A50/100FDD 2025
Mochiholic — Litigation & Risk
Food & Beverage - Bakery · FDD Items 3, 4 & 5
Lower Risk
No litigation cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
50 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID
FDD Items 5, 6 & 17 — what you give up
Contract Risk Indicators
Mandatory arbitration
Required
Disputes resolved outside court — limits your legal options
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
California
State whose law governs disputes — relevant if you're not based there
What drove the 50/100 rating
Risk Score Breakdown
- 01MEDOnly 1 unit in system with unknown growth trajectory — extremely limited proof of concept and inability to validate multi-unit success
- 02MEDNo Item 19 financial performance representations disclosed — cannot independently verify the $812k avg revenue and $300k net income claims
- 03MINORHigh initial investment range ($155k-$265k) relative to single-unit performance creates elevated risk if that one location underperforms
- 04MED5-year term is shorter than industry standard (typically 10 years) — suggests either franchisor caution or limited confidence in long-term model
- 05MEDExtremely limited franchisee network (1 unit) makes authentic due diligence and peer validation nearly impossible
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.