Welcome to Court Watch #128. Don’t worry, there is a usual court record roundup if you scroll down. And like always, we buried a banger of a story in the kicker. But first, as long-time readers know, we’ve been tracking more than 400 lawsuits filed against and by the Trump Administration. One of them included a lawsuit about the dismantling of the Consumer Financial Protection Bureau (CFPB). Now that they’re out of, at least temporarily, the regulatory game, we were curious to see how the past targets of CFPB’s ire were faring. So we went searching on the dockets against companies sued by the CFPB. Which led us to see what one payday lender, MoneyLion, was up to. It turns out the company had a litigious week.
We asked Gabrielle Russon, Court Watch’s favorite reporter in Florida, to explain why.
A Tipping Point for One Army Staff Sergeant
Just before Memorial Day weekend, an Army Staff Sergeant said in a new federal lawsuit that he is in jeopardy of losing his security clearance and his military job because of his excessive debt from a predatory lender charging consumers APR in the triple digits.
Johnathan and Deven Burkhardt are suing MoneyLion for violating the Military Lending Act (MLA) as they accuse the lender of charging deceptive fees and high rates to trap them into a cycle of debt with MoneyLion’s Instacash and Credit Builder loans. The couple said they were swindled.
MoneyLion and the Burkhardts’ attorneys did not respond to a request for comment on the lawsuit filed in the U.S. District Court’s Northern District of Florida. Johnathan Burkhardt, who has served in the U.S. Army for 11 years, is on active duty and lives in Okaloosa County in Florida’s Panhandle. That part of the state has several military bases, including a Pensacola Navy base home to the famous Blue Angels.
His lawsuit is seeking class action status for more than 100 others in Florida in a claim worth more than $5 million, his attorneys said. The Burkhardts’ lawsuit is asking for a court judgment voiding the couple’s and other people’s loans as well as damages, court fees, and more. Congress passed the MLA in 2006 to protect those serving in the military and their families from certain lending practices.
“Congress enacted the MLA because an epidemic of predatory lending was threatening and endangering military readiness, security clearances, and servicemember morale and retention,” the lawsuit said. “For military servicemembers like Plaintiffs, the presence of such derogatory marks on their credit reports poses a direct and significant threat to their employment status, including the loss of security clearances and the risk of involuntary separation from service. The harm caused by these omissions is precisely the type of injury the MLA was enacted to prevent.”
Under the MLA, servicemen’s “Military APR” is capped at 36%. But the lawsuit alleged MoneyLion’s Instacash loans have annual percentage rates of “495%, 990%, 2,310% or greater, and primarily serve to trap consumers in endless debt cycles.”
The structure of MoneyLion is exploitative, the lawsuit claimed, since borrowers can only take out up to $100 at a time, with fees tacked on, even when they are approved for loans worth $500 to $1,000 per pay period. “Defendants charge a so-called ‘Turbo Fee’ between $0.49 to $8.99 to obtain Instacash loans for their advertised and intended purpose—as an instant source of money,” the lawsuit said.
Consumers who opt out of paying the turbo fee must wait up to five business days for their “instant” cash, the lawsuit said. “Approximately every other week since 2022, Defendants extended Plaintiffs loans in amounts of up to $100 for each loan, and in cumulative amounts of up to $1,000 or more, resulting in Defendants extending dozens of loans to Plaintiffs each month.
The couple said they were required to provide their bank account information as security in order to get the cash. “Simply put, Defendants control Plaintiffs’ bank account and control their ability to use their personal bank account freely, so, Defendants get paid before Plaintiffs ever pay their mortgage, groceries, and utilities. This level of control, coupled with the Defendants’ usurious interest rates, have resulted in Plaintiffs being trapped in a reborrowing cycle,” the lawsuit said.
MoneyLion also encouraged consumers to tip, which the lawsuit called misleading since it said the money doesn’t actually help employees. The “tip” was just “an additional revenue stream for defendants,” the lawsuit said. Meanwhile, MoneyLion also offered a Credit Builder loan and advertised a 12-month installment loan of $500 with a 5.99% APR. But in order to get it, consumers were required to enroll in a membership program with a monthly fee, the lawsuit said.
“Consumers with unpaid loan balances or monthly fees cannot cancel their Credit Builder Plus Membership Programs—despite claims in some loan agreements that they can do so,” the lawsuit said. The couple took out a $1,000 Credit Builder loan in 2022, repaying it in less than a year. They took out a second $1,000 loan this year and still owe several hundred dollars, the lawsuit said, noting they also were charged a $155 finance charge and a $20 monthly membership fee to get the loan.
“Further, and similar to the ‘Turbo Fee’ and ‘Tips’ charged on Instacash loans, the ‘Monthly Membership Fees’ charged on Credit Builder loans violate the MLA,” the lawsuit states. The attorneys did not respond to a question about the couple’s circumstances and why they began using MoneyLion for cash advances and loans.
- Reporting by Gabrielle Russon from Orlando, Florida.
The Docket Roundup
A federal judge thought the DOJ’s redacted filing was enough to satisfy the public’s right to access its court records. After years of watching judges in that district do this, we just assume anyone can be a federal judge in South Dakota because they just rubber stamp everything in that district.
We tend to think this is the dear diary version of forthcoming ‘I’m about to rule against you’ judge’s order. Also, does anyone else find it bizarre that a federal judge would readily admit in an unprompted filing that their friends talk to them about the ongoing cases?
Twitter is taking remote work locations and arbitration to the next level.
A case in Vermont paints a picture (and a map) of how individuals are picked up at the Canadian border.
There’s a new lawsuit outlining the tragic history of boarding schools for Native American children.
