AStrongest tier59/100FDD 2026
Surestay: Litigation & Risk
Lodging · FDD Items 3, 4 & 5
Elevated Risk
27 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
- Cases disclosed
- 27
- Total from FDD Items 3 and 4
- Bankruptcy (Item 4)
- None
- Franchisor or officer bankruptcy
- Verdict score
- 59 / 100
- FranchiseVerdict composite · higher is better
- Rating
- A
- A / B / C / D / F verdict grade
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Charge-off rate is the share of loans that were charged off or settled for less than the full balance.
- Total 7(a) loans
- 58
- Government-backed loans issued
- Charge-off rate
- 4.5%
- vs 16% franchise average
- 5-yr charge-off rate
- 0.0%
- Defaults
- 1 loans
- Loans charged off or defaulted
- Total loan volume
- $158.2M
- Avg loan size
- $2.7M
- Participating lenders
- 26
FDD Items 5, 6 & 17: What You Give Up
Contract Risk Indicators
- Mandatory arbitration
- Not required
- You retain the right to sue in court
- Franchisor can compete
- Yes
- Franchisor can open competing locations in or near your territory
- Right of first refusal
- No
- Franchisor can match any purchase offer when you try to sell
- Governing law
- Arizona
- State whose law governs disputes. Relevant if you're not based there
Extracted from FDD Item 3
Litigation Detail
Item 3 discloses 2 concluded cases involving SureStay directly (franchisee suits for wrongful termination, settled for $125,000 and $165,000) and numerous cases involving parent Best Western International, including franchisee/member counterclaims for wrongful termination and breach of contract, several state regulatory consent orders/settlements for unregistered franchise/membership offerings (California $500,000, Maryland $297,000 penalty, Virginia, Washington), and multiple 2025 fee-collection suits BWI initiated against terminated members.
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.