Onisko & Scholz, LLP, Paul Scholz, and Cindy Schoelen, on behalf of themselves and all others similarly situated v. B.S.D. Capital, Inc., d/b/a Lendistry

District Court, C.D. California·Decided October 27, 2025·No. 2:24-cv-10314·Unknown

Opinion

O

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA

ONISKO & SCHOLZ, LLP, PAUL SCHOLZ, Case No.: 2:24-cv-10314-MEMF-SK and CINDY SCHOELEN, on behalf of themselves and all others similarly situated, ORDER GRANTING PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES [DKT. Plaintiffs, NO. 52] v.

B.S.D. CAPITAL, INC., d/b/a LENDISTRY, Defendant.

Before the Court is the Motion for Costs and Expenses Pursuant to 28 U.S.C. § 1447(c) filed by Plaintiffs Onisko & Scholz LLP, Paul Scholz, and Cindy Schoelen. Dkt. No. 52 (“Motion”). For the reasons stated herein, the Court hereby GRANTS the Motion. / / I. Background A. Factual Background1 Plaintiff Onisko and Scholz, LLP (“Onisko”) is a business located in Los Angeles County. Compl. ¶ 6. Plaintiffs Paul Scholz and Cindy Schoelen (together with Onisko, “Plaintiffs”) are people residing in Los Angeles County. Id. ¶ 7. Defendant B.S.D. Capital (“Lendistry”) has its principal place of business in Los Angeles County. Id. ¶ 8. On April 25, 2023, Lendistry entered into a contract on with the Governor’s Office to administer the Small Business and Nonprofit COVID-19 Supplemental Paid Sick Leave Relief Grant Program (“Grant Program”). Id. ¶¶ 12-13. The Governor’s Office required that Lendistry follow all applicable privacy laws in administering the Grant Program, including during the application process. Id. ¶ 51. As part of the contract, Lendistry was required to establish a procedure for applying to the Grant Program. Id. ¶ 15. Thus, Lendistry created a program website and application verification process. Id. As part of the application process, an applicant is required to create an account on the Lendistry app and verify their bank account. Id. ¶ 57. Lendistry’s website allowed a third-party bank verification partner to intercept communications between applicants and their financial institutions. Id. ¶ 62. This third-party partner accessed the putative class members’ bank accounts without consent to repeatedly data mine their accounts to monetize the obtained data in transactions with other third parties. Id. ¶ 63. On October 28, 2024, Plaintiffs filed their class-action Complaint in Los Angeles Superior Court. See generally Compl. Their Complaint defined the putative class is as “[a]ll persons in California who submitted an application to Lendistry for a grant from the Small Business and Nonprofit COVID-19 Supplemental Paid Sick Leave Relief Grant during the statute of limitations period,” and those who submitted on behalf of a business or nonprofit. Id. ¶¶ 224, 228. It also states that “Plaintiffs, all putative class members, and Defendant itself are citizens of this state [of California].” Id. at 4.

