govinfo:USCOURTS-mdd-1_25-cv-02474-0

IN THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT OF MARYLAND 
 
 * 
JUSTIN KELLER, et al. * 
 * 
 Plaintiffs, * 
 * Civil Case No.: SAG-25-02474 
 v. * 
MONROE CAPITAL CORP., et al. * 
 * 
 Defendants. * 
 * 
* * * * * * * * * * 
MEMORANDUM OPINION 
 
Plaintiffs Justin Keller, Hailey Kardux, Patricia Bandy, Alexei Mack, and Richard Riley 
(“Plaintiffs”) bring this action, on behalf of themselves and all others similarly situated , against 
Monroe Capit al Corporation, Monroe Capital BDC Advisors, LLC, and Monroe Capital 
Management Advisors, LLC (collectively, “Monroe”), asserting various state and federal claims 
relating to contractual agreements between Plaintiffs and MV Realty PBC, LLC (“MV Realty”). 
ECF 21. Monroe has filed two motions: a motion to compel arbitration , ECF 25, and a motion to 
dismiss the amended complaint, ECF 24. Plaintiffs opposed both motions, ECF 26, 27, and Monroe 
filed replies, ECF 29, 30. This Court has reviewed the filings and finds that no hearing is necessary. 
See Loc. R. 105.6 (D. Md. 2025). For the reasons explained below, Monroe ’s motion to compel 
arbitration will be denied as to the North Carolina -based plaintiff, granted as to the Maryland-
based plaintiffs, and deferred for limited discovery to obtain the HBA signed by the Virginia-based 
plaintiff (although such discovery will not take place until and unless an amended complaint is 
filed). Monroe’s motion to dismiss will be granted, although Plaintiffs will be afforded thirty days’ 
leave to file an amended complaint comporting with the requirements of the Local Rules. 

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I. BACKGROUND 
A basic statement of facts is helpful to the consideration of the motion to compel 
arbitration. The following facts are derived from Plaintiffs’ amended complaint, ECF 21. 
Real estate brokerage companies, under MV Realty , offered a “Homeowner Benefit 
Agreement” (“HBA”) targeting homeowners in financial distress. Id. ¶¶ 2–5. The HBA transaction 
offered the homeowners a small amount of “promotional” cash that never had to be repaid, in 
exchange for an extremely high- interest secured loan, creating a lien -like interest in the 
homeowners’ property and a 40-year “right to list” the property for sale. Id. ¶¶ 6–7, 15–16. The 
homeowners were targeted through robocalling and deceptive internet advertising geared towards 
persons who researched small short -term loans or refinancing opportunities. Id. ¶ 14. The 
homeowners were then presented with lengthy and complex contracts within a binder of materials, 
often while they were already meeting with a notary. Id. ¶ 19 
When subsequently called upon to list a property for sale, MV Realty engaged in no effort 
to promote or market the property and served only as a “transactional broker” for an inflated fee. 
Id. ¶ 24. In many of the states in which HBAs were signed, MV Realty did not even employ 
licensed realtors. Id. ¶ 26. To get out of the 40- year agreement and retain an effective sales agent 
to market their homes, the homeowners had to pay steep termination penalties. Id. ¶ 11. More than 
38,000 homeowners in dozens of states signed these HBAs. Id. ¶ 33. 
Defendant Monroe served as the principal financier of MV Realty’s scheme, profiting from 
the collection of the lucrative termination fees or the inflated brokerage commissions if the 
property sold. Id. ¶¶ 8, 30–32. Plaintiffs describe the relationship between Monroe and MV Realty 
as “a joint association -in-fact enterprise that combined deceptive practices, unlawful debt 
collection, and exclusionary control of the brokerage market to monetize homeowners’ equity 

