Jump to content

Can Cach legally Sue in CA if not registered?


scooter1
 Share

Recommended Posts

Can Cach, LLC  legally sue (does it have the legal capacity to sue) in California through Mandarich?  I have read that they can sue but can't "maintain it" as I understand it.  On the small claims court website it says the case can be dismissed if not registered.  So can I get it dismissed based on this?  Of course they can refile once they register but it might help someone that is close to SOL.  I checked with the secretary of State and they are not registered there.  So is Cach considered a foreign corporation and transacting interstate business by suing here? 

 

Foreign corporations are prohibited from transacting intrastate business without obtaining a "certificate of qualification" from the California Secretary of State. Corporations Code section 2203 subd. © only bars a foreign corporation from "maintaining" an action based on intrastate business transacted in California. (United Med. Management Ltd. v. Gatto (1996) 49 Cal.App.4th 1732, 1739.)

 

Link to comment
Share on other sites

So is Cach considered a foreign corporation and transacting interstate business by suing here? 

 

That is a very good question.

 

For purposes of qualification of a foreign corporation, `"transact intrastate business' means entering into repeated and successive transactions of its business in this state, other than interstate or foreign commerce." (Corp.Code, § 191, subd. (a).). United Systems of Arkansas v. Stamison, 74 Cal. Rptr.2d 407 (1998).

 

In other contexts, courts have held that debt collectors who do nothing but hire attorneys to file suit are nonetheless required to obtain a collection agency license. The reasoning here is that the filing of lawsuits constitutes "collection activity" and it is the business of debt collectors to engage in "collection activity." The issue here, with respect to CACH, is whether collection activity constitutes transactions of its business within the meaning of § 191. The court in Martin v. Martin, 363 SW 3d 221 (Tex. Ct. App. 2010) provides a good argument in favor of the premise that a lawsuit, in certain circumstances, is a transaction. On the other hand, the court in West Town Line Associates, LLC v. Mack & Meldrum Associates, LLC, No. 288384 (Mich Ct. App., Mar. 9, 2010) (unpublished) held that a lawsuit is not a transaction:

 

"Transaction" is defined in Black's law Dictionary (7th ed.) as "the act or instance of conducting business or other dealings," "something performed or carried out; a business agreement or exchange." A lawsuit is not a business agreement, nor is it an act of conducting business.

 

 

California is certainly not Michigan, however. I think the argument is one worth making.

  • Like 1
Link to comment
Share on other sites

@needabailouttoo!--Is 'Mandarich' a local law firm? If so, this may be how Cache is 'working around' whatever foreign entity restriction CA may be imposing. Also, in Ga., a foreign LLC debt collector isn't required to register with Sec. of State because they aren't extending credit. Could this be an exception in CA as well?

Yes they are a local law firm in California. But it is still Cach that is the Plaintiff and if they are doing business (calling, sending collection letters, hiring lawfirms to sue, etc.) are they not "transacting business" here? It may be Cach's thought on working around it but I think it does not fly. In California they have to register because they are a Corporation (they don't have a requirement to register as a collection agency).

Link to comment
Share on other sites

@nascar---Thanks for your input on this. I tend to agree with you that it is a good argument to make. Also by doing business here I would think that they may be skirting the tax law here as well by not being "registered with the Secretary of State" and adding more to the "unclean hands-Affirmative defense" as well as getting a case dismissed.

I would also think that under FDCPA filing of a lawsuit (assuming you requested Debt Validation and didn't get it answered)is another argument for transacting business here.

Although anyone can basically file a lawsuit in this case Cach can't "maintain" it because they are not registered with the Sec. of state as I understand it.

Also, wouldn't this go to the issue of STANDING (since they don't have the legal capacity to sue)?

Link to comment
Share on other sites

Can Cach, LLC  legally sue (does it have the legal capacity to sue) in California through Mandarich?  I have read that they can sue but can't "maintain it" as I understand it.  On the small claims court website it says the case can be dismissed if not registered.  So can I get it dismissed based on this?  Of course they can refile once they register but it might help someone that is close to SOL.  I checked with the secretary of State and they are not registered there.  So is Cach considered a foreign corporation and transacting interstate business by suing here? 

 

Foreign corporations are prohibited from transacting intrastate business without obtaining a "certificate of qualification" from the California Secretary of State. Corporations Code section 2203 subd. © only bars a foreign corporation from "maintaining" an action based on intrastate business transacted in California. (United Med. Management Ltd. v. Gatto (1996) 49 Cal.App.4th 1732, 1739.)

 

I don't know if they can legally sue but they file and win tons of default cases every year here in California-just check your local superior court records.  They tend to go to great lengths to document their defaults and often include card agreements which most JDBs do not do.

 

Carol-Lynn

  • Like 1
Link to comment
Share on other sites

I don't know if they can legally sue but they file and win tons of default cases every year here in California-just check your local superior court records.  They tend to go to great lengths to document their defaults and often include card agreements which most JDBs do not do.

 

Carol-Lynn

AGREED.

I don't think you will ever come up a against a worse bottom feeder than CACH. They make sure the lawyers they hire fit their business model as well.

  • Like 1
Link to comment
Share on other sites

SkippieB  You are right Carol-Lyn.  They do file one heck of a lot of lawsuits here.  Thanks for the heads up on what I can expect to get in the way of records from them.  I presume they don't bring in anyone to authenticate them at trial. 

 

Anon Amos  You are right so far they seem to be holding up to their reputation.

Link to comment
Share on other sites

  • 3 weeks later...

Is Cach, LLC even a legal entity in Colorado?  I am not a lawyer but it seems to me they have not complied with 7-90-601,C.R.S.  as their "LLC"  in their name should not be capitalized.  Which it is in their  ARTICLES OF ORGANIZATION as their name and states on the application page itself: 

 

(The name of a limited liability company must contain the term or abbreviation “limited

liability company”, “ltd. liability company”, “limited liability co.”, “ltd. liability co.”,

“limited”, “llc”, “l.l.c.”, or “ltd.” §7-90-601, C.R.S.)

 

Also :  7-90-601

Statute text

(1) An entity name shall not contain any term the inclusion of which would violate any statute of this state.

 

http://www.lpdirect.net/casb/crs/7-90-601.html    CRS 7-90-601

http://www.sos.state.co.us/biz/ViewImage.do?fileId=20051120495&masterFileId=20051120495     Cach, LLC Articles Of Organization

 

I know it is a tecnicality, but it appears to be the law.

 

 

 

Link to comment
Share on other sites

@nascar

The licensing question is one that has come up many times in Tennessee over the years against many debt collectors. Midland Credit Management has held a license since 1997 in Tennessee, however Midland Funding has argued for years that they do not need one. Over the years a few federal judges and the Tennessee Attorney General has said they do need a license. For some "strange" reason Midland Funding obtained a Tennessee Collections License in April of this year. 

So the question is why did they get a license if they claim they have never needed one? I challenge anyone dealing with any JDB/CA operating without a license in any state to fight them on this issue. They operate outside of the law because they get so many default judgments without even putting up the money to operate legally. As long as people remain ignorant and apathetic they have no motive to act. At least in Tennessee they have run up against enough resistance to at least put up the money.

Link to comment
Share on other sites

@ artvandelay

Even debt collectors who claim they need no license are beginning to see past their own rhetoric. With the recent LVNV state case and the several other federal cases involving LVNV, Erin Capital, Main Street, etc., they see the writing on the wall.

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.. For more information, please see our Privacy Policy and Terms of Use.