What event caused a total loss of the Hartwell Gold Star franchise?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Ohio 45216 (the "Property").
On October 9, 2021, there was a fire at the Property that resulted in a total loss of the Hartwell Gold Star. After the fire, the defendants ceased operating, never rebuilt, and retained insurance proceeds which were to be used to rebuild, the Hartwell Gold Star. Defendant 21 Partners was issued a check for $157,990.41 for replacement of furniture, fixtures, and equipment, but never provided Gold Star with these proceeds, despite having a contractual obligation to do so. Defendant 21 Partners provided Gold Star with building replacement insurance proceeds totaling $455,642.92, but the total cost for restoration is $1,106,670.00, a cost for whi
Source: Item 3 — Litigation (FDD pages 10–11)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, a fire on October 9, 2021, at the property located at 21 East Galbraith Road, Cincinnati, Ohio 45216, resulted in a total loss of the Hartwell Gold Star franchise. Following the fire, the franchisee ceased operations and did not rebuild the location.
The litigation described in Item 3 of the FDD indicates disputes over insurance proceeds related to this fire. The franchisee, 21 Partners, received $157,990.41 for the replacement of furniture, fixtures, and equipment but allegedly did not provide these proceeds to Gold Star, despite a contractual obligation to do so. Additionally, while 21 Partners provided $455,642.92 in building replacement insurance proceeds, the total restoration cost is estimated at $1,106,670.00, leaving a significant shortfall for which the franchisee is purportedly responsible.
This situation highlights the importance of understanding insurance requirements and financial obligations outlined in the Franchise Agreement. Prospective Gold Star franchisees should carefully review the terms regarding insurance coverage, restoration responsibilities, and the handling of insurance proceeds in the event of a significant loss. The litigation underscores the potential for disputes and the financial risks associated with property damage and business interruption.