robinson v nationstar settlement

Regulation X, which became effective on January 10, 2014, 78 Fed. The servicer "is liable for any economic damages caused by the violation." 1987) (holding, in the context of an informant who is paid a contingent fee, that the fee should be treated "as a credibility factor"). 1024.41(b)(2)(i)(B), which requires that an acknowledgment letter be sent within five days of receipt of a loss mitigation application; 12 C.F.R. Once the documents are received, the Remedy Star substatus and LSAMS code are changed again to mark the application complete. Delaware Attorney General Kathleen Jennings said the settlements, Several states also fined Nationstar in 2018, Kwame Raoul, attorney general of Illinois, latest research from the Mortgage Bankers Association. Law 13-316(c). v. Nationstar Mortgage LLC, Case No. Co., 595 F.3d 164, 179 (4th Cir. The Class is represented by Rafey S. Balabanian of Edelson PC. This abandoned high school was converted into a 31-unit apartment building, number of unlawful practices in handling mortgages following the Great Recession. Md. All Rights Reserved. Ins. 2601 et seq. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. at *2. See McGraw, 646 F.2d at 176. 1998). 2005))). 2d at 1366. 2605(f)(1)(A)). Rules Prof'l Conduct 3.4 cmt. Eligible consumers will be contacted by Nationstar or the settlement administrator about refunds under the settlement. 2019) (noting that the purpose of certifying a class "is not to identify every class member at the time of certification, but to define a class in such a way as to ensure that there will be some administratively feasible [way] for the court to determine whether a particular individual is a member at some point" (internal citation omitted) (quoting EQT Production Co. v. Adair, 764 F.3d 347, 358 (4th Cir. 1024.41(f), (g), and (h) and Md. 2015) (holding that Regulation X did not apply to loss mitigation applications submitted before the effective date). Code Ann., Com. More Information For example, it was undisputed that on May 30, 2014, Mr. Robinson, in response to Nationstar's requests for additional information, resubmitted the same information sent with his March 2014 loan modification application. Therefore, Nationstar was required to comply with section 1024.41 in processing it. Id. 2010) (considering consistency of results that provide finality to the defendant as favoring a finding of superiority). Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. State attorneys general are here for homeowners, Raoul adds. . While Mr. Robinson sought to reduce his monthly mortgage payment in applying for a loan modification, his deposition testimony reflects that he understands that the present lawsuit contends that Nationstar did not process the Robinsons' loan modification application correctly. In Washington v. Am. Furthermore, Nationstar's argument that the Robinsons are not typical largely recycles the same arguments made in the Motion for Summary Judgment. 2. application to Nationstar after January 10, 2014, and through the date of the Court's . Where the Robinsons may be able to show that they have suffered actual damages, their claim for statutory damages, upon a showing that Nationstar has engaged in a pattern or practice of violating Regulation X, remains viable. Likewise, Oliver's expert report provides no analysis on how Nationstar's databases allow for a systematic determination whether Nationstar failed to inform borrowers of the specific reasons for the servicer's decision to deny each loan modification option, in violation of 12 C.F.R. Home Loans, No. 2605(f)(2) is not fatal to the predominance inquiry. In approving such a modification, Nationstar made a mistake: the underwriter working on the Robinsons' loan had erroneously double-counted their income. 1024.41(f), (g), and (h), and Md. ("Opp'n') 13, ECF No. 10696, 10708, provides that "[a] servicer is only required to comply with the requirements of this section for a single complete loss mitigation application for a borrower's mortgage loan account." 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. Robinson, 2015 WL 4994491, at *4 (citing Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. . 1024.41(c)(1)(i). A class action is a superior means for "fairly and efficiently adjudicating" whether Nationstar has violated Regulation X and section 3-316(c) of the MCPA. PDF PUBLISHED - United States Court of Appeals for the Fourth Circuit Stewart v. Bierman, 859 F. Supp. 14-3667, 2015 WL 4994491, at *1-2 (D. Md. For example, since default fees are often paid by sources other than the borrower, such as in a short sale or refinancing, Nationstar challenges Oliver's assessment that fees identified through LSAMS can be deemed to constitute damages from RESPA violations, because the software does not reflect who paid the fee. Nationstar Mortgage Agrees to $91M Settlement with the CFPB Similarly, since Mr. Robinson has not suffered injury under these provisions, he may not bring those claims on behalf of the class. Questions? Furthermore, the Robinsons have made a sufficient showing that a central computerized analysis of Nationstar data would substantially, if not completely, resolve questions of whether RESPA violations occurred. which has the capacity, tendency, or effect of deceiving or misleading consumers." 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. Tagatz, 861 F.2d at 1042; cf. 1024.41(d). If you were contacted on your cell phone by a company via an . The Robinsons do not address this argument in their Opposition. USCA4 Appeal: 21-1087 Doc: 38 Filed: 06/15/2021 Pg: 9 of 33 If the settlements are approved by the D.C. district court, Nationstar will be required to immediately set aside about $15.6 million to pay borrowers it has not yet remediated. A separate Order shall issue. 