Mighty Dog Roofing Lawsuit: The Fraud Claims in Pennsylvania, Nebraska, and New Jersey

Mighty Dog Roofing, a residential and commercial roofing franchise under the Horsepower Brands portfolio, is now facing formal fraud lawsuits from its own franchisees. In 2026, franchisees filed three separate suits against the franchisor, MDR United, and its executives in Pennsylvania, Nebraska, and New Jersey, together representing eleven plaintiffs. The complaints accuse the company of running a “calculated fraudulent inducement scheme to sell franchises through deception.” This is the most detailed breakdown of the Mighty Dog Roofing lawsuit, including what came before it and what franchisees are alleging now.

This case did not appear out of nowhere. It follows the same pattern first reported in the 2023 lawsuit against sister brand Blingle. For the full history of that case, read our Blingle lawsuit article and our Horsepower Brands lawsuit overview.

What Is Mighty Dog Roofing

Mighty Dog Roofing is organized as a limited liability company under the laws of Pennsylvania, formed May 12, 2020, with a principal address at 95 N. Broad Street, Doylestown, Pennsylvania. The company has franchised under the Mighty Dog Roofing name since November 2020. It was the first brand Horsepower Brands built out after founders Josh Skolnick and Zachery Beutler started the holding company that same year. According to the brand’s 2025 Franchise Disclosure Document, Mighty Dog reported average gross sales of $1.5 million across 84 franchisees representing 304 territories.

The Warning Signs Before the Lawsuits

Franchise Times first reported problems at Mighty Dog Roofing in early 2025, before any lawsuit had been filed. Operators described a pattern that mirrored the earlier Blingle complaints almost exactly: they were told no roofing experience was necessary to run a territory, but the training and support they received afterward did not prepare them for the actual demands of the business. Franchisees also said corporate staff misrepresented how much money they would need to get up and running, leaving many franchisees to spend well beyond their original budget.

The numbers reported at the time were significant. One franchisee told Franchise Times that of the brand’s 143 territories, 40 had already closed, and another 25 were “on the edge” of closing due to lack of profitability. Only 60 territories made enough money in 2024 to stay open, according to that account.

In response to the growing complaints, dozens of Mighty Dog Roofing franchisees formed an association with the American Association of Franchisees & Dealers (AAFD) in April 2025. The stated goal, according to the AAFD’s announcement, was to “foster an economic relationship with [Horsepower Brands] that prioritizes the financial success and sustainability of the franchisees.” Franchisee associations of this kind typically form when individual operators feel they have no meaningful leverage negotiating with a franchisor on their own.

The 2026 Fraud Lawsuits

By 2026, complaints turned into formal litigation. Franchisees filed lawsuits against MDR United and its executives in three states: Pennsylvania, Nebraska, and New Jersey. Together, the three cases represent eleven franchisee plaintiffs.

The New Jersey complaint contains some of the most specific allegations reported so far. It states that MDR, “a newly formed company with no prior experience in the roofing industry, embarked on a calculated fraudulent inducement scheme to sell franchises through deception.” The suit further alleges that “despite having no operational history, infrastructure or proprietary technology, MDR marketed itself as offering a unique and ‘proprietary’ method that would allow franchisees to earn profit margins nearly triple the industry average.”

The EBITDA Allegations

One of the more technical but important claims in the lawsuits concerns the financial figures MDR disclosed to prospective franchisees. According to the complaints, MDR’s 2020 Franchise Disclosure Document listed EBITDA margins of 32.65 percent and 33.82 percent for its two company-owned outlets at the time. Franchisees allege those figures did not include payroll expenses for in-house labor, including managers, which would meaningfully reduce real profitability if properly accounted for. The lawsuits also claim MDR failed to disclose other operating costs that franchisees later discovered on their own once they were running their own territories.

If accurate, this kind of omission matters because EBITDA margins are one of the primary numbers prospective franchise buyers use to estimate how quickly they can recover their investment. A margin inflated by omitted labor costs would make the business appear substantially more profitable on paper than it would be in practice.

