26-1. 2013). If the application is denied, a notice to that effect is sent to the borrower. 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." 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. This is not the first time Nationstar has been the subject of federal and state investigations. The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. P. 23(a)(4); Ward v. Dixie Nat'l Life Ins. Here, even though the Robinsons' March 7, 2014 loss mitigation application was not the Robinsons' first such application, it was their first submitted after the effective date of Regulation X. 2010) (considering consistency of results that provide finality to the defendant as favoring a finding of superiority). 2. Thus, based on his report and experience, Oliver concludes that Nationstar "failed to comply" with Regulation X and that it is possible to "identify violations" of Regulation X "using the methodologies" he described, without the necessity of a file-by-file review. 15-05811, 2016 WL 3055901 (N.D. Cal. Sept. 29, 2017); Billings v. Seterus, Inc., 170 F. Supp. 1024.41(c)(1)(i) and (d), because the Robinsons made no showing that the Rule 23 requirements were met. After they became delinquent on their loan, the Robinsons submitted another loan modification application to Nationstar on March 7, 2014. Ward, 595 F.3d at 180 (quoting Gunnells, 348 F.3d at 430). Code Ann., Com. 2601(a). Law 13-316(c), the Court will grant class certification as to those class members and claims. 10696, 10836. Fed. Compl. Several states also fined Nationstar in 2018 over failing to have proper procedures in place and "unfair and deceptive" mortgage modification policies. McAdams v. Nationstar Mortgage, LLC, No. 21-1087 (4th Cir. 2022) 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. Finally, the Court finds that Mr. Robinson will adequately represent the absent class members. 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. Instead, he analyzed certain data fields that were returned by the scripts written by a different expert. 2014). First, Nationstar correctly notes that Mr. Robinson, in his Motion, and Oliver, in his expert report, do not put forward any evidence establishing that the necessary prerequisites for a class action have been met with respect to the claim that Nationstar did not evaluate borrowers "for all loss mitigation options available to the borrower," in violation of 12 C.F.R. The plaintiff's claim "cannot be so different from the claims of absent class members that their claims will not be advanced by" proof of the plaintiff's own individual claim. Mot. 1024.41(d). R. Civ. See D. Md. Code Ann., Com. See id. 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. On August 26, 2014, Nationstar mailed another letter acknowledging R. Civ. . Law 13-316(c), which requires a response to a loan modification application within 15 days. 2d 873, 883 (D. Md. LLC, No. Moreover, the conflict must not be "merely speculative or hypothetical." Reg. 1988) (distinguishing between a rule of professional conduct and admissibility of evidence); cf. 1024.41(b)(2)(B), (c)(1)(ii); Md. Id. 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. 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. Corp. ("McLean II"), 398 F. App'x 467, 471 (11th Cir. %PDF-1.6 % P. 23(a)(2); Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011). Date: September 9, 2019, Civil Action No. 3d at 1014. Courts have wide discretion to certify a class based on their familiarity with the issues and potential difficulties arising in class action litigation. 1024.41(i). Id. Although Nationstar argues that Mr. Robinson has a conflict of interest because he wishes to avoid foreclosure and to delay payments on his mortgage, the record does not reflect that proposition. Back To Top. Ohio 2014). Robinson v. Nationstar Mortg. LLC - Casetext The settlement will benefit a Class of consumers who purchased a 600-or 900-watt Nutribullet blender in the US between June 1, 2017 and March 15, 2022. R. Civ. That claim will be subject to common proof, namely sampling and analysis of loan files along the lines suggested by Oliver. Specifically, the application itself would have to be reviewed to determine when it was stamped as received by Nationstar. Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act ("Regulation X"), 78 Fed. As of November 22, about 2.8 million homeowners were in a forbearance plan, according to the latest research from the Mortgage Bankers Association. "[A] trial court should consider the specific factors identified in Daubert where they are reasonable measures of the reliability of expert testimony." 