MARSHALL v. PRESTAMOS CDFI, LLC
5:21-cv-04337
E.D. Pa.Apr 30, 2025Background
- Plaintiffs, approved for Paycheck Protection Program (PPP) loans from lender Prestamos CDFI, LLC, never received their funds because their banks returned the money to Prestamos for varying reasons specific to each plaintiff.
- Plaintiffs allege Prestamos breached the standard PPP loan contract by failing to fund the loans and falsely reported the loans as funded to the SBA to collect fees, leaving plaintiffs on the hook for repayment and preventing them from seeking forgiveness or loans elsewhere.
- Plaintiffs sought to certify two classes under Rule 23, arguing that liability turns on common contractual and regulatory duties applicable to all class members.
- Prestamos did not fund the loans and claimed its actions followed government guidance regarding fraud investigations on returned PPP loans, and that it was entitled to retain processing fees.
- The court addressed both a motion to exclude plaintiffs' expert reports under Daubert and plaintiffs’ motion for class certification.
- The case paralleled Greathouse v. Capital Plus Financial, LLC, previously litigated with nearly identical facts, counsel, and legal questions.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of expert legal opinions under Daubert | Experts’ legal opinions help show class certification is proper | Experts make improper legal conclusions; reports not fully admissible | Legal opinions excluded; background opinions admitted |
| Commonality under Rule 23(a) | Common question: Should PPP loans have been canceled? | Individualized reasons for returned loans defeat commonality | No commonality; reasons are too fact-specific |
| Typicality under Rule 23(a) | All signed same contract, same alleged injury | Defenses are individualized to reasons for loan returns | No typicality; unique defenses for each plaintiff |
| Predominance/Superiority under Rule 23(b)(3) | Contract and regulations provide basis for class-wide resolution | Individual facts predominate; class action not superior | Plaintiffs fail to show predominance or superiority |
Key Cases Cited
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011) (commonality under Rule 23 requires the common question to generate common answers)
- Marcus v. BMW of N. Am., LLC, 687 F.3d 583 (3d Cir. 2012) (sets out Rule 23(a) and (b) requirements for class certification)
- In re Blood Reagents Antitrust Litig., 783 F.3d 183 (3d Cir. 2015) (requires Daubert analysis of expert testimony at class certification stage)