Lauren James Enterprises is being sued by First Security Bank for allegedly defaulting on a loan. The Searcy-based bank is seeking $338,720 from an unpaid balance business loan of $400,000.
The women’s clothing company, based in Fayetteville, was founded in 2013 by Lauren Wilkins Stokes and Lance Stokes. The company has generated 100 employees, three store fronts and more than 300 retailers around the country, including well-renowned retailer Dillard’s.
First Security bank has named the married couple, Lance and Lauren Stokes, as co-defendants in the lawsuit. The couple agreed to take out a loan of $500,000 in February of 2017. The business loan was to provide liquidity for Lauren James Enterprises and was renewed multiple times, including the most recent renewal on April 20, for $400,000 that was to be due on June 5.
According to the lawsuit, Lauren Wilkins and Lance Stokes failed to pay-in-full all sums due and owing on its June 5 maturity date. As a result, First Security Bank is demanding all sums due and owing to be paid to the bank. The bank is also claiming that as a result of the defendant’s inability to pay the loan, the bank is entitled to take immediate possession of Lauren James collateral, which is valued at $1.35 million.
The lawsuit also states that Lauren Wilkins and Lance Stokes violated a security agreement by moving Lauren James’ inventory across state lines to New Jersey in “an attempt to preclude First Security from taking possession of the inventory.” The bank demands the defendants be ordered to disclose the exact location and nature of the whereabouts of the inventory.
First Security bank asked the Washington County judge to prevent Lauren James from having its warehouse sale scheduled for Saturday, June 23 and Sunday June 24, but the sale went on as planned.
As of May 1, the Lauren James store in Fayetteville has since been closed and its distribution center in Fayetteville has closed as well due to moving its distribution to New Jersey. The company has laid off about 50 employees.
Lauren Wilkins and Lauren James employees did not respond to requests for comment about the lawsuit.
Lauren James was recognized in a supplement of Arkansas Money and Politics called Arkansas Startups. The company was also recognized in Forbes 30 Under 30 for Retail & Ecommerce.