Treinen Law Office Provides $157,000 Cy Pres Award to New Mexico Center on Law and Poverty
Treinen Law Office provided a $157,000 cy pres award to the New Mexico Center on Law and Poverty in February 2021.
Cy pres awards are given in class actions where, for whatever reason, the money awarded to class members cannot be delivered directly to them. In many consumer class actions, such as those against predatory lenders, class members are hard to find. Persons that take out predatory loans are often from marginalized communities. They often move. The addresses that the predatory lender may have in its records are sometimes no longer valid when a class action settles, particularly – as is common – when the settlement takes place years after the unlawful conduct. Although diligent efforts are made to track down current addresses, through skip tracing and other methods, it frequently proves impossible to find some portion of the class members.
When class members cannot be tracked down resulting in money left over in the settlement fund, it is unfair for the money to be returned to the predatory lender. Such wrongdoers should not be allowed to profit from their unlawful practices. Accordingly, courts often allow cy pres awards to be given to non-profits that aid the public in the same arena as was at issue in the class action. Any cy pres award requires court approval.
The $157,000 cy pres award provided to the New Mexico Center on Law and Poverty in February 2021 involved a class action lawsuit brought against Cashco and Budget Payday Loans, two related predatory lenders, regarding their unlawful practices. Cashco and Budget Payday Loans extended loans to New Mexicans at 521 % Annual Percentage Rate. The lawsuit challenged this extreme interest rate as unconscionable.
Treinen Law Office is proud to have provided a cy pres award to New Mexico Center on Law and Poverty.