Claims Focused on Fee Structure
Plaintiffs argued that the companies charged rental and financing costs that exceeded what would be allowed under consumer credit rules. According to the complaints, the agreements were labeled as leases but operated in practice like installment sales with added charges.
In the state court matter, the dispute began after Carolina Lease sought to recover a shed from a customer who missed payments. The customer filed counterclaims challenging the fee structure, leading to broader class allegations.
The parties litigated for more than five years, including an appeal to the U.S. Court of Appeals for the Fourth Circuit, before agreeing to settle.
How the Settlement Is Divided
Under the approved terms, most of the funds go to members of the federal class.
About $6.9 million will be distributed among 7,412 federal class members. Attorneys from the National Consumer Law Center and Lapas Law Offices will receive roughly $2.3 million in fees and costs. Each class representative will receive $10,000.
In the state case, just over $1 million is set aside for 3,811 class members. Counsel will receive about $330,000 in fees and costs. The named class representative is scheduled to receive $20,000.
Carolina Lease also agreed to cancel nearly $670,000 in outstanding balances it claimed customers still owed.
