robinson v nationstar settlement robinson v nationstar settlement

Before the error was discovered, Mr. Robinson appealed this offer as insufficient on April 10, 2014. UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. The Class Action Administrator would then begin distribution of the settlement funds. Docket for Robinson v. Nationstar Mortgage LLC, 8:14-cv-03667 Brought to you by the RECAP Initiative and Free Law Project, a non-profit dedicated to creating high quality open legal information. Whether an application is complete depends on the requirements of the investor who holds the loan. MCC JR 0003. Code Ann., Com. However, if the costs are shown to have been incurred in response to the RESPA violation, the Court finds that they would be actual damages within the meaning of 12 U.S.C. at 152. Day to address discovery issues. Furthermore, Nationstar's argument that the Robinsons are not typical largely recycles the same arguments made in the Motion for Summary Judgment. Code Ann., Com. If the application is complete "more than 37 days before a foreclosure sale," the servicer may not move for a foreclosure judgment or conduct a foreclosure sale, but instead must first "[e]valuate the borrower for all loss mitigation options available to the borrower," send to the borrower "a notice in writing stating the servicer's determination of which loss mitigation options, if any, it will offer," and include a statement of applicable appeal rights. Id. The CFPB estimates about 40,000 borrowers were harmed by Nationstar's allegedly unfair and deceptive practices, according to a statement released Monday. Robinson v. Nationstar Mortgage, LLC Complaint with jury demand against Nationstar Mortgage, LLC. The court, however, did not explain how in the absence of any obligation to pay back to the Note, the plaintiff qualified as a "borrower" under the RESPA statute. Mot. 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. 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. 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. 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. The Magistrate Judge ordered Nationstar to run those scripts and return the electronic data to the Robinsons. If the named plaintiff satisfies all of the Rule 23(a) requirements and the Rule 23(b)(3) requirements, then class certification is appropriate. Nationstar will need to enhance its policies and processes around how it handles consumer complaints, performs escrow analyses and conducts audits, for example. 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. 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. Discovery Order, ECF No. HARRISBURG Attorney General Josh Shapiro, as part of a multistate effort, today announced that his office obtained an $86.3 million settlement from Nationstar Mortgage, the country's fourth-largest mortgage servicer. Ass'n, No. . See Tyson Foods v. Bouaphakeo, 136 S. Ct. 1036, 1045 (2016) ("When 'one or more of the central issues in the action are common to the class and can be said to predominate, the action may be considered proper under Rule 23(b)(3) even though other important matters will have to be tried separately, such as damages or some affirmative defense peculiar to some individual class members.'" Sept. 29, 2017); Billings v. Seterus, Inc., 170 F. Supp. In this photo illustration, the Nationstar Mortgage Holdings Inc. logo seen displayed on a smartphone. This is not the first time Nationstar has been the subject of federal and state investigations. Ohio 2014). Sept. 2, 2015). 2003). Since the parties do not argue that the Nationwide Class and the Maryland Subclass differ for the purposes of the class certification analysis, the Court will analyze them together. The fact that Oliver's methodology has not been subjected to peer review and that he has not published any articles about it does not invalidate it. ("Opp'n') 13, ECF No. That's one reason why the settlement, particularly the provisions requiring Nationstar to adhere to enhanced standards, is crucial. 12 U.S.C. 2015) Court Description: MEMORANDUM OPINION. During discovery, Oliver revealed that his fee arrangement with the Robinsons includes a flat fee for his expert services, but that a portion of the fee is contingent on the certification of a class in this case. 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. 89, 90, ECF No. Several states also fined Nationstar in 2018 over failing to have proper procedures in place and "unfair and deceptive" mortgage modification policies. See Farber, 2017 WL 4347826 at 15; Billings, 170 F. Supp. The Robinsons do not address this argument in their Opposition. Filing fee paid $ 402, Receipt number AOHNDC-10680087. And given that the class includes all borrowers who have submitted an application since January 10, 2014, joinder of all members is eminently impractical. 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. To view the settlement agreement and consent order, please visit the CSBS's website. Law 13-301 and 303. In addition to the fines and restitution, Delaware Attorney General Kathleen Jennings said the settlements require Nationstar to adhere to increased "servicing standards." Code Ann., Com. The Robinsons own a business called Green Earth Services, which provides waste and recycling services to clients. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. 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 Federal Rules of Evidence do not prohibit these kinds of arrangements. 1976). Therefore, Nationstar was required to comply with section 1024.41 in processing it. Id. JA 130. See 12 C.F.R. 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." A plaintiff has the burden to show that all of the necessary prerequisites for a class action have been met. at 248-49. 