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The Bairs Foundation was created to be a fair and low-cost way for plaintiffs to get financial support while going through a lawsuit. The founders, John and Amy Bair, noticed that in an industry full of for-profit lending companies, families in need had no alternatives. One of the ore well known of these for-profit companies who target people going through litigation and in desperation is Oasis.As of just the other week, two Missouri residents have filed a lawsuit against Oasis Legal Finance Operating Co., claiming that the litigation finance company charged an exorbitant annual percentage rate (APR) of more than 100 percent.

Plaintiff Ronald Wright was injured in an accident in 2016 and hired an attorney. Facing issues paying off his debts, he signed a loan agreement and promissory note (LAPN) with Oasis for a principal amount of $1,100. Similarly, plaintiff Jeremy Smith was injured in an accident in 2015 and also retained an attorney. He signed two LAPNs with Oasis for $1,075 and $2,100.

The plaintiffs made four claims in their complaint:

  1. Per se violation of the Missouri Merchandising Practices Act (MMPA): The company’s practices are inherently violating the Act.
  2. Unjust enrichment: Oasis benefitted at the expense of the plaintiffs in a way that is unjust.
  3. Usury: The illegal act of lending money at an unreasonably high interest rate.
  4. Constructive trust: Meant to make up for the wrongs the company has committed.

The lawsuit points out that an APR over 100 percent is “unconscionable, unfair and otherwise illegal,” as is the way Oasis explains the APR in its loan agreement and promissory note. The complaint argues that these and other provisions make Oasis’s agreement with the plaintiffs invalid under Missouri law. The lawsuit seeks class action status as well as double damages and punitive damages.

Similar lawsuits have been filed in Georgia and Florida, which resulted in wins for the finance company defendants. Recently, the Georgia Supreme Court ruled in Ruth v. Cherokee Funding that the agreements are not traditional loans and therefore not subject to laws regarding interest rates.

Beyond what gets decides in court with respect to what laws these companies are subject to, it is more about showing compassion towards humanity. For-profit lending companies like Oasis care more about their bottom line than about helping people who are struggling to make ends meet. The plaintiff-funding industry needs to take a look at the way it operates and needs to shift their focus from profit to people.

2 Comments

  1. Gravatar for Dana

    So I borrowed in two separate loans from Oasis financial during a case to settle for a car accident in which an airbag burned my face. I was working for a medical insurance company as a nurse case manager and their worker's compensation company has been involved in a number of lawsuits for not paying out. I was in the hospital getting a second skin graft when this company stated I was not out of work. I was in total shock. (I worked for Optum Care, Sedgwick was the disability claims company if you want to look up this legitimacy). I had no choice but to borrow money, I was in a very tough spot with a child who also has disability and eventually filed chapter 7 to start over as medical debt consumed me at that time. I took out two loans. For around 7000. When we settled within a year and Oasis disputed the amount I owed and claimed I owed 28,000. Which was a thousand more than I had settled for, essentially the whole amount I received. I settled for 75 thousand and the attorney took most of it. He felt bad that I would receive nothing as I have deep scars on my face and suffered a lot throughout this whole experience (I did fight Sedgewick and received back payment a year later, also found a new job). He gave me 16,000 and held ten thousand in a trust, which was the amount to be paid that we had understood from the contract. He wrote them a letter stating this was unfair, and Minnesota holds strong laws against Champerty. I totally trusted whatever he was saying, I wasn't in a good place at that time. Two years later I discharged all my debt in chapter 7 and Oasis was listed. The bankruptcy attorney did not tell me that my 16000 was still owed to Oasis, I assumed as it was listed as discharged and affirmed by my bankruptcy attorney. So I call my injury attorney at the time, and said just pay Oasis the ten grand, I discharged them in bankruptcy. So two years later I get a call from my injury attorney saying he still has this money in a trust. Which prompts me to call my bankruptcy attorney to confirm I have no interest in this matter. I get a call back from the bankruptcy attorney stating that this debt was not discharged as it was a lien on my loan, also records note I was counseled about this at the time of my bankruptcy. I am a medical clinician, I am very responsible and listen closely. People trust me with their lives, I understand direction and also counsel, I specifically asked about this debt and this matter with Oasis. I was not advised. I assume the bankruptcy attorney did not want to get into it with me? I plan on calling the attorney generals office in my state. I would have rather not received the 16 grand if I knew I would have been sued later down the line. I feel like my attorney maybe had some guilt I would receive nothing and knew how I had struggled. Can you help me? I feel very mislead. A number of lawsuits have addressed the champerty laws in MN. I also want to know my statute of limitations for them suing me. It's been 4 years since we've settled the lawsuit. Thank you!

    1. Dana, this is a heart wrenching story thank you for sharing it. Not all consumer litigation finance companies are horrible. For profit companies and our a charitable foundation alike try to help families when they are desperate. In your case, had you borrowed 7,000 from the Bairs Foundation, you would have only had to pay back about 7800. Leaving you with much more from your settlement. Our foundation is trying to be a source of reputable information about these loans and financing arrangements, and we are raising money so we can help other families. Please share our post if you feel comfortable doing so.

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