- 1Scott Pearson retires from Manatt, Phelps & Phillips at the end of December 2025.
- 2He defended AdvanceMe in Clark v. AdvanceMe, which settled in 2011 with no admission of wrongdoing.
- 3Industry leaders praised his role in shaping MCA compliance.
Scott Pearson, a partner at Manatt, Phelps & Phillips LLP who leads its Consumer Financial Services group, is retiring at the end of December 2025. His career helped define how merchant cash advance companies protect themselves against usury claims.
The cases that shaped MCA
Footnotes in virtually every legal brief on MCA history cite Richard B. Clark v. AdvanceMe, a class action filed in 2008 by an Orange County, California restaurateur who alleged his MCA was really a usurious loan. It settled in 2011 with AdvanceMe admitting no wrongdoing and agreeing to make changes. Pearson, then at Stroock & Stroock & Lavan LLP, represented AdvanceMe. Industry observers saw the outcome as a roadmap for operating an MCA business compliantly.
Pearson had earlier defended Rewards Network in a 2004 class action brought by Bistro Executive over similar allegations, which also settled without an admission of wrongdoing. Both outcomes guided how MCA agreements should be written to show that the advance is not absolutely repayable. He noted that language is now standard: if the business closes or files for bankruptcy, nothing is owed, because the funder bought a share of future revenue.
Career
Pearson has worked on well over 100 class actions in a career of more than 30 years. He started at Stroock in 1994 and later held partner roles at Seyfarth Shaw and Ballard Spahr before joining Manatt, a firm of 450 attorneys and consultants founded 60 years ago in Van Nuys, California, as a partner in 2019. He said a Supreme Court ruling that class action waivers are enforceable reduced class litigation and pushed him toward enforcement and compliance work.
He recalled marathon hours, including multiple all-nighters, and a six-week jury trial in New Hampshire over trade secrets and electronic evidence that he counts among his fondest memories. Outside work he plays in an ice hockey league and enjoys fishing, golf and cooking.
Tributes and what comes next
Steve Denis, executive director of the Small Business Finance Association, called him an invaluable asset to the industry. Lindsey Rohan, president of the Alternative Finance Bar Association, credited his leadership in establishing best practices. Christopher Murray of Murray Legal called his retirement a loss for commercial finance that is well earned.
Manatt added partner Gianna Ravenscroft in October and Pearson pointed to colleagues including Charles Washburn, Bryan Schneider and Andrew Morrison.
Compliance really flows from that basic concept of 'do the right thing for people.'
His compliance advice
Pearson said even small startups should draft agreements carefully and train senior management, and that larger companies must keep investing in real compliance. His parting message is to remember that customers are people: treat them as you would a vulnerable grandmother.
Source reporting: deBanked.
