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D73/100FDD 2022

Neurosculpting Institute — Litigation & Risk

Education - Tutoring & Test Prep · FDD Items 3, 4 & 5

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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
73 / 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
No
Franchisor can match any purchase offer when you try to sell
Governing law
Colorado
State whose law governs disputes — relevant if you're not based there

What drove the 73/100 rating

Risk Score Breakdown

  1. 01MINORUnit count declining 6.6% YoY (58 units) indicates system contraction and potential market saturation or performance issues
  2. 02MINORZero royalty structure may mask franchisor's true profit incentive—only makes money on initial franchise fees, creating misaligned interests
  3. 03MINORNo financial performance disclosure (Item 19) prevents assessment of actual franchisee profitability and ROI
  4. 04MINORWide investment range ($10,100–$130,650) suggests inconsistent startup costs and unclear requirements
  5. 05MINORUnprotected territory enables franchisor to oversaturate markets and cannibalize existing franchisee revenue
  6. 06MINORShort 3-year term creates high renewal risk and limits long-term business planning ability
  7. 07MEDNo disclosed average revenue or net income makes due diligence impossible and suggests weak unit economics

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.