FDD Items 3 & 4 · 2025 filing
Medicine Shoppe litigation history
What Medicine Shoppe 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
- 6
- Item 3, as counted in the filing
- Largest settlement, franchisor's own cases
- $18K
- As stated in Item 3
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2025
- Disclosures cover the prior ten years
Extracted from the 2025 Franchise Disclosure Document
Item 3: litigation
MSI initiated 3 arbitrations against franchisees (Acra, TODAMAR x2, Nunya). Cardinal Health parent faces SEC fraud settlement, National Opioid Litigation ($4.9B accrued), Cordis IVC filter product liability, and insurer coverage litigation.
Item 3 (litigation) · 6 matters disclosed · 2 pending listed
Litigation cases
The franchisor
Concluded (3)
Medicine Shoppe International, Inc. v. Nunya Business Systems, Inc., Brian Prather and Jodie Prather
settledBrought against a franchisee · filed 2015-07-13 · American Arbitration Association · 01-15-0004-2335
“… American Arbitration Association, AAA Case No. 01-15-0004-2335.”Page 14 of the 2025 FDD, Item 3
Outcome: “In June 2016, the parties reached a settlement agreement under which the franchisee converted to MSI’s current form of franchisee agreement and agreed to pay MSI $17,500, with $7,500 payable at the time of settlement and the remaining $10,000 payable in 12 monthly installments.”
Medicine Shoppe International, Inc. v. J. Acra, Inc. and Julie Acra
settledBrought against a franchisee · filed 2014 · American Arbitration Association · 58 114 26 14
“… American Arbitration Association, AAA Case No. 58 114 26 14.”Page 13 of the 2025 FDD, Item 3
Outcome: “In April 2016, the parties agreed to a settlement under which J. Acra liquidated its business and left the MSI system. MSI received approximately $165,000 as part of the liquidation.” (page 14)
Medicine Shoppe International, Inc. v. TODAMAR, Inc. and Timothy Gallegos
settledBrought against a franchisee · filed 2014 · American Arbitration Association · 58 114 28 14; 01-16- 0000-8681
“… American Arbitration Association, AAA Case No. 58 114 28 14.”Page 14 of the 2025 FDD, Item 3
Outcome: “In June 2016, the parties reached a settlement that allowed TODAMAR to leave the MSI system, but paying MSI $140,000, with $50,000 to be paid within 45 days and the remaining $90,000 payable in 12 monthly installments.”
Parent, affiliates, master franchisor and subfranchisor
Pending (2)
In Re: National Prescription Opiate Litigation
pendingGovernment or regulatory action · Cardinal Health (our parent) · filed 2017-12-12 · United States District Court for the Northern District of Ohio · 17-MV-2804
“… United States District Court for the Northern District of Ohio, 17-MV-2804, consolidated December 12, 2017, et al.”Page 15 of the 2025 FDD, Item 3
Cordis IVC Filter Litigation, Dunson, et al. v. Cordis Corporation, et al.
pendingCardinal Health (our parent) · Superior Court of the State of California for the County of Alameda · Lead Case No. RG16812476
“… Superior Court of the State of California for the County of Alameda, Lead Case No. RG16812476.”Page 16 of the 2025 FDD, Item 3
Outcome: “In April 2023, Cardinal Health executed a settlement agreement that, if certain conditions are satisfied, will resolve approximately 4,375 claims for $275 million.”
Concluded (1)
United States Securities and Exchange Commission v. Cardinal Health, Inc.
judgmentGovernment or regulatory action · Cardinal Health, Inc. (our parent) · filed 2007-07-26 · United States District Court, Southern District of New York · 07-CV-6709
“… United States District Court, Southern District of New York, (Civil Action No. 07-CV-6709).”Page 14 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.
Disclosure signals that moved the score
How this shows up in the verdict
- Parent company Cardinal Health faces SEC accounting settlements and extensive opioid/product liability litigation, creating reputational and financial risk to franchise system
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?