RDM Capital Funding, LLC v. Shoegod 313 LLC
2024 NY Slip Op 51077(U)
| N.Y. Sup. Kings | 2024Background:
- Plaintiff, RDM Capital Funding, alleged it entered a merchant cash advance contract to purchase $19,800 in future receivables from Defendant Shoegod 313 LLC, with personal guarantee by Defendant Damean Henderson.
- Plaintiff claims it performed under the contract by wiring $14,400 (purchase price minus fee) to Defendant and that Defendant breached by failing to remit receivables as agreed.
- Plaintiff moved for summary judgment, seeking $13,785 (unpaid receivables plus fees).
- Defendants contested the motion, arguing improper foundation for key business records, that the agreement was a usurious loan, and challenged enforceability of fees.
- The court's focus was whether Plaintiff provided admissible evidence proving it performed its contractual obligations—specifically, that the wire transfer occurred.
- The Court denied summary judgment, finding Plaintiff failed to lay the proper business records foundation to authenticate payment.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proof of contract performance | RDM says its records/evidence prove payment was made under contract | Defendants say no proper foundation for business records proving payment | Court found Plaintiff did not lay proper business records foundation; summary judgment denied |
| Admissibility of business records | RDM claims evidence (contract, wire, payment history) meets business record exception | Defendants challenge evidence as hearsay, no proper authentication | Court agreed with Defendants; records not properly authenticated |
| Nature of the contract (usury) | RDM treats contract as a merchant cash advance | Defendants argue contract is a usurious loan | Issue not reached; motion denied on evidentiary grounds |
| Enforceability of fees | RDM seeks to recover stated contract fees | Defendants argue fees are penalties | Issue not reached; motion denied on evidentiary grounds |
Key Cases Cited
- Alvarez v. Prospect Hosp., 68 NY2d 320 (summary judgment requires no triable issues of fact and proof in admissible form)
- Winegrad v. New York Univ. Med. Ctr., 64 NY2d 851 (summary judgment standards)
- Andre v. Pomeroy, 35 NY2d 361 (summary judgment standards)
- Zuckerman v. City of New York, 49 NY2d 557 (burden-shifting in summary judgment and evidentiary standards)
- Rotuba Extruders, Inc. v. Ceppos, 46 NY2d 223 (facts viewed in light most favorable to non-movant)
- Johnson v. Lutz, 253 NY 124 (business records hearsay exception foundation requirement)
- People v. Cratsley, 86 NY2d 81 (foundational requirements for business record admissibility)