What is Cinnaholic's definition of 'unfair or deceptive practices' in the context of disqualifying actions against a party?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
O ACCEPT TERMS WHICH AS LESS FAVORABLE THAN THOSE SET FORTH IN THIS FRANCHISE DISCLOSURE DOCUMENT.**
2. 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. No such party has an administrative, criminal or civil action pending against that person alleging: a felony, a violation of a franchise, antitrust, or securities law, fraud, embezzlement, fraudulent conversion, misappropriation of property, unfair or deceptive practices, or comparable civil or misdemeanor allegations.
- B. No such party has pending actions, other than routine litigation incidental to the business, which are significant in the context of the number of franchisees and the size, nature or financial condition of the franchise system or its business operations.
- C. No such party has been convicted of a felony or pleaded nolo contendere to a felony charge or, within the 10 year period immediately preceding the application for registration, has been convicted of or pleaded nolo contendere to a misdemeanor charge or has been the subject of a civil action alleging: violation of a franchise, antifraud, or securities law; fraud; embezzlement; fraudulent conversion or misappropriation of property; or unfair or deceptive practices or comparable allegations.
- D. No such party is subject to a currently effective injunctive or restrictive order or decree relating to the franchise, or under a Federal, State, or Canadian franchise, securities, antitrust, trade regulation or trade practice law, resulting from a concluded or pending action or proceeding brought by a public agency; or is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities and Exchange Act of 1934, suspending or expelling such person from membership in such association or exchange;
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 27–35)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the term 'unfair or deceptive practices' is used to describe actions that could disqualify certain parties. Specifically, Cinnaholic considers it relevant if the franchisor, its predecessors, individuals identified in Item 2, or affiliates offering franchises under Cinnaholic's trademark have been involved in legal actions alleging such practices.
Cinnaholic outlines that administrative, criminal, or civil actions alleging 'unfair or deceptive practices' against these parties are significant. This also extends to convictions or pleas of nolo contendere to misdemeanor charges, or being the subject of civil actions alleging 'unfair or deceptive practices' within the 10 years before the franchise registration application.
Furthermore, the presence of currently effective injunctive or restrictive orders or decrees related to franchise, securities, antitrust, trade regulation, or trade practice laws resulting from actions brought by a public agency also falls under this consideration. This definition helps prospective franchisees assess the legal and ethical background of Cinnaholic and its key personnel, ensuring transparency and informed decision-making.