Any additional updates will be posted here. 2010). 13-316(e)(1). On September 9, 2014, Nationstar sent Mr. Robinson a letter denying the loan modification application and stating that it could not offer him any modification because his income was not high enough to cover the mortgage payments under any modification option. Finally, the named plaintiff must "fairly and adequately protect the interests of class" without a conflict of interest with the absent class members. Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. Mr. Robinson then submitted another loan modification application on August 25, 2014. These events will be represented by discrete data points in Nationstar's databases, such that these violations may be proved through that data. Cal. Anderson, 477 U.S. at 248. They have a home in Damascus, Maryland purchased by Demetrius Robinson ("Mr. Robinson"). 10696, 10836. Gym, Recreational & Athletic Equip. Co., 595 F.3d 164, 179-80 (4th Cir. 1024.41(c)(1)(ii), which requires a servicer to respond to a completed loan modification application; or Md. "We will be watching the mortgage interest industry to ensure they are treating homeowners fairly and fulfilling their obligations.". See 12 C.F.R. 1024.41(h)(1), (4). 1024.41(h)(1), (4). (2012), and the Maryland Consumer Protection Act ("MCPA"), Md. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. 1 . Id. A Division of NBC Universal. Ask to speak in court about the fairness of the Settlement. 2605(f)(2). The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. On May 5, 2014, Nationstar asked the Robinsons for additional information to evaluate the appeal, including documents to verify their income. See id. Id. Because Nationstar employees used standard templates to communicate with borrowers, Oliver concluded that Regulation X violations can be identified through the existence of noncompliant templates and the dates that those templates were in use. Joint Record ("MSJ JR") 0102. 3d 249, 266 (D. Md. 2605(f), is common question of law and fact that Mr. Robinson and the class members would all be required prove in their individual cases in order to qualify for statutory damages. This Court previously held that a loan modification application can be an inquiry under the MCPA that triggers a duty to respond, and that in the case of the Robinsons, the loan modification application that was "submitted at the request of Nationstar[] necessarily seeks a response." Once an underwriter is assigned, that employee double-checks whether the application contains all required documentation and is complete. Joint Record ("MCC JR") 0907. 1024.41. But where the broad methodology is sound, the lack of consideration of unproduced data cannot provide a basis to strike the expert witness's testimony. Appellate Win Affirms $3 Million Settlement in Class Action against Nationstar Mortgage - Tycko & Zavareei LLP Contact Us We look forward to hearing from you. Indeed, Nationstar does not seriously contest the commonality prong. Code Ann., Com. . Law 13-316(e), for the reasons stated above, see supra part I.B.4, the Robinsons have provided sufficient evidence to create a genuine issue of material fact whether they have suffered economic damages, in the form of administrative costs, fees, and interest. Auto. The relevant rule prohibits an attorney from "offer[ing] an inducement to a witness that is prohibited by law." or other representation . First, as a threshold matter, the Court notes that in ruling on Nationstar's Motion for Summary Judgment, it will grant judgment in favor of Nationstar as to Mrs. Robinson's claims, Mr. Robinson's RESPA claims under 12 C.F.R. See Md. Md. P. 23(a)(1). 1024.41(a). Finally, a loan servicer "is only required to comply with the requirements" of section 1024.41 "for a single complete loss mitigation application for a borrower's mortgage loan account." Nationstar argues that summary judgment should be entered on the Robinsons' MCPA claim under section 13-316 because the Robinsons have not shown that they submitted a complaint or inquiry that triggers a duty to respond. Johnson, 374 F. App'x at 873; Keen v. Ocwen Loan Servicing, LLC, No. Although Monday's case specifically addresses Nationstar's actions following the Great Recession, the outcome can affect today's homeowners, says Kwame Raoul, attorney general of Illinois. See 12 C.F.R. See supra parts I.B.1, I.B.3, I.C.1. The Court may rely only on facts supported in the record, not simply assertions in the pleadings. Class Certif. Local R. 105.6. Sep. 9, 2019). Filing fee paid $ 402, Receipt number AOHNDC-10680087. 1024.41(b)(2)(B), (c)(1)(ii); Md. Every mortgage has a unique loan number that can be used to identify the borrower and the loan in each of the four databases. Under subsections (f) and (g), a loan servicer is not permitted to begin foreclosure proceedings or move for foreclosure judgment if "a borrower submits a complete loss mitigation application" except in certain circumstances. Although similar to Rule 23(a)'s commonality requirement, the test for predominance under Rule 23(b)(3) is "far more demanding" and "tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation." 