Does the New York amendment for City Publications address fraud?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
FOR THE STATE OF NEW YORK
NEW YORK 1. The following information is added to the cover page of the Franchise Disclosure Document: INFORMATION COMPARING FRANCHISORS IS AVAILABLE. CALL THE STATE ADMINISTRATORS LISTED IN EXHIBIT A OR YOUR PUBLIC LIBRARY FOR SERVICES OR INFORMATION. REGISTRATION OF THIS FRANCHISE BY NEW YORK STATE DOES NOT MEAN THAT NEW YORK STATE RECOMMENDS IT OR HAS VERIFIED THE INFORMATION IN THIS FRANCHISE DISCLOSURE DOCUMENT. IF YOU LEARN THAT ANYTHING IN THIS FRANCHISE DISCLOSURE DOCUMENT IS UNTRUE, CONTACT THE FEDERAL TRADE COMMISSION AND THE APPROPRIATE STATE OR PROVINCIAL AUTHORITY. THE FRANCHISOR MAY, IF IT CHOOSES, NEGOTIATE WITH YOU ABOUT ITEMS COVERED IN THE FRANCHISE 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 to be 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.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the New York amendment includes information regarding potential legal actions, including those related to fraud. Specifically, it states that no party associated with the franchisor has an action pending against them alleging fraud. This information is to be added at the end of Item 3 of the FDD.
This disclosure assures prospective City Publications franchisees in New York that the franchisor and its affiliates have not faced allegations of fraud or similar misconduct. This can be a crucial factor in evaluating the franchisor's integrity and business practices. Item 3 of the FDD typically covers the litigation history of the franchisor, its predecessors, and key personnel. The New York amendment supplements this information with an explicit statement regarding pending actions related to fraud and other specified violations.
It is important to note that this disclosure only covers pending actions. It does not address past instances or convictions related to fraud. A prospective City Publications franchisee should carefully review Item 3 of the FDD and consider this amendment in conjunction with other due diligence efforts to assess the overall risk associated with investing in the franchise.