FDD Items 3 & 4 · 2026 filing
Mr. Appliance litigation history
What Mr. Appliance disclosed about lawsuits, arbitrations and bankruptcy in the 2026 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
- 4
- 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
- 2026
- Disclosures cover the prior ten years
Extracted from the 2026 Franchise Disclosure Document
Item 3: litigation
2 prior actions (one franchisor as plaintiff for breach/non-compete settled $100K, one predecessor as defendant by former franchisees settled with no payment); 1 affiliate administrative order (Window Genie/CA, $5,000 penalty); 1 fiscal 2025 suit against franchisee for monies and non-compete.
Item 3 (litigation) · 4 matters disclosed
Litigation cases
The franchisor and its predecessor
Concluded (2)
Mr. Appliance SPV LLC v. Scott Brand
settledBrought against a franchisee · filed 2022-01-26 · Circuit Court of Cook County, Illinois, County Department, Law Division · 2022L000801
“… (Circuit Court of Cook County, Illinois, County Department, Law Division, Case No. 2022L000801, filed January 26, 2022).”Page 21 of the 2026 FDD, Item 3
Outcome: “The matter was resolved via a settlement agreement entered into by the parties on August 10, 2022. Pursuant to the settlement agreement, Defendants agreed to pay to Plaintiff $100,000;”
KB Industries, Kimberly Gandy and Robert Hosier v. Mr. Appliance, LLC, et al.
settledBrought by a franchisee · Mr. Appliance, LLC (Predecessor) · filed 2016-05-17 · U.S. District Court for the Northern District of Illinois · 3:16-cv-50202
“… (United States District Court for the Northern District of Illinois, Case No. 3:16-cv-50202, filed May 17, 2016, removed on June 23, 2016).”Page 22 of the 2026 FDD, Item 3
Outcome: “On July 19, 2018, Predecessor and Plaintiffs entered into a settlement agreement pursuant to which they released any and all claims between the parties, known or unknown, which arose prior to the date of the settlement.”
Status not stated in the filing (1)
Mr. Appliance SPV LLC v. Heather Dawn Jones, Mevin David Jones, Jr., ADJ Holdings Inc., ADJ Holdings Inc. 401k Profit Sharing Plan, Liberty Appliance Pros LLC
Brought by the franchisor · filed 2025-08-28 · 170th Judicial District, McLennan County, Texas · 2025-2609-4
“… Cause No. 2025-2609-4, filed on August 28, 2025 in the 170th Judicial District, McLennan County, Texas.”Page 23 of the 2026 FDD, Item 3
Parent, affiliates, master franchisor and subfranchisor
Concluded (1)
The Commissioner of Business Oversight of the State of California v. FOR Franchising LLC d/b/a Window Genie and Richard Nonelle
concludedGovernment or regulatory action · FOR Franchising LLC (a predecessor to our affiliate Window Genie) · filed 2017-11-14 · California Department of Business Oversight
“The Commissioner of Business Oversight of the State of California v. FOR Franchising LLC d/b/a Window Genie and Richard Nonelle.”Page 22 of the 2026 FDD, Item 3
Outcome: “FOR would pay an administrative penalty in the total amount of $5,000 (which amount FOR paid) and (c) within”
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 2026 Franchise Disclosure Document
Item 4: bankruptcy
No bankruptcy involving the franchisor itself. Several KKR-affiliated portfolio companies disclosed: Marelli Holdings (June 2025 Ch.11), The Collected Group (April 2021, emerged May 2021), Envision Healthcare (May 2023, emerged Nov 2023), Genesis Care (June 2023, emerged Feb 2024), IPI Legacy Liquidation (Dec 2023, emerged Apr 2024), Cafe Coffee Day (insolvency 2024, resolved 2025).
Disclosure signals that moved the score
How this shows up in the verdict
- Multiple litigation cases including fraud allegations (KB Industries et al.) and breach of contract disputes signal operational/support conflicts
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?