MyPillow CEO Mike Lindell Files New RICO Lawsuit Over ‘Usurious’ $1.5 Million Loan with 409% Interest Rate

MyPillow CEO Mike Lindell has filed a new lawsuit under the Racketeer Influenced and Corrupt Organizations (RICO) Act against Cobalt Funding Solutions, a New York City-based cash advance company. The lawsuit alleges that MyPillow was deceived into taking a $1.559 million loan with an exorbitant interest rate of 409.1% in September.

The lawsuit, filed in Carver County District Court on December 2, claims that the loan terms are “usurious, unconscionable, and thus unenforceable.” Daily payments on the balance exceed $45,000, with the total amount to be repaid surpassing $2.261 million. The lawsuit also includes allegations of wire fraud and accuses the lending company of misrepresenting the nature of the transaction.

This is not the first time Lindell has taken legal action against lending companies. A similar lawsuit was filed in late October with similar allegations against another lender. Both lawsuits criticize the merchant cash advance industry, describing it as “predatory” and operating in the “gray areas of the law”.

Lindell and MyPillow are seeking a court order to declare the loan agreement “unconscionable and unlawful” and to void the agreement. The lawsuit also seeks various damages, including compensatory, direct, and consequential damages, which Lindell aims to have tripled. Additionally, the lawsuit requests interest and attorneys’ fees.

The financial woes of MyPillow and its founder are multifaceted. The company has faced significant financial strain, partly due to Lindell’s public stance on the 2020 presidential election. MyPillow has been involved in several legal battles, including defamation lawsuits from Dominion Voting Systems and Smartmatic, which have reportedly cost the company hundreds of millions of dollars.