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 (litigation) & 4 (bankruptcy) at a glance
What the filing discloses
- Cases disclosed
- 2
- Item 3, as counted in the filing
- Largest settlement, franchisor's own cases
- $275K
- As stated in Item 3
- Bankruptcy (Item 4)
- Disclosed · an officer
- 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.
Item 3 (litigation) · 2 matters disclosed
Litigation cases
The franchisor
Concluded (2)
Oriole Group, LLC, Richard S. Stern and Michelle Stern v. Pool Scouts Franchising, LLC and Pool Scouts Services, LLC
settledBrought by a franchisee · filed 2024-06-28 · United States District Court for the Eastern District of Virginia, Norfolk Division · 2:24cv410
“… Civil Action No. 2:24cv410 (United States District Court for the Eastern District of Virginia, Norfolk Division, filed June 28, 2024).”Page 12 of the 2026 FDD, Item 3
Outcome: “Pursuant to a settlement agreement, we repurchased the franchises and certain assets used in connection with the franchise for $275,000 and agreed to reduce the period of the post-termination restrictive covenants; provided, however, that in the event the Oriole Group breaches the post-termination non-competition covenant they will be liable for liquidated damages.” (page 13)
Pool Scouts Franchising, LLC v. Stuart Road Corporation and Brent Berridge
settledBrought against a franchisee · filed 2024-04-11 · United States District Court for the Eastern District of Virginia, Norfolk Division · 2:24cv239
“… Civil Action No. 2:24cv239 (United States District Court for the Eastern District of Virginia, Norfolk Division, filed April 11, 2024).”Page 12 of the 2026 FDD, Item 3
Outcome: “The parties entered into a settlement agreement under which Stuart Road and Super Pools agreed to pay $240,250 to us. The action was dismissed with prejudice on June 26, 2025.”
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
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.
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?