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Pearl Capital Lawsuit: Pearl Capital Rivis v. RDN, Champion Auto Sales and Elegant Trio (2026)

Pearl Capital lawsuit records: Pearl Capital Rivis Ventures v. RDN (2016 usury denial), separate Pearl Beta Funding appeals, and what they do not prove.

Updated

Home · News · Pearl Capital lawsuit

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

Searches for Pearl Capital lawsuit usually turn up private commercial litigation involving Pearl-named MCA entities, not an FTC refund program or a New York AG industry-wide debt-cancellation track like the public Yellowstone Capital lawsuit. Captions matter here. Pearl Capital Rivis Ventures, LLC, Pearl Beta Funding, LLC, and other Pearl Alpha/Beta/Gamma/Delta names are not interchangeable. This page summarizes three published New York opinions merchants often land on, and what each one does not establish about a different agreement.

Editorial update: 2026-10-30 · Desk research of published court opinions only. Not legal advice, not affiliated with Pearl Capital Rivis Ventures, LLC, Pearl Beta Funding, LLC, or related Pearl entities.

This page covers the court record only. For who Pearl Capital is, what it sells and what merchants report, read our Pearl Capital company profile.

Quick answer

QuestionWhat the public record supports on this page
Who appears in captions?Pearl Capital Rivis Ventures, LLC (2016 Westchester trial opinion); Pearl Beta Funding, LLC (2018 First Department; 2025 Second Department)
Is there an FTC / NY AG “Pearl MCA refund” program?No program of that kind is described in the court sources checked for this page
Flagship trial opinionPearl Capital Rivis Ventures, LLC v. RDN Construction, Inc., 54 Misc. 3d 470 (Sup. Ct. Westchester County, Oct. 25, 2016): after inquest on a default, the court held the “Merchant Agreement” was a criminally usurious loan (~180% per annum on the court’s calculation) and denied Pearl recovery of principal, interest, fees, and unjust enrichment
Appellate COJ exampleChampion Auto Sales, LLC v. Pearl Beta Funding, LLC, 2018 NY Slip Op 01645 (1st Dept Mar. 15, 2018): affirmed dismissal of a complaint seeking to vacate a judgment by confession; on that record the court found the underlying agreement was not a usurious transaction
Recent jurisdictional examplePearl Beta Funding, LLC v. Elegant Trio Colors Corp., 2025 NY Slip Op 02217 (2d Dept Apr. 16, 2025): reversed a BCL § 1314 subject-matter dismissal and reinstated Pearl Beta’s breach complaint at the pleading stage
Does RDN wipe every Pearl balance?No. It decides the RDN Merchant Agreement and that inquest record. Champion shows another Pearl Beta record can go the other way on usury

If you were served, start with: Merchant cash advance lawsuit and Served with an MCA lawsuit: first 30 days.

Why Pearl lawsuit results look different from Yellowstone

Yellowstone Capital shows up in agency enforcement materials with redress narratives (FTC refunds; later NY AG settlement language for covered Yellowstone entities). Pearl’s public footprint, in the opinions checked here, looks more like:

  1. A trial-court inquest where Pearl Capital Rivis sought default damages on a Merchant Agreement and lost on criminal usury grounds (RDN)
  2. An Appellate Division affirmance that a merchant’s attempt to vacate a confession of judgment tied to Pearl Beta failed on that usury record (Champion Auto Sales)
  3. A later Appellate Division reverse-and-reinstate on Business Corporation Law § 1314 jurisdiction, not a merits ruling that every Pearl Beta FRSA is void or valid (Elegant Trio)

Match the legal name on your contract, UCC filing, and summons to the caption. Similar “Pearl …” branding is not proof of the same LLC or the same outcome.

