Company: CPSS
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001683168-25-003436
Chunk: 122

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-05-12
Form: 10-Q
Item: Part I, Item 8
Chunk 122
---
 April 2024, a motion for certification of a class was filed. Prior to the motion being ruled upon, summary judgment
was granted in our favor, disposing of the claims against CPS. An appeal of the summary judgment ruling was filed on October 25, 2024,
and we filed a cross appeal of the denial of the motion to compel arbitration on October 31, 2024.

     21 

CONSUMER PORTFOLIO SERVICES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS

In General.
There can be no assurance as to the outcomes of the matters described or referenced above. We record
at each measurement date, most recently as of March 31, 2025, our best estimate of probable incurred losses for legal contingencies, including
the matters identified above. The amount of losses that may ultimately be incurred cannot be estimated with certainty. However, based
on such information as is available to us, we believe that the range of reasonably possible losses for the legal proceedings and contingencies
we face, including those described or identified above, as of March 31, 2025, does not exceed $3.2 million.

Accordingly,
we believe that the ultimate resolution of such legal proceedings and contingencies should not have a material adverse effect on our consolidated
financial condition. We note, however, that in light of the uncertainties inherent in contested proceedings there can be no assurance
that the ultimate resolution of these matters will not be material to our operating results for a particular period, depending on, among
other factors, the size of the loss or liability imposed and the level of our income for that period. 

(9) Fair Value Measurements

ASC 820, “Fair Value
Measurements” clarifies the principle that fair value should be based on the assumptions market participants would use when pricing
an asset or liability and establishes a fair value hierarchy that prioritizes the information used to develop those assumptions. Under
the standard, fair value measurements would be separately disclosed by level within the fair value hierarchy.

ASC 820 defines fair value,
establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurement
and enhances disclosure requirements for fair value measurements. The three levels are defined as follows: level 1 - inputs to the valuation
methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; level 2 – inputs to