See, e.g., Ward v. Dixie Nat. That's one reason why the settlement, particularly the provisions requiring Nationstar to adhere to enhanced standards, is crucial. 12 U.S.C. Although the parties have not offered specific details on the nature and timing of those costs and fees, it is reasonable to infer that at least some portion of them were incurred after they submitted their March 7, 2014 loan modification application and after Nationstar had violated Regulation X. 26-1. See MCC JR0529-31. Under a provision of Regulation X entitled "Loss mitigation procedures," mortgage servicers must take certain steps when a borrower applies for loss mitigation measures, such as the loan modifications sought in this case. Nationstar Call Settlement Administrator. 1024.41(b)(1). 1024.41(i). See 12 C.F.R. R. Civ. 1024.41. 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. 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. The Robinsons' expert had written the scripts using data dictionaries and without accessing the databases. 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. 2605(f)(2). Code Ann., Com. 12 C.F.R. 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. Robinson, 2015 WL 4994491, at *4 (citing Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. Nationstar's failings resulted in "substantial consumer harm," CFPB Director Kathleen Kraninger said in a statement. at 983 (quoting 12 U.S.C. Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act ("Regulation X"), 78 Fed. Appellate Win Affirms $3 Million Settlement in Class Action against Nationstar Mortgage - Tycko & Zavareei LLP Contact Us We look forward to hearing from you. Law 13-316(c), which requires a response to a loan modification application within 15 days. Although she has worked as a bookkeeper for various companies, she was not employed between March and September 2014. A code is entered in Remedy Star when the letter is sent. 2010) (holding that a plaintiff who "was not a borrower or otherwise obligated on the . If you are a member of the Settlement Class, you must submit a completed Claim Form to receive a payment. R. Civ. Code Ann., Com. 1024.41(i). (2012), and the Maryland Consumer Protection Act ("MCPA"), Md. Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. He asserted that the amount of fees was calculated based on Nationstar's statements, but he could not specify the nature of the fees. In Washington v. Am. Mrs. Robinson was the primary point of contact for the Robinsons in interacting with Nationstar. 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. Subsequent to the Court's approval, one of the objectors to the settlement filed an appeal. The Class is represented by Rafey S. Balabanian of Edelson PC. 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. On February 10, 2022, the Court of Appeals issued a decision affirming the Final Approval Order. 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. 2013). Based on his experience and review of deposition transcripts of Nationstar employees, Oliver asserts that Nationstar has computerized data from which RESPA violations may be identified, not least because Nationstar must be able to demonstrate its compliance with RESPA to regulators. Motor Freight System, Inc. v. Rodriguez, 431 U.S. 395, 403 (1977))). at *2. The settlement in the form of a consent judgment, filed in the U . 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. Moreover, even if the fee arrangement violated the ethical rules for attorneys, "it does not follow that evidence obtained in violation of the rule is inadmissible." 2605(f). 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. 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. The comments to that rule state that the "common law rule in most jurisdictions is . This field is for validation purposes and should be left unchanged. 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. 2d 754, 768-69 (D. Md. P. 23(a)(4); Ward v. Dixie Nat'l Life Ins. 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. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." A fact is "material" if it "might affect the outcome of the suit under the governing law." From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. Filing fee paid $ 402, Receipt number AOHNDC-10680087. These fees allegedly violated the Fair Debt Collection Practices Act and the Washington state Collection Agency Act. Nationstar also argues that Oliver's report should be stricken as unreliable under the Federal Rules of Evidence and Daubert. Ballard v. Blue Shield of S.W. The company has already paid about $57.5 million in restitution to affected consumers, according to the CFPB. 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 is no evidence to support a violation of 12 C.F.R. 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. Gunnells, 348 F.3d at 429 ("[T]he need for individualized proof of damages alone will not defeat class certification."). 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. But see Ayres v. Ocwen Loan Servicing, LLC, 129 F. Supp. See Keen, 2018 WL 4111938, at *5-6. 12 U.S.C. Md. On May 5, 2014, Nationstar asked the Robinsons for additional information to evaluate the appeal, including documents to verify their income. 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. See Fed. "We will be watching the mortgage interest industry to ensure they are treating homeowners fairly and fulfilling their obligations.". 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. 