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through forty-year encumbrances.” Id. ¶ 36. Several state Attorneys General have sued MV Realty 
and its subsidiaries, although Monroe itself has not been sued. Id. ¶ 34. R ecently, in North 
Carolina, the Superior Court entered a Consent Judgment between MV Realty and the State in 
which MV Realty agreed that “the HBAs and Memoranda of HBAs are wholly unenforceable 
against North Carolina Consumers” and that it possessed “no rights, interests or privileges arising 
out of any HBA entered between Entity Defendants and North Carolina Consumers.” ECF 32-1. 
The Plaintiffs in this case are Maryland consumers (Keller/Kardux and Riley), Virginia 
consumers (Mack), and North Carolina consumers (Bandy) who executed HBAs and allege they 
were defrauded about the terms and suffered resulting harm . ECF 21 ¶¶ 58–107. Plaintiffs filed 
the instant class action suit and Amended Complaint against Monroe. ECF 1, 21. Monroe seeks to 
compel arbitration pursuant to the arbitration clause contained in the HBAs and also seeks to 
dismiss the Amended Complaint for failure to state a claim. ECF 24, 25. 
II. MOTION TO COMPEL ARBITRATION 
Initially, as confirmed at the hearing, the parties agree that this motion to compel arbitration 
falls in the “netherworld” between a motion to dismiss and motion for summary judgment. The 
relevant facts are largely undisputed , and the issues presented revolve around contractual 
interpretation. They do not require analysis of evidence outside the Complaint and the agreements 
integral thereto. Accordingly, as the parties concur, there is no meaningful distinction that needs 
to be resolved between motion to dismiss and motion for summary judgment standards to 
adjudicate this motion. 
Otherwise, the parties agree on very little with respect to the legal standards governing the 
contested questions. They disagree about which state’s law should govern, and they disagree about 
the “order of operations,” or which questions this Court should address in which order. Plaintiffs 

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contend that this Court should first address whether the HBAs’ plain language allows Monroe (a 
non-signatory) to enforce the express arbitration provisions before reaching whether there wa s 
concerted action between Monroe and MV Realty. That position is strained, because Monroe does 
not suggest that the plain language of the arbitration provision includes Monroe. It argues that, 
because of the concerted action alleged to have occurred, Plaintiffs are equitably estopped from 
avoiding arbitration, despite the fact that Monroe is not referenced in the HBAs themselves. This 
Court therefore agrees with Monroe’s approach and will first evaluate whether “a valid agreement 
to arbitrate exists” before turning to the validity of the HBAs’ delegation clause and whether 
equitable estoppel is warranted. See Glass v. Kidder Peabody & Co., 114 F.3d 446, 453 (4th Cir. 
1997). 
As the Fourth Circuit recently explained in Dhruva v. CuriosityStream, Inc., 131 F.4th 146, 
151 (4th Cir. 2025), the first question is “whether a valid arbitration agreement exists.” Id. (quoting 
Henry Schein, Inc. v. Archer & White Sales, Inc., 586 U.S. 63, 69 (2019)). As the party seeking to 
compel arbitration, Monroe “bears the burden of establishing the existence of a binding contract 
to arbitrate.” Marshall v. Georgetown Mem’l Hosp., 112 F.4th 211, 217 (4th Cir. 2024) (quoting 
Minnieland Priv. Day Sch., Inc. v. Applied Underwriters Captive Risk Assurance Co., 867 F.3d 
449, 456 (4th Cir. 2017) ). That initial issue is for the Court, because “where the dispute at issue 
concerns contract formation, the dispute is generally for courts to decide.” Granite Rock Co. v. 
Int’l Bhd. of Teamsters, 561 U.S. 287, 296 (2010). And Section 4 of the Federal Arbitration Act 
“requires that the district court—rather than an arbitrator —decide whether the parties have formed 
an agreement to arbitrate.” Berkeley Cnty. Sch. Dist. v. Hub Int’l Ltd., 944 F.3d 225, 234 (4th Cir. 
2019). But where there is a valid agreement to arbitrate, the “parties may agree to have an arbitrator 
decide not only the merits of a particular dispute but also ‘“gateway” questions of “arbitrability,” 

