Does Engel & Volkers consider routine litigation incidental to the business as a pending action that is significant in the context of the number of franchisees and the size, nature, or financial condition of the franchise system?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
SPECTIVE FRANCHISEE TO ACCEPT TERMS WHICH ARE LESS FAVORABLE THAN THOSE SET FORTH IN THIS FRANCHISE DISCLOSURE DOCUMENT.**
- Item 3 of the Franchise Disclosure Document is amended by deleting the last paragraph and substituting the following:
"Neither we, our predecessor, a person identified in Item 2, nor an affiliate offering franchises under our principal trademark:
- A. 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. Moreover, the
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 63–71)
What This Means (2025 FDD)
According to Engel & Volkers's 2025 Franchise Disclosure Document, the company does not consider routine litigation incidental to the business as a pending action that is significant in the context of the number of franchisees and the size, nature, or financial condition of the franchise system or its business operations. Specifically, Engel & Volkers states that there are no pending actions, other than routine litigation incidental to the business, which are significant when considering the number of franchisees and the overall state of the franchise system.
This statement indicates that Engel & Volkers acknowledges that routine litigation may occur as part of normal business operations. However, the company asserts that such litigation is not substantial enough to be considered a significant risk factor for potential franchisees. This suggests that while legal disputes may arise, they are not expected to materially impact the financial stability or operational capacity of the franchise system as a whole.
For a prospective franchisee, this information provides some reassurance that the franchise system is not currently facing major legal challenges that could jeopardize its viability. However, it is important to note that this statement only applies to the current status of the franchise. Potential franchisees should still conduct their own due diligence to assess the potential risks associated with litigation, including reviewing any available legal filings and consulting with legal counsel to understand the implications of any ongoing or potential legal disputes.