Summary:
Judge Terrence W. Boyle of the Eastern District of North Carolina granted preliminary approval of a proposed class action settlement in a consumer protection case brought against Carolina Lease Management Group, LLC and CTH Rentals, LLC (but notably not Old Hickory Buildings, LLC, which remains a non-settling defendant).
The class includes North Carolina residents who entered into rent-to-own agreements for personal property and were subject to collection efforts on or after March 10, 2018. The agreements were allegedly deceptive or violative of consumer protection laws. The settlement, if finally approved, will provide a common fund of $6,998,328.87, from which class members will be compensated—without requiring a claims form. Checks will be automatically mailed unless a class member opts out.
The Court certified the class for settlement purposes under Fed. R. Civ. P. 23(b)(3), appointed Adrian Lapas, Jennifer Wagner, and Charles Delbaum as class counsel, and scheduled a final fairness hearing for October 28, 2025.
Commentary:
Excellent work by Adrian Lapas! Hopefully more to come.
While this proposed class settlement represents a significant recovery for affected North Carolina consumers—particularly by avoiding the usual claim-submission burden—its approval in federal court is also notable for what it avoids: the often hostile environment in North Carolina bankruptcy courts toward class actions.
Debtors asserting class-wide claims in bankruptcy (especially against debt buyers, landlords, or finance companies) often run into a wall in the bankruptcy courts of the Fourth Circuit, particularly in the Eastern and Western Districts of North Carolina. These courts have frequently declined to certify Rule 23 classes in bankruptcy, citing the individualized nature of claims, the administrative burden, or the perceived conflict with the centralized claims resolution process envisioned by the Bankruptcy Code.
By proceeding in federal district court under Rule 23, the plaintiffs here bypassed those hurdles. This case demonstrates that, while North Carolina’s bankruptcy courts may be unreceptive to consumer class actions, district courts remain viable forums for large-scale consumer redress, especially where contracts and collection practices are uniform and documented.
Moreover, the administration of the Bland settlement—with no claim form, proactive address searches, and even the option of digital payments—reflects a modern approach to ensuring actual relief reaches affected consumers. That’s especially critical in cases like this, where the defendants targeted low-income consumers with high-risk, potentially predatory contracts.
This case should encourage consumer advocates to consider whether federal district court class actions may be more effective than adversary proceedings in bankruptcy court—at least in jurisdictions where class claims are viewed skeptically. It also underscores the need to watch how North Carolina bankruptcy courts treat proofs of claim stemming from such settlements: Will they honor the certified class judgment, or force individualized objection and litigation?
Either way, Bland shows that large-scale consumer relief is still possible—even if you have to get out of bankruptcy court to make it happen.
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To read a copy of the transcript, please see:
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