2605(f). "Since then, we have continued to invest in technology, people, and leadership to ensure that our compliance and risk management programs not only meet our regulators' expectations but also support sustainable growth and maintain our position as an industry leader.". Law 13-301 and 303. Broussard v. Meineke Discount Muffler Shops, Inc., 155 F.3d 331, 344 (4th Cir. Accordingly, Nationstar's Motion for Summary Judgment will be granted as to the MCPA claims under sections 13-301 and 13-303. 2013); Poindexter v. Teubert, 462 F.2d 1096, 1097 (4th Cir. Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. McLean I, 595 F. Supp. Signed by Judge Theodore D. Chuang on 8/18/2015. Neither the rule nor the comment, however, state whether Maryland is one such jurisdiction. It will be otherwise denied. Contact Fraudfighters.net Current Class Settlements Search Our Successes Practice Areas Class Actions Financial Services & Economic Justice UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. In addition, Nationstar asserts that not all loan modification applications referred to an underwriter are complete. After this missed payment, Nationstar assessed a late fee. even after that settlement was reached. Thus, Mrs. Robinson is not "obligated" to pay the amount due on the Note and therefore is not a "borrower" for purposes of RESPA. 1024.41(i). 2012). 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. Pia McAdams, a class member, objected to the settlement, arguing that the Although based on imperfect data, Oliver's expert report reveals that such analysis can substantially address whether Nationstar violated 12 C.F.R. Law 13-316(e)(1), and "actual damages," 12 U.S.C. 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. Marais v. Chase Home Fin., LLC, 24 F. Supp. 702, 703. 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. However, the burden is on the plaintiffs to show that other class members exist and that their joinder is impracticable; a court may not rely on mere speculation that numerosity has been satisfied. 2017) (holding that "incidental costs related to the sending of correspondence" to the servicer, including "postage and travel," are not actual damages under RESPA because such a rule "would transform virtually all unsatisfactory borrower inquiries into RESPA lawsuits"). 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). The Motions are fully briefed, and no hearing is necessary to resolve the issues. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. 8:14-CV-03667-TJS ORDER GRANTING MOTION FOR . See 12 C.F.R. 1024.41(a). Bouchat, 346 F.3d at 522. 303 0 obj <> endobj According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. A "borrower" may enforce the provisions of Regulation X pursuant to 12 U.S.C. See Keen, 2018 WL 4111938, at *5-6. application to Nationstar after January 10, 2014, and through the date of the Court's . 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. 1024.41(i). 19-303.4 cmt.3. 10696, 10708 (Feb. 14, 2013) (codified at 12 C.F.R. v. Nationstar Mortgage LLC Nationstar Call Settlement Administrator PO Box 3560 Portland, OR 97208-3560 877-683-9363 Class Counsel Rafey S. Balabanian EDELSON PC Defense Counsel Abraham J. Colman Raymond Y. Kim REED SMITH LLP 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 Torres v. Mercer Canyons Inc., 835 F.3d 1125, 1137 (9th Cir. 1024.41 (2019), and the Maryland Consumer Protection Act ("MCPA"), Md. Although she has worked as a bookkeeper for various companies, she was not employed between March and September 2014. A class action allows representative parties to prosecute not only their own claims, but also the claims of other individuals which present similar issues. Id. 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. See Farmer v. Ramsay, 159 F. Supp. (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"). 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." Nationstar seeks summary judgment on the Robinsons' RESPA claims on the grounds that (1) Mrs. Robinson is not a proper plaintiff because she is not a "borrower" within the meaning of RESPA; (2) RESPA is inapplicable because Nationstar was required to comply with Regulation X only as to the Robinsons' first loss mitigation application; (3) there Throughout discovery, Nationstar repeatedly stated that it could not produce the data on loss mitigation or loan modification applications from its databases in the form requested by the Robinsons. 1024.41(h)(1). PDF United States District Court District of Maryland Customers may call with questions about the settlement or the remediation checks at 1-855-914-4649 Monday-Friday, 9:00 a.m. to 9:00 p.m. except holidays. See Wirtz, 886 F.3d at 719-20. Similarly, though the precise nature of the fees imposed was not specified, it is reasonable to infer that some were attributable to delays linked to RESPA violations. 