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such as whether the parties have agreed to arbitrate or whether their agreement covers a particular 
controversy.’” Henry Schein, Inc., 586 U.S. at 67–68 (quoting Rent -A-Ctr., W., I nc. v. Jackson , 
561 U.S. 63, 68–69 (2010)). 
The initial question of whether there is an enforceable agreement to arbitrat e presents a 
state law issue of contractual interpretation. See Meadows v. Cebridge Acquisition, LLC, 132 F.4th 
716, 726 (4th Cir. 2025). For questions of formation, this Court cannot enforce the choice of law 
provisions in the HBAs1 before it determines whether an agreement has been formed. See Ford v. 
Genesis Fin. Sols., Inc., 726 F. Supp. 3d 441, 448-49 (D. Md. 2024); Johnson v. Cont’l Fin. Co., 
LLC, 690 F. Supp. 3d 520, 525 (D. Md. 2023). This Court thus turns to the choice-of-law rules of 
Maryland, the forum state. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496–97 (1941). 
Maryland uses lex loci contractus to determine contract formation, looking to the law of the 
jurisdiction where the contract was made. Konover Prop. Tr., Inc. v. WHE Assocs., 142 Md. App. 
476, 490 (2002). That jurisdiction is determined by “where the last act is performed which makes 
an agreement a binding contract.” Ford, 726 F. Supp. 3d at 450 (quoting Grain Dealers Mut. Ins. 
Co. v. Van Buskirk , 241 Md. 58, 66 (1965)) . Although not all of the copies of the HBAs for the 
Plaintiffs are fully executed, the parties do not appear to dispute that the “ last act” would be the 
signature of MV Realty’s representative before a notary in Florida. ECF 21-2, 21-3, 21-4. Lex loci 
contractus would therefore look to the Florida law governing contract formation. 
In that area, however , Florida law does not differ in any meaningful respect from other 
states. See Vega v. T -Mobile USA, Inc., 564 F.3d 1256, 1272 (11th Cir. 2009) (explaining that 
 
1 The Maryland HBAs have a choice- of-law provision favoring Maryland law, although the 
arbitration provisions specify that “arbitration shall take place in Nevada.” See ECF 21-2 at 7; 21-
3 at 7. The North Carolina HBA’s choice-of-law provision applies North Carolina law. ECF 21-4 
at 9. 

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Florida law of contract formation requires “(1) offer; (2) acceptance; (3) consideration; and (4) 
sufficient specification of the essential terms.”). And Plaintiffs do not contend that any of those 
basic contract elements are lacking as to the HBAs or the arbitration clauses contained therein . 
Their challenge is to the validity and enforceability of the agreements, not their formation. 
However, Monroe’s position that valid arbitration agreements exist in the HBAs hits a snag 
as to North Carolina. In that jurisdiction , the State, MV Realty , and the North Carolina Superior 
Court have agreed that the HBAs are “wholly unenforceable against North Carolina Consumers” 
and that MV Realty possesses “no rights, interests, or privileges arising out of any HBA” entered 
with North Carolina consumers. ECF 32-1 at 8. Monroe has not explained how, in light of that 
concession and court order, this Court can find th e present existence of an agreement to arbitrate 
as to Plaintiff Patricia Bandy, a North Carolina consumer. It would be patently inequitable to allow 
a non-signatory to enforce provisions of a “wholly unenforceable” agreement, on the ground that 
Bandy alleged “substantially interdependent and concerted misconduct” between Monroe and the 
party that has conceded unenforceability. Monroe’s motion to compel arbitr ation, therefore, will 
be denied as to Plaintiff Bandy because Monroe has failed to establish “the existence of a binding 
contract to arbitrate.” Marshall , 112 F.4th at 218. T his Court will proceed no further to analyze 
the North Carolina HBA. 
With valid agreements to arbitrate having been formed between MV Realty and the 
Virginia and Maryland Plaintiffs, the choice- of-law provisions in those HBAs take over and 
govern the next step: looking to the scope of the delegation clauses in the HBAs to determine 
whether the challenged issues of validity or enforceability are for this Court or an arbitrator. And 
here, this Court is unable to assess the choice-of-law provision or other terms of the Virginia HBA 
signed by Plaintiff Alexei Mack, because neither party is presently in possession of a complete 

