In a dramatic legal move, a small business has filed a lawsuit against several merchant cash advance companies, accusing them of engaging in predatory lending practices that allegedly violate federal and state laws. The complaint was filed by Foodees, LLC, along with Ronald Keith Kennedy III and Tricia Dawn Croft, in the United States District Court for the Western District of North Carolina on December 23, 2025. The defendants include Rival Funding, LLC; United First, LLC; EBF Holdings, LLC doing business as Everest Business Funding; Kash Advance, LLC; Cromwell Capital, LLC; Syndicate Group USA, Inc.; and several individuals associated with these entities.
The plaintiffs allege that the defendants orchestrated a long-running scheme to collect unlawful debts through deceptive merchant cash advance agreements. These agreements were purportedly designed to appear as purchases of future receivables but were actually high-interest loans disguised to circumvent usury laws in New York and Florida. According to the complaint, “the terms and conditions demonstrate that despite the form of the agreements, no sale of future receipts ever took place.” Instead, these were loans demanding repayment within fixed periods at interest rates exceeding legal limits—over 25% per annum as defined under New York law.
Foodees is a North Carolina-based company specializing in organizing food truck and cultural festivals across the United States. Between October 2024 and December 2025, Foodees entered into nine such agreements with the defendants. These transactions involved receiving lump sums from the defendants in exchange for agreeing to repay much larger amounts through weekly payments. For instance, one agreement with EBF Holdings required Foodees to repay $43,200 on a $30,000 loan through $1,800 weekly installments—a rate described as criminally usurious under applicable laws.
The lawsuit paints a picture of an industry rife with exploitation where small businesses are lured into financial traps masked as legitimate funding solutions. It claims that many MCA companies operate without proper regulation or oversight and employ tactics similar to payday lending but targeted at businesses instead of consumers. The plaintiffs argue that these practices have drawn scrutiny from state attorneys general and courts alike.
Foodees seeks relief under the Racketeer Influenced and Corrupt Organizations (RICO) Act for what they describe as racketeering activities involving wire fraud and collection of unlawful debts. They demand treble damages—three times their actual losses—as well as costs and attorney fees incurred while exposing these alleged criminal activities.
Representing Foodees are attorneys from prominent law firms specializing in complex litigation cases involving financial misconduct. The case is identified by Civil Action No. 3:25-cv-01023.
Source: 325cv01023_Fooddees_LLC_v_Rival_Funding_LLC_Complaint_Western_District_North_Carolina.pdf
