FranchiseVerdict
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D76/100FDD 2023

Talkin’ Tacos — Litigation & Risk

Food & Beverage - Full Service · 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
76 / 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
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 76/100 rating

Risk Score Breakdown

  1. 01MINOROnly 4 units in system with unknown/likely stagnant growth trajectory raises viability concerns
  2. 02HIGHGoing Concern = False indicates potential financial distress or structural weakness at franchisor level
  3. 03MINORNo Item 19 financial disclosures (average revenue/net income) prevents ROI validation and suggests franchisor may lack credible performance data
  4. 04MEDHigh investment range ($271K-$575K) with no disclosed average unit economics creates blind spot for franchisee profitability
  5. 05MINORExtremely small franchise system (4 units) offers minimal support infrastructure and weak brand recognition
  6. 06MINOR10-year term locks franchisee into relationship with undercapitalized franchisor lacking proven operational track record

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.