Case spotlight: Pearl Capital Rivis v. RDN Construction (2016)

Court: Supreme Court, Westchester County (Hon. David F. Everett, J.)
Citation: Pearl Capital Rivis Ventures, LLC v. RDN Construction, Inc., 54 Misc. 3d 470, 41 N.Y.S.3d 397 (2016) (also reported as 2016 NY Slip Op 26344)
Decided: October 25, 2016
Docket note: FindLaw / official reports list the matter as No. 70590/15

What the court described

Pearl sued RDN Construction and guarantor Robbie Neely for breach and unjust enrichment after a December 2, 2014 “Merchant Agreement.” The agreement’s face terms (as quoted in the opinion) included:

  • Purchase price: $9,000
  • Specified percentage: 15%
  • Specific daily amount: $198
  • Receipts purchased amount: $13,050

RDN defaulted in the action. Liability was previously granted by default; Pearl then proceeded to inquest. Pearl’s Chief Risk Officer testified that RDN was to make about 66 weekday payments of $198 until the $13,050 payback, that roughly $6,700 had been paid before ACH debits bounced, and that Pearl sought additional bounce fees and a $2,500 contractual default fee, plus attorney fees.

What the court held

Using the traditional New York interest-computation approach (citing Band Realty Co. v. North Brewster, Inc., 37 N.Y.2d 460), the court calculated an interest rate of about 180% per annum. It treated the arrangement as a loan that was absolutely repayable, not a true purchase of receivables with meaningful risk of loss to the funder. The personal guaranty and the inability of Pearl’s witness to point to a non-recourse risk allocation in the (hard-to-read) agreement supported that finding.

Because New York’s criminal usury threshold is 25% per annum (Penal Law § 190.40), and because a usurious loan can be void as to the lender’s recovery, the court held Pearl was not entitled to recover principal or interest, nor the other fees or costs requested, and that unjust enrichment was unavailable to a party seeking criminally usurious interest (citing Blue Wolf Capital Fund II, L.P. v. American Stevedoring, Inc., 105 A.D.3d 178).

The opinion’s opening line is blunt: calling a loan document a “Merchant Agreement” does not shield it from a judicial determination that it contemplates a criminally usurious transaction.

What this decision does not establish

  • It does not create an FTC or NY AG refund program for merchants with other Pearl-named contracts
  • It does not mean every Pearl or Pearl Beta agreement is usurious; Champion Auto Sales (below) shows a different record and a different result
  • It does not set a settlement percentage, win rate, or damages formula for unrelated files
  • It does not automatically vacate judgments or UCC liens in other captions

Case spotlight: Champion Auto Sales v. Pearl Beta Funding (2018)

Court: Appellate Division, First Department
Citation: Champion Auto Sales, LLC v. Pearl Beta Funding, LLC, 2018 NY Slip Op 01645 (Mar. 15, 2018)
Underlying: Supreme Court, New York County order (Edwards, J.) entered June 16, 2017, dismissing the merchants’ complaint

Merchants sued Pearl Beta Funding seeking to vacate a judgment by confession. The First Department affirmed dismissal. On the evidence in that appeal, the court held the underlying agreement leading to the confession judgment was not a usurious transaction (citing Giventer v. Arnow and Feld v. Apple Bank for Savings). Other challenges to the confession judgment were found unavailing.

What this decision does not establish

  • It does not overrule RDN; different entity, different agreement, different procedural posture
  • It does not hold that every confession of judgment tied to a Pearl-named funder is immune from challenge
  • It does not decide your papers if your caption, affidavit, or statutory compliance differs

For confession-of-judgment mechanics generally, see MCA confession of judgment.

Case spotlight: Pearl Beta Funding v. Elegant Trio Colors (2025)

Court: Appellate Division, Second Department
Citation: Pearl Beta Funding, LLC v. Elegant Trio Colors Corp., 2025 NY Slip Op 02217 (Apr. 16, 2025)
Index: Queens County Supreme Court Index No. 706306/22

Pearl Beta (a Delaware LLC qualified in New York) sued California merchant Elegant Trio Colors Corp. d/b/a Jazzy France and its owner on a December 2021 receivables-purchase / future-receipts agreement, alleging missed remittances. The trial court dismissed for lack of subject-matter jurisdiction under Business Corporation Law § 1314. The Second Department reversed, denied the dismissal motion, and reinstated the complaint.

