What is the former franchisee accusing Golden Krust Caribbean Restaurant of in the current lawsuit?
Golden_Krust_Caribbean_Restaurant Franchise · 2024 FDDAnswer from 2024 FDD Document
nded December 31, 2023, were purchased from three suppliers. Approximately 53% of goods purchased during the years ended December 31, 2023, were purchased from one supplier
NOTE 13 RISKS AND UNCERTAINTIES
The Company is involved in various court cases and legal proceedings, most of which, the company believes will have outcomes in its favor, or it has already been awarded damages that are being contested by the other party(ies). No accrual has been made for potential legal settlements or awards that the company believes it is entitled to, as they have not yet been received by the Company. In addition, the Company is a party to a lawsuit with a former franchisee, whose franchise agreements were terminated in 2018 due to material defaults in those agreements, as determined by the C
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 35)
What This Means (2024 FDD)
According to the 2024 Franchise Disclosure Document, Golden Krust Caribbean Restaurant is currently involved in a lawsuit with a former franchisee. The franchise agreements with this former franchisee were terminated in 2018 due to what Golden Krust Caribbean Restaurant determined to be material defaults.
Despite Golden Krust Caribbean Restaurant prevailing in a prior arbitration in 2018 and being awarded approximately $758,000 plus accrued interest, the former franchisee filed a demand for arbitration against the company in October 2022.
It is important to note that the FDD does not specify the exact nature of the former franchisee's accusations in the current lawsuit. Prospective franchisees should seek clarification from Golden Krust Caribbean Restaurant regarding the details of this legal dispute and its potential impact on their investment.