1024.41(c)(1)(i)-(ii), (g). Since the Rule 23(a) factors are satisfied, the Court will now consider whether the Rule 23(b)(3) predominance and superiority considerations are met. A plaintiff has the burden to show that all of the necessary prerequisites for a class action have been met. Similarly, since Mr. Robinson has not suffered injury under these provisions, he may not bring those claims on behalf of the class. He asserted that the amount of fees was calculated based on Nationstar's statements, but he could not specify the nature of the fees. To view the settlement agreement and consent order, please visit the CSBS's website. Campbell v. Nationstar Mortg., 611 F. App'x 288, 297-98 (6th Cir. 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. MSJ JR 0284. . v. W.R. Grace & Co., 6 F.3d 177, 188 (4th Cir. 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. In their Motion for Class Certification, the Robinsons seek certification of two classes. 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. Home Loans, No. P. 23(b)(3). J. 2006). 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. Code Ann., Com. See Broussard, 155 F.3d at 344. 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. CFPB Director Kathleen Kraninger said in a statement. Law 13 . 12 U.S.C. On May 5, 2014, Nationstar asked the Robinsons for additional information to evaluate the appeal, including documents to verify their income. 2d 452, 468 (D. Md. The Robinsons' designated expert, Geoffrey Oliver, has offered a methodology for identifying class members and when their rights under RESPA and the MCPA have been violated. Law 13-301 and 13-303, because the Robinsons do not have standing to bring those claims. A fact is "material" if it "might affect the outcome of the suit under the governing law." v. Nationstar Mortgage LLC, Case No. Fed. If you were contacted on your cell phone by a company via an . Reg. 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. 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. But see Ayres v. Ocwen Loan Servicing, LLC, 129 F. Supp. The Robinsons and Nationstar then engaged in a series of tortured exchanges over the next several months. Cal. Indeed, Nationstar does not seriously contest the commonality prong. Id. Rather than rendering the testimony inadmissible, the fee arrangement is relevant to the expert's credibility. Sept. 2, 2015). McLean v. GMAC Mortg. 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. 1024.41(f), (g), and (h); and (4) there is no evidence of actual damages from any RESPA violation. First, as a threshold matter, the Court notes that in ruling on Nationstar's Motion for Summary Judgment, it will grant judgment in favor of Nationstar as to Mrs. Robinson's claims, Mr. Robinson's RESPA claims under 12 C.F.R. HealthSystem, 669 F.3d 802, 812 (7th Cir. 2010). In 2007, Mr. Robinson obtained a loan with the principal amount of $755,000 to refinance the property. PO Box 3560. Wirtz v. Specialized Loan Servicing, LLC, 886 F.3d 713, 719-20 (8th Cir. Day to address discovery issues. See Lierboe v. State Farm Mut. A Division of NBC Universal. The ruling serves as a reminder that Florida remains one of the top states for both mortgage fraud and lender errors. The Robinsons assert, and Nationstar does not argue otherwise, that litigation regarding Regulation X is not proceeding against Nationstar in another forum. 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. 1024.1, prescribe additional duties and responsibilities of mortgage servicers under RESPA. Filing fee paid $ 402, Receipt number AOHNDC-10680087. FCRA). 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. The first of these prerequisites is that the class must exist and be "readily identifiable" or "ascertainable" by the court through "objective criteria." The Motions are fully briefed, and no hearing is necessary to resolve the issues. But, Nationstar is correct that Owens-Benniefield may 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. Ins. Id. Law 13-316(c), which requires a response to a loan modification application within 15 days. 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." 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. Law 13-301 and 13-303, and that Mr. Robinson therefore may not assert such claims on behalf of the class, Mr. Robinson's remaining claims and defenses are typical of the class members. The Final Approval Order, approving the Class-wide Settlement, was entered December 11, 2020. 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. Northern District of Ohio, ohnd-1:2021-cv-00452 of 0 An error occurred while loading the PDF. R. Evid. Id. 8:2014cv03667 - Document 18 (D. Md. Code Ann., Com. "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.". At the time, Nationstar had not completed the process of updating its systems to conform to those requirements. See Tagatz, 861 F.2d at 1042. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. Nationstar ultimately became the servicer of the Robinsons' loan. 