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B65/100FDD 2025

The Local Fry — 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
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
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
Maryland
State whose law governs disputes — relevant if you're not based there

What drove the 65/100 rating

Risk Score Breakdown

  1. 01MINOROnly 1 existing unit makes performance claims unverifiable and system viability unproven
  2. 02MEDNo Item 19 (average revenue/net income) disclosed—impossible to validate ROI claims or benchmark performance
  3. 03MEDHigh initial investment ($556.5k–$755.5k) with no disclosed average unit economics creates significant financial risk
  4. 04MINORSingle-unit franchise system suggests either brand is brand new, failed to scale, or franchisor lacks operational maturity
  5. 05MINOR6% royalty on 'Adjusted Gross Sales' requires clarification—non-standard language may hide additional fees or revenue manipulation 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.