1024.41(f), (g), and (h); and (4) there is no evidence of actual damages from any RESPA violation. The Court may rely only on facts supported in the record, not simply assertions in the pleadings. The "Maryland Subclass" consists of "[a]ll persons in the State of Maryland that submitted a loss mitigation application to Nationstar after January 10, 2014, and through the date of the Court's certification order." 1024.41 Broussard v. Meineke Discount Muffler Shops, Inc., 155 F.3d 331, 344 (4th Cir. See Stillmock v. Weis Markets, Inc., 385 F. App'x 267, 275 (4th Cir. 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. Sep. 9, 2019). The Nationstar Mortgage Unwanted Phone Calls Class Action Lawsuit is Wright, et al. 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. "Mortgage servicers are entrusted with handling significant financial transactions for millions of Americans, including struggling homeowners. 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. Appellate Win Affirms $3 Million Settlement in Class Action against Nationstar Mortgage - Tycko & Zavareei LLP Contact Us We look forward to hearing from you. Id. See Baby Neal for and by Kanter v. Casey, 43 F.3d 48, 56-57 (3d Cir. ("MCC") 2, ECF No. P. 23(a)(1). 28, 2017). In support of this argument, Nationstar contends that the ethical rules for attorneys prohibit contingency fee arrangements with expert witnesses. See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. 1024.41(f), (g). 1 . Id. Law 13-316(c), which requires a response to a mortgage servicing complaint or inquiry within 15 days. From this approach, Oliver concluded that for approximately 60 percent of the sampled loans, Nationstar failed to comply with the requirement that it inform the borrower of loss mitigation application determination within 30 days of receiving a complete application. After several customers of Green Earth Services canceled its services, the Robinsons sought loss mitigation in the form of a loan modification from Nationstar. Code Ann., Com. R. Civ. Code Ann., Com. Since Mrs. Robinson may not bring a claim under Regulation X, she may not be a named class representative. 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. Likewise, he concluded that for approximately 53 percent of sampled loans, Nationstar failed to comply with the requirement of acknowledging receipt of the application within five days. 2010) (holding that a plaintiff who "was not a borrower or otherwise obligated on the . Nationstar claims that manual review of each file would take about 60 to 90 minutes per file. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. Since it is the plaintiff's burden to establish that the requirements of Rule 23 have been met and Mr. Robinson has failed to do so, the Motion for Class Certification will be denied as to any claims that Nationstar violated 12 C.F.R. Signed by Judge Theodore D. Chuang on 8/18/2015. 1024.41(c)(1)(i) and (d), because the Robinsons made no showing that the Rule 23 requirements were met. . In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." Class certification will be granted, with Demetrius Robinson as the named plaintiff, as to both the Nationwide Class and the Maryland Class for the claims under 12 C.F.R. 1 Nationstar later conceded that at the time the Robinsons submitted their application, it had not yet updated its systems to comply with Section 1024.41. Presently pending is Nationstar's Motion for Summary Judgment, Nationstar's Motion to Strike, and the Robinsons' Motion for Class Certification. Ins. After attempts to modify the 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. Regulation X's effective date reflected "an intent not to apply it to conduct occurring prior to that date." See Broussard, 155 F.3d at 344. All Rights Reserved. Bouchat v. Balt. Code Ann., Com. All but $28.6 million of its. 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. 1024.41(b)(1), which requires reasonable diligence in obtaining documents and information to complete a loss mitigation application; and Md. The Deed specifies that a person who signs it but "does not execute the note" is a co-signer of the Deed in order to mortgage and convey that person's interest in the Property under the terms of the Deed, but "is not personally obligated to pay the sums secured by this Security Instrument," and her consent is not required to alter the terms of the Deed or the Note. See Fed. Code Ann., Com. The Court does not find such a prohibition in the Maryland Attorneys' Rules of Professional Conduct. 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. 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. 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. At least one court has found a similar expert report by Oliver to meet the Daubert standard. Id. The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. at 300. 1024.41(c)(1)(ii), which requires a servicer to respond to a loan modification application within 30 days of receipt of a complete loss mitigation application and provide notice of appeal rights; 12 C.F.R. They have a home in Damascus, Maryland purchased by Demetrius Robinson ("Mr. Robinson"). Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). 218. 10696, 10708 (Feb. 14, 2013) (codified at 12 C.F.R. The comments to that rule state that the "common law rule in most jurisdictions is . Indeed, Mr. Robinson testified that Mrs. Robinson did not sign the Note because she did not purchase the property with him. Moreover, Nationstar cites no authority for the proposition that a loss mitigation application would not be deemed "complete" for purposes of RESPA upon such a formal designation, and any rule that would deem such an application incomplete in the event that an underwriter subsequently decided to ask for additional material would be entirely unworkable. 