The Original Pancake House: Litigation & Risk
Full-Service Restaurants · FDD Items 3, 4 & 5
Elevated Risk
2 cases disclosed in FDD Items 3 and 4. Bankruptcy disclosed in Item 4.
FDD Items 3 & 4
Litigation Metrics
- Cases disclosed
- 2
- Total from FDD Items 3 and 4
- Bankruptcy (Item 4)
- Disclosed
- Franchisor or officer bankruptcy
- Verdict score
- 56 / 100
- FranchiseVerdict composite · higher is better
- Rating
- B
- A / B / C / D / F verdict grade
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Charge-off rate is the share of loans that were charged off or settled for less than the full balance.
- Total 7(a) loans
- 59
- Government-backed loans issued
- Charge-off rate
- 13.6%
- vs 16% franchise average
- 5-yr charge-off rate
- 0.0%
- Defaults
- 6 loans
- Loans charged off or defaulted
- Total loan volume
- $32.0M
- Avg loan size
- $542K
- Participating lenders
- 11
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
- 1 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
- Oregon
- State whose law governs disputes. Relevant if you're not based there
Extracted from FDD Item 3
Litigation Detail
The Original Pancake House Franchising, Inc. brought 2 cases against franchisees during fiscal year 2024: (1) Case No. 24CV05538 in Oregon Circuit Court (Multnomah County) against Top H Enterprises, LLC, Forever Holdings, LLC, and Taylor McEver for collection of royalty payments and enforcement of reporting requirements; (2) Case No. 24GC07047 in Georgia Superior Court (Cobb County) against the same defendants to enforce a default judgment obtained in the first matter.
What drove the 56/100 verdict
Risk Score Breakdown
- 01MINORStrong financials: net income $3.95M, equity $863,185
- 02MINOR147 units, established since 1991
- 03MINOR2 suits are franchisor-plaintiff collections (routine)
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.