PPP loan borrowers of Prestamos CDFI, LLC with unfunded PPP loans should be aware that only borrowers residing or injured in the same states as the named plaintiffs in the pending class action lawsuits against Prestamos may be able to participate as class members.
In March of 2022, Nolan Heller Kauffman published an article titled, “Your PPP Lender Refused to Fund Your SBA-Approved PPP Loan – Now What?” That article discussed some of the most common issues with PPP loan funding and alerted PPP loan borrowers that Nolan Heller Kauffman and co-counsel had filed two class action lawsuits against Prestamos and its parent company, Chicanos Por La Causa, Inc. (“CPLC”). Those lawsuits are captioned Marshall, et. al, v. Prestamos CDFI, LLC, Civil No. 5:21-cv-04337-JMG (E.D. Pa.) (“Prestamos I”) and Drevnak, et al. v. Prestamos CDFI, LLC, Civil No. 5:23-cv-02777-JMG (E.D. Pa.) (“PrestamosII”).
In a decision on March 31, 2023 in Prestamos I, the Court denied Prestamos’s motion to dismiss the PPP borrowers’ breach of contract claim, holding that “Plaintiffs have standing to raise their breach of contract claim, for which they successfully state a claim, except to the extent Named Plaintiffs purport to bring state law claims under the laws of states in which they do not reside in or in which they were never injured.” In other words, the Court held that the plaintiffs cannot proceed for borrowers in all 50 states and U.S. territories. Instead, the plaintiffs can only maintain breach of contract claims based on the laws of the states or territories in which they reside or were injured by Prestamos’s alleged failure to fund their SBA-approved PPP loans.
The plaintiffs in Prestamos I include SBA-approved but unfunded Prestamos PPP borrowers in the following states: California, Pennsylvania, Connecticut, Missouri, Illinois, Washington, Michigan, Nevada, Ohio, and Arizona. The plaintiffs in Prestamos II include SBA-approved but unfunded Prestamos PPP borrowers in the following additional states: Colorado, Utah, Georgia, Texas, Indiana, and Mississippi.
PPP borrowers with unfunded SBA approved PPP loans from Prestamos in states or Territories not covered by either Prestamos I or Prestamos II will not be eligible to participate in any class action recoveries in these cases, unless their states are added to the list of represented states.
If you are a PPP borrower with an unfunded PPP loan from Prestamos and have questions or would like to learn more about this subject, please contact Matthew M. Zapala, Esq. by e-mail (email@example.com) or phone (518-432-3133).