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B65/100FDD 2025

TA Tracy Anderson — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

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Lower Risk

No litigation cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
65 / 100
FranchiseVerdict composite
Rating
MODERATE
STRONG / MODERATE / CAUTION / AVOID

FDD Items 5, 6 & 17 — what you give up

Contract Risk Indicators

Mandatory arbitration
Not required
You retain the right to sue in court
Jury trial waiver
Waived
You give up the right to a jury trial
Non-compete
3 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
New York
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MEDNo Item 19 financial performance representations disclosed — cannot validate if $1.3M-$2.6M investment generates positive ROI
  2. 02MINOROnly 5 franchised units with unknown growth trajectory suggests minimal system traction or contraction risk
  3. 03MEDHigh capital requirement ($1.3M-$2.6M) paired with undisclosed average revenue creates severe ROI uncertainty
  4. 04MED7% royalty on gross revenue is standard but with no disclosed profitability metrics, cannot assess viability at break-even
  5. 05MINORFranchise fee ($50K) is low relative to total investment, suggesting most capital is buildout — high sunk cost risk

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.