What did the California Commissioner determine regarding Healthsource Chiropractic's disclosure documents?
Healthsource_Chiropractic Franchise · 2025 FDDAnswer from 2025 FDD Document
The Commissioner of Financial Protection and Innovation of the State of California v. HealthSource Chiropractic, Inc. On July 20, 2021, we entered into a Consent Order with the California Commissioner of Financial Protection and Innovation (the "Commissioner"). The Commissioner determined that our 2017 and 2018 disclosure documents failed to contain a required disclosure concerning Mr. Brozek's personal bankruptcy and therefore violated Section 31200 of the California Franchise Investment Law. In order to resolve this matter we agreed to desist and refrain from the violation described above. Mr. Brozek is no longer employed by us.
Source: Item 3 — Litigation (FDD pages 14–15)
What This Means (2025 FDD)
According to Healthsource Chiropractic's 2025 Franchise Disclosure Document, the California Commissioner of Financial Protection and Innovation determined that Healthsource Chiropractic's 2017 and 2018 disclosure documents violated Section 31200 of the California Franchise Investment Law. The Commissioner's determination was made because the disclosure documents failed to include a required disclosure about a personal bankruptcy of one of Healthsource Chiropractic's officers, Bernard Brozek.
To resolve the matter, Healthsource Chiropractic entered into a Consent Order with the California Commissioner. As part of the Consent Order, Healthsource Chiropractic agreed to stop the violation described by the Commissioner.
It is important to note that Bernard Brozek, the officer whose bankruptcy led to the violation, is no longer employed by Healthsource Chiropractic. This suggests that Healthsource Chiropractic has taken steps to address the issues that led to the Commissioner's determination.
Prospective franchisees should carefully review Item 3 of the FDD, which discusses litigation and public agency orders, to fully understand the nature and implications of the Consent Order. They may also want to inquire about Healthsource Chiropractic's current procedures for ensuring compliance with franchise disclosure laws.