CASHCALL, INC.; WS FUNDING, LLC; DELBERT SERVICES CORPORATION; WESTERN SKY FINANCIAL, LLC; AND JOHN PAUL REDDAM, APPELLANTS,
v.
OFFICE OF THE ATTORNEY GENERAL, DEPARTMENT OF LEGAL AFFAIRS AND OFFICE OF FINANCIAL REGULATION, APPELLEES

Fla. 2d DCA | 2015-07-31
No. 2D14-3634
VILLANTI, C.J., and NORTHCUTT, J., Concur.
173 So. 3d 1056 Florida District Court of Appeal, Second District (2015) Positive Treatment
Cited by 2 cases

AI-generated. These summaries, headnotes, and key points are machine-generated and may contain errors or omissions. Always verify against the full opinion text below. Not legal advice.

Synopsis

CashCall and related entities challenged a trial court's temporary injunction freezing loan proceeds and requiring a $1 million reserve pending resolution of a Deceptive and Unfair Trade Practices Act action. The Court reversed, holding that the Attorney General failed to establish a clear legal right to relief because the viability of the case depends on overcoming a choice-of-law clause selecting Cheyenne River Sioux Tribe law, which the Attorney General could not establish had no reasonable relationship to the transaction.


Holding

The trial court erred in granting the temporary injunction because the Attorney General failed to establish a clear legal right to relief. The Attorney General cannot demonstrate a clear legal right when the viability of its action depends on its ability to overcome a choice-of-law clause to tribal law, particularly where prior Florida Supreme Court cases have found no strong public policy against usury sufficient to override such provisions when there is a reasonable relationship between the chosen jurisdiction and the transaction.


Headnotes

[1] A temporary injunction may be granted only upon a showing of a clear legal right to relief.

[2] Appellate review of a temporary injunction order involves de novo review of purely legal matters and abuse of discretion review of factual findings.

Previewing 2 of 5 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.

Join FLexlaw to unlock all legal intelligence

Key Quotes

“in order to obtain a temporary injunction the Attorney General must demonstrate that 'it has a clear legal right' to the injunction”

Establishes the governing legal standard for reviewing temporary injunctions—the Attorney General must show a clear legal right to relief.

Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.

Join FLexlaw to unlock all legal intelligence

Facts & Procedural History

The loan servicers processed consumer installment loans originated by Western Sky Financial, LLC, a company wholly owned by an enrolled member of the …

The full statement of facts, procedural history, and disposition for this case are member content.

Join FLexlaw to unlock all legal intelligence

© FLexlaw, Inc. — AI-generated enrichments are proprietary. All rights reserved.


Opinion of the Court
KELLY, Judge.

KELLY, Judge.

In this appeal, CashCall, Inc., WS Funding, LLC, and Delbert Services Corporation challenge the orders of the trial court granting ex parte a temporary injunction and subsequently declining to dissolve it. The underlying action was brought by the appellees, Office of the Attorney General and Office of Financial Regulation, for alleged violations of Florida’s Deceptive and Unfair Trade Practices Act (“FDUTPA”). The focus of the action is consumer installment loans issued to Florida residents by Western Sky Financial, LLC, a company wholly owned by an enrolled member of the Cheyenne River Sioux Tribe and that conducted its business from within the exterior boundaries of the Cheyenne River Indian Reservation in South Dakota. The injunction requires the appellants to pay all loan proceeds collected during the pen-dency of this litigation into the court registry and to establish an additional reserve in the amount of one million dollars.

The appellees’ action is based on the theory that servicing loans acquired from Western Sky is a deceptive practice because the loans’ interest rates exceed the maximum allowed by Florida law. Among other defenses to the action, CashCall contends the loan contracts are not subject to Florida law because the choice of law provision in the contracts provides that the loans are “subject solely to the exclusive laws and jurisdiction of the Cheyenne River Sioux Tribe.” The Attorney General responds that the choice of law provision is unenforceable because it violates Florida public policy. CashCall in turn argues that Florida has no strong public policy against usury and therefore the provision is valid, relying primarily on the Florida Supreme Court’s decisions in Morgan Walton Properties, Inc. v. International City Bank & Trust Co., 404 So.2d 1059, 1062 (Fla.1981), and Continental Mortgage Investors v. Sailboat Key, Inc., 395 So.2d 507, 509 (Fla.1981). In those cases, the court declined to apply the public policy exception to set aside a choice of law provision in a usury context finding that Florida had no strong public policy against usury as long as there is a reasonable relationship between the chosen jurisdiction and the transaction.

Appellate review of a temporary injunction and denial of a motion to dissolve is a hybrid: to the extent the trial court’s order is based on factual findings, the appellate court should not reverse unless the trial court abused its discretion; to the extent the order rests on purely legal matters, it is subject to full, de novo review. Colucci v. Kar Kare Auto. Grp., Inc., 918 So.2d 431, 436 (Fla. 4th DCA 2006). As a matter of law, in order to obtain a temporary injunction the Attorney General must demonstrate that “it has a clear legal right” to the injunction. See Millennium Commc’ns & Fulfillment, Inc. v. Office of Att’y Gen., 761 So.2d 1256, 1260 (Fla. 3d DCA 2000). We conclude that as currently framed, the viability of the Attorney General’s action is dependent on its ability to avoid the choice of law provision in the loan agreements. Given the case law in that area, the Attorney General has failed to establish it has a clear legal right to relief, a fact the Attorney General essentially admitted below:

Hey, that money you’re getting from Floridians, let’s put it into the Court Registry until we can hear your Motion to Dismiss from all of your hundreds of attorneys and we can talk about hundreds of years’ worth of tribal authority. And you know what, they might win. There’s good case law I think as Brian said on both sides. It is an interesting argument. But I would like to ask the *1058Court to focus on what we asked for and are we entitled to it.

(Emphasis supplied.) Thus, while we express no opinion on the ultimate ability of the Attorney General to prevail against CashCall, at the temporary injunction stage it failed to meet its burden to demonstrate a clear legal right to the injunction. Accordingly, we reverse and remand for further proceedings.

Reversed and remanded.

VILLANTI, C.J., and NORTHCUTT, J., Concur.


Cases With Similar Vibessemantic neighbors from the corpus


Citator

Cited By

Authorities Cited

Full citator, related cases, and AI research tools

Open in FLexlaw