FDD Items 3 & 4 · 2026 filing
Verlo Mattress litigation history
What Verlo Mattress disclosed about lawsuits, arbitrations and bankruptcy in the 2026 Franchise Disclosure Document. Item 3 lists the material legal actions a franchisor must report; Item 4 covers bankruptcy. This is the franchisor's own disclosure, not a court record, and not legal advice.
Items 3 & 4 at a glance
What the filing discloses
- Cases disclosed
- 4
- Item 3, as counted in the filing
- Largest disclosed settlement
- None stated
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2026
- Disclosures cover the prior ten years
Extracted from the 2026 Franchise Disclosure Document
Item 3: litigation
Four disclosed cases as of Item 3: (1) MKD Investment Holdings, LLC v. FWR, LLC (AAA arbitration, filed Dec. 2024) alleging misrepresentation in the FDD, seeking rescission and $2M damages; Verlo counterclaimed; (2) The Marcus Corporation, et al. v. MKD Investment Holdings, LLC (E.D. Wis. declaratory judgment action re: arbitrability, filed Aug. 2025), with MKD counterclaiming; (3) North Shore Z's LLC v. FWR, LLC (AAA arbitration, filed May 2025) alleging misrepresentation, seeking rescission and $700,000 damages, with Verlo counterclaiming; final hearing scheduled Sept. 2026; (4) NN3 BP Associates, LLC v. Noble Ventures 317, LLC, et al. (Indiana state court, landlord breach-of-lease action) in which the franchisee cross-claimed against Verlo alleging FDD misrepresentation; Verlo's motion to compel arbitration was granted.
Disclosure signals that moved the score
How this shows up in the verdict
- No litigation or bankruptcy
The verdict grade is FranchiseVerdict's editorial assessment across SBA loan performance, unit growth, revenue and disclosure signals. It is not investment advice.
Before you weigh a lawsuit
How to read Item 3
A franchisor must disclose pending actions and any material civil action involving the franchise relationship, plus convictions or civil judgments for fraud, unfair or deceptive practices, or franchise-law violations, going back ten years. A case the franchisor brought against a franchisee counts too. Item 3 does not include every dispute: settled claims below the materiality line and matters resolved in private arbitration can be absent.
Questions worth asking current and former franchisees, using the contact list in Item 20:
- Were you, or anyone you know in the system, party to a dispute with the franchisor?
- Was it resolved by settlement, arbitration or a court, and on what terms?
- Has the number of disputes gone up or down since you signed?