FDD Items 3 & 4 · 2025 filing
We Rock The Spectrum Kid’s Gym litigation history
What We Rock The Spectrum Kid’s Gym disclosed about lawsuits, arbitrations and bankruptcy in the 2025 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
- 2
- Item 3, as counted in the filing
- Largest disclosed settlement
- $110K
- As stated in Item 3
- Bankruptcy (Item 4)
- None
- Franchisor, parent, predecessor or officer
- Filing year
- 2025
- Disclosures cover the prior ten years
Extracted from the 2025 Franchise Disclosure Document
Item 3: litigation
Case 1 (17-cv-03055-RBJ-NYW): We Rock the Spectrum, LLC v. 5 Hearts, LLC et al. in U.S. District Court, District of Colorado, filed December 18, 2017. Franchisor sued franchisee and guarantors for breach of franchise agreement, covenant not to compete, and guarantee. Settled January 31, 2018 with franchise termination, de-identification, and refunds. Case 2 (BC716981): Aleksandr Zeltser and Yelena Zeltser v. We Rock The Spectrum, LLC in Los Angeles Superior Court, filed August 7, 2018. Franchisees sued franchisor for breach of contract and breach of implied covenant of good faith and fair dealing under settlement agreement. Claims paid in full before summary judgment. Motion for attorney fees denied; costs and prejudgment interest awarded to plaintiffs totaling approximately $5,350.87 as of September 9, 2021 with no collection efforts to date.
Disclosure signals that moved the score
How this shows up in the verdict
- Two routine litigation matters, both resolved/franchisor-initiated
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?