Who is the plaintiff in the lawsuit against Bft and other related entities?
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 Bft's 2025 Franchise Disclosure Document, Nickle Acquisition LLC, along with its owners Michael D. Nickle and Jana Nickle, are the plaintiffs in a lawsuit against Bft and related entities. This lawsuit, filed on February 3, 2025, in the Superior Court of the State of California, County of Orange, is titled Nickle Acquisition LLC v. Xponential Fitness, Inc. et al. The plaintiffs are collectively referred to as the "Nickle Plaintiffs."
The Nickle Plaintiffs, who are former franchisees of both the BFT and CycleBar brands, allege several violations. These include violations of the California Franchise Investment Law related to disclosures in Franchise Disclosure Documents, making untrue financial performance representations, breach of franchise agreements, fraudulent omissions, and fraudulent inducement. The Nickle Plaintiffs are seeking a declaratory judgment that the franchise agreements are void, rescission of the agreements, actual and special damages, attorneys' fees, costs, and interest.
This lawsuit is significant for prospective Bft franchisees as it highlights potential risks related to the accuracy and completeness of information provided in the Franchise Disclosure Document, as well as potential disputes over financial performance representations and the franchisor's conduct. It is important for potential franchisees to carefully review the FDD, conduct thorough due diligence, and seek legal counsel to understand the implications of this and other pending litigation involving Bft and its related entities.