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copy. See ECF 26 at 18 n.13 (“Plaintiff Alexei Mack does not possess, and likely never possessed, 
a full copy of his HBA.”); ECF 25-1 at 14–15 (arguing in the alternative for targeted discovery 
seeking Mack’s HBA agreement). This Court believes the most prudent approach is not to make 
assumptions based on other Virginia consumers’ agreements, but to allow Monroe an opportunity 
to conduct limited , targeted discovery to obtain a copy of the agreement Mack and MV Realty 
signed before renewing its motion to compel arbitration. 
 Continuing with the Maryland HBAs, then, each of th ose agreements contains a broad 
delegation clause delegating questions about validity and arbitrability to the arbitrator. See ECF 
21-2 and 21-3 at 5 (“[T]he arbitrator shall (i) resolve all disputes and issues between the Parties, 
including all issues of arbitrability and the validity and enforceability of this Arbitration Provision 
(however, the validity and enforceability of the class-action waiver agreed to by the Parties in this 
Arbitration Provision shall only be decided by a court) . . . .”) . Thus, the myriad questions of 
unconscionability and in validity raised by Plaintiffs are in the arbitrators’ purview.2 See Corbin 
on Contracts 2.12 (2026) (“[Unconscionability . . . goes to enforceability and not formation.”). 
What is in this Court’s purview, however, is whether equitable estoppel should preclude 
Plaintiffs from avoiding the arbitration agreements (and delegation clauses) in the HBAs. Because, 
as discussed above, an agreement was formed, M aryland law governs the question under the 
choice-of-law provision. 
 
2 Plaintiffs do argue, in their opposition to the motion to compel arbitration, that the class action 
waiver renders the HBA arbitration clauses substantively unconscionable. ECF 26 at 17. That 
argument, pertaining to whether the arbitration clause itself i s enforceable, is reserved to the 
arbitrator. This Court does not read Plaintiffs to be arguing, at this stage, the validity and 
enforceability of the class-action waiver itself. If such a challenge is mounted, it will be decided 
by this Court, not the arbitrator. 

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The Fourth Circuit engaged in extensive discussion of equitable estoppel in the arbitration 
context in Am. Bankers Ins. Grp., Inc. v. Long, 453 F.3d 623, 627–28 (4th Cir. 2006): 
“Equitable estoppel precludes a party from asserting rights he otherwise would have 
had against another when his own conduct renders assertion of those rights contrary 
to equity.” Int’l Paper, 206 F.3d at 417–18 (internal quotation marks omitted). “In 
the arbitration context, the doctrine recognizes that a party may be estopped from 
asserting that the lack of [another ’s] signature on a written contract precludes 
enforcement of the contract ’s arbitration clause when [the party] has consistently 
maintained that other provisions of the same contract should be enforced to benefit 
him.” Id. at 418. 
 
Applying these concepts, we have announced the following test for determining 
when equitable estoppel applies against a signatory to an arbitration clause: 
 
[E]quitable estoppel applies when the signatory to a written agreement containing 
an arbitration clause must rely on the terms of the ... agreement in asserting its 
claims against the nonsignatory. When each of a signatory’ s claims against a 
nonsignatory makes reference to or presumes the existence of the written 
agreement, the signatory’s claims arise out of and relate directly to the written 
agreement, and arbitration is appropriate. 
 
Brantley v. Republic Mortgage Ins. Co., 424 F.3d 392, 395–96 (4th Cir. 2005) 
(quoting MS Dealer Serv. Corp. v. Franklin, 177 F.3d 942, 948 (11th Cir. 1999)) 
(alterations, ellipses, and internal quotation marks omitted). Because this legal test 
examines the nature of the signatory’ s underlying allegations against the 
nonsignatory, courts should examine the underlying complaint to determine 
whether estoppel should apply. See id. at 396 (denying application of estoppel 
where the signatory- plaintiffs’ underlying “claims” did not rely on the contract 
containing the arbitration clause). 
 
