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 (litigation) & 4 (bankruptcy) at a glance
What the filing discloses
- Cases disclosed
- 4
- Item 3, as counted in the filing
- Largest settlement, franchisor's own cases
- 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.
Item 3 (litigation) · 4 matters disclosed · 4 pending listed
Litigation cases
The franchisor
Pending (3)
NN3 BP Associates, LLC v. Noble Ventures 317, LLC d/b/a Verlo Mattress, Jeremy M. Knepp, and Tracy M. Knepp v. FWR, LLC dba Verlo Mattress
pendingBrought by the franchisor · filed 2025-09-19 · Hamilton County, Indiana (Cause No. 29D05-2509- PL-010521) · 29D05-2509- PL-010521
“NN3 BP Associates, LLC v. Noble Ventures 317, LLC d/b/a Verlo Mattress, Jeremy M.”Page 11 of the 2026 FDD, Item 3
North Shore Z’s LLC v. FWR, LLC dba Verlo Mattress
pendingBrought by a franchisee · filed 2025-05-01 · American Arbitration Association · 01-25-0002- 1172
“… AAA Case No. 01-25-0002- 1172. On May 1, 2025, North Shore Z’s, LLC (“North Shore”) filed a demand for arbitration against Verlo, Dirk Stallmann, Bobby Cleveland, Marcus Investments, LLC, and The Marcus Corporation.”Page 11 of the 2026 FDD, Item 3
MKD Investment Holdings, LLC v. FWR, LLC dba Verlo Mattress
pendingBrought by a franchisee · filed 2024-12-19 · American Arbitration Association · 01- 24-0009-2406
“… AAA Case No. 01- 24-0009-2406 (the “MKD Arbitration”). On December 19, 2024, MKD Investment Holdings, LLC (“MKD”) submitted to the American Arbitration Association (“AAA”) a demand for arbitration”Page 10 of the 2026 FDD, Item 3
Parent, affiliates, master franchisor and subfranchisor
Pending (1)
The Marcus Corporation, et al. v. MKD Investment Holdings, LLC
pendingThe Marcus Corporation, Marcus Investments, LLC and Dirk Stallmann · filed 2025-08-01 · U.S. District Court for the Eastern District of Wisconsin · 25-CV- 1131-SCD
“… Case No. 25-CV- 1131-SCD (the “MKD Court Action”). On August 1, 2025, The Marcus Corporation, Marcus Investments, LLC, and Dirk Stallmann (the “Non-Signatories”) filed a declaratory judgment action in the U.S. District Court for the Eastern District of Wisconsin.”Page 11 of the 2026 FDD, Item 3
Item 3 lists the litigation the franchisor must disclose; a matter against a parent, an affiliate or a named officer is not a matter against the franchisor, and pending claims are allegations, not findings.
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?