What to Do After You Are Sued by an MCA Company

Do Not Ignore the Lawsuit

If you have been served with a lawsuit, this is the most important thing to understand: do not ignore it.

Failing to respond to legal papers can result in a default judgment being entered against you, which substantially limits your options. Even if your goal is to settle, ignoring a filed lawsuit can make that harder and more expensive. Time limits apply — do not assume you have more time than you do.

Pursue Settlement During Active Litigation

A filed lawsuit does not close the door on settlement. Settlement discussions can often proceed while legal proceedings are ongoing — funders and their attorneys frequently prefer this to a prolonged court process.

We can initiate or continue those conversations on your behalf, though outcomes are not guaranteed.

Understand Your Options with a Confession of Judgment

If a confession of judgment has been entered against you, the situation is serious but may not be final. Whether it can be challenged depends on your jurisdiction and the specific circumstances.

We can help you understand what happened and connect you with an attorney who handles these matters. We are not attorneys and cannot advise you on legal strategy.

Address Bank Freezes and Account Levies

A frozen bank account can stop your business from functioning. This type of situation is urgent. Depending on the circumstances, it may be possible to negotiate the release of funds as part of a broader resolution — but this requires prompt action.

Coordinate Across Multiple Funders

If more than one funder has filed suit, addressing them one at a time can trigger escalation from the others. A coordinated approach across all creditors is generally more effective, though it is also more complex and outcomes are harder to predict.

A Note on Legal Representation

We are not attorneys and do not provide legal advice. We cannot represent you in court or advise you on legal defenses. If your case requires legal representation, we will tell you clearly and recommend that you consult with a licensed attorney.

Our role is to pursue settlement discussions with funders and their representatives — which can often happen alongside, or sometimes instead of, formal litigation.

Act Quickly

If a lawsuit has been filed or a judgment entered, contact us as soon as possible. We review time-sensitive situations promptly and will be straightforward with you about what can realistically be done.