Code Ann., Com. Code Ann., Com. Those claims arose from Nationstar's alleged Home [robinsonsettlement.com] The cases cited by the Robinsons do not alter the Court's conclusion. Co v. Adair, 764 F.3d 347, 359-60 (4th Cir. TDC-14-3667, 2019 WL 4261696 (D. Md. The settlement in the form of a consent judgment, filed in the U . See, e.g., Linderman v. U.S. Bank Nat'l Ass'n, 887 F.3d 319, 321 (7th Cir. In addition, Nationstar asserts that not all loan modification applications referred to an underwriter are complete. 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. 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." You will not receive a payment if you fail to timely submit a completed Claim Form, and you will give up your right to bring your own lawsuit against the Defendant about the claims in this case. Certification will also be denied as to the claim under 12 C.F.R. Nationstar argues that it should be granted summary judgment on all of the RESPA claims because Nationstar was required to comply with Regulation X only as to a borrower's first loss mitigation application, and the Robinsons' March 7, 2014 application was not their first loan modification application. The data derived from scripts written by another expert, Abraham J. Wyner, without the benefit of seeing the databases, a process necessitated by Nationstar's unwillingness or inability to produce the relevant data. Nationstar's criticism that Oliver failed to use the correct data field to identify the date when a loss mitigation application was complete, and failed to consider the timing of application relative to the date of scheduled foreclosure sale, ring hollow because Nationstar provided to Oliver only limited data fields, which did not contain clear field names or definitions. 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. Amchem Prods. Nationstar's Motion for Summary Judgment will be granted as to Tamara Robinson. Home Loans, No. 2010) (holding that a plaintiff who "was not a borrower or otherwise obligated on the . While the Nationstar employee who conducts the initial processing of an application may refer it to an underwriter based on its facial completeness, the underwriter makes the final determination of whether the application is complete and is responsible for obtaining any additional required documentation. 1 . Every mortgage has a unique loan number that can be used to identify the borrower and the loan in each of the four databases. 1024.41(b)(2)(B), which requires that an acknowledgment letter be sent within five days of receipt of a loan modification application; or 12 C.F.R. Mr. Robinson then submitted another loan modification application on August 25, 2014. 1024.41(h)(1). If the application is denied, a notice to that effect is sent to the borrower. On June 16, 2017, the Magistrate Judge bifurcated discovery to focus initially on the merits of the Robinsons' individual claim and the question of class certification, ordered Nationstar to disclose electronic records so that the Robinsons could sample Nationstar's data for purposes of a motion for class certification, and limited the discovery of such records to a sample of 400 loans from the period from January 10, 2014 to June 30, 2014 and "to areas which inform" the Court's decision on class certification, namely whether Nationstar was in compliance with Regulation X. Mot. 3d 712, 728 (S.D. Nationstar denies all allegations of wrongdoing and no judgment or determination of wrongdoing has been made. 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"). Furthermore, Oliver states that since Nationstar employees used templates to communicate with borrowers, he could determine whether there were violations of certain RESPA provisions based on entries showing that Nationstar employees used templates that did not comply with RESPA. The fact that each borrower must individually show damages under 12 U.S.C. This assertion mischaracterizes the burden of proof in a civil case. (2012), and the Maryland Consumer Protection Act ("MCPA"), Md. Law 13-301 and 13-303, because the Robinsons do not have standing to bring those claims. 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. 10696, 10836. "[N]amed class representatives [must] demonstrate standing through a 'requisite case or controversy between themselves personally and defendants,' not merely allege that 'injury has been suffered by other, unidentified members of the class to which they belong and which they purport to represent.'" Moreover, the conflict must not be "merely speculative or hypothetical." Law 13-303(4)-(5), 13-408. Before relating the facts relevant to the Motion for Class Certification, the Court will highlight the relevant procedural history affecting the record before the Court. 164. On July 17, 2014, Nationstar informed Mr. Robinson by letter that he did not qualify for a HAMP modification and that since the March 14 loan modification offer had not been accepted, it was withdrawn. A Division of NBC Universal. 