The Bairs Foundation was created to be a fair and inexpensive way for plaintiffs to obtain financial support while being the subject of legal action. Founders John and Amy Bair noticed that in an industry full of for-profit loan companies, families in need had no alternatives. One of the well-known minerals of those for-profit companies that target people in litigation and desperation is Oasis. The other week, two residents of Missouri had filed a complaint v Oasis Legal Finance Operating Co., claiming the litigation finance company was charging an exorbitant Annual Percentage Rate (APR) of over 100 percent.
Complainant Ronald Wright was injured in an accident in 2016 and hired a lawyer. Faced with debt repayment issues, he signed a Loan and Promissory Note Agreement (LAPN) with Oasis for a principal amount of $ 1,100. Likewise, the plaintiff Jeremy Smith was injured in an accident in 2015 and also retained the services of a lawyer. He signed two LAPNs with Oasis for $ 1,075 and $ 2,100.
The complainants made four requests in their complaint:
- In itself violation of the Missouri Merchandising Practices Act (MMPA): The company’s practices inherently contravene the law.
- Enrichment without cause: Oasis has taken advantage of this to the detriment of the complainants in a way that is unfair.
- Wear: The illegal act of lending money at an unreasonably high rate of interest.
- Constructive confidence: Intended to right the wrongs committed by the company.
The lawsuit points out that an APR greater than 100% is “unreasonable, unfair and otherwise illegal,” as is how Oasis explains the APR in its loan agreement and promissory note. The complaint argues that these and other provisions render the Oasis agreement with the complainants invalid under Missouri law. The lawsuit seeks class action status as well as double damages and punitive damages.
Similar lawsuits were filed in Georgia and Florida, which resulted in victories for the finance company’s defendants. Recently, the Georgia Supreme Court ruled in Ruth v. Cherokee financing that the agreements are not traditional loans and therefore not subject to laws regarding interest rates.
Beyond what is decided in the courts with regard to the laws to which these companies are subject, it is more a question of showing compassion towards humanity. For-profit loan companies like Oasis care more about their bottom line than helping people who are struggling to make ends meet. The plaintiff finance industry needs to look at how it works and needs to move from profit to people.