FranchiseVerdict
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B60/100FDD 2025

Wushu Central’s Kung Fu Kids — Litigation & Risk

Health & Fitness · FDD Items 3, 4 & 5

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Lower Risk

No litigation cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
0
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
60 / 100
FranchiseVerdict composite
Rating
MODERATE
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
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
Delaware
State whose law governs disputes — relevant if you're not based there

What drove the 60/100 rating

Risk Score Breakdown

  1. 01MINOROnly 3 existing units with unknown growth trajectory indicates minimal system scale and unproven expansion model
  2. 02HIGHGoing Concern status is False, suggesting potential financial instability or structural issues at franchisor level
  3. 03MINORHigh initial investment range ($213.5K-$396.8K) against only 3 reference units limits ability to validate ROI claims
  4. 04MEDNo Item 19 financial performance representations disclosed; cannot verify if $942K average revenue and $178K net income are achievable or cherry-picked
  5. 05MINORExtremely small franchisee base (3 units) creates survivorship bias and insufficient data for meaningful financial projections

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.