United States District Court, D. Minnesota
Scott Rilley, Michelle Kunza, Venus Colquitt-Montgomery, Jonathan Aldrich, and Kendra Buettner, on behalf of themselves and those similarly situated, Plaintiffs,
MoneyMutual, LLC, Selling Source, LLC, and PartnerWeekly, LLC, Defendants.
Michelle Drake, Esq., Jeffrey L. Osterwise, Esq., and John G.
Albanese, Esq., Berger & Montague, PC; and Mark L.
Heaney, Esq., Heaney Law Firm, LLC, counsel for Plaintiffs.
Christina Rieck Loukas, Esq., and Joseph M. Windler, Esq.,
Winthrop & Weinstine, PA; and Donald J. Putterman, Esq.,
and Michelle L. Landry, Esq., Putterman Landry & Yu LLP,
counsel for Defendants.
MEMORANDUM OPINION AND ORDER
DONOVAN W. FRANK UNITED STATES DISTRICT JUDGE
matter is before the Court on the Plaintiffs' motion for
class certification. (Doc. No. 113.) Defendants' oppose
the motion. For the reasons discussed below, the Court grants
a class action brought by Plaintiffs on behalf of all
Minnesota residents who used moneymutual.com or any
MoneyMutual-branded website to obtain a payday loan from
August 1, 2009 through the date the Court certifies the Class
(the “Class Period”), against Defendants, for
violations of Minnesota statutes and common law. (Doc. Nos.
1-2 (“Am. Compl.”), 113.) The background facts of
this case have been set forth in prior orders and the Court
need not fully discuss the facts here. Instead, the Court
summarizes and supplements the relevant facts below.
collectively operate a lead-generating business for various
payday lenders. Consumers would go to Defendants' website
to fill out an application, and then Defendants would sell
the application to lenders. The lenders would independently
decide whether to lend consumers money.
operate the website www.moneymutual.com (“MM
Website”). MoneyMutual, LLC holds the MM Website, but
has no employees. (Doc. No. 29 (“Madsen Decl.”)
¶ 5.) Selling Source is the sole owner of MoneyMutual
and PartnerWeekly. PartnerWeekly and Selling Source have
shared numerous employees. (Doc. No. 28 ¶¶ 2-4.)
Defendants use television and Internet-based advertising, as
well as direct marketing to market the MM Website. (Madsen
Decl. ¶¶ 5-6; Doc. No. 117 (“Albanese
Decl.”) ¶ 22, Ex. 2 (“McKay Dep.”) at
17, 19-21, 47, 91, 94-95.) Defendants' advertising
features celebrity spokesperson Montel Williams.
(Id.) The MM Website has been active since 2009, and
Montel Williams has been the spokesperson for MoneyMutual
since its inception. (Albanese Decl. ¶ 22, Ex. 3 at
65-66., Ex. 4, Ex. 5.) Until around October 2016, the MM
Website advertised to consumers that they could secure loans
“as soon as tomorrow, ” in amounts up to $1, 000;
as of October 2016, the amount changed to $2, 500.
(Id., Exs. 7-8.) The MM Website did not disclose to
potential borrowers that MoneyMutual is not licensed in
Minnesota or that the loans offered may be illegal in
Minnesota. (See id., Exs. 6-9.)
Website invited consumers to apply for a loan, which involved
the consumer providing his or her name, social security
number, address, bank account information, military status,
income, employment status, e-mail address, phone number, and
next payday. (Id., Ex. 10 (“Maple Dep.”)
at 21-25.) These categories of information remained
substantially the same during the Class Period.
MoneyMutual receives an applicant's information via the
MM Website, Defendants then connect those leads to
Defendants' network of lenders via PartnerWeekly's
“automated, ” “ping tree” system for
selling leads. (Madsen Decl. ¶ 8; McKay Dep. at 30-31.)
This system is based upon lead purchase agreements between
PartnerWeekly and the lenders, which include “lead
purchase insertion orders” that specify the type of
consumer sought by the lender. (Madsen Decl. ¶ 6; McKay
Dep. at 33.) Once an applicant is matched with a lender, the
consumer's web browser is automatically redirected to the
lender's website, and the consumer receives an e-mail
with the lender's contact information. (Maple Dep. at
33-35.) Defendants represent that 30%-60% of leads sold in
the industry result in a loan transaction. (McKay Dep. at
124-126; Albanese Decl. ¶ 22, Ex. 15 (“Madsen
Dep.”) at 46-47.)
to a spreadsheet detailing all of the leads sold by
Defendants regarding Minnesota consumers, Defendants sold 41,
154 leads regarding Minnesota consumers to lenders during the
period of September 29, 2009 to October 19, 2017 (“Lead
Acquisition Spreadsheet”). (Albanese Decl. ¶
Because of duplicate contact information, however, Plaintiffs
estimate that there are approximately 27, 887 unique
Minnesota consumers on the Lead Acquisition Spreadsheet.