12 U.S.C. 2010). The CFPB estimates about 40,000 borrowers were harmed by Nationstar's allegedly unfair and deceptive practices, according to a statement released Monday. Specifically, the application itself would have to be reviewed to determine when it was stamped as received by Nationstar. Oliver is the Chief Executive Officer of Hilltop Advisors LLC, a financial services consulting, compliance audit, and accounting advisory firm, and has extensive experience conducting compliance reviews for mortgage servicers, including for compliance with loss mitigation procedures. The lawsuit alleges, however, that Nationstar has not made interest payments to the plaintiffs, nor provided any record that interest was accruing and due to the homeowners, at any time during or after December 1, 2018 to March 22, 2019 or May 1, 2020 through the present. Mr. Robinson then submitted another loan modification application on August 25, 2014. Thorn v. Jefferson-Pilot Life Ins. Any additional updates will be posted here. McLean v. GMAC Mortg. 2013)). 2002) (affirming without addressing the propriety of the striking of the expert testimony). After an additional period of expert discovery relating to the class certification motion, discovery closed on December 30, 2018. To the extent that, as Nationstar claims, such a determination could not be fully accomplished through computerized analysis alone, the resources needed to resolve this question would be even greater, such that the importance of having it resolved in a common fashion for all claims would be heightened. Rather than striking the testimony, the Court may need to consider permitting supplemental discovery to correct for the lack of relevant data not previously made available to Oliver. Robinson v. Nationstar Mortgage, LLC Complaint with jury demand against Nationstar Mortgage, LLC. The commonality requirement is also met. Law 13-301 and 303. 1024.41(c)(1)(i)-(ii), (g). 1024.41(h)(1), (4). 702, 703. Because Oliver's methodology is reliable within the meaning of Federal Rule of Civil Procedure 702 and Daubert, Nationstar's Motion to Strike will be denied. Because Oliver analyzed proprietary databases and data specifically disclosed for this litigation pursuant to a protective order, such that Oliver's peers lack access to the same information, Oliver's expert testimony is not of the type that ordinarily would be subject to peer review, and it would be unfair to require "general acceptance within a relevant scientific community." . Law 13-303(4)-(5), 13-408. The Robinsons own a business called Green Earth Services, which provides waste and recycling services to clients. 12 U.S.C. The cases cited by the Robinsons do not alter the Court's conclusion. While she is trained as a bookkeeper, at the time of the Robinsons' 2014 application for a loan modification and in the subsequent months, Mrs. Robinson was not employed in any capacity. See Tagatz, 861 F.2d at 1042. Specifically, the loan servicer failed to honor borrowers' loan modification agreements. 2d 873, 883 (D. Md. Moreover, the possibility that some members of the class as defined by the Robinsons have not suffered any injury cognizable under RESPA or MCPA does not preclude certifying the class. For example, in EQT, the court concluded that a proposed class of all individuals who owned an interest in a gas estate was not ascertainable because the actual owners could be determined only through an individualized review of land records. Gunnells, 348 F.3d at 427-28. Courts have wide discretion to certify a class based on their familiarity with the issues and potential difficulties arising in class action litigation. A settlement has been reached in a class action lawsuit alleging Nationstar Mortgage LLC ("Nationstar" or "Defendant") violated the Real Estate Settlement Procedures Act ("RESPA") by failing to adhere to its requirements with respect to its customers' loss mitigation applications and that Nationstar violated Maryland law by not timely responding After this missed payment, Nationstar assessed a late fee. Nationstar also does not argue that the class is not numerous, as there approximately 33,855 members who submitted loss mitigation applications from January 10, 2014 to March 30, 2014. R. Civ. at 983 (quoting 12 U.S.C. 1024.41(b)(1), which requires reasonable diligence in obtaining documents and information to complete a loss mitigation application; and Md. Specifically, if a loss mitigation application is received "45 days or more before a foreclosure sale," the loan servicer must provide a notice to the borrower "in writing within 5 days" of receiving it in which the servicer acknowledges receipt of the application and states whether the "application is either complete or incomplete." 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. 1984), and has upheld the certification of a class with as few as 18 members, Cypress v. Newport News Gen. & Nonsectarian Hosp. 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. Law 13 . Oliver's expert report focuses on the use of Nationstar's internal databases to determine whether Nationstar has systematically failed to comply with various requirements of Regulation X. 1024.41(b)(2)(B), (c)(1)(ii); Md. Nationstar admits that in March 2014, two months after the implementation date of Regulation X, it had not yet updated its systems to comply with the regulation. PDF In the United States Court of Appeals for the Fourth Circuit After they became delinquent on their loan, the Robinsons submitted another loan modification application to Nationstar on March 7, 2014. The Court will address the varying claims in turn. uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results." McLean v. GMAC Mortg. See 12 C.F.R. Some courts have held that administrative costs that predate the alleged RESPA violation cannot constitute "actual damages." 