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D72/100FDD 2024

Purvelo — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

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Elevated Risk

8 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
8
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
72 / 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
Yes
Franchisor can match any purchase offer when you try to sell
Governing law
Virginia
State whose law governs disputes — relevant if you're not based there

What drove the 72/100 rating

Risk Score Breakdown

  1. 01MINOROnly 4 units system-wide with unknown growth trajectory suggests minimal scale and unproven model replicability
  2. 02MEDNo disclosed average revenue or net income (no Item 19) prevents financial performance validation and raises transparency concerns
  3. 03HIGHMultiple litigation cases against affiliates and CEO Paul Flick involving breach of contract, misrepresentation, and state regulatory actions across 5 states indicate pattern of legal/compliance issues
  4. 04MINORHigh initial investment ($355,920-$512,320) combined with aggressive royalty structure (6% or $250/week minimum) creates significant downside risk with unproven unit economics
  5. 05HIGHGoing concern status suggests financial instability at corporate level, creating franchise support and viability risk
  6. 06HIGHAffiliate litigation directly implicates management credibility and operational integrity across PSB Group entities

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.