(Id.) Defendants also collected and preserved the
banking information, including bank name, routing number, and
account number, for all applicants. (See Id. ¶
5; ¶ 22, Ex. 16.) Defendants are not licensed to arrange
loans in Minnesota. (McKay Decl. ¶ 7; Madsen Decl.
¶ 19.) Neither are the lenders to which they sell leads.
According to the MM Website, the loans offered by the lenders
have annual interest rates with a “typical
representative APR range . . . somewhere between 261% and
1304% for a 14-day loan.” (Albanese Decl. ¶ 22,
Ex. 9 at PLF-0001227.)
19, 2010, the Attorney General's Office for the State of
Minnesota notified MoneyMutual that because it
“arrange[s] for payday loans to Minnesota
consumers” that it was “subject to the
restrictions on payday loans set forth in Minnesota law,
” and that MoneyMutual was “aiding and abetting
lenders that violate Minnesota law.” (Id., Ex.
23.) The Attorney General sent the same letter to MoneyMutual
in 2012. (Id., Ex. 24.) Defendants did not respond
to the Attorney General's letter, and Defendants'
counsel represented at the hearing on this motion that
Defendants disagree with the Attorney General's
interpretation of the law and facts on this matter.
are consumer-borrowers and have filed a purported class
action against Defendants related to the payday loans.
Plaintiffs Rilley and Kunza have been involved in the
litigation since its inception in March 2014; Plaintiffs
Aldrich, Buettner, and Colquitt-Montgomery have been involved
since March 2018. Each Named Plaintiff visited the MM Website
from a computer in Minnesota, submitted their Minnesota
address and banking information, and were matched with a
lender that provided a loan with a principal under $1, 000.
(Doc. Nos. 138 (“Aldrich Decl.”) ¶¶
6-8, 139 (“Buettner Decl.”) ¶¶ 6-9; 140
(“Kunza Decl.”) ¶¶ 8-16; 141
(“Colquitt-Montgomery Decl.”) ¶¶ 9-12;
142 (“Rilley Decl.”) ¶¶ 7-10.)
first filed their complaint in Minnesota state court, naming
only MoneyMutual as a defendant. Plaintiffs eventually
amended the complaint to add Defendants PartnerWeekly and
Selling Source. (Doc No. 1-2 (“Am. Compl.”).)
Defendants then removed the case to this Court and moved to
dismiss for lack of personal jurisdiction. In the August 30,
2017 Order, the Court found the exercise of personal
jurisdiction appropriate, but dismissed the RICO claim under
March 21, 2018, Plaintiffs filed their Second Amended
Complaint, which added Plaintiffs Jonathon Aldrich, Venus
Colquitt-Montgomery, and Kendra Buettner, omitted the
previously dismissed claims, and did not add any new claims
or theories of recovery. (Doc. No. 85 (“2d Am.
Compl.”).) Defendants moved to dismiss the Second
Amended Complaint again for lack of personal jurisdiction.
(Doc. No. 95.) On October 3, 2018, the Court denied
now move the Court for an order certifying this case as a
class action under Federal Rules of Civil Procedure 23(a) and
23(b)(3) on behalf of the following proposed class of
borrowers (the “Class”):
All individuals residing in Minnesota who (1) received a loan
from a lender of $1, 000 or less, (2) that required a minimum
payment within 60 days of loan origination of more than 25
percent of the principal balance, (3) by using
moneymutual.com or any MoneyMutual-branded website, (4) from
August 1, 2009 through the date of this Order.
(Doc. No. 113 at 1.) Plaintiffs also move the Court for an
order appointing Named Plaintiffs as representatives of the
Class and appointing E. Michelle Drake and John G. Albanese
of Berger & Montague, P.C., and Mark Heaney of Heaney Law
Firm, LLC as Class Counsel (“Proposed Class
Legal Standard for Rule 23 Class Certification
“A class action serves to conserve the resources of the
court and the parties by permitting an issue that may affect
every class member to be litigated in an economical
fashion.” Ebert v. Gen. Mills, Inc., 823 F.3d
472, 477 (8th Cir. 2016). To obtain class certification, ...