FranchiseVerdict
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D70/100FDD 2023

USL League One — Litigation & Risk

Other · FDD Items 3, 4 & 5

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Moderate — Review

3 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
3
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
70 / 100
FranchiseVerdict composite
Rating
CAUTION
STRONG / MODERATE / CAUTION / AVOID

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
Non-compete
5 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
No
Franchisor can match any purchase offer when you try to sell
Governing law
Florida
State whose law governs disputes — relevant if you're not based there

What drove the 70/100 rating

Risk Score Breakdown

  1. 01HIGHGoing Concern = False indicates serious financial/operational viability questions at corporate level
  2. 02MEDNo Item 19 (Average Unit Volume) disclosed — inability or unwillingness to share revenue/profitability data is a major red flag
  3. 03HIGHActive litigation (employment and discrimination lawsuits) suggests governance, culture, and legal liability issues within the league
  4. 04MINORHigh franchise fee ($5M) combined with slow unit growth (9.1% YoY to only 12 total units) indicates weak market demand and franchisee struggles
  5. 05MINORRoyalty structure capped at $115K annual with 15% escalation clause creates unpredictable cost burden; combined fee + royalty may exceed ROI capacity
  6. 06MINORSmall system size (12 units) limits brand leverage, supplier economies, and marketing scale
  7. 07MEDProfessional soccer in North America has historically faced sustainability issues; USL League One is a second-tier league with limited media revenue potential

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.