Diesel Funding lawsuit: what Kings and the Second Department held in Build Retail

Diesel Funding lawsuit coverage of Build Retail: Kings denied vacatur and the Second Department affirmed, holding the agreement was not a usurious loan.

Updated 2026-10-30

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By Anonymous MCA industry contributor Research, writing and editorial review · MCA sales background

A Diesel Funding lawsuit search usually lands on private New York collection litigation naming Diesel Funding, LLC, not a statewide Attorney General enforcement caption. The clearest published multi-level signal is Diesel Funding, LLC v. Build Retail, Inc., where Kings County denied a motion to vacate a settlement judgment and the Second Department affirmed that denial on April 29, 2026 (2026 NY Slip Op 02629, 248 AD3d 1190). Merchants argued the underlying receivables purchase was a usurious loan that poisoned both the agreement and the stipulation; both courts rejected that theory under the three-factor test. This page sticks to those opinions. It is not a prediction about your file.

Editorial update: 2026-10-27 · Desk research of the published Second Department opinion and the Kings County order it affirmed. Not legal advice.

Quick answer

Item	Public record
Lead appellate case	Diesel Funding, LLC v. Build Retail, Inc., 2026 NY Slip Op 02629, 248 AD3d 1190 (2d Dept Apr. 29, 2026)
Trial court	Supreme Court, Kings County (Ruchelsman, J.), order dated Apr. 18, 2024 (Index No. 523957/2022); also 2024 NY Slip Op 31381(U)
Trial posture	Defendants moved to vacate a May 25, 2023 judgment ($1,476,330.68) and an Aug. 22, 2022 stipulation; Kings denied those branches
Appellate outcome	Order affirmed insofar as appealed from
Core holding	Agreement not shown to be a usurious loan: percentage-capped daily remittances, reconciliation/adjustments, non-finite term, unused recon review precluded, no bankruptcy-as-default

Soft next step if papers name Diesel Funding: compare your reconciliation, percentage cap, term, and bankruptcy default language to the package Kings and the Second Department treated as contingent receivables before you assume either label controls.

What happened below and on appeal

On or about June 21, 2022, Diesel and Build Retail, Inc. entered a written agreement. Build Retail sold an interest in future receivables for an $850,000 purchase price. In exchange, Build Retail authorized Diesel to debit a percentage of daily sales revenue until Diesel received $1,274,150 (the purchased amount). On default, the uncollected purchased amount "may become due and payable in full immediately." James Wesley Cashwell signed a personal guaranty.

After an alleged default, Diesel sued in August 2022. The parties then stipulated to settle for $1,150,740.12. The stipulation allowed Diesel, on default and without further court application, to enter judgment for that sum plus fees equal to 20% of the then-remaining settlement balance, costs, interest, and disbursements, less amounts paid. Defendants made none of the stipulated payments. On May 25, 2023, a clerk judgment entered for $1,476,330.68.

In March 2024 the defendants moved to vacate the judgment and the stipulation, arguing among other things that the underlying agreement was a usurious loan. Kings denied those branches on April 18, 2024. The defendants appealed.

What the Second Department held

A stipulation of settlement is a contract enforceable according to its terms. The defendants did not comply, and the stipulation authorized entry of judgment on default without further application (CPLR 3215[i][1]).

On the usury theory: if the agreement were a loan, criminal usury could void it (Principis; Davis). Usury requires a loan; without absolute repayment there is no loan (LG Funding). Courts usually weigh reconciliation, finite vs indefinite term, and bankruptcy recourse.

The panel held the defendants failed to show a usurious loan:

Payments were capped at a specified percentage of daily receivables.
The agreement allowed adjustments based on sales changes and provided reconciliation so collections would equal that percentage.
Because daily amounts could change, the term was not finite.
Defendants did not seek reconciliation, which precludes review of a claim that the process was illusory (citing Apollo Funding Co. v. Dave Reilly Constr., LLC, 241 AD3d 1508).
No provision made bankruptcy an event of default (again citing Apollo; cf. Davis; LG Funding).

Remaining contentions were new on appeal or without merit. Genovesi, J.P., Christopher, Wan, and Ventura concurred.

Why this matters for "Diesel Funding lawsuit" searches

This is a funder-side Second Department affirmance that ties settlement-judgment vacatur fights back to the same three-factor receivables test used in Apollo and True Business Funding, and that contrasts with Crystal Springs when reconciliation duty and bankruptcy treatment go the other way. Compare:

Apollo Funding lawsuit: 2d Dept reversed Rockland and granted funder SJ; unused reconciliation not treated as illusory (Dave Reilly).
Crystal Springs Capital lawsuit: 2d Dept vacated default and dismissed after fixed daily debits, no reconciliation duty, and bankruptcy/default acceleration made repayment absolute and criminally usurious (Big Thicket).
True Business Funding lawsuit: 2d Dept affirmed funder SJ on reconciliation / indefinite term / bankruptcy-as-excuse (Guerrero).
Samson MCA lawsuit: 4th Dept Russo affirmance plus Erie Elephant SJ for the same funder.
Seamless Capital Group lawsuit: Kings denied funder SJ on CPLR 4518 foundation and damages math (Bryan Anthonys).
Unique Funding Solutions lawsuit: Nassau granted funder SJ despite an "alarming" reconciliation-receipt addendum (A-Z Imports).

If your caption is Diesel collecting after a stipulation judgment, Build Retail is the published Second Department signal that calling the MCA a usurious loan does not, on that record, vacate the settlement judgment when percentage caps, reconciliation, a non-finite term, unused recon, and no bankruptcy-as-default are in the contract.

Related funder lawsuit pages

We keep a running list of funder cases, including this one, in our MCA lawsuit tracker.

Sources (public)

Diesel Funding, LLC v. Build Retail, Inc., 2026 NY Slip Op 02629, 248 AD3d 1190 (2d Dept Apr. 29, 2026), NY Courts reporter
Diesel Funding LLC v. Build Retail Inc., 2024 NY Slip Op 31381(U) (Sup Ct, Kings County Apr. 18, 2024), Justia republication

Takeaway

Treat "Diesel Funding lawsuit" search intent primarily through Build Retail: Kings left a stipulation judgment standing; the Second Department affirmed after finding percentage-capped remittances, reconciliation/adjustments, a non-finite term, unused reconciliation that the panel would not review as illusory, and no bankruptcy-as-default clause. That is a multi-opinion receivables-vs-loan signal wrapped around a settlement-judgment fight, not a statewide ban and not an FTC refund story.

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