Jenner & Block

Firm Wins Appellate Victory for Clients in Injunction Action Brought by the Florida Attorney General

On July 31, 2015, Jenner & Block achieved a significant victory for clients CashCall, Inc., WS Funding, LLC, Delbert Services Corporation, Western Sky Financial, LLC, and John Paul Reddam when the Florida Court of Appeals reversed a Tampa Circuit Court's imposition of an injunction that had required the clients to escrow almost $7 million over the previous year.  As a result of the ruling, the clients will get their money back while the litigation proceeds.

The case involves the validity of installment loans issued by Western Sky and later serviced by CashCall and Delbert Services.  At a July 2014 hearing, the Attorney General argued that the loans were usurious and void under Florida law, despite the fact that the loan agreements stated that they were governed exclusively by the law of the Cheyenne River Sioux Tribe.  The Tampa Circuit Court agreed with the Attorney General and imposed an injunction mandating that the clients pay into escrow all incoming loan proceeds on a continual basis.

The Court of Appeals reversed, agreeing with Jenner & Block that the Attorney General had failed to show a "clear legal right" to relief, given that the Florida Supreme Court has repeatedly held that parties can choose the law of another jurisdiction to govern their loans, so long as that jurisdiction has a reasonable relationship to the loan transaction.  The Court of Appeals also based its decision on the Attorney General's concession at the trial hearing that there was "good case law ... on both sides." 

Partner Brian J. Fischer argued the appeal in December 2014.  With him on the case were Partners Katya Jestin, Neil M. Barofsky, and Barry Levenstam and Associates Daniel T. Fenske, Anouck Giovanola, Jason P. Hipp, R. Trent McCotter, and Daniel H. Wolf.