D69/100FDD 2025
Supreme Deli — Litigation & Risk
Food & Beverage - Full Service · FDD Items 3, 4 & 5
Elevated Risk
7 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
7
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
69 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID
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
Texas
State whose law governs disputes — relevant if you're not based there
What drove the 69/100 rating
Risk Score Breakdown
- 01MINORMaterial securities law violations across three states (WA, MD, CA) involving unregistered franchise sales and failure to provide disclosure documents
- 02MINORNo financial performance disclosure (Item 19) — cannot verify if 40.9% unit growth translates to profitable operations
- 03MINORExtremely short 1-year franchise term creates instability and suggests franchisor lacks confidence in long-term viability
- 04MINORWide royalty range (5-25% of weekly gross sales) with no clarity on rate structure — potential for unexpected cost increases
- 05MINORUnprotected territory creates direct competition between franchisees and reduces exclusivity value
- 06MEDHigh initial investment ($27,975-$288,125 variance) relative to undisclosed revenue potential
- 07HIGHGoing Concern indicator is FALSE — suggests potential financial distress at franchisor level
- 08MINORRapid unit growth (40.9% YoY) may be driven by aggressive recruitment rather than organic unit profitability
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.