Besides BFT and CycleBar, what other franchise brands are associated with the defendants in the Nickle Acquisition, LLC lawsuit, and how might this affect Body20?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
California, County of Orange, Case No. 30-2025-01459041- CU-AT-CXC. This action was filed by a CycleBar® and BFT® franchisee and its owners, Nickle Acquisition LLC, Michael Nickle, and Jana Nickle, (collectively, the "Nickle Plaintiffs") against (i) BFT Franchise Holdings, LLC and BFT Franchise SPV, LLC; (ii) CycleBar Franchising, LLC and CycleBar Franchising SPV, LLC; (iii) the Xponential Entities and Xponential Holdings LLC; (iv) H&W Investco LP and H&W Investco II LP; (v)
LAG Fit, Inc.; (vi) MGAG LLC; (vii) Anthony Geisler, Mark Grabowski, Trevor Lucas, Ryan Junk, Lou Defrancisco, Sarah Luna, Lance Freeman, and Kristie Lavasile; and (viii) Navitas Credit Corp. (collectively, (i) through (viii), the "Nickle Defendants"). The Nickle Plaintiffs allege that one or more of the Nickle Defendants (a) violated pre-sale disclosure obligations under the California Franchise Investment Law by failing to provide a compliant Franchise Disclosure Document, making statements that they contend were erroneous or prohibited, and failing to disclose information that they contend necessitated disclosure; (b) fraudulently induced them to invest in franchises; (c) breached the Franchise Agreement; (d) breached the implied covenant of good faith and fair dealing; and (e) made fraudulent omissions. The Nickle Plaintiffs seek (1) declaratory and injunctive relief regarding the enforcement of the mandatory arbitration provisions in their franchise agreements; (2) rescission of their franchise agreements; (3) actual and special damages; and (4) attorneys' fees, costs, and interest. The Nickle Defendants will soon be filing a demurrer to the complaint.
American Health Concepts, LLC and Yaqim Lalani v. Yoga Six Franchise, LLC, Xponential Fitness, LLC, Anthony Geisler, and Lindsay Junk, filed December 11, 2024, Superior Court of Dekalb County, State of Georgia, Case No. 24CV11069. A former Yoga Six® franchisee and its owner filed this action against Y6, Xponential, the former Chief Executive Officer of Xponential, Anthony Geisler, and the President of Y6, Lindsay Junk. Contending that the Franchise Disclosure Document that Y6 provided to them in connection with their signing of a Yoga Six® development agreement and franchise Agreement in 2019 failed to include certain disclosures required by the Federal Trade Commission Franchise Rule, plaintiffs allege that (i) (a) defendants violated the Federal Trade Commission Act, for which plaintiffs seek damages in the amount of $430,600, and (b) the development agreement was void for lack of consideration, for which plaintiffs seek damages in the amount of $135,000; or, alternatively, (ii) (a) defendants committed fraud in the inducement, for which plaintiffs seek damages in the amount of $430,600, (b) defendants breached the franchise agreement when defendants failed to return a transfer fee paid by plaintiffs when the subject proposed transfer of the franchise agreement was not consummated, for which plaintiffs seek damages of not less than $5,000, and (c) defendants were unjustly enriched by plaintiffs' payment of certain initial fees under their Yoga Six® agreements and the above-referenced transfer fee, for which plaintiffs seek damages of not less than $140,000. Plaintiffs also seek unspecified punitive damages, attorneys' fees, and other relief as the court may determine. On March 12, 2025, defendants filed a Notice of Removal to remove the action to the United States District Court for the Northern District of Georgia (Case No. 1:25-cv-01315-SCJ).
Xponential Fitness, Inc.
Source: Item 3 — LITIGATION (FDD pages 13–17)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the Nickle Acquisition, LLC lawsuit involves several franchise brands beyond BFT and CycleBar. The lawsuit, filed by a CycleBar and BFT franchisee, names numerous defendants, including entities and individuals associated with Xponential Fitness. Other franchise brands connected to these defendants through separate lawsuits include AKT and Yoga Six. Lindsay Junk, Body20's Chief Executive Officer, previously served as Brand President of Y6 (Yoga Six). Anthony Geisler, the Chief Executive Officer of Sequel Brands, previously served in the same role for Xponential and various subsidiaries of Xponential.
The Nickle Acquisition, LLC lawsuit alleges violations of pre-sale disclosure obligations, fraudulent inducement to invest in franchises, breach of contract, breach of good faith, and fraudulent omissions. The plaintiffs are seeking declaratory and injunctive relief, rescission of franchise agreements, actual and special damages, and attorneys' fees. The presence of these lawsuits and the involvement of individuals connected to Xponential Fitness could raise concerns for prospective Body20 franchisees.
While Body20 states it is not affiliated with Xponential and that these lawsuits do not involve Body20 or its affiliates, the prior roles of Body20's CEO and Sequel Brands' CEO at Y6/Xponential, respectively, create an indirect link. This connection could lead potential franchisees to scrutinize Body20's franchise disclosures and business practices more closely. It may also prompt them to seek assurances that Body20 operates independently and ethically, with no recurrence of the issues raised in the lawsuits against Xponential-related brands.
Prospective Body20 franchisees should conduct thorough due diligence, including consulting with franchise attorneys and current franchisees, to assess the potential impact of these lawsuits on Body20's business and reputation. Understanding the details of these legal actions and the measures Body20 has taken to prevent similar issues can help franchisees make informed decisions.