Greathouse v. Capital Plus Financial, LLC — court filings

Case summary

Eric Greathouse and other borrowers sued Capital Plus Financial, LLC over Paycheck Protection Program loans, first in the U.S. District Court for the Eastern District of Arkansas, Central Division, No. 4:21-cv-1243-BRW, and then in the U.S. District Court for the Northern District of Texas, Fort Worth Division, No. 4:22-cv-00686-P. The Texas complaint of August 9, 2022 names Capital Plus Financial, LLC, its corporate parent Crossroads Impact Corp., their former dual chief executive Eric A. Donnelly and Crossroads board chairman Robert H. Alpert, and pleads breach of contract, unjust enrichment, the California Unfair Competition Law and the North Carolina Unfair and Deceptive Trade Practices Act. On September 6, 2023 the court granted the motions to dismiss in part, dismissing the unjust enrichment claims against all defendants and denying the motions as to the rest, and denied class certification.

Case at a glance

What does the complaint allege?

That Capital Plus Financial failed to fund PPP loans the Small Business Administration had approved and that it was contractually obligated to fund, and that because an SBA number was assigned to them the plaintiffs remain obliged to repay money they never received.

What did the court decide on the motions to dismiss?

It dismissed the unjust enrichment claims against all defendants and denied the motions as to the other claims, writing that the remaining issues are appropriately resolved at the summary judgment stage.

Why was class certification denied?

The opinion of September 6, 2023 records that the plaintiffs were approved and suffered similar injuries but that their situations after approval differ: some loans were denied and cancelled over inconsistent paperwork, some were disbursed but rejected by banks, and some were disbursed but never arrived.