Served by Green Grass Funding: 8 Documents to Pull Before You Respond

If you have been served with a lawsuit by Green Grass Funding, before you talk to anyone, gather eight documents: the court papers, the MCA agreement, the personal guarantee, any confession of judgment, bank statements for the relevant period, notices from the company, any UCC notices and a list of all MCAs you ever signed. Circle the court deadline in red, since missing it can mean a default judgment. And remember, talking to the lender about payments will not change the court deadline.

1. The summons and complaint

These two documents combine to put you on formal notice that you are being sued. The complaint contains the allegations as to why the lawsuit was filed. In an MCA lawsuit, the complaint says you owe money and have breached the agreement. The summons directs you to appear and answer the lawsuit (in response to the complaint) by a certain date. Do not throw out the summons and complaint, or put it in a stack of papers to review later. You must act.

In New York state court, you typically have 20 days to answer if the summons was handed to you personally. If the summons was left with a roommate or other person or was posted on the door and then mailed to you (called “nail and mail”), then the timeline is 30 days. In federal court, you normally have 21 days to respond to a summons, but if you sign and mail back a waiver of service on time then you have 60 days. Write down when you got the papers and how they were served.

2. The MCA agreement itself

The MCA agreement lays out the terms of the transaction, and serves as the contract for the relationship between the parties. Pull every amendment too. Read the “default” clauses together with payment terms, reconciliation clause, notice and any guarantee terms to decide if notice was required and if you got it. Does it have a notice requirement or give you a chance to fix the problem (a chance to “cure” the default)? There is no universal grace period that covers every MCA. What does the funder say happened?

3. The personal guarantee

Pull any guarantee you signed in connection with the MCA. There is no standard personal guarantee form; your mileage may vary, so look closely. An MCA and a guarantee are connected but not interchangeable. Analyze who signed each, what conduct triggers liability under each one, and whether the lawsuit targets the business, you personally, or both. Demanding payment from you as a guarantor is not the same as going to court to get a judgment against you.

4. Any confession of judgment

If you signed a confession of judgment when the MCA started, pull it now. A confession of judgment may let the lender skip straight to a court judgment without the normal court process. However, it only works where state law allows it, and some states bar it outright or put strict rules on it. Look at who signed it, which state’s rules it leans on, and whether anyone filed it yet. In New York, a confession can only be filed within three years of signing it, and only in the county where the defendant said it lives, and a business lives in any county where it has a place of business.

5. Your bank statements

Pull statements for the entire period the agreement was in force. Note the debits. When did they start, when did they stop, and how much was taken? Do the amounts and dates match up?

Line up what you were charged against what was in the contract or any amendment. Mark any debit that was double-counted, returned, or disputed. Then look at the bigger picture: does the balance they want really credit what you already paid? If you find a charge you did not sign for, gather the details, and call the bank about its dispute deadlines.

6. Default notices and reconciliation requests

A default notice tells you that the lender says you have missed a payment or done something else that breached the MCA. On a spreadsheet, list the notices, dates, who sent them, how they came to you (email, fax, mail, text) and who was on the “to” line, and whether you responded.

A default notice is only the lender’s side of the story. It is not proof that every allegation or amount claimed is correct. If the MCA is a share of receivables, check the reconciliation clause to see whether withdrawals had to track actual revenue. Keep copies of any reconciliation request, supporting records and the funder’s reply. Sending a request does not by itself stop withdrawals or waive a default.

7. UCC filings and customer notices

A UCC financing statement is only public notice that someone claims an interest in an asset; it is not the legal basis to go and collect it. When it comes to receivables, a funder may send notices to payment processors or customers, demanding to get paid directly. Some will hold on to funds until the dispute gets sorted out. Get the whole notice and write down exactly what funds they say are affected. And keep what you tell customers accurate.

If you need to find out what is on the public records against your business, run a UCC lien search. If your company was organized in New York state, the Department of State will run a search for $25 per name. You will need one Form UCC-11 per name. Most UCC financing statements lapse after 5 years unless the creditor files a continuation.

8. A list of every MCA

Make a list of every MCA you signed, including funders, numbers, dates, and other key terms (balance, fixed payments or share of revenue).

Bring Everything to an Attorney

If there is already a judgment or a bank restraint, add it to the stack. Write down the court, the case number, the names of the debtors, the dollar amount, and the day the enforcement notice reached you. For example, in New York a motion to vacate a judgment for excusable default must come within one year after you are served with the judgment and notice of entry. Bring everything to an attorney.

While you pull together this information, hold off on any drastic moves until you have advice. Don’t change banks, lock out the funder, redirect payments, or move any assets. Don’t settle with or sign anything new under pressure.

A free contract review costs nothing and takes a day or two. Call (888) 837-7053, or send the agreements to Delancey Street for a straight read on your options.