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. In analyzing this question, a court compares the class representative's claims and defenses to those of the absent class members, considers the facts needed to prove the class representative's claims, and assesses the extent to which those facts would also prove the claims of the absent class members. Law 13-316(c). Furthermore, according to Nationstar, to identify the content of a letter sent to a borrower, the letter itself must be viewed. Similarly, since Mr. Robinson has not suffered injury under these provisions, he may not bring those claims on behalf of the class. Life Ins. MSJ JR 0284. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. Law 13-301 and 303. Mot. 1024.41(c)(1)(i). Mortgage servicers seek government aid as forebearance requests soar, How this 39-year-old earns $26,000 a year in California. 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. "[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.'" Johnson, 374 F. App'x at 873; Keen v. Ocwen Loan Servicing, LLC, No. PO Box 3560. 1 . In February 2014, after their income had further decreased, the Robinsons ceased making payments on the mortgage loan. Discovery Order, ECF No. Am. 3d 1011, 1015 (W.D. Finally, the Court finds that Mr. Robinson will adequately represent the absent class members. 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. 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. 2007)), aff'd sub nom. 12 C.F.R. 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. Distribution of funds to Class Members, however, could not occur because a member of the Class filed an objection to the Settlement and a subsequent appeal to the U.S. Court of Appeals for the Fourth Circuit. However, Nationstar did not comply with all requirements of Regulation X, which became effective on January 10, 2014. The fee arrangement will be considered as an issue potentially affecting the credibility, rather than the admissibility, of the expert testimony. The Magistrate Judge ordered Nationstar to run those scripts and return the electronic data to the Robinsons. Campbell v. Nationstar Mortg., 611 F. App'x 288, 297-98 (6th Cir. See Tagatz, 861 F.2d at 1042. The Robinsons also claim as damages interest overcharges of approximately $141,000. That provision provides, in parallel, that a loan servicer which does not comply with Regulation X is liable "to the borrower." 8:2014cv03667 - Document 18 (D. Md. v. Windsor, 521 U.S. 591, 623-24 (1997). 2006). 2014))). 2d at 1366. Fed. 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. RESPA's implementing regulations, codified at 12 C.F.R. 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. 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"). 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. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. An expert's testimony is "critical" where it is "important to an issue decisive for the motion for class certification." Code Ann., Com. The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. "There are going to be a lot of homeowners who need a home loan modification or other assistance," Raoul says. Id. Claim Your Cash Every Week! 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. . Code Ann., Com. 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." The Nationstar Mortgage Unwanted Phone Calls Class Action Lawsuit is Wright, et al. 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. 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. 2013)). Class Certif. Mot. "); cf. 2015) Court Description: MEMORANDUM OPINION. 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. 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. In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." Id. Nationstar denies all allegations of wrongdoing and no judgment or determination of wrongdoing has been made. Gunnells, 348 F.3d at 427-28. 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. He is joined by 49 other Attorneys General, the District of Columbia, and other state and federal agencies. A Division of NBC Universal. See 12 C.F.R. Rules Prof'l Conduct 3.4 cmt. 1976). 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. 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. Md. Robinson v. Nationstar Mortgage, LLC Complaint with jury demand against Nationstar Mortgage, LLC. 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. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. Since neither party contends that Oliver's testimony and report are not "critical," the Court must address the Daubert challenge before reaching the question of class certification. 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. 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." And given that the class includes all borrowers who have submitted an application since January 10, 2014, joinder of all members is eminently impractical. Aug. 19, 2015). McLean II, 398 F. App'x at 471. Petitioner: NATIONSTAR MORTGAGE, LLC: Respondent: TAMARA ROBINSON and DEMETRIUS ROBINSON: Case Number: 19-379: Filed: September 24, 2019: Court: U.S. Court of Appeals . Law 13-316(c), the Court will grant class certification as to those class members and claims. 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. the same interest in establishing the liability of defendants." See Farber, 2017 WL 4347826 at 15; Billings, 170 F. Supp. 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. 3d 712, 728 (S.D. Nationstar correctly notes that the Robinsons have not identified a false or misleading statement or representation by Nationstar in the record. See id. See, e.g., Linderman v. U.S. Bank Nat'l Ass'n, 887 F.3d 319, 321 (7th Cir. Cf. 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. Co., 595 F.3d 164, 179-80 (4th Cir. See Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178 (1974) ("In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met."). 2012). 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.