Bank of America Class Action Lawsuit
On April 14, 2020, Plaintiffs filed a Notice of Appeal and Emergency Motion for Injunctive Relief Pending Appeal. Those filings can be accessed here: Notice of Appeal; Emergency Motion for Injunctive Relief Pending Appeal.
Today, the Court denied Plaintiffs’ motions for a Temporary Restraining Order and Preliminary Injunction. A copy of Judge Gallagher’s Opinion can be accessed here: Opinion.
Although recognizing that “Bank of America’s rigid eligibility criteria have undoubtedly made it materially harder for some small businesses to access the PPP”, (pp 21) the Court determined, among other things, that Plaintiffs did not have a private right of action under the CARES Act.
In so holding, however, the Court recognized that “the Plaintiffs’ experiences demonstrate a significant flaw, from their perspective and that of many other small businesses, in the implementation of the massive and complex PPP program.” (pp 23). The Court said that it “will not wade into the merits of this debate” and noted that “Congress is better positioned to remedy any defects in the CARES Act, and to pass supplemental legislation best aimed at ameliorating the effects of the COVID-19 crisis.” (pp 23).
In response to the Court’s decision, Alan M. Rifkin, managing partner of Rifkin Weiner Livingston LLC, issued the following statement:
“The class action highlights serious shortcomings in Bank of America’s administering of the program which, by application, denied scores of small businesses throughout the country the right to access these critical funds at a time when those funds are desperately needed. While the Court denied the relief Plaintiffs sought, concluding among other things that the PPP did not allow for a private right of action, Plaintiffs will appeal the Court’s decision and continue to press their right to seek these critical funds. During the pendency of the appeal, we call upon Congress, Bank of America and all other banks throughout America to do what is right and open the PPP process to any small business that otherwise qualifies for Federal funds under the PPP program.
Since April 3rd, Rifkin Weiner Livingston, LLC. has served as a voice for the scores of small businesses around the country that were prevented from accessing the PPP by Bank of America. Rifkin Weiner Livingston, LLC. will continue to work on behalf of small businesses on appeal to ensure their voices continue to be heard and they are treated fairly.”
On April 24, the President signed into law the “Paychecks Protection Program and Health Care Enhancement Act” which authorized additional funds for the PPP, including the allocation of 60 billion dollars specifically earmarked for distribution through smaller regional banks, credit unions, minority owned banks and other small lenders.
On April 3, 2020, the Small Business Administration released the Paycheck Protection Program (PPP) loans to banking institutions. Bank of America established gating restrictions that prioritized access to the PPP loans to its lending clients and denied access to certain depository clients and other small businesses.
As a result of Bank of America’s lending actions, RWL filed a class action lawsuit on behalf of small businesses that were denied access to the federally funded program by Bank of America. After the lawsuit was filed, Bank of America changed its application criteria. RWL has amended its lawsuit and is continuing to monitor further updates to the gating restrictions that prioritize access to the PPP loans.
A copy of the Memorandum in Support of the Motion for Temporary Restraining Order and Preliminary Injunction and Exhibits can be accessed here: Plaintiffs Memorandum in Support of TRO; Exhibits to Plaintiffs TRO.
A copy of the Bank of America’s Opposition to the Motion for Temporary Restraining Order and Preliminary Injunction and Exhibits can be accessed here: BOAs Opposition to TRO; Exhibits to BOAs Opposition.
If your small business has been denied access to the PPP application process by Bank of America, please contact [email protected].
You may also wish to consult with a personal attorney of your choosing who can explain in greater detail the PPP loan program, your businesses eligibility for it and the process we will be following in order to obtain prompt relief for companies such as yours. While we hope for the best result possible, all litigation is inherently unpredictable in outcome and our class action, is no exception. The record of past case resolutions are no assurance of favorable results in the future.
Yahoo! Finance. (April 3, 2020) Rifkin Weiner Livingston LLC sues Bank of America for class action for prioritizing its lending clients and denying access to the PPP Program to its depository clients and other small businesses.
Associated Press (April 3, 2020) Rifkin Weiner Livingston LLC sues Bank of America for class action for prioritizing its lending clients and denying access to the PPP Program to its depository clients and other small businesses.
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