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. at 358. Because of the manner in which class discovery was conducted, see supra part II.A, Oliver did not have access to all of Nationstar's data fields for the representative sample of loans. Under subsection (h), if a loan servicer receives a complete loss mitigation application more than 90 days before a foreclosure sale but then denies the application, the servicer must allow the borrower to appeal and must respond to the appeal within 30 days of receiving it. The loan is then evaluated for loan modification options. Ask to speak in court about the fairness of the Settlement. 125. The Robinsons assert that they have paid a total of $6,147.12 in unspecified fees to Nationstar. Thus, the Court concludes that, while Nationstar may have defenses as to some borrowers, the common proof that establishes the asserted violations, as well as the common question of whether the Robinsons can prove a pattern-or-practice violation by Nationstar, will predominate over the individual issues as to these claims. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Finally, the Court finds that common issues of law and fact predominate. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." Nationstar's failings resulted in "substantial consumer harm," CFPB Director Kathleen Kraninger said in a statement. Home [robinsonsettlement.com] The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. 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. Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 348-49 (2011) ("[A] class representative must be part of the class and possess the same interest and suffer the same injury as the class members." If a class is ascertainable, it must then satisfy all four elements of Rule 23(a): numerosity, commonality, typicality, and adequacy. . Robinson v. Nationstar Mortgage LLC (8:14-cv-03667) The one-time consulting fee was paid in August 2013 to PaCE, a forensic loan auditor, to advise the Robinsons on how to communicate with Nationstar and to handle their loan. 1024.41(f), (g), and (h), and Md. 222. The fact that each borrower must individually show damages under 12 U.S.C. Where the Robinsons, after discovery, cannot point to evidence that Nationstar did not even consider or evaluate the Robinsons for loss mitigation options, they have not established the existence of a genuine issue of material fact on the issue of false or misleading statements. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. In Accrued Financial, the United States Court of Appeals for the Fourth Circuit held that where commercial real estate tenants assigned their potential claims against their landlords to a commercial real estate auditor under an arrangement through which the auditor would receive a percentage of any recovery in litigation, the assignments violated public policy because where the auditor's employees could testify in such litigation, the assignments "provide for supplying expert testimony for a contingent fee." In addition to the fee paid to PaCE, the Robinsons also assert as damages $50.58 in administrative costs, specifically postage fees for sending information relating to their loan modification application to Nationstar, and 120 hours of time expended on the loan modification process. at 248-49. Since Mr. Robinson has the same goal as the other class members of establishing that Nationstar violated Regulation X with respect to his loan, he will adequately protect their interests. They have claimed $141,000 in interest; $6,147.12 in fees assessed by Nationstar; $2,275 in consulting fees; $50.58 in administrative costs; and lost time and labor of approximately 120 hours; as well as punitive and statutory damages. Because of the need to protect the rights of absent plaintiffs to assert different claims and of defendants to assert facts and defenses specific to individual class members, courts must conduct a "rigorous analysis" of whether a proposed class action meets the requirements of Federal Rule of Civil Procedure 23 before certifying a class. Law 13-316(e)(1), and "actual damages," 12 U.S.C. 2605(f). Nationstar said in a statement that its settlements were based on "loan-servicing practices" that the company used between 2010 and 2015 and has since discontinued. 1024.41(a). When combined with the state settlements, Nationstar is on the hook to pay a total of $91 million overall: $85 million to harmed consumers and $6 million in civil penalties. While Demetrius Robinson did appeal Nationstar's March 15, 2014 offer of an in-house modification, the requirements of subsection (h) were not triggered because the offer was not a denial of a loan modification application. Since there is no genuine issue of material fact as to whether Nationstar violated subsection (h), summary judgment will be entered for Nationstar on that claim. is generally unproblematic as the non-injured parties can just be sorted out at the remedies phase of the suit."). Instead, he analyzed certain data fields that were returned by the scripts written by a different expert. (quoting 7AA Charles Allan Wright et al., Federal Practice and Procedure 1778 (3d ed. If a borrower is experiencing issues or not getting the help needed, contact your state attorneys general. "If a borrower's complete loss mitigation application is denied for any trial or permanent loan modification option available to the borrower," the servicer must state in the required notice to the borrower "the specific reason or reasons for the servicer's determination for each such trial or permanent loan modification and, if applicable, that the borrower was not evaluated on other criteria." Robinson v. Nationstar Mortg. LLC - Casetext The Robinsons and Nationstar then engaged in a series of tortured exchanges over the next several months. In assessing the Motion, the Court views the facts in the light most favorable to the nonmoving party, with all justifiable inferences drawn in its favor. In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." 