What constitutes 'routine litigation incidental to the business' for C12 Group franchisees?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
NCHISE DISCLOSURE DOCUMENT. HOWEVER, THE FRANCHISOR CANNOT USE THE NEGOTIATING PROCESS TO PREVAIL UPON A PROSPECTIVE FRANCHISEE TO ACCEPT TERMS WHICH ARE LESS FAVORABLE THAN THOSE SET FORTH IN THIS FRANCHISE DISCLOSURE DOCUMENT.**
- The following is added at the end of Item 3:
Except as provided above, with regard to the franchisor, its predecessor, a person identified in Item 2, or an affiliate offering franchises under the franchisor's principal trademark:
- A.
Source: Item 23 — RECEIPTS (FDD pages 46–137)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document for C12 Group mentions 'routine litigation incidental to the business' in the context of disclosing pending legal actions against the franchisor. However, the FDD does not define what specific types of legal actions would be considered 'routine litigation incidental to the business.'
Without a clear definition, prospective C12 Group franchisees face uncertainty about what the franchisor considers routine. This is important because only non-routine or significant litigation needs to be disclosed, so understanding the threshold for disclosure is key. A franchisee might be concerned if the franchisor has a history of lawsuits, even if the franchisor considers them routine.
To gain clarity, a prospective C12 Group franchisee should ask the franchisor for specific examples of what they consider 'routine litigation incidental to the business.' They should also inquire about the typical types of claims that arise in the course of operating a C12 Group franchise and how the franchisor handles such disputes. Understanding the franchisor's perspective on this issue is crucial for assessing the potential legal risks associated with investing in a C12 Group franchise.