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. Mortgage servicers seek government aid as forebearance requests soar, How this 39-year-old earns $26,000 a year in California. Thus, a loan servicer could not have complied with Regulation X for a loss mitigation application submitted before January 10, 2014 because there was no regulation in effect with which to comply. at 300. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. Ballard v. Blue Shield of S.W. The trial court granted the motion over the Robinsons' objection, noting in its order that Nationstar had now waived its claim for attorney feesthe claim that had been the sole impediment to a final judgment being entered after the trial court granted Nationstar's request to reopen the evidence after entry of the initial final judgment. 2004). 2003). Finally, the Court finds that Mr. Robinson will adequately represent the absent class members. 1024.41(f), (g), and (h), and Md. Wright et al. If a class is ascertainable, it must then satisfy all four elements of Rule 23(a): numerosity, commonality, typicality, and adequacy. Parties, docket activity and news coverage of federal case Robinson et al v. Nationstar Mortgage LLC, case number 8:14-cv-03667, from Maryland Court. 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. After an additional period of expert discovery relating to the class certification motion, discovery closed on December 30, 2018. 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. Law 13-301 and 303. See Keen, 2018 WL 4111938, at *5-6. 2d 1360, 1366 (S.D. See Johnson v. Ocwen Loan Servicing, 374 F. App'x 868, 873 (11th Cir. Mr. Robinson's counsel is experienced in complex civil litigation and class action litigation. at 983. is generally unproblematic as the non-injured parties can just be sorted out at the remedies phase of the suit."). 1024.41(f), (g), and (h) and Md. Co, 445 F.3d 311, 318 (4th Cir. 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. 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. Furthermore, to the extent that the Robinsons' claim is that Nationstar falsely stated that it would evaluate the Robinsons for all available loss mitigation plans, the Robinsons point only to statements in letters that the Robinsons "may" be eligible for certain non-HAMP loan modification programs. 15-0925, 2015 WL 5165415, at *4 (D. Md. Likewise, although Mrs. Robinson expended time corresponding with Nationstar, she was not working for pay at the same time, and the Robinsons have not provided evidence to quantify the loss to Mr. Robinson, the only viable plaintiff here. ORDER Scheduling Settlement Conference for Wednesday, October 26, 2016 at 10:30 a.m. 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. Auto. Those claims arose from Nationstar's alleged Nelson, 2017 WL 1167230, at *3 (collecting cases). United States v. Valona, 834 F.2d 1334, 1344 (7th Cir. Cal. Nationstar Call Settlement Administrator. The denial letters stated that the loan's principal balance exceeded the limit under HAMP. Subscribe to our free newsletter right now. P. 23(a)(4); Ward v. Dixie Nat'l Life Ins. Am. See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. Id. A "borrower" may enforce the provisions of Regulation X pursuant to 12 U.S.C. Rules Prof'l Conduct 3.4 cmt. Id. Courts have wide discretion to certify a class based on their familiarity with the issues and potential difficulties arising in class action litigation. This assertion mischaracterizes the burden of proof in a civil case. Although similar to Rule 23(a)'s commonality requirement, the test for predominance under Rule 23(b)(3) is "far more demanding" and "tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation." "); see also 1 William Rubenstein et al., Newberg on Class Actions 2:3 (5th ed. Joint Record ("MCC JR") 0907. 2601-2617 (2012), specifically RESPA's implementing regulations known as "Regulation X," 12 C.F.R. After they became delinquent on their loan, the Robinsons submitted another loan modification application to Nationstar on March 7, 2014. The Robinsons assert that they have paid a total of $6,147.12 in unspecified fees to Nationstar. Plaintiffs "must present specific evidence to establish a causal link between the [servicer's] violation and their injuries." 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. Id. Here, Mrs. Robinson signed the Deed but did not sign the Note. Nationstar also argues that Oliver's report should be stricken as unreliable under the Federal Rules of Evidence and Daubert. A code is entered in Remedy Star when the letter is sent. 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. At least one court has found a similar expert report by Oliver to meet the Daubert standard. 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. 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. 2605(f)(1). For the foregoing reasons, Nationstar's Motion for Summary Judgment will be GRANTED IN PART and DENIED IN PART. 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. 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. 