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A44/100FDD 2026

Orangetheory Fitness — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

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Moderate — Review

3 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
3
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
44 / 100
FranchiseVerdict composite
Rating
STRONG
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
455
Government-backed loans issued
Default rate
1.6%
vs <3% typical · system-wide
5-yr default rate
3.0%
Defaults
5 loans
Loans charged off or defaulted
Total loan volume
$254.9M
Avg loan size
$560K
Participating lenders
76

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
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 44/100 rating

Risk Score Breakdown

  1. 01MEDUnit count declined 5.8% YoY (1224 to ~1152 units) indicating system contraction and potential market saturation
  2. 02MEDNet income not disclosed in Item 19 prevents ROI analysis; only average revenue of $802,145 provided without profitability metrics
  3. 03HIGHMultiple litigation actions including settled arbitration for demographic misrepresentation, permanent Illinois injunction for FDD violations, and NY Assurance of Discontinuance for unregistered sales — suggests compliance and disclosure issues
  4. 04MINORHigh total investment ($764K-$1.1M) combined with 8% royalty creates significant fixed costs with unclear profit margins
  5. 05HIGHGoing Concern status raises questions about franchisor's financial stability and long-term viability

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.