FDD Items 3 & 4 · 2026 filing
The Daily Pilates litigation history
What The Daily Pilates disclosed about lawsuits, arbitrations and bankruptcy in the 2026 Franchise Disclosure Document. Item 3 lists the material legal actions a franchisor must report; Item 4 covers bankruptcy. This is the franchisor's own disclosure, not a court record, and not legal advice.
Items 3 & 4 at a glance
What the filing discloses
- Cases disclosed
- 2
- Item 3, as counted in the filing
- Largest disclosed settlement
- $100K
- As stated in Item 3
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2026
- Disclosures cover the prior ten years
Extracted from the 2026 Franchise Disclosure Document
Item 3: litigation
Two arbitration cases filed by Georgia franchisees (Nikki Hightower and Jessica Davis Conner) on October 21, 2025: Case No. 01-25-0005-2690 asserting violations of Georgia statutes including breach of legal duty, Uniform Deceptive Trade Practices Act, Sale of Business Opportunities Act, Fair Business Practices Act, breach of franchise agreement, and unjust enrichment; Case No. 01-25-0005-2693 alleging wrongful termination of second franchise agreement. Settlement reached January 2026: royalty rate reduced from 10% to 7.5%, no Marketing Fund Contributions, waiver of post-termination non-competition covenant, buyout right for $100,000 upon franchise expiration. Mutual releases and confidentiality agreements executed.
Disclosure signals that moved the score
How this shows up in the verdict
- No bankruptcy/going-concern
The verdict grade is FranchiseVerdict's editorial assessment across SBA loan performance, unit growth, revenue and disclosure signals. It is not investment advice.
Before you weigh a lawsuit
How to read Item 3
A franchisor must disclose pending actions and any material civil action involving the franchise relationship, plus convictions or civil judgments for fraud, unfair or deceptive practices, or franchise-law violations, going back ten years. A case the franchisor brought against a franchisee counts too. Item 3 does not include every dispute: settled claims below the materiality line and matters resolved in private arbitration can be absent.
Questions worth asking current and former franchisees, using the contact list in Item 20:
- Were you, or anyone you know in the system, party to a dispute with the franchisor?
- Was it resolved by settlement, arbitration or a court, and on what terms?
- Has the number of disputes gone up or down since you signed?