Ruth v. Cherokee Funding, LLC

Summary

The court held that litigation-funding agreements requiring repayment only if the funded plaintiff recovered in an underlying personal-injury action, and limiting repayment to the recovery, are not loans covered by either the Industrial Loan Act or the Payday Lending Act. Because the complaint did not allege that the repayment contingencies were illusory or sham provisions, the plaintiffs failed to state claims under either statute. The court affirmed the Court of Appeals; the concurring justice agreed with the judgment but concurred in the Payday Lending Act analysis only in the result.