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B61/100FDD 2025

Voodoo Brewing Co. — Litigation & Risk

Food & Beverage - Full Service · 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
61 / 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
38
Government-backed loans issued
Default rate
0.0%
vs <3% typical · system-wide
5-yr default rate
0.0%
Defaults
0 loans
Loans charged off or defaulted
Total loan volume
$20.7M
Avg loan size
$544K
Participating lenders
7

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
2 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
Pennsylvania
State whose law governs disputes — relevant if you're not based there

What drove the 61/100 rating

Risk Score Breakdown

  1. 01HIGHGoing concern warning indicates potential financial distress at franchisor level
  2. 02HIGHThree active/recent litigation cases including fraud/misrepresentation allegation regarding liquor licenses—critical operational asset
  3. 03MINOR76.9% YoY unit growth masks absolute unit count (23 total)—extremely small system with high volatility risk
  4. 04MEDNo disclosed average revenue or net income prevents ROI validation; 6% royalty on undisclosed sales is opaque
  5. 05HIGHLiquor license fraud litigation (NERco case) directly threatens franchisee's ability to operate core business
  6. 06MEDTwo prior arbitrations (settled/dismissed) suggest unresolved franchisee grievances and relationship deterioration
  7. 07MINORHigh investment range ($481.5K–$1.625M) combined with no performance benchmarks creates severe information asymmetry

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.