The appellate court accepted, at the pleading stage, Pearl Beta’s funding-manager affidavit that the agreement was reviewed/countersigned in New York, that purchase-price funds were sent from a New York bank account, and that remittances were accepted in New York. Those averments were enough, the court held, to show BCL § 1314(b) jurisdiction could be exercised. The opinion does not decide whether the agreement was a loan, whether it was usurious, or who wins on the merits.

What this decision does not establish

  • It is a jurisdiction / pleading-stage ruling, not a usury or enforceability holding
  • It does not mean California merchants always lose (or always win) on Pearl Beta suits filed in New York
  • It does not replace reading your own summons, arbitration clause, or answer deadline

What to do if you were served by a Pearl-named plaintiff

  1. Read the caption and the contract name. Pearl Capital Rivis Ventures, Pearl Beta Funding, Pearl Capital Business Funding, and related Alpha/Gamma/Delta names can differ. Compare your signed agreement and any assignment papers to the plaintiff on the summons.
  2. Calendar the response deadline from the summons/proof of service. Missing it can allow default even while you research opinions like RDN or Champion.
  3. Collect the agreement, ACH history, UCC filings, and any confession-of-judgment packet before talking strategy.
  4. Do not assume Yellowstone-style relief applies. Pearl is not the covered Yellowstone entity list described on the Yellowstone Capital lawsuit page.
  5. Do not assume RDN automatically wins your case, and do not assume Champion automatically loses it. Courts decide the record in front of them.
  6. If you talk settlement, keep counsel/docket obligations in view. Negotiating does not automatically stop a court calendar.

Practical playbooks on this site: frozen account / MCA funder, what is MCA settlement?, and attorneys vs settlement companies.

FAQ

Is there a Pearl Capital FTC refund or NY AG debt-cancellation program?

No equivalent public FTC redress or NY AG debt-cancellation program for Pearl Capital Rivis or Pearl Beta is described in the court sources checked for this page. Treat “Pearl Capital lawsuit” as a search for private commercial litigation unless and until an agency action says otherwise.

Does RDN mean my Pearl agreement is automatically void?

No. RDN held that that Merchant Agreement was a criminally usurious loan on the inquest record and denied Pearl recovery in that case. Your entity name, contract text, payment history, and procedural posture may differ. Champion Auto Sales shows another Pearl Beta record was not treated as usurious on appeal.

Why do some results say Pearl Beta instead of Pearl Capital?

Because the plaintiff or defendant LLC on the caption may be Pearl Beta Funding, LLC (or another Pearl-series entity), not Pearl Capital Rivis Ventures. Branding overlap is common in MCA search results. Use the legal name on your papers.

Pearl sued my company: should I ignore ACH pulls?

Stopping payments without a formal agreement or court order can accelerate default fees, UCC enforcement, or judgment practice. Get the papers and deadline reviewed promptly. Compare written scopes and fees; see attorneys vs settlement companies.

Can a settlement company or attorney help while a suit is pending?

Sometimes, depending on the stage, the forum, and whether you already have counsel of record. Engagement terms vary. Confirm in writing who appears in court, what fees cover, and what happens if a hearing is already scheduled.

Where else should I read on this site?

Related funder lawsuit pages

Our MCA lawsuit tracker shows how the Pearl Capital record compares with cases against other funders.

Related reading

Sources checked October 27, 2026

Desk research only. We did not contact Pearl-named entities for this update, and we did not review any merchant’s private claim file. This is not a complete litigation search or a prediction about your case.

Takeaway

Treat “Pearl Capital lawsuit” as a search across related but distinct Pearl-named entities. RDN is a published Westchester opinion denying Pearl Capital Rivis recovery on criminal-usury grounds for that Merchant Agreement. Champion Auto Sales and Elegant Trio are Pearl Beta appellate decisions about a confession-of-judgment challenge and subject-matter jurisdiction, not industry-wide refunds. Read the caption, the deadline, and the actual order before assuming either RDN or Champion controls your file.

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