37th Annual Bear River PowWow

Posted by Lac Du Flambeau Band of Lake Superior Chippewa Indians on Monday, July 15, 2019

Lac du Flambeau Band leaders accused in new online lending lawsuit

Several leaders and employees of the Lac du Flambeau Band of Lake Superior Chippewa Indians are being sued by a consumer of the tribe's online lending operation.

Isaiah A. Jones III filed the lawsuit in the federal court for the Eastern District of Pennsylvania, The Pennsylvania Record reported. The Eastern District falls within the 3rd Circuit Court of Appeals.

The location of the filing is notable because of a recent decision from the 4th Circuit Court of Appeals. In a case that originated in Virginia, the court held that a lending business owned by the Lac Vieux Desert Band of the Lake Superior Chippewa Indians enjoys sovereign immunity as an "arm of the tribe."

The unanimous July 3 decision set an important standard for determining whether a tribal entity can be sued without its consent. But the court's holding does not apply outside the 4th Circuit unless other courts choose to adopt it.

Jones does not raise the same "arm of the tribe" issues in his June 7 complaint. But in seeking to represent other consumers of the Lac du Flambeau Band's RadiantCash operation, he is trying to pierce the tribe's sovereign immunity by going after tribal leaders, including President Joseph Wildcat Sr., and employees in their personal capacities. He also accuses them of running a criminal enterprise in violation of the Racketeer Influenced and Corrupt Organizations Act (RICO).

"There are common questions of law and fact that apply to all class members, including but not limited to: (a) whether Pennsylvania law applies to loans from Radiant or LDF Holdings to borrowers in Pennsylvania; (b) whether the tribal dispute resolution procedure is enforceable against Mr. Jones and class members; (c) whether the Individual Defendants are operating an enterprise through the collection of unlawful debt in violation of 18 U.S.C. § 1962, and (c) whether the Individual Defendants are protected from suit in their personal capacity by tribal immunity," the complaint reads.

According to Jones, RadiantCash charges interest rates and other fees that are illegal were the business to operate under Pennsylvania law. The tribe operates the business from its reservation in Wisconsin.

Read More on the Story
Chester man alleges tribe-run online lender charged excessive rates on loan (The Pennsylvania Record August 8, 2019)

Law Article
Josh Dhyani, Brian Epling and Jennifer Galloway: Big Picture Loans Lands Big Win for Tribal Lenders in Sovereign Immunity Case (JD Supra August 8, 2019)

Join the Conversation

Related Stories
Appeals court turns back attack on tribal lending operation (July 5, 2019)
Appeals court appears skeptical of attack on tribal lending operation (May 8, 2019)
'Under Attack': Fate of tribal lending industry in hands of appeals court (May 6, 2019)
Indian Country experts warn of gridlock in troubled political climate (February 1, 2019)
Agency that targeted tribal lenders in line for even more big changes (February 20, 2018)
Trump administration signals major changes for tribal lending industry (January 19, 2018)
Tribes see opening under Trump to reshape agency that targets lending industry (November 17, 2017)
Native American Financial Services Association hires new director (September 28, 2016)
Tribal lenders face pressure as new rule aims to end 'debt traps' (June 7, 2016)
Tribal lenders praise Treasury Department study of industry (July 20, 2015)
Opinion: Connecticut takes wrong approach with tribal lenders (April 30, 2015)
Connecticut tribes support state's efforts against online lenders (April 14, 2015)
Jane Daugherty: Tribal e-commerce continues to draw scrutiny (March 26, 2015)
Lac Vieux Desert Band relies on revenue from lending business (March 2, 2015)
Otoe-Missouria Tribe defends online loan business amid scrutiny (November 24, 2014)
NAFSA puts a positive spin on decision in tribal lending lawsuit (October 2, 2014)
Jane Daugherty: Tribes lose out in battle over Internet lending (October 9, 2013)
Jane Daugherty: Lawmakers defend online lending industry (August 26, 2013)