The “legal principle [underlying the theory of equitable estoppel] rests on a simple 
proposition: it is unfair for a party to rely on a contract when it works to its 
advantage, and repudiate it when it works to its disadvantage.” Wachovia Bank, 
Nat. Ass’n v. Schmidt, 445 F.3d 762, 769 (4th Cir. 2006) (internal quotation marks 
and alterations omitted). To be equitably estopped from denying the applicability 
of an arbitration clause, therefore, the signatory need not necessarily assert a cause 
of action again st the nonsignatory for breach of the contract containing the 
arbitration clause. Instead, estoppel is appropriate if “in substance [the signatory’s 
underlying] complaint [is] based on the [nonsignatory’ s] alleged breach of the 
obligations and duties assigned to it in the agreement,” Sunkist Soft Drinks, Inc. v. 
Sunkist Growers, Inc., 10 F.3d 753, 757 (11th Cir. 1993) (discussing Hughes 
Masonry Co. v. Greater Clark County Sch. Bldg. Corp., 659 F.2d 836 (7th Cir. 
1981)), “regardless of the legal label assigned to the claim,” J.J. Ryan & Sons, Inc. 
v. Rhone Poulenc Textile, S.A., 863 F.2d 315, 319 (4th Cir. 1988). See also R.J. 

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Griffin & Co. v. Beach Club II Homeowners Ass ’n, Inc., 384 F.3d 157, 164 (4th 
Cir. 2004) (stating that a party “may [not] use artful pleading to avoid arbitration”). 
 
 There are two conditions, in the arbitration context, permitting a non- signatory to rely on 
equitable estoppel to enforce an arbitration agreement: (1) “when the signatory to a written 
agreement containing an arbitration clause must rely on the terms of the . . . agreement in asserting 
its claims against the nonsignatory” and (2) when the signatory “raises allegations of substantially 
interdependent and concerted misconduct by both the nonsignatory and one or more of the 
signatories.” Id. at 627 & n.3. 
 Here, both of those elements exist. Although the Maryland Plaintiffs do not in any way 
seek to enforce the language of the HBAs, the claims they assert make frequent reference to and 
presume the existence of the HBAs. And, there can be no doubt that the Maryland Plaintiffs raise 
allegations of substantially interdependent and concerted misconduct by MV Realty and Monroe 
– that is the entire basis of the Plaintiffs’ claims against Monroe. Accordingly, while Plaintiffs will 
be entitled to raise all of their arguments about the validity and enforceability of the HBAs within 
the context of the arbitrations, Monroe’s motion to compel arbitra tion will be enforced as to 
Plaintiffs Keller, Kardux, and Riley.
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III. MOTION TO DISMISS 
As this Court explained in its letter order of May 12, 2026, ECF 31, Defendants have also 
moved to dismiss the Amended Complaint, ECF 24, in part because it grossly exceeds this Court’s 
40-page limitation. See Loc. R. 103.1(d) (D. Md. 2025). This Court will grant the motion to dismiss 
on that basis, because the 29 -page overage is caused at least in part by unnecessary inclusions , 
 
3 Whether this district will be the most appropriate venue to adjudicate the claims of plaintiffs from 
other states is an issue for another day. 

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such as citations to judicial opinions and news pieces unrelated to providing a “short and plain 
statement of the claim.” Plaintiffs will be afforded thirty days’ leave to file a Second Amended 
Complaint rectifying the rules violation and complying with the page limitation. Defendants will 
then be permitted to respond, presumably by refiling some or all of the substantive arguments 
currently raised in their motion to dismiss. 
IV. CONCLUSION 
For the reasons stated above , Defendants’ motion to compel arbitration, ECF 25, will be 
granted as to Plaintiffs Keller, Kardux, and Riley, denied as to Plaintiff Bandy, and deferred as to 
Plaintiff Mack, in favor of limited discovery to obtain Mack’s signed HBA, which cannot occur 
until an amended complaint is filed. Defendants’ motion to dismiss, ECF 2 4, will be granted 
because of Plaintiffs’ violation of the page limitation set forth in the Local Rules. A separate Order 
follows, affording Plaintiffs thirty days’ leave to file a Second Amended Complaint. 
 
Dated: June 15, 2026 /s/ 
 Stephanie A. Gallagher 
 United States District Judge 

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