1024.41(c)(1)(i) and (d), because the Robinsons made no showing that the Rule 23 requirements were met. 2605(f)(1)(A); see 12 C.F.R. Law 13-316(c), which requires a response to a mortgage servicing complaint or inquiry within 15 days. 2015) (holding that Regulation X did not apply to loss mitigation applications submitted before the effective date). The Robinsons do not address this argument in their Opposition. at *5. Additional facts relevant to the pending motions are set forth below. He asserted that the amount of fees was calculated based on Nationstar's statements, but he could not specify the nature of the fees. See Baby Neal for and by Kanter v. Casey, 43 F.3d 48, 56-57 (3d Cir. 2016) (dicta). Finally, the Court notes that a decision to certify a class is based on whether or not a putative class satisfies the Rule 23 factors, not on a preliminary assessment of the underlying merits of the claim. In Frank, due to the state's community property laws, the mortgage was "a community debt," and after her husband died, the plaintiff "was therefore obligated to make the loan payments" because of her interest in the home. All but $28.6 million of its. A dispute of material fact is only "genuine" if sufficient evidence favoring the nonmoving party exists for the trier of fact to return a verdict for that party. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. Nationstar ultimately became the servicer of the Robinsons' loan. Date: September 9, 2019, Civil Action No. 1024.41(i). According to Nationstar's Underwriting Workflow Procedures, which sets forth the steps followed to review loans for modifications, when a borrower submits a loan modification application, a code is entered into LSAMS and updates the loan's substatus in Remedy Star. More Information Moreover, because borrowers often submit multiple loan modification applications, and because Nationstar's data is stored at the loan level, not at the application level, Nationstar claims that it is not possible to tell from the data alone, without reviewing the files, whether a status or code change is in response to a specific loan modification application. Where the results of such an analysis would apply to any individual claim, it would be highly inefficient and wasteful to require duplicative analysis in each such case. The Robinsons' designated expert, Geoffrey Oliver, has offered a methodology for identifying class members and when their rights under RESPA and the MCPA have been violated. MCC JR 530. Aug. 19, 2015). Fed. Mar. 12 U.S.C. On February 10, 2022, the Court of Appeals issued a decision affirming the Final Approval Order. Write to the Court if you do not like the Settlement. The Robinsons also claim as damages interest overcharges of approximately $141,000. Order, ECF No. Class litigation would also promote consistent results on the common question whether Nationstar engaged in a pattern or practice of violating Regulation X and would provide Nationstar with finality and closure on that issue. The cases cited by the Robinsons do not alter the Court's conclusion. Thus, Mrs. Robinson is not "obligated" to pay the amount due on the Note and therefore is not a "borrower" for purposes of RESPA. 218. Instead, he analyzed certain data fields that were returned by the scripts written by a different expert. If you were contacted on your cell phone by a company via an . The ruling serves as a reminder that Florida remains one of the top states for both mortgage fraud and lender errors. (quoting East Tex. Where the PaCE consulting fee was a one-time fee to advise the Robinsons in their interactions with Nationstar paid in August 2013, several months before they first submitted the March 2014 loan modification application, this cost was incurred "whether or not [Nationstar] complied with its obligations." . In its Motion to Strike, Nationstar moves to strike the report of the Robinsons' expert witness, Geoffrey Oliver, on the grounds that (1) Oliver was hired pursuant to an ethically improper contingency fee agreement; and (2) his testimony does not meet the requirements of Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). The Fourth Circuit has stated that 74 members is "well within the range appropriate for class certification," Brady v. Thurston Motor Lines, 726 F.2d 136, 145 (4th Cir. The Court does not find such a prohibition in the Maryland Attorneys' Rules of Professional Conduct. DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE LLC, Defendant. Law 13-316(c), the Court will grant class certification as to those class members and claims. . Nationstar Call Settlement Administrator. 