Following three clerk quality control notices on his past filings, Matt Taibbi’s lawyer is now also accused of improperly serving his client’s lawsuit against Congresswoman Kamlager-Dove too. A conservative opinion writer warned last month that it was a “battle of wits” to go against Taibbi. A review of the docket sheet may quickly avail one of that belief.
An Indian national who is accused of a murder for hire plot targeting a Sikh activist in the U.S. filed a pro se motion to dismiss his indictment.
“I am an officer of the Defense Intelligence Agency (DIA) serving in a technical role in support of our internal Officer of Security (SEC). The recent actions of the current administration are extremely disturbing to me….I do not agree or align with the values of this administration and intend to act to support the values that the United States at one time stood for. To this end, I am willing to share classified information that I have access to” is a series of words and sentences that should never be uttered together if you’re trying to avoid a federal charge.
It turns out your Vape pen may not be climate conscious? That should be the sign that gets you to quit. Put in a dipper like an adult.
Happy 2 year anniversary to everyone who invested in Substack and have yet to have any news on their investment. We asked the Substack comms department for an update. No response. We asked the Substack founder, Hamish McKenzie for a comment. No response. The whole crowdsourced raise smells but no media reporter has noticed. Click on the “ask a question” and sort by date filed. It’s a den of disappointment.
Erik Prince was sued over his alleged involvement in using mercenaries in Yemen.
A small update from our story this week about a woman who was shot by a CIA police officer while allegedly driving drunk towards the Agency’s headquarters. Her lawyer says she was released on Wednesday night, but he argues she did not receive proper medical attention while detained. He also says she has no feeling or movement in her left arm because there is a bullet still lodged in it.
Carter Page lost his case.
“This case is about a hospital, that talks the talk, but does not walk the walk,” says a new lawsuit against Georgetown’s hospital that uses one too many commas in a sentence.
A “Good Faith Effort” is in the eye of the beholder. (Footnote 1)
Criminal charges were filed against a Mr. Rubio for 17 bundles of cocaine.
This was an interesting flight.
We humbly submit our nomination for the worst person of the week in the courts.
A Florida man allegedly threatened to kill a U.S. senator’s children.
The U.S. Institute of Peace says it now has rats and roaches in the building after DOGE took over.
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Make this song your vibe of the week. We’re seeing them live in concert in a few weeks.
People who care about fashion may find this civil complaint interesting. People who care about excessive prose in legal filings may also find it equally as interesting.
Eugene Volokh is as interested in this case as we are. Props to him for trying to do something about said interest.
If you like Dutch crime Netflix series, you will love this tea.
A New York man is accused of attempting to firebomb the U.S. consulate in Tel Aviv, Israel.
A random email tip exposed a purported drug ring.
When you ask your boss to check your work – “Though I am still confident in my February 2025 summary-judgment opinion, the questions here are hard. Interlocutory appellate review of two of them will resolve the case more efficiently,” says one federal judge. The appeals court is the DOGE of the judiciary branch?
Judge Xinis is not happy.
The feds say a Virginia man in prison was collecting unemployment insurance.
A hunting guide in Alaska may have skirted the line.
A Florida security guard has entered the mix involving a D.C. city council bribery scandal.
We just assumed all of South Carolina was just one big ponzi scheme. No state can appear that laid back unless they’re doing something shady.
“The Court should deny the motion. Open courts are the rule; sealing is the exception,” says one annoyed lawyer and all of Court Watch’s staff.
Twitter says a crew in Vietnam has been gaming their content engagement revenue system.
Thanks for reading, but just one last thing. If you’ve gotten this far down the newsletter, you’ve earned another exclusive for the week. (editor’s note: when you read about this story in other news sites later today and they don’t cite us, just know that we know they made an active choice to do the wrong thing.)
In New York, an Afghan man, Dilbar Gul Dilbar, on an interpreter visa, was charged with fraud last month. Authorities said he lied on his application to get into America saying he served with the U.S. military. The judge held a detention hearing and ordered Dilbar released pending trial. It was covered locally for a day and then everyone moved on. For most reporters, it looked like a run-of-the-mill criminal case. However, we thought it interesting that an officer with the FBI Joint Terrorism Task Force filed the affidavit. So we put it in the back of our mind to keep an eye on it.
On Tuesday, prosecutors filed a motion saying, “This is not a typical visa fraud case. The defendant was ineligible for an Afghan Special Immigrant Visa (“SIV”) not only because he submitted fraudulent employment documentation but also because he was linked to the Haqqani Network, a designated Foreign Terrorist Organization. The government was unable to proffer this information to Magistrate Judge Holland during the detention hearing. Since that hearing, the government has either discovered or declassified information related to the defendant’s background.”
The motion continued further in the document to state that, “According to the Terrorist Explosive Device Analytical Center (“TEDAC”), in 2011, the Department of Defense obtained evidence from a crime scene in Afghanistan. One piece of evidence was a handwritten note. The note contained a series of letters and numbers, possibly the coordinates of a planned terrorist attack. The note was next to another piece of evidence that was also turned over to TEDAC. The defendant’s fingerprint was on the note.”
Prosecutors say they didn’t arrest Dilbar when he originally came to the United States because they needed time to build a visa fraud case, and that “there was a national security interest in determining whether the defendant was associating with terrorists or other criminals while in the United States. Law enforcement had to carefully balance the risk of allowing the defendant to remain out of custody against the need to investigate his past and current activities.”
On Wednesday, we asked for a comment on the case from his federal defender and the Justice Department. We did not receive a response from either party. The filing was sealed by a federal judge that day. Nevertheless, we persisted and asked around again. The filings were ordered unsealed late last night. Additionally, a federal judge reversed the magistrate judge’s decision on release. Dilbar is now being held in prison pending his trial.
We told you in the headline to stick around for the kicker. Well done, subscribers.