X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

MEMORANDUM AND ORDER Plaintiffs have brought this action under the Racketeer Influenced and Corrupt Organizations Act (“RICO”) and related state claims against defendants. Plaintiffs allege that defendants operated a scheme (the “Dealers-EAC Scheme”) to fraudulently induce individuals with federal student loan debts to purchase certain services from dealers and to finance that purchase with a loan from defendant Equitable Acceptance Corporation (“EAC”). EAC’s prior motion to dismiss plaintiffs’ RICO claim was denied by the Court in its Memorandum & Order of March 11, 2020. See ECF No. 73 (the “RICO Order”).1 Presently before the Court are three motions: (1) EAC’s motion to dismiss plaintiffs’ fraudulent conveyance claim; (2) defendants Jeffrey Henn (“Jeffrey”) and Teresa Henn’s (“Teresa”)2 motion to dismiss each claim made against them; and (3) plaintiffs’ motion for a preliminary injunction to prohibit the Henns from moving assets out of their trusts and directing EAC to cease all transfers of funds collected as the profits of the Dealers-EAC Scheme. For the following reasons, EAC’s motion to dismiss plaintiffs’ fraudulent conveyance claim is granted, the Henns’ motion is granted in part and denied in part, and the plaintiffs’ motion for a preliminary injunction is denied. BACKGROUND The Court detailed the background of this case in the RICO Order. The Court assumes familiarity with this decision and states here only those facts and procedural history necessary to resolve the pending applications. 1. The Dealers-EAC Scheme As described more fully in the RICO Order, plaintiffs allege that around 2015, EAC conspired with dozens of dealers (“Dealers”) to offer purported student loan assistance services (“Services”) to federal student loan borrowers (“Borrowers”). The Dealers introduced their purported Services as providing loan “forgiveness,” when in reality they were simply filing applications on behalf of the Borrowers for loan consolidation and enrollment in repayment programs offered by the Department of Education. SAC

77-80, 94. While Borrowers could have applied to these programs on their own in a process that would have taken approximately ten minutes and cost nothing, the Dealers and EAC charged approximately $1300 for these Services. Id. 129. Because Dealers were prohibited from receiving payments directly from Borrowers under federal regulations, Dealers referred Borrowers to EAC to finance the purchase of Services. Id.

 
Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

More From ALM

Premium Subscription

With this subscription you will receive unlimited access to high quality, online, on-demand premium content from well-respected faculty in the legal industry. This is perfect for attorneys licensed in multiple jurisdictions or for attorneys that have fulfilled their CLE requirement but need to access resourceful information for their practice areas.
View Now

Team Accounts

Our Team Account subscription service is for legal teams of four or more attorneys. Each attorney is granted unlimited access to high quality, on-demand premium content from well-respected faculty in the legal industry along with administrative access to easily manage CLE for the entire team.
View Now

Bundle Subscriptions

Gain access to some of the most knowledgeable and experienced attorneys with our 2 bundle options! Our Compliance bundles are curated by CLE Counselors and include current legal topics and challenges within the industry. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. Both options are priced the same.
View Now

New York Legal Awards 2021

October 13, 2021
New York, NY

The New York Law Journal honors attorneys and judges who have made a remarkable difference in the legal profession in New York.


Register

BenefitsPRO Broker Expo 2021

May 18, 2021 - August 18, 2021
Virtual / San Diego, CA

The premier educational and networking event for employee benefits brokers and agents.


Register

African Legal Awards 2021

September 03, 2021
TBD

The African Legal Awards are set out to recognise exceptional achievement from Africa s legal elite.


Register

Divisional Office Coordinator

San Francisco, California, United States

The United States Bankruptcy Court for the Northern District of California: Seven Bankruptcy Judges. Clerk’s Office staff of 50. ...


Apply Now ›

Plaintiff Mass Tort and Medical Malpractice Attorney

Voorhees, New Jersey, United States

Javerbaum Wurgaft, a large statewide civil litigation firm with nine (9) offices, seeks: associate attorney experienced in litigating m...


Apply Now ›

Litigation Associate

WHITE PLAINS, New York, United States

 About the firm: Defense firm has extensive experience for over 30 years in the defense of Labor Law and construction accident litigat...


Apply Now ›

FLB LAW

08/02/2021
Connecticut Law Tribune


View Announcement ›

VAN DER VEEN, O NEILL, HARTSHORN, AND LEVIN

07/27/2021
TLI Web

VAN DER VEEN, O NEILL, HARTSHORN, AND LEVIN is pleased to welcome Frank Breitman, Esq. a talented and respected litigator to our ranks of trial lawyers.


View Announcement ›

HARWOOD LLOYD, LLC

07/26/2021
NJLJ Web

HARWOOD LLOYD, LLC Welcomes Beth L. Barnhard, Esq. Beth has joined the firm as Counsel in the Wills, Trusts and Estates Department. She is Certified to be an Elder Law Attorney (CELA) by the ABAaccredited National Elder Law Foundation.


View Announcement ›