FranchiseVerdict
The Casual Pint logo
D70/100FDD 2025

The Casual Pint — Litigation & Risk

Other · FDD Items 3, 4 & 5

Back to overview

Moderate — Review

1 case disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
1
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
70 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID

7(a) FOIA data · FY2020–present

SBA Loan Performance

Aggregated from public SBA 7(a) loan disclosures. Default rate is the share of loans that were charged off or settled for less than the full balance.

Total 7(a) loans
12
Government-backed loans issued
Default rate
10.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
1 loans
Loans charged off or defaulted
Total loan volume
$3.4M
Avg loan size
$287K
Participating lenders
6

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
Tennessee
State whose law governs disputes — relevant if you're not based there

What drove the 70/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern status is FALSE — indicates potential financial distress or uncertainty at franchisor level
  2. 02MEDNo Item 19 (Average Unit Volume) disclosed — cannot validate $715,823 avg revenue claim or assess ROI feasibility
  3. 03HIGHLitigation history: 2017 arbitration case alleging misleading statements by franchisor; reputational and disclosure integrity concern
  4. 04MINORStagnant unit growth: Only 18 units with unknown trajectory suggests weak franchisee acquisition and retention
  5. 05MEDHigh initial investment ($914K-$1.67M) against undisclosed net income creates profitability blind spot
  6. 06MINOR5% royalty on net sales compounds risk if revenue projections are optimistic or territory underperforms

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.