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Titan Asset Purchasing Lawsuits in Arlington General District Court
You got a warrant in debt from Arlington, Virginia, for a business loan you took out somewhere else. The plaintiff is Titan Asset Purchasing, or QuarterSpot, and it names you personally, not just your company.
That is by design. Here is why the case is in Arlington, why your name is on it, and what to do about it.
Who are Titan Asset Purchasing and QuarterSpot?
QuarterSpot was an online lender that made short-term, high-rate loans to small businesses. Titan Asset Purchasing buys defaulted QuarterSpot loans and sues to collect them.
Both have filed large numbers of collection cases in Arlington General District Court against business owners from all over the country. Many of those cases end in default judgments because the defendant never appeared.
Why is the lawsuit in Arlington when my business is not?
The QuarterSpot loan agreement contains a choice of venue clause that sends disputes to Arlington, Virginia, no matter where the borrower is located. Courts generally enforce those clauses.
So a bakery in Ohio or a contractor in Texas gets sued in Arlington. The distance is part of the strategy. A defendant 800 miles away is less likely to show up, and a defendant who does not show up loses by default.
Why am I being sued personally?
Because you signed a personal guarantee. QuarterSpot required one on every loan and checked the owner’s personal credit before lending.
Business owners are normally not liable for the debts of a corporation or LLC. A personal guarantee changes that. When the business defaults, the guarantee makes you liable for the same debt, and Titan names both the business and the owner in the same warrant.
If the business has already closed, you are the only defendant left to collect from. That is the point of the guarantee.
What happens after Titan gets a judgment in Virginia?
It hires a lawyer near you, domesticates the Virginia judgment in your home state, and enforces it there: wage garnishment, bank garnishment, liens.
A default judgment entered in Arlington because you did not appear is just as enforceable as one entered after a trial. It is also much harder to undo after the fact than it was to prevent.
What should I do when I am served?
Three things.
Do not ignore it because the business is closed. The business closing does not end your personal liability on the guarantee.
Do not file anything or call opposing counsel before you talk to a lawyer. What you say and sign can be used against you.
Find the return date. On that date the court either enters judgment or sets the case for trial. Here is how a Virginia warrant in debt works and what happens if you miss it.
What are the defenses?
The ones I look for first: whether Titan can document the assignment from QuarterSpot, whether the amount claimed matches the contract, how interest and fees were calculated, and whether the guarantee was signed by the person being sued. Debt buyers do not always have a clean file.
Even when the debt is valid, a defendant who appears and demands proof settles on better terms than one who defaults. These cases are negotiated far more often than they are tried.
Is bankruptcy an option for a personal guarantee?
Often, yes, and it is sometimes the cleanest answer.
A personal guarantee on a business loan is an unsecured debt, and Chapter 7 discharges it. Because the debt is a business debt rather than a consumer debt, the Chapter 7 means test may not apply to you at all, which opens Chapter 7 to owners whose income would otherwise be too high.
If the loan is one of several business debts that followed you home, call me before the Arlington return date. A bankruptcy filing stops the lawsuit, and the judgment never gets entered.
What should I do right now?
Call me at (202) 448-5136 with the warrant in front of you. I defend Titan Asset Purchasing and QuarterSpot cases in Arlington General District Court, Alexandria General District Court and the circuit courts, and I handle the bankruptcy side if that turns out to be the better route.
The consultation is free. Don’t let the return date pass.
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