F82/100FDD 2026
The James — Litigation & Risk
Lodging - Hotels & Motels · FDD Items 3, 4 & 5
Elevated Risk
22 cases disclosed in FDD Items 3 and 4.
Source: FDD Items 3–5
FDD Items 3 & 4
Litigation Metrics
Cases disclosed
22
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
82 / 100
FranchiseVerdict composite
Rating
AVOID
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
13
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
—
Defaults
0 loans
Loans charged off or defaulted
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
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
Massachusetts
State whose law governs disputes — relevant if you're not based there
What drove the 82/100 rating
Risk Score Breakdown
- 01HIGHGoing Concern status FALSE indicates franchisor financial instability and potential business failure risk
- 02MINORZero operating franchise units with unknown growth trajectory suggests failed or non-existent franchise system
- 03HIGHExtensive litigation including stockholder suits, trademark disputes, breach of contract, and collection actions against former franchisees indicates systemic operational and legal problems
- 04MINORNo average revenue or net income disclosure prevents ROI validation and suggests poor or unreliable performance data
- 05MINORUnprotected territory creates direct competition risk from other franchisees with no geographic exclusivity
- 06MEDHigh $3.165M investment requirement with no disclosed returns, unit growth, or financial performance metrics
- 07MINORCollection actions against former franchisees indicates payment difficulties and potential franchise failure pattern
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.