How We Helped a Small Business Owner Settle a $1.15 Million Debt Collection Lawsuit—and Saved Their Business
When a national debt collector came after a family-owned transportation company for more than $1.15 million, the future looked bleak. Here’s how strategic legal intervention helped the owner protect his business, his vehicles, and his livelihood.
When Debt Collectors Target a Small Business, Everything Is on the Line
The owner of a luxury transportation company reached out to us in crisis. A national debt collection agency had filed a lawsuit demanding $1,151,964.11, plus 18% interest, late fees, and attorney’s fees.
Three commercial vehicle loans—originally issued by a major national bank and later sold twice to debt buyers—were at the heart of the case. Those loans had financed the limousines that kept the company running.
Without those vehicles, the business would collapse. Without a legal strategy, the owner risked losing everything.
The Claims: A Lawsuit Designed to Overwhelm
The complaint included three separate claims, each with serious consequences:
1. Breach of Contract
The plaintiff alleged that the transportation company failed to make payments on three promissory notes dating from 2016–2018. The collector demanded the entire outstanding balance, plus penalties.
2. Breach of Personal Guaranty
The business owner had personally guaranteed the loans—meaning his personal assets were at risk if the company defaulted. His home, savings, and income could all be targeted.
3. Unjust Enrichment (Backup Claim)
As an alternative theory, the plaintiff argued that even if the contracts were defective, the owner and company had benefited from the loan proceeds and vehicles without repayment.
On paper, the case looked like a runaway train. But paper doesn’t tell the whole story.
The Strategy: Calm the Chaos, Control the Case
Rather than rushing into expensive litigation, we built a strategic plan focused on protecting the business and minimizing financial damage.
- We filed a strong Answer denying the inflated amount and challenging the collector’s accounting.
- We scrutinized the loan history and assignments to identify inconsistencies and gaps in the plaintiff’s documentation.
- We opened early settlement discussions to avoid costly discovery.
- We prioritized keeping the vehicles on the road so the business could generate income during the lawsuit.
The goal was simple: buy time, uncover leverage, and negotiate a path that didn’t destroy the company.
The Breakthrough: A Settlement That Saved the Business
Through consistent negotiation and realistic financial planning, we achieved a result that allowed our client not just to survive—but to rebuild.
Here’s what we secured:
- ✅ A manageable structured payment plan instead of a devastating lump-sum judgment.
- ✅ A vehicle-title release schedule—each payment returned a title, giving the business real momentum.
- ✅ A discounted payoff amount at market rates, saving the client tens of thousands.
- ✅ A full dismissal with prejudice once payments were completed.
- ✅ Most importantly: the business stayed open. The client kept the limousines, kept the contracts, and kept his employees working.
For a small business pressured by a million-dollar lawsuit, this was a lifeline—and a turning point.
Before & After: The Transformation
| Before | After |
|---|---|
| Facing a $1.15M demand | Negotiated a reduced, market-rate settlement |
| Risk of vehicle seizure and business collapse | Kept every vehicle and stayed operational |
| At risk personally due to guaranty | Protected personal assets from aggressive collection |
| Fear of bankruptcy and insolvency | A structured plan that preserved cash flow |
What Small Business Owners Should Know
Debt-collection litigation moves fast—and can be unforgiving. These key lessons made all the difference for our client:
- Immediate action is crucial. Waiting risks default judgments, liens, and bank account freezes.
- Debt accounting is often flawed. Errors in assignments, interest, fees, and credits can dramatically change the amount owed.
- Personal guaranties are powerful. They expose the owner—not just the company—to liability.
- Settlement is often the smartest path. It reduces risk, protects assets, and keeps operations running.
- Early negotiation saves money. Avoiding discovery and depositions protects both time and cash flow.
Facing a Debt Collection Lawsuit? We Can Help.
A lawsuit like this is more than a legal problem—it’s a threat to your livelihood. We understand how much is on the line: your business, your reputation, your employees, your financial future.
Our litigation team helps small business owners:
- Challenge inflated balances
- Protect personal assets from guaranty enforcement
- Negotiate payment plans aligned with cash flow
- Avoid unnecessary litigation costs
- Achieve dismissals that close the case permanently
You don’t have to face a multimillion-dollar lawsuit alone. With the right strategy, you can regain control.