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 complied. . Joint Record ("MSJ JR") 0102. 2012) (citing Lloyd v. Gen. Motors Corp., 916 A.2d 257, 277 (Md. While Mrs. Robinson stated that she was conducting bookkeeping for Green Earth Services during the relevant time frame, she testified that her work was less than six hours per week, and the Robinsons have not shown that her time spent communicating with Nationstar "resulted in actual pecuniary loss" to Mr. Robinson or the business. A servicer that fails to comply with Regulation X is liable for "any actual damages to the borrower as a result of the failure" to comply. Others, however, have concluded that "all expenses, costs, fees, and injuries fairly attributable to" a servicer's RESPA violation are damages, "even if incurred before the" violation, because the "wrongful act . Law 13-301(1). P. 23(b)(3). 1024.41, a regulation of RESPA that outlines loss mitigation procedures. As a result, the Robinsons' claim that Nationstar violated certain Regulation X procedures with respect to their loan modification application and those of the class members. Here, the Robinsons have not put forward any evidence that Mrs. Robinson has an ownership interest in the home that would specifically obligate her to make payments on the loan. Consumer Financial Protection Bureau and Multiple States Enter into 1987) (holding, in the context of an informant who is paid a contingent fee, that the fee should be treated "as a credibility factor"). which has the capacity, tendency, or effect of deceiving or misleading consumers." In Robinson v. Nationstar Mortgage LLC, No. However, Nationstar did not comply with all requirements of Regulation X, which became effective on January 10, 2014. 1024.41(h)(1), (4). Indeed, since previous versions of the Maryland rule expressly stated that contingency fee arrangements for experts were forbidden, but that explicit language was removed, it is reasonable to conclude that the amendment changed the rule in Maryland to no longer bar contingency fee arrangements. Id. The commonality requirement is also met. Potentially eligible class members for all of these provisions can be identified through the LSAMS and Remedy data that marks that an application was received, identified as complete, and denied. Nationstar, the fourth-largest mortgage servicer in the U.S., is set to pay $91 million to settle claims brought by the Consumer Financial Protection Bureau and state attorneys general alleging. Feb. 14, 2017) (holding that the plaintiff sufficiently pleaded damages under the MCPA where she alleged that the defendant's failures to respond "resulted in the continual assessment of accruing interest, fees and costs on the mortgage account," as well as "stress, physical sickness, headaches, sleep deprivation, worry, and pecuniary expenses"). ("Opp'n') 13, ECF No. Once an underwriter is assigned, that employee double-checks whether the application contains all required documentation and is complete. 27. judge. Some of the alleged damages are not supported in law or in fact. 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. 3d 1011, 1015 (W.D. If the initial application is complete, the substatus in Remedy Star is changed to refer the application to an underwriter for review, and an additional code is added in LSAMS. 2015) (holding that Regulation X did not apply to loss mitigation applications submitted before the effective date). Law 13-316(c). 1976) (holding that while it may be unethical for a lawyer to testify on behalf of a client as an expert, "it does not necessarily follow that any alleged professional misconduct" would require exclusion of the testimony because the rules of professional conduct do "not delineate rules of evidence"); United States v. Fogel, 901 F.2d 23, 26 (4th Cir. Class Members included all U.S. consumers who received a robocall on their cell phone from Nationstar between October 2015 and March 2016. USCA4 Appeal: 21-1087 Doc: 38 Filed: 06/15/2021 Pg: 9 of 33 State attorneys general are here for homeowners, Raoul adds. Life Ins. . 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. 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. In Robinson v., Under the RESPA, civil liability is limited to "borrowers": "[w]hoever fails to comply with any provision of, Full title:DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE, Court:UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. 1993) (quoting Blum v. Yaretsky, 457 U.S. 991, 1001 n.13 (1982)). A class action claimed Nationstar violated consumer protection laws in servicing class members' mortgage loans. Gunnells v. Healthplan Serv., Inc., 348 F.3d 417, 458 (4th Cir. 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.