Reorganized Debtor Defoor Centre Sues Newtek Business Lending & Newtek Business Services Corp For “Intentional Misrepresentation”
January 14, 2022, Middle District of Florida – Plaintiff – Reorganized Debtor Defoor Centre, LLC brings a lawsuit against Newtek Business Lending, LLC and Newtek Business Services Corp. for alleged “intentional misrepresentation”, “false promise”, “negligence”, “unjust enrichment”, and “quantum meruit.”
The complaint alleges that Defoor entered into a contract with GB Square, LLC d/b/a Bright Screen Studio (“GB”) to sell a property for a contract price of $3,130,000.00. Subsequently, GB applied for Small Business Administration (SBA) loan financing that was financed through Newtek. The complaint asserts that Newtek allegedly promised and represented to GB that Newtek would “do everything in its power to close the loan sooner rather than later. Accordingly, Defoor argues that GB relied on Newtek’s assurances and believed funding would be forthcoming. However, the complaint asserts that despite complying with all SBA regulations and being approved by SBA, Newtek “paused the funding” and “forced” Debtor and GB to enter into a series of amendments to the contract to extend the closing date. The complaint thus, alleges that because of Newtek’s “multiple requests for extensions”, GB had to “expend additional sums” to Defoor for non-refundable deposits and costs to extend the closing date. In addition, Defoor contends that it had to expend additional interests and fees to its mortgage lender to hold off foreclosure on the property.
Thus, Defoor argues that GB and the Debtor suffered an economic loss of $200,000.00 due to Newtek’s alleged “failure and refusal to fund the loan.” Accordingly, in its own name and as assignee of GB, the Debtor requests the Court to enter a final judgment against Newtek and in favor of Debtor for $200,000.00 plus any additional costs, expenses, fees, and interest to which it is entitled.