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 & 4 at a glance
What the filing discloses
- Cases disclosed
- 7
- Item 3, as counted in the filing
- Largest disclosed settlement
- $50K
- As stated in Item 3
- 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
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?