The defendant filed a vigorous response in mid-2021, seeking to dismiss Ferrum’s claims and filing counterclaims for . Their defense centered on three key arguments:
The fallout has resulted in a complex web of criminal and civil proceedings: ferrum capital lawsuit 2021
New York usury laws cap interest rates on loans at 16% for corporations (and 25% for non-bank lenders). The defendant argued Ferrum’s 2.5x multiplier effectively represented an annual interest rate exceeding 150%—making the agreement criminally usurious and thus unenforceable. Ferrum countered that litigation funding is not a "loan" but an "investment" in a legal asset, exempt from usury laws. This became the central legal battleground. The defendant filed a vigorous response in mid-2021,
Some claims suggested that Ferrum Capital representatives forged signatures or altered documents to make it appear as though loans were secured by specific properties when, in fact, the collateral either did not exist or was already leveraged by another lender. Ferrum countered that litigation funding is not a