By Russ Weekes | Weekes Law, LLC | Utah-Licensed (USB 10214)
By the time a Utah merchant stops paying, it’s usually too late to be looking for collection counsel.
That’s the reality most MCA funders discover the hard way. The ACH transfers stop. The merchant goes quiet. Someone opens a browser tab and starts searching for a Utah MCA collections attorney — any Utah attorney — who handles collections. What they usually find is a generalist who has never seen a merchant cash advance agreement, doesn’t know what a future receivables sale structure is, and will spend the first two weeks of your engagement asking you to explain your own product.
I’ve been inside that process from the other direction. I’ve managed litigation strategy across an active MCA portfolio — reviewing agreements before accounts went sideways, coordinating enforcement responses when they did, and litigating contested matters in Utah courts when merchant debtors pushed back. Here’s what that experience has taught me about what Utah MCA collections actually requires.
Three MCA-Specific Legal Issues Utah Courts See Most Often
In my experience litigating MCA matters in Utah, three contested issues arise most consistently:
→ Forum selection clause challenges. Merchant debtors — often on advice of counsel — will attempt to defeat forum selection clauses by reframing the dispute as a tort, unjust enrichment, or consumer protection claim. The defense requires knowing how Utah courts analyze these arguments, being prepared to defend the future receivables characterization of the MCA transaction, and moving quickly before the court entertains jurisdictional arguments.
→ Discovery stonewalling. When a merchant has financial exposure, they frequently respond to discovery with redacted documents, blanket proportionality objections, and delay tactics. The goal is to make litigation expensive enough that the funder walks away. Outside counsel who will not litigate the discovery dispute aggressively often enables this strategy inadvertently.
→ Unconscionability challenges. This is the attack that keeps MCA funders up at night — and the one most outside counsel are least prepared to defend. Merchant debtors, typically through counsel, argue that the MCA agreement itself is unenforceable as unconscionable: either procedurally (claiming the merchant didn’t understand what they were signing), substantively (arguing the effective cost of capital amounts to an unlawful penalty or usurious rate), or both. The argument is a direct assault on your agreement’s enforceability, and it requires outside counsel who understands the future receivables doctrine, can distinguish MCA transactions from loans under Utah law, and has seen these arguments before — not encountered them for the first time on your file.
Why unconscionability matters more than other defenses: A successful forum selection challenge moves the case. A successful unconscionability challenge voids the contract. The stakes are categorically different, and the defense requires counsel who has already litigated it.
The Unconscionability Defense in MCA Litigation: What Funders Need to Know
Unconscionability challenges in MCA litigation typically take one of two forms — or both at once.
Procedural unconscionability focuses on the circumstances of contract formation: Was the merchant presented with a take-it-or-leave-it agreement with no opportunity to negotiate? Was the agreement buried in fine print? Did the merchant have adequate opportunity to review and understand the terms? These arguments are not unique to MCA, but they are frequently raised in MCA defaults because the speed of the origination process — often 24 to 72 hours from application to funding — creates factual fodder for this claim.
Substantive unconscionability focuses on the terms themselves: arguing that the effective cost of capital, the factor rate, or the reconciliation provisions are so one-sided as to shock the conscience. Merchant counsel will sometimes frame this as a disguised usury argument — attempting to characterize the MCA as a loan subject to Utah’s interest rate limitations, rather than a purchase of future receivables. If that argument succeeds, the entire transaction framework collapses.
The defense to both is well-established in MCA caselaw, but it requires counsel who knows it: the transaction is a sale of future receivables, not a loan; the factor rate is not an interest rate; the risk is on the funder because repayment is tied to the merchant’s actual revenue, not a fixed schedule; and the merchant received a benefit — immediate capital — in exchange for the terms they accepted.
What makes this defense fail is outside counsel who hasn’t made it before. The argument needs to be built from the agreement up, grounded in the specific reconciliation and repayment language in your contract, and presented by an attorney who already understands the doctrinal framework. An attorney learning MCA law during your case is a liability, not an asset.
What to Look for in Utah MCA Collections Attorney
When evaluating outside counsel for Utah MCA defaults, the question isn’t just whether the attorney handles collections. It’s whether they understand the product, have litigated the contested edge cases, know the local courts, and can cover the state — not just a corner of it.
→ Have they litigated contested MCA cases — not just uncontested defaults?
→ Can they articulate why an MCA agreement is a sale of future receivables, not a loan — and defend that characterization in a Utah motion?
→ Are they licensed in Utah and active in courts across the state — not just their home district?
→ Will they pursue garnishment and other enforcement tools in parallel with litigation, or wait for a judgment before acting?
→ How quickly can they move when an account first goes into default?
The Value of Establishing Outside Counsel Before You Need Them
The funders who recover the most from defaulted Utah accounts are not always the ones who litigate most aggressively — they’re the ones who have outside counsel ready to move before the default is weeks old. The longer an account sits without enforcement action, the more opportunity the merchant has to dissipate assets, open new accounts, and create obstacles to recovery.
Establishing an outside counsel relationship in Utah before you need it — with an attorney who already understands your agreements and enforcement priorities — is one of the highest-ROI decisions a funder can make.
About the Author
Russell B. Weekes is a MCA Collections attorney and owner of Weekes Law, LLC, licensed in Utah (USB 10214) with a statewide commercial collections practice. He previously served as de facto general counsel for an active MCA portfolio, managing litigation strategy across a multi-case commercial collections operation in Utah courts. He represents MCA funders, commercial lenders, and factoring companies in collections, enforcement, and contested litigation across Utah.
To discuss Utah collections matters or schedule a consultation, contact us today.
