Does the Deck Medic FDD require disclosure of routine litigation incidental to the business?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Item 3 "Litigation," is supplemented by the addition of the following:
- A. Neither the Franchisor nor any person identified in Items 1 or 2 above has any administrative, criminal or material civil action (or a significant number of civil actions irrespective of materiality) pending against him alleging a violation of any franchise law, fraud, embezzlement, fraudulent conversion, restraint of trade, unfair or deceptive practices, business opportunity law, securities law, misappropriation of property or comparable allegations.
- B. Neither the Franchisor nor any other person identified in Items 1 or 2 above has during the 10 year period immediately preceding the date of this Disclosure Document, been convicted of a felony or pleaded nolo contendere to a felony charge or been held liable in any civil action by final judgment, or been the subject of any material complaint or other legal proceeding where a felony, civil action, complaint or other legal proceeding involved violation of any franchise law, fraud, embezzlement, fraudulent conversion, restraint of trade, unfair or deceptive practices, business opportunity law, securities law, misappropriation of property or comparable allegations or which was brought by a present or former purchaser-investor or which involves or involved the business opportunity relationship.
- C. Neither the Franchisor nor any person identified in Items 1 or 2 above is subject to any currently effective injunctive or restrictive order or decree relating to the franchise, or under any federal,
state or Canadian franchise, securities, business opportunity, antitrust, trade regulation or trade practice law as a result of concluded or pending action or proceeding brought by a public agency, or is a party to a proceeding currently pending in which an order is sought, relating to or affecting business opportunity activities or the seller-purchaser-investor relationship, or involving fraud, including but not limited to, a violation of any business opportunity law, franchise law, securities law or unfair or deceptive practices law, embezzlement, fraudulent conversion, misappropriation of property or restraint of trade.
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the franchisor is required to disclose certain litigation. Specifically, the FDD states that Deck Medic must disclose any administrative, criminal, or material civil actions, or a significant number of civil actions irrespective of materiality, pending against them alleging a violation of any franchise law, fraud, embezzlement, fraudulent conversion, restraint of trade, unfair or deceptive practices, business opportunity law, securities law, misappropriation of property, or comparable allegations.
Furthermore, Deck Medic must disclose if they or any person identified in Items 1 or 2 of the FDD has, within the past 10 years, been convicted of a felony, pleaded nolo contendere to a felony charge, or been held liable in any civil action by final judgment. They must also disclose any material complaint or other legal proceeding involving violations of franchise law, fraud, embezzlement, fraudulent conversion, restraint of trade, unfair or deceptive practices, business opportunity law, securities law, misappropriation of property, or comparable allegations, especially if brought by a present or former purchaser-investor or involving the business opportunity relationship.
Deck Medic must also disclose if they are subject to any currently effective injunctive or restrictive order or decree relating to the franchise, or under any federal, state, or Canadian franchise, securities, business opportunity, antitrust, trade regulation, or trade practice law. This includes any concluded or pending action or proceeding brought by a public agency, or if they are a party to a proceeding currently pending in which an order is sought, relating to or affecting business opportunity activities or the seller-purchaser-investor relationship, or involving fraud, including violations of business opportunity law, franchise law, securities law, unfair or deceptive practices law, embezzlement, fraudulent conversion, misappropriation of property, or restraint of trade. This comprehensive disclosure requirement ensures that prospective franchisees are aware of any significant legal issues involving Deck Medic and its key personnel.