Maryland Users Of Cleo’s Cash Advance App Will Get Their Day In Court

Kevin Abramowicz and Chandler Steiger (June 2, 2025)

East End Trial Group’s Kevin Abramowicz, Chandler Steiger, and Jes Liu just secured a series of trial- and appellate-court wins in Franklin v. Cleo AI Inc., No. 24-cv-00146 (D. Md.), on appeal, No. 24-1817 (4th Cir.). The case, filed on behalf of a class of Maryland consumers, alleges that Cleo, a financial technology company, violates Maryland law by offering cash advances and charging costly fees that significantly exceed the 33% APR limit under Maryland law.

Cleo tried to dismiss the case but, in July 2024, a trial court in the District of Maryland denied that request. Cleo argued that one of the lead plaintiffs had to bring his claims individually in arbitration. The court rejected that request because Cleo was not a party to the arbitration agreement it sought to enforce, and could not use equitable estoppel to enforce the agreement as a third party. Cleo argued that the other lead plaintiff had to bring her claims in England. The court rejected that request too because it would be unreasonable to require Maryland consumers to bring Maryland claims in England.

Cleo tried to obtain the trial court’s consent to appeal the ruling denying Cleo’s request to force litigation in England but, in October 2024, the court denied that request too. In doing so, the court found that there was no substantial ground for difference of opinion as to the approach the court employed when deciding whether Cleo could force a Maryland consumer to litigate Maryland-based claims in England.

Cleo was able to appeal the arbitration ruling but, in May 2025, an appellate court affirmed the trial court’s decision. The Fourth Circuit agreed with the District of Maryland that Cleo could not use equitable estoppel to enforce the arbitration agreement to which it was not a party.

As a result of these rulings, Maryland residents will get their day in court, in the state in which they reside, and may be able to recover the costly fees that Cleo has charged for its cash advances and other amounts.