FranchiseVerdict
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B66/100FDD 2025

Yi Fang Taiwan Fruit Tea — Litigation & Risk

Food & Beverage - Juice & Smoothies · FDD Items 3, 4 & 5

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Moderate — Review

4 cases disclosed in FDD Items 3 and 4.

Source: FDD Items 3–5

FDD Items 3 & 4

Litigation Metrics

Cases disclosed
4
Total from FDD Items 3 and 4
Bankruptcy (Item 4)
—
Franchisor or officer bankruptcy
Overall risk score
66 / 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
Non-compete
1 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
New York
State whose law governs disputes — relevant if you're not based there

What drove the 66/100 rating

Risk Score Breakdown

  1. 01MEDUnit count declined 5.7% YoY (33 units) indicating system contraction and potential franchisee struggles
  2. 02MINORFranchisor involved in regulatory investigations and consent orders across multiple states (CA, NY, WA) for franchise registration violations and data misrepresentation — suggests compliance and transparency issues
  3. 03MEDNo average revenue or net income disclosed in FDD Item 19 — inability to assess unit economics or franchisee profitability potential
  4. 04HIGHGoing concern status indicates financial viability uncertainty for the franchisor itself
  5. 05MED3-year term is short and risky — limited time to recoup $118,700-$221,250 investment plus working capital
  6. 06MED4% royalty on undisclosed revenue baseline makes financial projections impossible to validate

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.