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. If the application is denied, a notice to that effect is sent to the borrower. The Court will therefore deny the Motion for Summary Judgment as to this argument. Write to the Court if you do not like the Settlement. 89, 90, ECF No. Id. PDF United States District Court Middle District of Florida Tampa Division Anderson, 477 U.S. at 248. 1024.1, prescribe additional duties and responsibilities of mortgage servicers under RESPA. The record is undisputed that as of September 25, 2017, Nationstar had neither started foreclosure proceedings nor moved for foreclosure judgment on the Robinsons' home. . Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. When those scripts did not produce data that allowed the Robinsons to conduct the sampling, the Magistrate Judge ordered Nationstar on April 3, 2018 to run certain "structural scripts" on two of its four databases. A "borrower" may enforce the provisions of Regulation X pursuant to 12 U.S.C. that it is improper to pay an expert witness a contingent fee." See id. Cal. Plaintiff and Class Representative Demetrius Robinson, along with Class Counsel Tycko & Zavareei LLP and The Bestor Law Firm, respectfully move this Court for an award of $1,300,000 in reasonable attorneys' fees and expenses, as well as a $5,000 service award for Mr. Robinson. In Robinson v. Nationstar Mortgage LLC, No. 2605(f)(2); Wirtz, 886 F.3d at 719-20, that the individualized damages inquiry would need to precede the award of statutory damages based on a finding of a pattern-or-practice of RESPA violations is a distinction without a difference: whether individual damages are shown before or after the pattern-or-practice liability, the common issues of liability predominate over the individualized questions of damages. Fed. The settlement in the form of a consent judgment, filed in the U . Under Federal Rule of Civil Procedure 56(a), the Court grants summary judgment if the moving party demonstrates that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. "[A] trial court should consider the specific factors identified in Daubert where they are reasonable measures of the reliability of expert testimony." Congress enacted RESPA to protect consumers from "unnecessarily high settlement charges caused by certain abusive practices" in the real estate mortgage industry, and to ensure "that consumers throughout the Nation are provided with greater and more timely information on the nature and costs of the settlement process." Likewise, the articulated concern that Nationstar would not be required to respond to loss mitigation applications filed within a certain number of days of a foreclosure sale, can be addressed through the provision of data relating to the dates of scheduled foreclosure sales. Signed by Judge Theodore D. Chuang on 8/18/2015. Distribution of funds to Class Members, however, could not occur because a member of the Class filed an objection to the Settlement and a subsequent appeal to the U.S. Court of Appeals for the Fourth Circuit. From this methodology, Oliver concluded that Nationstar failed to inform borrowers of their appeal rights in 39 percent of the sampled loans and failed to exercise reasonable diligence by improperly requested the same documentation already provided in 18 percent of the loans. 12 U.S.C. Code Ann., Com. Code Ann., Com. Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). In the case of Tony Robinson and Debra Robinson vs Nationstar Mortgage, LLC, the appeals court ruled that the lender did not actually have the right to foreclose on the property. At this stage of the proceedings, the Court must rely on facts in the record, and not assertions in the pleadings. UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. 2014). Furthermore, according to Nationstar, to identify the content of a letter sent to a borrower, the letter itself must be viewed. For the Regulation X provisions that require the servicer to communicate specific information to a borrower, Oliver's methodology involves reviewing a sample of loan files and identifying a specific communication to a borrower based on the file name. To calculate damages, Oliver stated that he would look to data from the LSAMS application, including data tables that contain fee information, to identify fees that would not have been charged but for Nationstar's various RESPA violations, but that he was not able to evaluate this data in his report because it had not been provided to him. Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. Furthermore, determining whether statutory damages are available will require no individualized consideration, because the pattern-or-practice claim "would be based solely on" Nationstar's conduct and can be established through sampling.