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. In support of these claims, Mr. Robinson testified in his deposition that the $141,000 in interest represents the amount that the Robinsons have been overcharged over the life of the loan. Moreover, although the court stated that an arrangement for providing expert testimony for a contingent fee would violate public policy, the court did not address the question of the admissibility of evidence at issue here. 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. Subscribe to our free newsletter right now. In their memorandum in opposition to the Motion for Summary Judgment ("Opposition"), the Robinsons admit that they "do not have evidence that Nationstar dual tracked them" or began foreclosure proceedings while a loan modification application was pending. 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. You will receive no benefits from the Settlement, but will retain any rights you currently have to sue Nationstar about the same claims in this case. 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. CFPB Director Kathleen Kraninger said in a statement. 3d 249, 266 (D. Md. application to Nationstar after January 10, 2014, and through the date of the Court's . The Class is represented by Rafey S. Balabanian of Edelson PC. Before the error was discovered, Mr. Robinson appealed this offer as insufficient on April 10, 2014. 3d 1011, 1015 (W.D. After attempts to modify their loan failed, the Robinsons filed a Class Action Complaint against Defendant Nationstar Mortgage, LLC ("Nationstar") for alleged violations of the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. Marais v. Chase Home Fin., LLC, 24 F. Supp. These fees allegedly violated the Fair Debt Collection Practices Act and the Washington state Collection Agency Act. 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. Discovery Order, ECF No. 2018); Renfroe v. Nationstar Mortg., LLC, 822 F.3d 1241, 1247 n.4 (11th Cir. A plaintiff has the burden to show that all of the necessary prerequisites for a class action have been met. LLCNo. . 218. . Similarly, since Mr. Robinson has not suffered injury under these provisions, he may not bring those claims on behalf of the class. While the date that Nationstar's systems came into compliance, is unknown, Nationstar's systematic noncompliance presents common questions of law and fact for all class members. 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. To prepare his expert report, Oliver reviewed a randomly selected sample of 400 loans serviced by Nationstar in which a loan modification application was submitted. Ask to speak in court about the fairness of the Settlement. Nationstar Mortgage LLC v. Demetrius Robinson cause[d] damages retroactively" and "transmogrifie[d]" the costs that predate the RESPA violation into damages. See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. 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. Nationstar will need to enhance its policies and processes around how it handles consumer complaints, performs escrow analyses and conducts audits, for example. Local R. 105.6. 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. Furthermore, Nationstar's argument that the Robinsons are not typical largely recycles the same arguments made in the Motion for Summary Judgment. 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. 1024.41(c)(1)(i). 1994) (noting that a single common issue is sufficient to meet the commonality requirement). v. W.R. Grace & Co., 6 F.3d 177, 188 (4th Cir. Reg. 2605(f). Messner v. Northshore Univ. JA 130. Claim Your Cash Every Week! J. It is the plaintiffs who bear the burden of proving their claims. 1024.41. 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. Law 13-316(e)(1), and "actual damages," 12 U.S.C. See Farmer v. Ramsay, 159 F. Supp. 1024.41(f), (g), and (h), and Md. 1024.41(c)(1)(ii), which requires a servicer to respond to a completed loan modification application; or Md. 2605(f). 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. 2003) ("[I]f Lierboe has no stacking claim, she cannot represent others who may have such a claim, and her bid to serve as a class representative must fail. For example, Nationstar's own internal procedures reveal that when a loss mitigation application is received, a processor reviews it to determine if all required information and documents have been received, and enters one code, specifically "code HMPC" in LSAMS signifying "Financial Application Complete," and a different code, specifically "code HMPA," signifying "Financial Application Incomplete." The commonality requirement is also met. If more documents are required, then the same Remedy Star substatus and LSAMS code that denote missing documents are entered. The Complaint asserts two claims. 