Marion County Circuit Court Judge Louis Rosenberg granted final approval today to a class-action settlement against online payday lender “LoanPoint USA.” The settlement awards $1.35 million to more than 6,500 Hoosiers and voids an additional $5.5 million in amounts owed on payday loans. Cohen & Malad, LLP filed the lawsuit in 2010 after learning that over the course of just 3 months LoanPoint USA had deducted $700 in finance charges from Plaintiff Akeala Edwards’s checking account for a $300 “payday loan,” and that LoanPoint  USA was charging finance fees in some cases that exceeded 1000% APR. The lawsuit alleged that LoanPoint’s finance fees, and other contract terms, violated Indiana’s Small Loans Act.

“We are glad that some of Indiana’s most financially distressed citizens will be getting meaningful checks to compensate them for the overcharges,” stated Vess Miller of Cohen & Malad, LLP, which was appointed by the Court as Class Counsel. “Indiana passed laws specifically to prevent lenders from taking advantage of people that are in a financial bind and as part of that it limited the finance fees that lenders can charge,” said Miller. The average class member will get a check for roughly $200 from this settlement, and several will receive checks of more than $1,000.

The case was litigated for three years, including appeals by LoanPoint USA to the Indiana Supreme Court and United States Supreme Court, as the lender tried to force the case to be arbitrated on an individual basis and not as a class action. “This case is a good example of why class actions are so important,” said Miller. “None of LoanPoint’s victims could reasonably afford to bring a lawsuit over their few hundred dollars, but because we were able to bring a class action we were able to make sure that thousands of people will get back the money they deserve and that LoanPoint is held accountable.”

Checks are expected to be mailed directly to class members in early 2014. The case is Edwards v. Geneva-Roth Capital, Inc., 956 N.E.2d 1195 (Ind. Ct. App. 2011), reh’g denied & trans. denied, 969 N.E.2d 87 (Ind. 2012), cert. denied 133 S.Ct. 650 (2012). Read more about payday lending here.