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. The loan is then evaluated for loan modification options. A code is also added to LSAMS to put a hold on foreclosure proceedings. Id. An 85-year Harvard study found the No. Law 13-316(c), the Court will grant class certification as to those class members and claims. Mich. 2016), at least one district court has held that loan servicers need not comply with Regulation X if the borrower had previously submitted a loss mitigation application before the January 10, 2014 effective date, see Trionfo v. Bank of America, N.A., No. "); cf. Sept. 9, 2019), there were multiple other claims at issue, for which Oliver's expert report seemed better suited to address. TDC-14-3667 (D. Md. 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. A class action allows representative parties to prosecute not only their own claims, but also the claims of other individuals which present similar issues. 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. Nationstar claims that manual review of each file would take about 60 to 90 minutes per file. A $3.8 million settlement has been reached in a Nationstar convenience fee class action lawsuit, which claimed that the mortgage lender wrongfully charged convenience fees to their consumers when making payments on past due accounts. USCA4 Appeal: 21-1087 Doc: 38 Filed: 06/15/2021 Pg: 9 of 33 TDC-14-3667, 2019 WL 4261696 (D. Md. Robinson et al v. Nationstar Mortgage LLC, No. 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." See 12 C.F.R. She alleges Nationstar was sent multiple disputes by both Experian and Equifax with documentation showing the debt was forgiven, yet Nationstar persisted in reporting the debt as valid. These claims do not have to be factually or legally identical, but the class claims should be fairly encompassed by those of the named plaintiffs. Specifically, the loan servicer failed to honor borrowers' loan modification agreements. The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. Aug. 19, 2015). Ask to speak in court about the fairness of the Settlement. See id. 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. On November 21, 2014, the Robinsons filed suit against Nationstar on behalf of themselves and a class of similarly situated individuals nationwide. 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. 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. Nationstar further argues that the Robinsons cannot show that they suffered economic damages as a result of the violation of section 13-316. Corp. ("McLean II"), 398 F. App'x 467, 471 (11th Cir. A conflict of interest will not defeat the adequacy requirement when "all class members share common objectives[,] the same factual and legal positions, and . Tenn. Aug. 28, 2018) (holding that a spouse who signed a deed of trust stating that a person who did not sign the promissory note was not obligated on the security instrument, but did not sign the promissory note, was not a borrower under RESPA). v. Nationstar Mortgage LLC. Accordingly, the Motion is denied as to such claims. Because such information is stored electronically and based on objective criteria, the members of the class will be ascertainable without significant administrative burden. UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. "We want to hear from you," Raoul says. R. Civ. At a minimum, the question of when a loss mitigation application is "complete" under RESPA within the workflow of Nationstarwhether at the time of the processor's designation of the file as complete or at a later stageis a significant unresolved question of law and fact that would be common to all RESPA claims against Nationstar. 3d 254, 274-75 (S.D.N.Y. For the requirements that hinge on the timing of a communication or response, Oliver's methodology consists of using Nationstar's data from the LSAMS and FileNet software applications relating to a sample of 400 loans to identify the dates when certain events occurredsuch as the filing of a loan modification application, when a loan modification application became complete, and the sending of an acknowledgment or decision letter to a borrowerand then counting the days between the dates to assess whether a RESPA timing requirement was satisfied. 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. 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. 12 U.S.C. A complete loss mitigation application is "an application in connection with which a servicer has received all the information that the servicer requires from a borrower in evaluating applications for the loss mitigation options available to the borrower." Some courts have held that administrative costs that predate the alleged RESPA violation cannot constitute "actual damages." Finally, while Nationstar presented arguments for why the Robinsons have not shown damages as to most of the asserted categories, it did not advance any argument for why the interest damages claimed by the Robinsons were not attributable to Nationstar's Regulation X violations and thus is not entitled to summary judgment on that issue. At this stage of the proceedings, the Court must rely on facts in the record, and not assertions in the pleadings.