The New York Court of Appeals has been busy redressing lower
state and federal courts' interpretations of its usury laws
for the past two years. Two Circuit Courts of Appeals—the 9th
Circuit and the 2nd Circuit—have certified questions to New
York's highest court on certain unsettled usury issues.
See Adar Bays, LLC v. GeneSYS ID, Inc., 962 F.3d 86 (2d
Cir. 2020); Fast Trak Inv. Co., LLC v. Sax, 962 F.3d 455
(9th Cir. 2020). The latter case was dismissed upon settlement of
those issues. Our Adar Bays case resulted in a convincing
win on other usury issues.
Another unsettled issue of law that may make its way to the New
York Court of Appeals is contractual default interest and default
charges built into financial transactions, and whether default
rates and charges should apply to interest subject to New
York's criminal usury analysis. There is a split of
authority stretching over both federal and state courts on this
issue that has not been addressed, nor resolved by
