LAS VEGAS (CN) – An “injury loan” company charges illegal interest rates to injured people and interferes with their contracts with their attorneys, a law office claims in court.
The Harris Law Firm claims InjuryLoans.com and its manager-attorney Adam D. Stokes charge illegal annual interest of more than 400 percent to injury victims “in desperate situations.” The lawsuit describes Stokes as an attorney. On its Web page, InjuryLoans describes him as a “former attorney.”
Harris Law claims the defendants “interfere() with the normal attorney-client relationship by pushing borrowers away from attorneys that do not support or assist IJL in its business endeavors,” and have done this with “with at least two of Harris Law’s clients,” whom it does not name, “so as to protect their pending claims.”
A “Confidential” InjuryLoans.com “Business Overview,” attached to the lawsuit as an exhibit, boasts that the company “expects to have a material number of clients who are willing to accept a referral to an attorney who will suborn [sic] InjuryLoans.com products if theirs will not.”
Harris client Kimberly La Shonny Gorman is the lead plaintiff in the Aug. 19 lawsuit in Clark County Court.
InjuryLoans advertises its service as “better than payday loans,” and offers loans of up to $50,000. The application on its Web page, checked Monday morning, asks for the name and phone number of the applicant’s attorney.
InjuryLoans offers several products, including a “FAST Loan” in which the borrower gets $250 and immediately owes $1,000 in repayment, and other loans that charge 15 to 20 percent interest per month, according to the complaint.
InjuryLoans rewards cooperating attorneys with “exceptionally valuable” cases and tells them that working with InjuryLoans “brings with it additional business and that a lack of participation may result in cases being referred elsewhere,” the complaint states.
Harris Law claims that because it “does not suborn or participate in InjuryLoans’ unlawful scheme, IJL puts pressure on these clients to terminate their contractual and business relationship with Harris Law and to become clients of other law firms that support its practices.”
“For example, IJL informed Ms. Gorman that it could not lend her all she wanted if she remained a client of Harris Law, but could if she changed to IJL’s suggested law firm.”
Nevada “expressly regulates” lenders that charge more than 40 percent annual interest, and requires them to “obtain a special license,” Harris law says. It claims that neither InjuryLoans nor Stokes has such a license.
On the “frequently asked questions” on its web page, InjuryLoans calls the money an “advance” via “pre-settlement funding.”
“Is pre-settlement funding the same as a loan?” InjuryLoans asks itself on the FAQ section. It answers: “Sort of, but not really. The simple reason being that you do not have to repay the money if you lose your case. The money we provide is an advance on your case with the obligation to repay us contingent upon the outcome of your case.”
In answer to the frequently asked question: “What if my attorney does not release the information to InjuryLoans.com?” the Web page answers: “YOU are the client, your attorney must comply with your wishes if you need and want a loan. It is YOUR money and not theirs. Therefore, injuryloans.com will provide detailed instructions to your attorney signed by you instructing your attorney to comply and cooperate with our office.”
The FAQ page also states: “In most cases, you will not have to provide any documents.” After getting the name of the prospective client’s attorney, “Our office will provide all the documents, and you will even be able to sign them electronically!”
Gorman and Harris Law seek declaratory judgment that InjuryLoans and Stokes illegally operate a high-interest loan service that charges more than 400 percent annual interest without a license, that Gorman’s loan is void, that Harris Law firm has priority over InjuryLoans, and punitive damages for deceptive trade, conspiracy, intentional interference with contract and business law violations.
Plaintiffs’ attorney J. Stephen Peek with Holland & Hart was not immediately available for comment, nor were InjuryLoans.com or Stokes.
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