Mustang Litigation Funding of Wayzata, Minnesota; Mustang Specialty Funding I and II; James "Jimmy" Beltz, and Kevin Cavanaugh Remove Legal Bay Lawsuit to New Jersey Federal Court

Legal Bay Lawsuit Funding filed a lawsuit against the above parties in New Jersey Superior Court, Chancery Division, on May 19, 2022, claiming that the Mustang entities engaged in a course of wrongful conduct designed to divert litigation funding originations from a joint venture established by Legal Bay and the above-named Mustang principals. Mustang has embarked on a campaign of direct competition with Legal Bay and the recognized joint venture. Legal Bay's complaint also alleges that Beltz and Cavanaugh fraudulently induced Legal Bay to do business with the Mustang entities as a joint venture.

NEWARK, N.J., June 27, 2022 /PRNewswire/ -- Legal Bay, The Lawsuit Settlement Funding Company, announced today that on June 15, 2022, its recent New Jersey State Court lawsuit filing against Mustang Legal Funding and its principals has been removed to the United States District Court for the District of New Jersey, Newark Vicinage, by the Mustang Entities, James Beltz, and Kevin Cavanaugh. The case now bears the following docket name: Legal Bay LLC v. Mustang Funding LLC, et al., No. 22-cv-3941 (ES) (JBC). The matter has been assigned to District Judge Esther Salas and Magistrate Judge James B. Clark, III.

Previously, Legal Bay had notified its business contacts of the suit's filing, but had not made any public statements. With the removal of Legal-Bay's action to Federal Court, Legal Bay believes that the time is now appropriate to disseminate a notice to the ligation funding industry about its lawsuit and its importance to the industry's direction and commercial standards.

Chris Janish, CEO of Legal Bay, commented, "Our complaint against the Mustang entities and their principals is a public record at this point, and we will let the legal process play out in Federal Court. Legal Bay's purpose in pursuing this matter is not only to protect its own interests from the Mustang defendants' misconduct, but to send a message that their documented, abhorrent behavior is not limited to the Mustang defendants, but commonplace in the litigation and pre-settlement funding industry. These issues will hopefully, at long last, be formally addressed by Legal Bay's lawsuit."

Legal Bay has asked the court to dissolve its joint venture with the Mustang entities and is asserting other equitable and legal claims against the Mustang defendants. Legal Bay has reason to believe that, in addition to the equitable relief it is entitled to, its monetary damages are substantial. The exact amount of those damages is not yet fully calculable, but will be determined in due course during the litigation.

Janish added: "While we had hoped to avoid the need for a lawsuit, our hands were tied by Mustang's continuing misconduct. Legal Bay looks forward to continuing their work with the industry's leaders and regulators in order to find better ways to protect members engaged in formal business relationships from deceptive and anti-competitive business practices in the industry, as well as initiatives for better disclosures to consumers where previous legislation has fallen short."

Legal Bay is represented by Fox Rothschild LLP within its Morristown, New Jersey office, and Timothy P. Kebbe, Esq. of Hawthorne, New York. Mustang and the other defendants are represented by Kasowitz, Benson, Torres, & Friedman LLP, of Manhattan. 

SOURCE Legal-Bay, LLC