Getting sued by IOU Central Inc. or IOU Financial can be a small business owner’s worst nightmare. It is normal to feel overwhelmed, upset, and angry.
Fortunately, Diwan Law has experience litigating against IOU Central and many other creditors.
What is IOU Central Inc. or IOU Financial?
Before we discuss what you should do if you or your small business is served with a complaint, we will first discuss what IOU Central Inc. or IOU Financial is.
According to its website, IOU Central provides small businesses access to the funds they need to grow quickly. Its customers include medical and dental practices, grocery and retail stores, restaurant and hotel franchisees, and e-commerce companies from across the country.
What the IOU Financial’s website does not tell you?
Like most creditors, if you default on your loan, IOU Financial and IOU Central will file a court action against you to collect the debt owed.
Unlike most creditors, IOU Financial will often file its lawsuits in Georgia. No matter where you or your business is located in the country, it will force you to defend the case in Georgia.
IOU Central often files simple cases of breach of contract seeking to enforce Promissory Notes [the “Notes”] against borrowers and persons who are allegedly guarantors on the Notes.
The total of IOU Financial’s personal jurisdiction in these cases is that the defendant borrowed the funds from a Georgia lender, IOU Central, and communicated with the defendant through the internet.
Whether IOU Central has personal jurisdiction over you or your company will depend on several factors, so you will need to discuss your situation with an experienced breach of contract attorney.
Personal Jurisdiction Under the Georgia Long-Arm Statute
Georgia’s long-arm statute states a Georgia Court can exercise jurisdiction over a party residing in another state if they:
Transact any business within this State;
Commit a tortious act or omission within this State;
Commit a tortious injury in this State caused by an act or omission outside this State if the tortfeasor regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this State….
O.C.G.A. § 9-10-91. These are the only potentially applicable sections.
The court must also engage in a two-part inquiry to determine whether that reach comports with due process.
First, the defendant must have established “minimum contacts” with Georgia. Id. Second, exercising personal jurisdiction over the defendant must not offend traditional notions of fair play and substantial justice.
The “‘minimum contacts’ analysis looks to the defendant’s contacts with the forum State itself, not the defendant’s contacts with persons who reside there.” “Due process requires that a defendant be haled into court in a forum State based on his own affiliation with the State, not based on the random, fortuitous, or attenuated contacts he makes by interacting with other persons affiliated with the State.”
What to do if you are sued by IOU Financial or IOU Central in Georgia?
Step 1: Review the case with a contract lawyer.
If you are served with an IOU Financial lawsuit, you should first review it carefully with an experienced business defense lawyer.
Step 2: DO NOT communicate directly with IOU Central.
Anything business owners say to the plaintiff regarding the contract, debt, or lawsuit can be used against you and your business.
Step 3: DO NOT ignore the lawsuit.
Failure to answer the complaint within the specified time period will allow the plaintiff to request a default judgment against you and your business.
Step 4: Call Diwan Law
We will analyze your situation and develop the best defense for you.
Call today for your free consultation.
* The information presented in this article does not constitute legal advice. All information, content, and materials presented on this website are for general informational purposes only. If your business is sued, we encourage you to contact Diwan Law before taking any action.
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CREDIT CARD OR OTHER DEBT COLLECTION LAWSUIT?
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Diwan Law represents clients facing: third-party debt buyer lawsuits [i.e. Midland Funding, Portfolio Recovery Associates, Asset Acceptance, Cavalry SPV I, LLC, Cavalry Portfolio Services, Unifund, etc.] and Credit Card lawsuits [Zwicker, Cooling and Winter, Cooling & Winter]
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Atlanta, GA 30346
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We serve clients across Georgia, including, but not limited to, clients in the following locations: Fulton County including Atlanta, Milton, Roswell, and Sandy Springs; Bibb County including Macon; Carroll County including Carrollton; Cobb County including Kennesaw, Marietta, and Smyrna; Coweta County including Newnan; DeKalb County including Brookhaven, Clarkston, Decatur, Dunwoody, and Stone Mountain; Douglas County including Douglasville; Floyd County including Rome; Gwinnett County including Duluth; Habersham County including Cornelia; and Hall County including Gainesville, Cherokee County, Henry County, Forsyth County, and Paulding County.