Horsepower Brands’ Countersuits

As franchisees escalated their claims into formal litigation, Horsepower Brands responded by filing its own lawsuits against certain franchisees. This is a notable shift from the company’s earlier approach, which had largely consisted of public statements defending its disclosure practices rather than direct legal action against operators. The countersuits mean the dispute between Mighty Dog Roofing franchisees and their franchisor is now being fought on multiple legal fronts at once, in multiple states.

How This Connects to the Blingle Lawsuit

Franchise Times has drawn a direct line between the Mighty Dog Roofing litigation and the earlier Blingle case. Both involve the same parent company, Horsepower Brands. Both feature nearly identical franchisee complaints: no experience required, inadequate training after the sale, and startup costs that ran higher than what franchisees were told upfront.

The key difference is procedural. The original Blingle case was dismissed in March 2024 because the franchise agreements required mediation rather than court litigation. Whether the Mighty Dog Roofing cases will face the same fate depends on the specific arbitration or mediation language in MDR’s franchise agreements, which may differ from Blingle’s. As of this writing, the Mighty Dog Roofing lawsuits remain active in the court system rather than dismissed to private mediation.

What Franchisees Are Asking For

While full relief demands vary case by case, franchise fraud lawsuits of this kind typically seek some combination of the following: rescission of the franchise agreement, return of franchise fees and other payments made to the franchisor, compensatory damages for losses incurred operating the business, and in some cases punitive damages tied to allegations of intentional deception. None of these outcomes have been awarded in the Mighty Dog Roofing cases as of this writing, since the litigation remains ongoing.

What Prospective Mighty Dog Roofing Franchisees Should Know

If you are researching a Mighty Dog Roofing franchise investment in 2026, the active litigation is disclosed information you are entitled to review before signing anything.

Check Item 3 of the current FDD. Federal franchise law requires franchisors to disclose pending litigation involving the company and its officers in Item 3 of the Franchise Disclosure Document. Active fraud lawsuits filed by franchisees should appear here.

Ask about the EBITDA and revenue figures directly. Given the specific allegations in the New Jersey complaint about undisclosed labor costs, ask pointedly whether current profitability figures include full payroll expenses, including management labor, not just direct job costs.

Talk to current and recently exited franchisees. Item 20 of the FDD lists contact information for franchisees, including those who have left the system in the past three years. A conversation with someone who closed their territory will tell you more than any sales call.

Model your own startup budget independently. Given the pattern of franchisees reporting higher-than-disclosed startup costs, build your own budget with a margin of safety well beyond the franchisor’s stated investment range, and confirm it with an accountant familiar with roofing or home service franchise economics.

Review the dispute resolution clause carefully. Ask your franchise attorney to explain exactly what happens if a dispute arises: will it go to arbitration, mediation, or court, and in which state.

Frequently Asked Questions

How many franchisees have sued Mighty Dog Roofing? As of 2026, eleven franchisee plaintiffs across three separate lawsuits filed in Pennsylvania, Nebraska, and New Jersey.

What are the franchisees claiming? Fraudulent inducement, including inflated EBITDA margins in the Franchise Disclosure Document, misrepresented startup costs, and inadequate training and support after the franchise sale.

Has Mighty Dog Roofing been found guilty of fraud? No. These are active civil lawsuits, and the allegations have not been proven or ruled on by a court as of this writing.

Is this connected to the Blingle lawsuit? Yes. Both Blingle and Mighty Dog Roofing operate under the same parent company, Horsepower Brands, and franchisees at both brands have raised nearly identical complaints about earnings projections, training, and startup costs.

How many Mighty Dog Roofing territories have closed? A franchisee cited by Franchise Times in early 2025 said 40 of the brand’s 143 territories had closed, with another 25 described as close to shutting down.

Last updated on: 24th July 2026