New York Business Litigation Lawyer Blog
In a surprising decision (to me), a Nassau County Supreme Court judge recently vacated a TRO and denied injunctive relief on an otherwise meritorious claim because plaintiff sent defendants “a series of threatening, offensive text messages which seem to imply that he was using the court to strong-arm [the defendants] into making payments.”
Briefly, in this merchant cash advance case, defendants reneged on repayment by cutting off plaintiff’s access to its bank account, from which plaintiff took repayment. Plaintiff obtained a TRO restraining the funds in defendants’ bank account and then moved for a preliminary injunction. The court’s colorful decision indicates that while plaintiff met the burden for the injunction, it would not get that relief. In the court’s words,
In opposition to the motion, Defendants make some valid arguments, but also see fit to lecture the court on the evils of the receivables purchase industry, an argument that at times seems contradictory when considering Lopes’ actions.
As for the account that Eagle was to have access to, Defendants argue that the restraint on that should be lifted, and the entire TRO vacated, because Eagle is a predator who took advantage of Relik. There are a couple of problems with painting Relik as an innocent victim. The first is that Lopes, in his affidavit, describes himself as a savvy businessman having built Relik himself “from the ground up” from a company that had one employee to one that now has over 250 employees. Relik is “award-winning” and “nationally-recognized” which would argue against it being easy to take advantage of him. Second, Eagle was actually the third receivables purchase company with whom he signed a contract and from which he accepted money. He cannot claim surprise about the way Eagle’s contract operated. He likens these companies to payday lending companies that prey upon consumers, but a savvy, successful, award-winning businessman is a bit different from a consumer looking to leverage their paycheck into some quick cash.
As for Eagle it appears that its Principal sent Lopes a series of threatening, offensive text messages which seem to imply that he was using the court to strong-arm Lopes into making payments. His threats only lend credence to Defendants’ arguments that instead of being a business providing a service, Eagle is a predatory lender. Some of these text messages include: “I’m going to have a judge … freeze your account,” “Should I file a lawsuit now since you’re completely broke [sic] this will go against you your business and personally. Or should I call your accounts receivable?”, “so obviously you know I froze your account the next thing I’m going to do is contact every LLC that you do work for and let them now what’s going on … I will get a judgment in five days and then just the money.” There are more.
With that, the court denied injunctive relief based on plaintiff’s “unclean hands” and as “unconscionable” even as defendants did not raise these defenses. As of this writing, no request to reargue or appeal have been filed. I wonder why.
Eagle Advance, LLC v. Relik Realty, et ano.; Index No. 608198/22