Does Checkersrallys expect pending litigation to have a material impact on its business or consolidated financial position?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
From time to time, we are involved in legal proceedings arising in the ordinary course of business relating to matters including, but not limited to, disputes with franchisees, suppliers, employees (including pursuant to employment discrimination and wage and hour laws) and customers, as well as disputes over intellectual property. We do not expect the outcome of pending litigation to have a material impact on our business or consolidated financial position, although it may have a material impact on our consolidated results of operations in any particular annual period.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys' 2025 Franchise Disclosure Document, Checkersrallys is involved in legal proceedings that arise in the ordinary course of business. These proceedings include disputes with franchisees, suppliers, employees, and customers, and also disputes over intellectual property.
However, Checkersrallys does not anticipate that the outcome of any pending litigation will have a material impact on its overall business or consolidated financial position. It is important to note that while the company does not expect a material impact on its overall financial position, pending litigation may have a material impact on Checkersrallys' consolidated results of operations in any particular annual period.
For a prospective franchisee, this suggests that while Checkersrallys faces regular legal challenges, these are not expected to destabilize the company financially. However, franchisees should be aware that specific legal outcomes could still affect the company's profitability in a given year, which could indirectly affect franchisees.