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D72/100FDD 2025

Liftology — Litigation & Risk

Home Services - Other · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
72 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID

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

What drove the 72/100 rating

Risk Score Breakdown

  1. 01HIGHActive litigation alleging misappropriation of trade secrets and tortious interference suggests potential IP vulnerability and ethical concerns at leadership level
  2. 02MINORZero existing franchise units with unknown growth trajectory indicates brand has never successfully scaled franchise model—unproven system
  3. 03MINORNo average revenue or net income disclosure prevents ROI validation; combined with $166k-$365k investment range, impossible to assess payback period or profitability
  4. 04MINORMonthly royalty minimums (starting year 2) create fixed cost burden regardless of sales performance—high risk for underperforming locations
  5. 05HIGHGoing concern status raises solvency questions about franchisor's ability to provide ongoing support, technology updates, and marketing
  6. 06MED10-year term is unusually long with no disclosed break-even metrics or unit economics to justify commitment length
  7. 07MINORRoyalty floor structure (7% minimum) could exceed actual gross revenue percentage in slow-growth markets, creating negative cash flow scenarios

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.