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B58/100FDD 2024

Trademark Collection by Wyndham — Litigation & Risk

Lodging - Hotels & Motels · FDD Items 3, 4 & 5

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Elevated Risk

10 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
10
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
58 / 100
FranchiseVerdict composite
Rating
MODERATE
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
21
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
Not required
You retain the right to sue in court
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
No
Franchisor can match any purchase offer when you try to sell
Governing law
New Jersey
State whose law governs disputes — relevant if you're not based there

What drove the 58/100 rating

Risk Score Breakdown

  1. 01MINORNo financial performance disclosures (Item 19) despite wide investment range ($216K-$17M), making ROI assessment impossible
  2. 02HIGHAggressive litigation portfolio spanning price-fixing, antitrust, privacy violations, and FTC settlements indicating systemic compliance issues
  3. 03MINORExplosive unit growth (35.9% YoY) suggests rapid expansion without quality control; unsustainable growth often precedes contraction
  4. 04MINORNo territory protection combined with unprotected market creates franchisee cannibalization risk and commoditization
  5. 05MEDHigh royalty burden (5.5% of gross revenues) with no disclosed average revenue means franchisees absorb risk blindly
  6. 06MINORWide investment variance ($216K to $17M) indicates unpredictable startup costs and inconsistent unit economics
  7. 07MINOR20-year term locks franchisees into brand during period of active legal/regulatory challenges

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.