FDD Items 3 & 4 · 2026 filing
Rainbow International litigation history
What Rainbow International 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
- $541K
- 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
Franchisor/Predecessor prevailed in a 2024 judgment (affirmed on appeal March 2026, rehearing pending) against former franchisees Cheyenne Partners/Kitts for breach of non-compete, trade secret misappropriation, and unpaid fees, receiving $541,036 (plus $71,773 to affiliate Grounds Guys) in damages; defendants' counterclaims under Michigan Franchise Investment Law, Sherman Act, fraud, etc. were all denied. Separately, franchisor filed suit in October 2025 against a franchisee (Rapid Response Disaster Services) to collect monies owed.
Disclosed in the 2026 Franchise Disclosure Document
Item 4: bankruptcy
No bankruptcy involving the Franchisor, its predecessor, or officers. Item 4 discloses bankruptcy proceedings of unrelated portfolio companies controlled by KKR (Marelli Holdings, The Collected Group, Envision Healthcare, Genesis Care, IPI Legacy Liquidation, Cafe Coffee Day) - none involve the Franchisor.
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?