FDD Items 3 & 4 · 2026 filing
Pool Scouts litigation history
What Pool Scouts 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 & 4 at a glance
What the filing discloses
- Cases disclosed
- 2
- Item 3, as counted in the filing
- Largest disclosed settlement
- $275K
- As stated in Item 3
- 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
(1) Pool Scouts Franchising, LLC v. Stuart Road Corporation and Brent Berridge (E.D. Va., filed 2024) — franchisor sued former franchisee to enforce non-compete; defendant counterclaimed alleging fraud/DTPA violations; settled for $240,250 to franchisor, dismissed with prejudice 2025. (2) Oriole Group, LLC et al. v. Pool Scouts Franchising, LLC and Pool Scouts Services, LLC (E.D. Va., filed 2024) — former franchisee alleged fraud, RICO, DTPA, breach of contract; settled via franchisor repurchase of franchises/assets for $275,000, dismissed with prejudice 2025.
Disclosed in the 2026 Franchise Disclosure Document
Item 4: bankruptcy
Dave Warn, VP of Franchise Development, and spouse filed Chapter 13 personal bankruptcy petition April 24, 2014 (E.D. Cal., Sacramento); plan confirmed August 2014; standard discharge entered January 27, 2020. Not the franchisor entity itself.
Disclosure signals that moved the score
How this shows up in the verdict
- Going Concern = False suggests potential financial instability at corporate level despite unit growth
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?