Cole Schotz served as counsel to the Creditors’ Committee in Think Finance, LLC, in the Northern District of Texas

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Cole Schotz served as counsel to the Creditors’ Committee in Think Finance, LLC, et al. in the Northern District of Texas. The Debtors were the perpetrators of a $2 billion fraud which used Native American Tribes as a front for an internet lending scheme that charged up to 400% interest to consumer borrowers for small dollar short term loans, and tried to use the tribe’s sovereign immunity to protect it from civil RICO suits and usury violations. As Committee counsel, we worked with national Consumer Borrower Class Counsel, the CFPB, and the Attorney General for the Commonwealth of Pennsylvania, to shed light on the scheme and recover value for the defrauded consumers and trade creditors. We also discovered additional substantial fraudulent transfers during our investigation in the cases. After years of litigation, 9 months of mediation, over 30 depositions, analyzing nearly 500,000 documents, the Debtors capitulated and agreed to a global resolution that we proposed.

On November 25th, the Court confirmed the Plan in the cases, which, among other things, enjoins and voids $380,000,000 in consumer loans, ends the tribal lending business of Think Finance for good, pays trade creditors 50% of their claims, and places close to $60 million in a Litigation Trust for distribution to the consumer borrowers along with a valuable avoidance action portfolio to monetize. The team consisted of Gary Leibowitz, Mike Warner, Irv Walker, Jim Walker, Susan Usatine, Ben Wallen, Jill Bienstock, Dan Geoghan, Ian Phillips and Rebecca Hollander.

As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.

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