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. . To establish an MCPA violation under this provision, a plaintiff must establish that (1) the defendant engaged in an unfair or deceptive practice or misrepresentation; (2) the plaintiff relied upon the representation; and (3) doing so caused the plaintiff actual injury. J. 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. 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. On February 10, 2022, the Court of Appeals issued a decision affirming the Final Approval Order. Accordingly, a loan servicer must comply with Regulation X as to the first loss mitigation application submitted after the effective date. 2012) (citing Lloyd v. Gen. Motors Corp., 916 A.2d 257, 277 (Md. (2000) (reflecting that the prior version of the rules of professional conduct prohibited an attorney from "acquiesc[ing] in the payment of compensation to a witness contingent on the content of his testimony or the outcome of the case"). Nov. 12, 2011), the court held that a plaintiff who signed a deed of trust on a property and was a joint tenant with her son, but did not sign the promissory note, had constitutional standing to bring a RESPA claim because she stood to be injured if a default on her son's loan led to the loss of her equitable interest in the property. That's one reason why the settlement, particularly the provisions requiring Nationstar to adhere to enhanced standards, is crucial. at 151. 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. 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. 222. 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." Nationstar also seeks summary judgment on the Robinsons' claims under the MCPA, which include claims of misleading statements in connection with the collection of consumer debts, in violation of section 13-301(1), (3) and section 13-303(4)-(5) of the MCPA, and claims that Nationstar did not respond to consumer inquiries within 15 days, in violation of section 13-316(c) of the MCPA. 2d 754, 768-69 (D. Md. "[A] trial court should consider the specific factors identified in Daubert where they are reasonable measures of the reliability of expert testimony." PDF Motion for Fees - Robinson v Nationstar - Home Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. 1024.41(a). Compl. Nationstar's Motion to Strike will be DENIED. Finally, where Nationstar has offered no specific argument in its brief, beyond those addressed above, to refute Oliver's proffered analysis for identifying RESPA violations arising from the failure to notify borrowers of their appeal rights or the failure to exercise diligence in requesting documents based on repeated requests for the same documents, 12 C.F.R. He asserts that damages to borrowers can be calculated based on entries in LSAMS and other data showing that fees were assessed, and that it would be possible to identify which fees would not have been assessed but for a RESPA violation. In contrast, Nationstar maintains that there is no way to reliably identify when a loss mitigation application is submitted or complete using codes and status change entries in its existing software, and that the only way to make those determinations is through a file-by-file review. Eligible consumers will be contacted by Nationstar or the settlement administrator about refunds under the settlement. 1024.41(a). Because there are, at a minimum, disputed issues of fact as to what fees, administrative costs, and interest constitute damages, the Court will deny the motion for summary judgment on the issue of actual damages. The Court will therefore deny the Motion for Summary Judgment as to this argument. 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." 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. The Robinsons own a business called Green Earth Services, which provides waste and recycling services to clients. which has the capacity, tendency, or effect of deceiving or misleading consumers." The Class Action Administrator would then begin distribution of the settlement funds. In Robinson v. Nationstar Mortgage LLC, No. Once an underwriter is assigned, that employee double-checks whether the application contains all required documentation and is complete. See Broussard, 155 F.3d at 344. v. Nationstar Mortgage LLC. After two more extensions were granted, based on a finding by the Magistrate Judge that "Defendant has failed to comply" with its discovery obligations and delayed the process, discovery closed on March 22, 2018. See, e.g. 2014). 2605(f)(1). 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. 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." Fed. A code is also added to LSAMS to put a hold on foreclosure proceedings. Tagatz, 861 F.2d at 1042; cf. Day to address discovery issues. The Robinsons do not address this argument in their Opposition. Plaintiffs "must present specific evidence to establish a causal link between the [servicer's] violation and their injuries." or other representation . The distinction is crucial. 