FDD Items 3 & 4 · 2025 filing

Shipley Do-Nuts litigation history

What Shipley Do-Nuts disclosed about lawsuits, arbitrations and bankruptcy in the 2025 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: 9; Item 3, as counted in the filing

Largest settlement, franchisor's own cases: None stated

Bankruptcy (Item 4): None; Franchisor, parent, predecessor or officer

Filing year: 2025; Disclosures cover the prior ten years

Extracted from the 2025 Franchise Disclosure Document

Item 3: litigation

Shipley Franchise Company LLC and Shipley Do-Nut Flour and Supply Co LLC are involved in 4 pending litigation cases against former franchisees. Cases involve claims of trademark infringement, unfair competition, deceptive trade practices violations, and breach of contract. All defendants have filed counterclaims alleging wrongful termination and violations of the Arkansas Franchise Practices Act. Defendant counterclaims in 3 cases (Sonny Ros, Botny Heang, Llina Lab) have been dismissed by the Court. One case (Jeffrey Ek) is stayed due to defendant's Chapter 7 bankruptcy filing. Discovery is ongoing in active cases. Attorney fees of $7,607.80 were awarded in one case.

Item 3 (litigation) · 9 matters disclosed · 8 pending listed

Litigation cases

The franchisor

Pending (8)

Georgia Taco, LLC v. Shipley Franchise Company, LLC, et al.
pending
Brought by a third party · filed 2024 · Gwinnett County, Georgia · 24-A-08227-10
“… Civil Action No. 24-A-08227-10, Gwinnett County, Georgia Plaintiff, a landlord of a premises - - that we leased and then subsequently assigned our franchisee, AFRD Shipley 1, LLC (“Franchisee”) - -”Page 12 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Botny Heang, d/b/a Starhouse Donuts
pending
Brought against a franchisee · filed 2022-06-07 · Pulaski Co. Cir., Ark. · 60CV-22-3029
“Shipley Do-Nut Flour and Supply Co LLC v. Botny Heang, d/b/a Starhouse Donuts, Case No. 60CV-22-3029 (Pulaski Co. Cir., Ark.) (Filed: June 7, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee, and”Page 10 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Bun Chhhun, and Vin Thada TV
pending
Brought against a franchisee · filed 2022-08-08 · Columbia Co. Cir., Ark. · 14CV-22-179-4
“Shipley Do-Nut Flour and Supply Co LLC v. Bun Chhhun, and Vin Thada TV, Case No. 14CV-22-179-4 (Columbia Co. Cir., Ark.) (Filed: August 8, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendants, former franchisees, and”Page 11 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Carolyn Ros, d/b/a Monticello Donuts
pending
Brought against a franchisee · filed 2022-08-08 · Drew Co. Cir., Ark. · 22CV-22-111
“Shipley Do-Nut Flour and Supply Co LLC v. Carolyn Ros, d/b/a Monticello Donuts, Case No. 22CV-22-111 (Drew Co. Cir., Ark.) (Filed: August 8, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee, and”Page 11 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Evelyn Jones, d/b/a Doughboy Donuts
pending
Brought against a franchisee · filed 2022-08-04 · Pulaski Co. Cir., Ark. · 60CV-22-5184
“Shipley Do-Nut Flour and Supply Co LLC v. Evelyn Jones, d/b/a Doughboy Donuts, Case No. 60CV-22-5184 (Pulaski Co. Cir., Ark.) (Filed: August 4, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee,”Page 11 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Jeffrey Ek, d/b/a Grandpa’s Donuts
pending
Brought against a franchisee · filed 2022-05-06 · Pulaski Co. Cir., Ark. · 60CV-22-2903
“Shipley Do-Nut Flour and Supply Co LLC v. Jeffrey Ek, d/b/a Grandpa’s Donuts, Case No. 60CV-22-2903 (Pulaski Co. Cir., Ark.) (Filed: May 6, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee, and”Page 10 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Llina Lab, d/b/a Starhouse Donuts
pending
Brought against a franchisee · filed 2022-05-16 · White Co. Cir., 1st Div., Ark. · 73CV-22-376
“Shipley Do-Nut Flour and Supply Co LLC v. Llina Lab, d/b/a Starhouse Donuts, Case No. 73CV-22-376 (White Co. Cir., 1st Div., Ark.) (Filed: May 16, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee,”Page 10 of the 2025 FDD, Item 3
Shipley Franchise Company LLC, and Shipley Do-Nut Flour and Supply Co LLC v. Sonny Ros, d/b/a Starhouse Donuts
pending
Brought against a franchisee · filed 2022-03-21 · Pulaski Co. Cir., Ark. · 60CV-22-2593
“Shipley Do-Nut Flour and Supply Co LLC v. Sonny Ros, d/b/a Starhouse Donuts, Case No. 60CV-22-2593 (Pulaski Co. Cir., Ark.) (Filed: March 21, 2022) SFC and Shipley Do-Nut Flour and Supply Co LLC filed a lawsuit against the Defendant, a former franchisee, and”Page 10 of the 2025 FDD, Item 3

Status not stated in the filing (1)

Matter with no printed caption
Brought against a franchisee · filed 2024-06-05 · Circuit Court of Faulkner County, Arkansas · 23CV-24-1038
“June 5, 2024 Circuit Court of Faulkner County, Arkansas 23CV-24-1038 Rany Pao, d/b/a L&M Donuts Breach of Franchise Agreement Except with respect to the foregoing, there is no litigation that must be disclosed in this Item.”Page 12 of the 2025 FDD, Item 3

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.

Disclosure signals that moved the score

How this shows up in the verdict

7 litigation matters (franchisor mostly plaintiff)

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?

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