What is the name of the lawsuit involving the Bft franchise mentioned in this section?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
Nickle Acquisition LLC v. Xponential Fitness, Inc. et al., filed February 3, 2025, Superior Court of the State of California, County of Orange, Case No. 30-2025-01459041-CU-AT-CXC (the "Nickle Acquisition Lawsuit"). This action was filed by Nickle Acquisition LLC ("Nickle Acquisition"), a former franchisee of the BFT and CycleBar franchise brands, and its purported owners, Michael D. Nickle and Jana Nickle ("Nickles" together with Nickle Acquisition, "Nickle Plaintiffs"), asserting that one or more of XFI, CB, CB SPV, BFT, BFT SPV, Xponential, Xponential Intermediate Holdings LLC, Assetco, H&W Franchise Intermediate Holdings LLC, LAG FIT, Inc., H&W Investco LP, H&W Investco II LP, MGAG LLC, Anthony Geisler, Mark Grabowski, Trevor Lucas, Lou DeFrancisco, Ryan Junk, Sarah Luna, Lance Freeman, Kristie Lavasile, and Navitas Credit Corp. (collectively, the "Nickle Defendants"): (a) violated the California Franchise Investment Law for allegedly (i) failing to disclose directors, principal officers, and individuals with management responsibility and litigation and material terms of settlements in Franchise Disclosure Documents; (ii) willfully making untrue statements regarding franchisee's estimated initial investment and time to open studios in the in Franchise Disclosure Documents; and (iii) failing to timely disclose the Franchise Disclosure Documents; (b) willfully made untrue financial performance representations and other representations and failing to disclose financial performance representations in Franchise Disclosure Documents; (c) breached the franchise agreements and covenant of good faith and fair dealing by allegedly undercutting membership sales; (d) made fraudulent omissions by allegedly failing to disclose kickbacks, financial relationships, lack of standard due diligence, and material facts regarding the Xponential franchise system; and (e) committed fraudulent inducement by allegedly making misrepresentations regarding the Castle Pines CycleBar studio performance. Nickle Plaintiffs seek declaratory judgment that the franchise agreements, including the arbitration provisions, are void and unenforceable, and rescission of the franchise agreements, actual and special damages, attorneys' fees, costs, and interest.
Source: Item 3 — LITIGATION (FDD pages 14–18)
What This Means (2025 FDD)
According to the 2025 FDD, the lawsuit involving the Bft franchise is named Nickle Acquisition LLC v. Xponential Fitness, Inc. et al. This lawsuit was filed on February 3, 2025, in the Superior Court of the State of California, County of Orange, with Case No. 30-2025-01459041-CU-AT-CXC. The plaintiffs, Nickle Acquisition LLC, a former franchisee of Bft and CycleBar, along with Michael D. Nickle and Jana Nickle, are asserting several claims against Xponential Fitness, Inc. and related entities.
The Nickle Plaintiffs allege violations of the California Franchise Investment Law, claiming failures in disclosing directors, officers, litigation details, and material settlement terms in the Franchise Disclosure Documents. They also allege untrue statements regarding the estimated initial investment and studio opening times. Furthermore, the plaintiffs claim that Bft made untrue financial performance representations and failed to disclose such representations in the FDD.
In addition to these disclosure-related claims, the Nickle Plaintiffs allege breach of contract and the covenant of good faith and fair dealing, citing undercutting membership sales. They also claim fraudulent omissions related to kickbacks, financial relationships, and a lack of standard due diligence. The plaintiffs further allege fraudulent inducement based on misrepresentations about the performance of the Castle Pines CycleBar studio. As a result, the Nickle Plaintiffs are seeking a declaratory judgment that the franchise agreements are void and unenforceable, rescission of the agreements, actual and special damages, attorneys' fees, costs, and interest.