HealthSource Chiropractic Franchise

Financing Details

HealthSource Chiropractic does not offer any direct or indirect financing to its franchisees in the normal course of business. The company also does not guarantee any franchisee's notes, leases, or other obligations.

Litigation Summary

HealthSource Chiropractic has been involved in three disclosed litigation cases. One case, filed in January 2020 by the Commonwealth of Virginia, alleged that HealthSource Chiropractic's 2017 and 2018 disclosure documents failed to disclose a personal bankruptcy of an officer, Bernard Brozek. HealthSource Chiropractic settled this matter by agreeing to refund up to $80,000 to one purchaser and pay $9,000 in costs and civil penalties. Mr. Brozek reimbursed the company and is no longer employed. A second case, from July 2021, involved the California Commissioner of Financial Protection and Innovation, who determined that HealthSource Chiropractic's 2017 and 2018 disclosure documents also failed to disclose Mr. Brozek's personal bankruptcy, violating state law. HealthSource Chiropractic entered a Consent Order to cease and desist from this violation, and Mr. Brozek is no longer employed. The third case, filed in December 2007 by a chiropractor named Donald R. Dudley, alleged trademark infringement of "HealthSource Chiropractic" and unfair competition in the Rochester, New York area. The court granted summary judgment in favor of HealthSource Chiropractic in August 2012, finding no infringement for internet use. In February 2013, HealthSource Chiropractic settled with Dr. Dudley, agreeing not to use the mark in specific New York counties and paying $20,000, leading to the lawsuit's dismissal in March 2014.

Renewal Conditions

To renew their franchise agreement, HealthSource Chiropractic franchisees must be in full compliance with all provisions of their existing Franchise Agreement and any other agreements, including the Operations Manual. They are required to refurbish and redecorate their premises, and replace fixtures, furnishings, wall decor, furniture, equipment, and signs to meet the franchisor's then-current specifications and standards for new or renewal clinics. Franchisees must correct any deficiencies in their operation identified by HealthSource Chiropractic prior to the agreement's expiration. They must also sign the franchisor's then-current franchise agreement and any ancillary documents, pay a renewal fee of $10,000, and execute a general release of any and all claims against HealthSource Chiropractic and its affiliates, officers, directors, employees, and agents. The terms and conditions of the new renewal agreement may differ materially from the original.

Staffing Notes

HealthSource Chiropractic franchisees are responsible for all aspects of hiring, training, and managing their own employees and independent contractors. All personnel must hold any licenses, certifications, and/or degrees required by law or by the franchisor's Operations Manual. Franchisees, their General Managers (if applicable), and designated staff must satisfactorily complete an initial training program. Employees providing clinical services, such as chiropractors in a Clinic Management Business, must also complete required training, including mandatory attendance at the annual conference. Franchisees must ensure staff maintain a neat appearance, adhere to dress codes, sign confidentiality agreements, and provide prompt, courteous service. HealthSource Chiropractic also requires franchisees to enroll in and maintain designated human resources and payroll services. Franchisees are prohibited from recruiting or hiring employees from other HealthSource Chiropractic locations or affiliates without prior written consent. If operating a Clinic Management Business, a separate Licensed Provider (a licensed chiropractor or professional entity) will own and operate the clinical aspects of the clinic and employ clinical staff.