Franchising (“Virginia Division”) as to whether the “License Agreements” we”Page 12 of the 2025 FDD, Item 3
Outcome: “we entered into a Settlement Order with the Virginia Division dated June 20, 2018 (Commonwealth of Virginia, ex rel., State Corporations Commission v. Larada Sciences, Inc. and Claire Roberts, Case No. Sec-2017-00047).”
Matter with no printed caption
concluded
Government or regulatory action · filed 2018-05-23 · State of Washington Department of Financial Institutions - Securities Division · S-17-2283-18-CO01
“Prior to submitting an initial franchise application for our franchise offering in the State of Washington, we initiated discussions with the State of Washington Department of Financial Institutions - Securities Division (“Washington Division”) as to whether”Page 12 of the 2025 FDD, Item 3
Outcome: “we entered into a “Consent Order” with the Washington Division dated May 23, 2018 (Order No. S-17-2283-18-CO01), which resolved the investigation by the Washington Division of our alleged violations of the Washington Act.”
Matter with no printed caption
concluded
Government or regulatory action · filed 2017-08-03 · California Commissioner of Financial Protection and Innovation
“We entered into a “Consent Order” with the California Commissioner of Financial Protection and Innovation effective August 3, 2017.”Page 11 of the 2025 FDD, Item 3

Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.

Disclosed in the 2025 Franchise Disclosure Document

Item 4: bankruptcy

Larada Sciences, Inc. (and 37 Ventures, LLC as guarantor) filed Chapter 11 reorganization March 19, 2021 in Central District of California (Case 9:21-bk-10269-DS). Plan confirmed September 8, 2022.

Disclosure signals that moved the score

How this shows up in the verdict

Four active breach of contract/non-compete lawsuits filed by franchisor against franchisees in 2024 alone suggests franchisor-franchisee conflict and enforcement issues
Three regulatory settlement orders in California, Virginia, and Washington indicate compliance failures or customer protection violations

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?

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