FDD Items 3 & 4 · 2025 filing
Mr. Gatti’s FEC litigation history
What Mr. Gatti’s FEC 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
- 1
- Item 3, as counted in the filing
- Largest disclosed settlement
- $200K
- 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
One concluded case against predecessor Gatti's Great Pizza and officers (R.J. Phillips, Kyle Mann) filed July 2019 in US Bankruptcy Court for Northern District of Texas. Franchisee alleged breach of contract re: purchase of 13 facilities. Settled Sept 2019 for $200,000 in rent subsidies; no admission of liability. No pending matters against MGOLLC directly.
Disclosed in the 2025 Franchise Disclosure Document
Item 4: bankruptcy
Predecessor MGLP and affiliates (Sovrano LLC, Gatti's Great Pizza Inc., Gigi's Cupcakes LLC, others) filed Chapter 11 January 4, 2019. Plan confirmed October 2019, effective November 2019. Bankruptcy closed September 30, 2021. Officers Mann and Phillips were members/officers of Debtors. Two additional Chapter 7 filings: Allorco LLC (closed June 2019) and GGP Mississippi LLC (closed October 2019).
Disclosure signals that moved the score
How this shows up in the verdict
- 2019 litigation with $200k settlement suggests contract/operational disputes; lack of admission complicates future risk assessment
- Going Concern status = False is ambiguous; clarify whether this applies to franchisor or means non-disclosure of going concern issues
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?