Tampa Employee Retention Credit Litigation Lawyer

When “Help” Comes with a Hidden Price Tag: Businesses Nationwide Are Fighting Back Against ERC Collection Lawsuits Filed in Florida. 

During the darkest days of the pandemic, Congress created the Employee Retention Credit (ERC) as a lifeline for businesses that kept employees on payroll through unprecedented disruption. It was meant to be relief. For a growing number of business owners across the country, especially small businesses, it has instead become the opening chapter of a lawsuit — one filed hundreds or even thousands of miles from home, in Florida.

A pattern has emerged. Florida-based companies that marketed themselves as ERC “preparation” or “recovery” specialists approached business owners across the country — restaurants, retailers, service companies, family-run operations, and larger regional and multi-location businesses alike — with promises to handle the paperwork and unlock funds the owners didn’t know they were entitled to. Agreements were signed, often quickly, often without the benefit of counsel reviewing the terms, including a forum-selection clause requiring any dispute to be litigated in Florida.

Now, months or years later, some of those same companies are suing the businesses they claim to have been helping — in Florida courts, far from where those businesses actually operate — demanding significant sums in fees. As your Tampa employee retention credit litigation lawyer, we can help you understand and navigate the process.

Who Actually Agreed to What?

One issue we are seeing, and actively testing in litigation, is whether the person who signed on behalf of the business actually had the authority to bind the company to an agreement. Businesses don’t always run every contract through an owner or officer — day-to-day paperwork sometimes gets handled by whoever is available at the time, especially during times of unprecedented economic uncertainty and operational upheaval, when owners were focused on keeping their doors open and their employees paid.

Under Florida law, a business generally is not bound by a contract signed by someone without the actual or apparent authority to sign it. Whether authority existed depends on the facts: the signer’s role and actual responsibilities, whether the business later ratified the agreement, and what the other side knew or should have known at the time. These are questions we work through carefully with each client — and depending on what the facts show, a lack of authority can be a meaningful defense.

Fees That Don’t Line Up With What Was Promised — or What Was Done.

We’re also seeing recurring problems with how these companies calculate and demand payment. In some instances, real work was performed. In others, little or no actual service was ever provided. Either way, once an ERC credit comes through, the company comes looking for payment — and the amount demanded doesn’t always appear to line up with what the underlying agreement actually authorizes.

We are actively litigating and testing a range of legal theories in response to these suits — including whether a complaint adequately alleges how the amount demanded was calculated, whether it connects that demand to what the contract actually provides, and whether the claims as pled meet Florida’s fact-pleading requirements.

Businesses Deserve a Real Defense.

These lawsuits are landing on business owners who spent 2020 through 2022 trying to keep their doors open and their employees paid. Many are now being asked to pay tens of thousands of dollars — and to defend themselves in a Florida courtroom far from home — under agreements they may not have authorized or fully understood.

If your business has received a demand letter, invoice, or lawsuit from an ERC preparation or recovery company requiring you to litigate in Florida, you are not without options, no matter where your business is located. Before assuming a bill is owed, that agreement — and who signed it, and on what authority — deserves a careful legal review.

We Are Ready to Help.

Our firm is currently representing businesses, including small businesses, from across the United States in ERC-related litigation pending in Florida, and we invite any business owner facing a similar demand or lawsuit in Florida to reach out, wherever your business is based. We will review your case, examine the ERC agreement and any related documents, and let you know candidly whether there are defenses, or even affirmative counterclaims, available to you. We are testing the sufficiency of these claims by asking the court to dismiss them where the law and facts support it, and we are prepared to do the same for you.

The Tampa employee retention credit litigation lawyers at Chemere Ellis, PLLC represent businesses in litigation, including disputes arising from Employee Retention Credit agreements pending in Florida courts. This article is for informational purposes only and does not constitute legal advice. The general topics and strategies discussed do not apply to all cases and prior results do not guarantee or predict a similar outcome in any future matter.