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. In response, on May 30, 2014, Mr. Robinson sent Nationstar the exact same application that he had submitted on March 7, 2014. Where such statements in no way promise approval, the Robinsons appear to claim that such statements are false or misleading because Nationstar never intended to, and did not, evaluate the Robinsons for the various loss mitigation options. 20-cv, -2202, 2021 WL 4462909, at *1 (S.D. In Frank v. J.P. Morgan Chase Bank, N.A., No. 3d 1011, 1015 (W.D. Id. 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." The Motion will be granted as to all of Tamara Robinson's claims and as to Demetrius Robinson's claims under 12 C.F.R. 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. 164. Once the documents are received, the Remedy Star substatus and LSAMS code are changed again to mark the application complete. Id. or other representation . 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. Id. 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. TDC-14-3667, 2019 WL 4261696 (D. Md. 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. In contrast, the Court finds that there is a genuine issue of material fact whether the administrative costs and fees incurred by the Robinsons resulted from Nationstar's RESPA violations. Lembach v. Bierman, 528 F. App'x 297 (4th Cir. R. Civ. From January 2012 to December 2016, the CFPB and 50 state attorneys general claim Nationstar, which is now doing business asMr. Cooper, engaged in a number of unlawful practices in handling mortgages following the Great Recession. More importantly, while a determination of an individual violation would not require extensive analysis, specific proof of a pattern or practice of RESPA violations in any individual case would be a substantial undertaking, likely requiring the same type of complex analysis proposed here: a sampling of Nationstar files, compilation of all relevant data for such files, expert analysis to identify violations, and an assessment whether the identified violations are sufficient to establish a pattern or practice of violations. The Court will not revisit this determination. 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. Proof of these claims requires a showing of the dates that an application was received, an acknowledgment letter was sent, an application became complete, Nationstar sent a decision letter to the borrower, and a foreclosure sale is scheduled. 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. 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. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." Wright et al. Law 13-316(c), the Court will grant class certification as to those class members and claims. Portland, OR 97208-3560. 2d 754, 768-69 (D. Md. Corp. ("McLean I"), 595 F. Supp. . Rules Prof'l Conduct 3.4 cmt. Ass'n, 375 F.2d 648, 653 (4th Cir. 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. News Ask a Lawyer Ask to speak in court about the fairness of the Settlement. Nationstar's reliance on Accrued Financial Services v. Prime Retail, Inc., 298 F.3d 291 (4th Cir. 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. Here, Mrs. Robinson signed the Deed but did not sign the Note. See id. is generally unproblematic as the non-injured parties can just be sorted out at the remedies phase of the suit."). As for the claims of errors in Oliver's analysis, although this criticism is couched as his "misunderstanding the nature of Nationstar's various databases," Nationstar largely challenges Oliver's failure to use particular data fields, some which were never made available to him. Nationstar's Motion for Summary Judgment will be granted as to Tamara Robinson. The loan is then evaluated for loan modification options. An expert's testimony is "critical" where it is "important to an issue decisive for the motion for class certification." Nationstar has no process for standardizing file names. 2d at 1366. . USCA4 Appeal: 21-1087 Doc: 38 Filed: 06/15/2021 Pg: 9 of 33 Code Ann., Com. 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. Id. 8:2014cv03667 - Document 18 (D. Md. 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. LLC, No. Code Ann., Com. 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. 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. 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. State attorneys general are here for homeowners, Raoul adds. 1024.41(f), (g), and (h) and Md. 2013); Poindexter v. Teubert, 462 F.2d 1096, 1097 (4th Cir. Although she has worked as a bookkeeper for various companies, she was not employed between March and September 2014. . 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. Law 13-316(c). While Mr. Robinson signed the promissory note ("the Note"), the deed of trust ("the Deed"), and the balloon payment rider for the 2007 loan, Tamara Robinson ("Mrs. Robinson") signed only the Deed and balloon payment rider and did not sign the Note. 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. 2007)), aff'd sub nom. 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. 2605(f), caused by the violation, which likely consist of administrative fees and costs, the individual recovery available for each class member would likely be low, far below the cost of litigating the claims themselves. Individual damages would be below the cost of litigation even if each class member could establish that Nationstar's conduct consisted of a pattern or practice of violating Regulation X, because the statute limits such damages to $2,000 per borrower. In approving such a modification, Nationstar made a mistake: the underwriter working on the Robinsons' loan had erroneously double-counted their income. 2013) (holding that the plaintiff sufficiently pleaded actual injury or loss under the MCPA where he alleged that he suffered "bogus late fees," damage to his credit, and attorney's fees); see also Cole v. Fed'l Nat'l Mortg.