1024.41(a). Notably, although a borrower may recover up to $2,000 in statutory damages upon a showing of a "pattern or practice of non-compliance with the requirements" of Regulation X, 12 U.S.C. UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. If the initial application is not complete, a different Remedy Star substatus notation and LSAMS code are entered, and a letter is created and sent to the borrower asking for the required documents. For a class action brought for violations of Regulation X, a servicer is liable for "actual damages to each of the borrowers in the class" and, upon a finding of a "pattern or practice" of noncompliance, statutory damages amounting to a maximum of $2,000 per class member up to a total of the lesser of $1 million or one percent of the servicer's net worth. See Farmer v. Ramsay, 159 F. Supp. Although this data was not provided to Oliver, there is no reason it could not be produced and used to make determinations on the timeliness of decisions on loss mitigation applications. Rules 19-303.4(b) (2018). Discovery Order, ECF No. Specifically, the application itself would have to be reviewed to determine when it was stamped as received by Nationstar. 2605(f)(2) is not fatal to the predominance inquiry. R. Civ. at 983 (quoting 12 U.S.C. Md. See, e.g. In support of this argument, Nationstar contends that the ethical rules for attorneys prohibit contingency fee arrangements with expert witnesses. The company has already paid about $57.5 million in restitution to affected consumers, according to the CFPB. Rather, the Court finds, based on the reasoning of Tagatz and Universal Athletic Sales, that the potential violation of an ethical rule does not itself make Oliver's testimony inadmissible. On March 8, 2014, Nationstar sent to Mr. Robinson a letter stating that he was ineligible for a HAMP modification, but on March 15, 2014, it sent a different letter offering a loan modification under which Mr. Robinson would receive a reduced interest rate for two years. A plaintiff has the burden to show that all of the necessary prerequisites for a class action have been met. See Fed. If the named plaintiff satisfies each of these requirements under Rule 23(a), the Court must still find that the proposed class action fits into one of the categories of class action under Rule 23(b) in order to certify the class. For the claims that rely on the timing of a response, Oliver and the Robinsons propose using changes in the Remedy Star substatus or LSAMS codes and documents stored in FileNet to identify the date a loan modification application was received or marked as complete, to identify the date a response was sent, and to count the number of days between events. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. See Tyson Foods, 136 S. Ct. at 1046-47 (holding that representative sampling was a permissible method to prove whether time spent donning and doffing gear resulted in violations of the Fair Labor Standards Act). Where Accrued Financial addresses a different scenario with a different remedy, the Court does not find that it requires that the testimony of an expert witness paid on contingency fee basis must be excluded. Nationstar further argues that summary judgment must be entered in its favor on the Robinsons' claims under 12 C.F.R. The Motions are fully briefed, and no hearing is necessary to resolve the issues. Ohio 2014). Accordingly, Nationstar did not send the Robinsons an acknowledgment letter within five days stating that it had received the application, as required by Regulation X. A servicer that fails to comply with Regulation X is liable for actual damages and, upon a finding of a "pattern or practice" of non-compliance by the servicer, up to $2,000 in statutory damages. Regulation X went into effect on January 10, 2014. Nationstar sent Mr. Robinson two letters denying his loan modification application on July 17, 2014 and September 9, 2014, but there is no evidence in the record that the Robinsons submitted an appeal to either of those letters. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." At different stages in the processing of a loan modification application, Nationstar employees enter certain codes into certain databases, and certain information can be stored and accessed through those applications. Co v. Adair, 764 F.3d 347, 359-60 (4th Cir. Between July 2010 and November 2013, the Robinsons submitted and Nationstar denied three applications for a loan modification under the Home Affordable Modification Program ("HAMP"). 1988) (distinguishing between a rule of professional conduct and admissibility of evidence); cf. 125. See Wirtz, 886 F.3d at 719-20. LLC, No. Sept. 29, 2017); Billings v. Seterus, Inc., 170 F. Supp. 2601(a). Thus, the nature of the proof of whether there has been a pattern or practice of RESPA violations provides substantial support for a finding of predominance. As the Supreme Court noted in Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999), Daubert "made clear that its list of factors was meant to be helpful, not definitive," and it is not always the case that an expert witness's claim will have been subjected to peer review. Id. Relevant factual and procedural background is set forth in the Court's prior Memorandum Opinion granting in part and denying in part Nationstar's partial Motion to Dismiss.
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