There is so much in the lawsuit that can be helpful to funders and brokers alike. Here are few sections that should resonate with some and be a reminder to others that the terminology you use in ALL of your interactions can affect the categorization of an MCA into a loan or at least the reasoning for bringing a case against a funding company.
Here are the sections:
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421. Furthermore, dozens of the ISOs that Yellowstone partnered with to broker its MCAs to merchants had names like “Business Loan Masters,” “Loan Supply Company,” “True Business Lender,” “Reliable Lending Group,” “Quick Capital Commercial Lending,” and “American Lending Inc.” Ex. 424. These typically confirmed merchants’ understanding that the MCA transactions were loans.
422. Yellowstone and Delta Bridge did not have any measures or policies in place to ensure that merchants understood that the MCA transactions were not loans, apart from boilerplate language in their form MCA agreements. See Aryeh Tr. at 203:10-205:4.
423. Merchants commonly understood Yellowstone and Delta Bridge’s MCAs as loans
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Do you use the word loans or lender when referring to MCAs/RBF?