What is the status of the Consolidated Shareholder Derivative Action related to Bft?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
y be consolidated with the current actions.
Additionally, the Ayers Lawsuit and Akande Lawsuit were consolidated (the "Consolidated Shareholder Derivative Action") on June 24, 2024, and the Consolidated Shareholder Derivative Action is stayed pending final resolution of the consolidated Taylor General Lawsuit and WBP Pension Fund Lawsuit. It is possible that additional shareholder derivative lawsuits will be filed purportedly on behalf of XFI based on the same set of facts alleged in the Ayers Lawsuit and Akande Lawsuit.
City of Taylor General Employees Retirement System v. Xponential Fitness, Inc., Anthony Geisler, John Meloun, Mark Grabowski, Brenda Morris, Chelsea Grayson, BoFA Securities, Inc., Jefferies LLC, Morgan Stanley & Co. LLC, Guggenheim Securities, LLC, Piper Sandler & Co., Robert W. Baird & Co. Incorporated, Raymond James & Associates, Inc., Roth Capital Partners, LLC, and R. Seelaus & Co., LLC, filed February 9, 2024, United States District Court for the Central District of California, Southern Division, Case No. 8:24-cv-00285 (the "Taylor General Lawsuit").
*Gideon Akande v. Anthony Geisler, John Meloun, Jair Clarke, Mark Grabowski, Chelsea A.
Source: Item 3 — LITIGATION (FDD pages 14–18)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the Ayers Lawsuit and Akande Lawsuit were consolidated into the "Consolidated Shareholder Derivative Action" on June 24, 2024. The document indicates that this action is currently stayed, meaning it is temporarily suspended. The reason for the stay is that the court is awaiting the final resolution of the consolidated Taylor General Lawsuit and WBP Pension Fund Lawsuit. The FDD also states that additional shareholder derivative lawsuits may be filed on behalf of XFI based on the same facts alleged in the Ayers Lawsuit and Akande Lawsuit.
In February 2025, another shareholder derivative lawsuit, the Nelson Lawsuit, was filed, alleging similar claims as the Akande and Ayers Lawsuits. Plaintiffs in the Akande and Ayers Lawsuits requested that the Nelson Lawsuit be consolidated into the Consolidated Shareholder Derivative Action.
For a prospective Bft franchisee, this information is relevant because it highlights ongoing legal challenges involving Bft's parent company, Xponential Fitness, Inc. While the Consolidated Shareholder Derivative Action is stayed, the possibility of additional lawsuits and the connection to other pending securities litigation (Taylor General Lawsuit and WBP Pension Fund Lawsuit) suggests a degree of legal and financial risk associated with the parent company. Franchisees should monitor the outcomes of these legal proceedings, as they could potentially impact the financial stability and reputation of Xponential Fitness, which in turn could affect the Bft franchise system.