Lawsuits involving The Fundworks fall into two categories: collection cases the company has filed against merchants and personal guarantors, mostly in Texas courts, and disputes on the borrower side where merchants have pushed back on merchant cash advance (MCA) agreements through negotiation or counter-litigation. No class action or large regulatory action against the company appears in available records.
Collection Cases The Fundworks Has Filed
Court records from Denton County, Texas show The Fundworks pursuing commercial debt-collection suits through attorney Kyle R. Millsap. Two cases give a sense of how those actions play out.
In November 2023, The Fundworks sued EDX Technologies, Inc. and its principal, Roger Ray Skidmore. An abstract of judgment was entered by December 2024. The company then escalated: in January 2025 it filed a motion to compel and requested a receiver, and in February 2025 the court appointed a receiver and approved a turnover of assets.1UniCourt. The Fundworks LLC vs EDX Technologies Inc and Roger Ray Skidmore A receivership order is a serious enforcement step. It puts a third party in control of the debtor’s assets to satisfy the judgment.
A second case, filed in February 2024 against Fatstack Smokers, LLC and Eric Lee Wech, ended differently. The Fundworks voluntarily dismissed it by filing a notice of non-suit in October 2024, and the matter closed without a judgment.2UniCourt. The Fundworks LLC vs Fatstack Smokers LLC and Eric Lee Wech A non-suit can reflect a private settlement or a decision that further litigation wasn’t worth pursuing. The public record doesn’t say which.
Bankruptcy Filings
The Fundworks has also appeared in federal bankruptcy proceedings. In the Chapter 11 case of Analia Home Health Care Services, LLC in the Northern District of Georgia, a docket entry linked to the company was recorded in June 2024.3PACER Monitor. Analia Home Health Care Services, Case 24-52233 The claim details sit in a sealed PDF and aren’t visible from the public docket summary. MCA funders routinely file claims when a merchant seeks bankruptcy protection.
Borrower-Side Representation
At least one firm that defends merchants against MCA collection efforts, Grant Phillips Law, lists “Fundworks” among the funders it has “either negotiated a settlement with, or sued successfully.”4Grant Phillips Law. List of MCA Funders Our Law Firm Has Engaged With Specific case names, settlement amounts, and outcomes aren’t disclosed on that list.
The Legal Footing for Challenging an MCA
An MCA is written as a purchase of future receivables, not a loan. The funder buys a share of future revenue at a discount, and the merchant repays through daily debits. Because it’s framed as a sale, MCA providers have long argued they aren’t subject to state usury caps or lending licensure.
Courts have increasingly tested that framing under a substance-over-form analysis. Judges look at whether repayment is genuinely tied to actual revenue, whether the reconciliation mechanism that adjusts payments to income fluctuations is real and usable, and whether the funder truly bears the risk that the receivables won’t come in.5Fintech Weekly. Merchant Cash Advances: Not Loans? Legal Distinction in Court If a court finds the agreement is really a loan, it can be recharacterized, which may trigger usury violations and licensing exposure for the funder.
State-level scrutiny has grown alongside the case law. California, New York, New Jersey, Virginia, and Utah have enacted or proposed disclosure laws covering annualized cost and repayment terms. Amendments to New York General Business Law ยง 349 that took effect in February 2026 let the Attorney General examine MCA collection practices under standards once reserved for consumer debt.6Mizrahi Law PC. The Evolving Legal Landscape of Merchant Cash Advance Collections New York also banned out-of-state confessions of judgment in 2019, cutting off a tool MCA funders once used to obtain judgments against out-of-state merchants without a hearing.
Who The Fundworks Is
The Fundworks launched in 2015 and is based in Salt Lake City, Utah. It markets revenue-based financing for growth-stage businesses, with advances from $5,000 to $500,000, factor rates estimated between 1.23 and 1.29, terms up to 180 days, and daily repayments. Typical qualification benchmarks include six months of operating history, a credit score around 500, and $10,000 in monthly revenue.7United Capital Source. The Fundworks Review
The company holds an A+ rating with the Better Business Bureau but is not BBB-accredited. Google reviews sit at 4.6 out of 5 across more than 100 ratings; Trustpilot sits at 2.8 out of 5. Recurring borrower complaints include difficulty reaching customer service, high effective interest, frequent account withdrawals, and reports of continued debits after a balance was paid off. The Fundworks has reportedly disputed some of those complaints, saying it has no record of the customers involved.7United Capital Source. The Fundworks Review The company does not offer an online balance portal, so merchants must contact it directly to confirm what they still owe.