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. . Additional facts relevant to the pending motions are set forth below. After an additional period of expert discovery relating to the class certification motion, discovery closed on December 30, 2018. Under Count I, the Robinsons allege a violation of 12 C.F.R. Accordingly, the Motion is denied as to such claims. Id. R. Civ. at 300. Nelson, 2017 WL 1167230, at *3 (collecting cases). at 152. at *2. "); cf. The language of the regulation states not that a loan servicer must comply with Regulation X's requirements only for a borrower's first loss mitigation application, but that a loan servicer must "comply with the requirements" only "for a single complete loss mitigation application." Corp. ("McLean I"), 595 F. Supp. Id 1024.41(c)(1). Class Cert. at 358. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. As for typicality, the named plaintiff must be "typical" of the class, such that that the class representative's claim and defenses are "typical of the claims or defenses of the class" in that prosecution of the claim will "simultaneously tend to advance the interests of the absent class members." 702, 703. Mar. Reg. These events will be represented by discrete data points in Nationstar's databases, such that these violations may be proved through that data. 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. 1987) (holding, in the context of an informant who is paid a contingent fee, that the fee should be treated "as a credibility factor"). Through both a declaration by a Nationstar Vice President of Default Servicing, Brandon Anderson, and an expert report by Stuart D. Gurrea, Nationstar contests Oliver's analysis and endeavors to establish that the only way to identify RESPA violations using Nationstar's data is through a file-by-file review. 10696, 10708 (Feb. 14, 2013) (codified at 12 C.F.R. Here, Mrs. Robinson signed the Deed but did not sign the Note. Thus, the Court concludes that common computerized analysis can largely answer the question of whether Nationstar violated these RESPA provisions with respect to individual borrowers. See 12 C.F.R. Code Ann., Com. Actual damages may include late fees; denial of credit or access to the full amount of a credit line; out-of-pocket expenses incurred in dealing with a RESPA violation, such as expenses for preparing and copying correspondence; and lost time and inconvenience, including time spent away from employment while preparing correspondence "to the extent it resulted in actual pecuniary loss." 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. In the Amended Complaint, the Robinsons claim that Nationstar's representations that it offered many loss mitigation plans and "would evaluate" borrowers "for eligibility for all these loss mitigation plans" were false. The Court will address the varying claims in turn. MCC JR 318, 530-531. 2011) ("[T]he possibility that a well-defined class will nonetheless encompass some class members who have suffered no injury . The MCPA prohibits the use of an "unfair or deceptive trade practice" in the "[t]he extension of consumer credit" or "[t]he collection of consumer debts" and provides for a private right of action. Nationstar Mortgage TCPA Class Action Settlement Because such a common question would have to be resolved in many if not all individual cases, it advances, rather than undermines, the argument in favor of predominance. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. 1998). Co., 595 F.3d 164, 179-80 (4th Cir. Nationstar's reliance on Accrued Financial Services v. Prime Retail, Inc., 298 F.3d 291 (4th Cir. The Motions are fully briefed, and no hearing is necessary to resolve the issues. 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. 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. Summ. Questions? 12 U.S.C. 2004). This argument runs contrary to the plain language of Nationstar's own procedures, which describe the application as "complete" based on the processor's determination, leading to the referral of the complete package to an underwriter. The Robinsons also claim as damages interest overcharges of approximately $141,000. 1024.41(h)(1), (4). The Robinsons and Nationstar then engaged in a series of tortured exchanges over the next several months. 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. Id. 2605(f)(1)(B), a borrower cannot recover these additional damages "without first recovering actual damages." In its complaint, filed in federal district court in the District of Columbia, the Bureau alleges that Nationstar engaged in unfair and deceptive acts and practices in violation of the Consumer Financial Protection Act of 2010, violated the Real Estate Settlement Procedures Act (RESPA), and violated the Homeowner's Protection Act of 1998 (HPA).
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