FranchiseVerdict
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D72/100FDD 2025

Salty Paws Ice Cream Truck — Litigation & Risk

Food & Beverage - Ice Cream & Desserts · FDD Items 3, 4 & 5

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Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
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

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
1
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted

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

What drove the 72/100 rating

Risk Score Breakdown

  1. 01HIGHActive litigation alleging breach of contract and fraud by CEO/affiliate with specific damages claim ($45,063.45) suggests systemic training or disclosure failures
  2. 02HIGHGoing Concern status is FALSE — indicates the franchisor itself may be financially unstable or at risk of insolvency
  3. 03MEDNo average revenue or net income disclosure (Item 19) makes ROI analysis impossible; combined with only 9 units, suggests weak performance data the company does not want disclosed
  4. 04MINORTiny unit count (9 franchises) with unknown growth trajectory indicates either new/unproven concept or declining system; ice cream trucks are highly seasonal/weather-dependent with thin margins
  5. 05MINORWide investment range ($72K-$255K) suggests lack of standardization or scope creep; franchisees may face unexpected capital calls
  6. 06MINORRoyalty structure (greater of $500/mo or 6%) creates cash drain even in slow months; $500 minimum on $1,200/mo gross revenue = 42% royalty rate — unsustainable

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.