1 The following factual background is derived from the allegation in Plaintiffs’ Complaint, Dkt. No. 1-1 (“Compl.”), except where otherwise indicated. The Court makes no finding on the truth of these allegations On November 27, 2024, Lendistry filed its Notice of Removal, removing this case to federal court. Dkt. No. 1. Lendistry alleged there that, “[b]ecause the putative class purports to encompass ‘all persons in California’—rather than all California citizens—it necessarily includes people that are not citizens of California.” Id. ¶ 21. B. Procedural History The Plaintiffs filed suit in the Los Angeles County Superior Court on October 28, 2024. See Compl. The Plaintiffs bring sixteen claims under California law: (1) breach of contract; (2) negligence; (3) violation of California’s Comprehensive Data Access and Fraud Act; (4) unlawful obtaining or use of personal information; (5) violation of California Penal Code Act section 631; (6) violation of California Penal Code section 632; (7) violation of California Penal Code section 632.7; (8) violation of California Penal Code section 638.51; (9) invasion of privacy: intrusion upon seclusion; (10) invasion of privacy: publication of private information; (11) invasion of privacy: breach of confidence; (12) violation of California Constitutional Invasion of Privacy; (13) civil conspiracy; (14) violation of Cal. Civ. Code sections 1709-1711; (15) breach of implied contract; and (16) violations of California Unfair Competition Law. See generally Compl. The Plaintiffs bring this action on behalf of themselves and other similarly situated applicants of the Grant Program using Lendistry’s website. Id. The Complaint lists no exact amount in controversy. Lendistry removed the action to this Court on November 27, 2024, under the jurisdiction of the Class Action Fairness Act (“CAFA”). See Dkt. No. 1 (“NOR”). The Plaintiffs filed a Motion to Remand on December 6, 2024. Dkt. No. 12. The Court granted that Motion on June 24, 2025. Dkt. No. 47. Plaintiffs filed the instant Motion for Attorneys’ Fees on August 22, 2025. Dkt. No. 52 (“Motion”). Lendistry filed its Opposition on September 5, 5025. Dkt. No. 53 (“Opp’n”). Plaintiffs filed their Reply on September 12, 2025. Dkt. No. 54 (“Reply”). This Court heard oral argument on the Motion on October 9, 2025. / / II. Applicable Law “Absent unusual circumstances, courts may award attorneys’ fees under 28 U.S.C. § 1447(c) only where the removing party lacked an objectively reasonable basis2 for seeking removal. Conversely, when an objectively reasonable basis exists, fees should be denied.” Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005). Fee awards are left to the discretion of the district court. Id. Unusual circumstances may include “a plaintiff's delay in seeking remand or failure to disclose facts necessary to determine jurisdiction.” Id. “[R]emoval is not objectively unreasonable solely because the removing party’s arguments lack merit, or else attorney’s fees would always be awarded whenever remand is granted.” Lussier v. Dollar Tree Stores, Inc., 518 F.3d 1062, 1065 (9th Cir. 2008). “[W]hether the relevant case law clearly foreclosed the defendant’s basis of removal” and “the clarity of the law at the time of removal” may be considered in determining the removal’s reasonableness. See id. at 1066. “Clear factual distinctions” between the case in question and the cases that the parties cite as evidence are also relevant. See Grancare, LLC v. Thrower ex rel. Mills, 889 F.3d 543, 552 (9th Cir. 2018). III. Discussion Lendistry argues that this Court should not reach the merits of whether Lendistry had an objectionably reasonable basis for removal for two reasons. First, Lendistry argues that the Motion is an improper motion for reconsideration of the remand order. Opp’n at 13-15. Second, Lendry argues that the Motion is untimely. Opp’n at 16-17. This Court addresses both arguments before turning to the merits. A. Plaintiffs’ Motion is not a motion for reconsideration. Lendistry argues that this Court should deny the Motion as an improper motion for reconsideration of the remand order. Opp’n at 13. In particular, Lendistry contends that since the 2 Plaintiffs state that the Ninth Circuit employs a “reasonable litigant” standard, which they suggest encompasses an assessment of more than the “objectively reasonable basis for removal” standard. Motion at 7. Plaintiffs cite Gardner v. UICI, 508 F.3d 559 (9th Cir. 2007), to support the “reasonable litigant” standard. However, Gardner only employs this language once and in close relation to the basis for removal; otherwise, Gardner references the “objectively reasonable basis” standard from Martin. Id. at 562. Therefore, the Court remand ord

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Onisko & Scholz, LLP, Paul Scholz, and Cindy Schoelen, on behalf of themselves and all others similarly situated v. B.S.D. Capital, Inc., d/b/a Lendistry, (C.D. Cal. 2025).

Onisko & Scholz, LLP, Paul Scholz, and Cindy Schoelen, on behalf of themselves and all others similarly situated v. B.S.D. Capital, Inc., d/b/a Lendistry (Onisko & Scholz, LLP, Paul Scholz, and Cindy Schoelen, on behalf of themselves and all others similarly situated v. B.S.D. Capital, Inc., d/b/a Lendistry) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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