The Borrower Payment Amount shall be used: (1) for payments to borrowers who submit claims and are in either or both of the Service Transfer and Property Preservation Populations set forth below; and (2) for reasonable costs and expenses of the Settlement Administrator, including taxes and fees for tax counsel. The Court may rely only on facts supported in the record, not simply assertions in the pleadings. . Nationstar denies all allegations of wrongdoing and no judgment or determination of wrongdoing has been made. For example, since default fees are often paid by sources other than the borrower, such as in a short sale or refinancing, Nationstar challenges Oliver's assessment that fees identified through LSAMS can be deemed to constitute damages from RESPA violations, because the software does not reflect who paid the fee. 2605(f)(1). The Federal Rules of Evidence do not prohibit these kinds of arrangements. While several district courts have concluded that loss mitigation applications submitted before Regulation X's effective date do not count as the single application for which a loan servicer must comply with Regulation X, see, e.g., Farber v. Brock & Scott, LLC, No. If the named plaintiff satisfies all of the Rule 23(a) requirements and the Rule 23(b)(3) requirements, then class certification is appropriate. Subsequent Loss Mitigation Application. Stewart v. Bierman, 859 F. Supp. Furthermore, Nationstar's argument that the Robinsons are not typical largely recycles the same arguments made in the Motion for Summary Judgment. In approving such a modification, Nationstar made a mistake: the underwriter working on the Robinsons' loan had erroneously double-counted their income. Hickerson, 882 F.3d at 480 (quoting Cooper, 259 F.3d at 199). 1024.41 (2019), and the Maryland Consumer Protection Act ("MCPA"), Md. In 2017, the CFPB fined Nationstar $1.75 million for failing to report accurate data about its mortgage transactions. It is the plaintiffs who bear the burden of proving their claims. He asserted that the amount of fees was calculated based on Nationstar's statements, but he could not specify the nature of the fees. The Motion will be otherwise denied. Code Ann., Com. Nationstar Mortgage agreed to settle an action commenced by the Consumer Financial Protection Bureau for $91 million to resolve allegations surrounding mortgage servicing misconduct and deceptive practices that resulted in financial harm to borrowers. Code Ann., Com. Am. See supra parts I.B.1, I.B.3, I.C.1. The Court will not revisit this determination. Code Ann., Com. at 359-60. Finally, the named plaintiff must "fairly and adequately protect the interests of class" without a conflict of interest with the absent class members. 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. 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. 2016) ("[F]ortuitous non-injury to a subset of class members does not necessarily defeat certification of the entire class, particularly as the district court is well situated to winnow out those non-injured members at the damages phase of the litigation, or to refine the class definition. Co, 445 F.3d 311, 318 (4th Cir. The one-time consulting fee was paid in August 2013 to PaCE, a forensic loan auditor, to advise the Robinsons on how to communicate with Nationstar and to handle their loan. Amchem Prods. Code Ann., Com. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). TDC-14-3667 (D. Md. 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. 1024.41(c)(1)(i). 1024.1 to 1024.41 and known as "Regulation X," see 12 C.F.R. A Scheduling Order was first entered on November 24, 2015, and the period for discovery was extended four times between November 2015 and January 2017. . Robinson et al v. Nationstar Mortgage LLC, No. 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. 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. See Stillmock, 385 F. App'x at 274 ("[T]here is no reasoned basis to conclude that the fact that an individual plaintiff can recover attorney's fees in addition to statutory damages of up to $1,000 will result in enforcement of [the Fair Credit Reporting Act] by individual actions of a scale comparable to the potential enforcement by way of class action."). On May 5, 2014, Nationstar asked the Robinsons for additional information to evaluate the appeal, including documents to verify their income. R. Civ. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. Robinson, 2015 WL 4994491, at *4 (citing Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. 2605(f). Id. 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. 10696, 10708 (Feb. 14, 2013) (codified at 12 C.F.R. 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"). Nationstar correctly notes that the Robinsons have not identified a false or misleading statement or representation by Nationstar in the record. Relevant factual and procedural background is set forth in the Court's prior Memorandum Opinion granting in part and denying in part Nationstar's partial Motion to Dismiss. Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir. 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. Gunnells, 348 F.3d at 429 ("[T]he need for individualized proof of damages alone will not defeat class certification."). A class action allows representative parties to prosecute not only their own claims, but also the claims of other individuals which present similar issues. But see Sutton v. CitiMortgage, Inc., 228 F. Supp. Law 13-316(c), which requires a response to a loan modification application within 15 days. 2010). The Robinsons assert, and Nationstar does not argue otherwise, that litigation regarding Regulation X is not proceeding against Nationstar in another forum. See 12 C.F.R. As to the third denial on November 7, 2013, Nationstar informed the Robinsons that the loan modification application was denied because the mortgage loan was not in default. 1 . Finally, to the extent that Oliver did not execute his stated methodology for identifying damages, that limitation is again based in part on Nationstar's failure to make relevant data available to him. 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. 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. 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. Bouchat, 346 F.3d at 522. 3d 1011, 1015 (W.D. The servicer "is liable for any economic damages caused by the violation." 1024.41(b)(1), (b)(2)(i)(B), and (c)(1)(ii) and Md. 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. 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 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). 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. Id. Where the cost of litigation as compared to the potential recovery gives class members little incentive to bring suit, and there is little reason to individually control the litigation, a class action is a superior method to vindicate the rights of class members. THEODORE D. CHUANG United States District Judge. After an additional period of expert discovery relating to the class certification motion, discovery closed on December 30, 2018. 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. 2605(f)(2) is not fatal to the predominance inquiry. "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.". "); cf. On February 16, 2017, the Court referred the case to United States Magistrate Judge Charles B. 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 that the company failed to honor mortgage forbearance agreements and unfairly foreclosed on homeowners. (quoting 7AA Charles Allan Wright et al., Federal Practice and Procedure 1778 (3d ed. As a result, on January 29, 2018, the Magistrate Judge granted the Robinsons' Motion to Compel in which the Robinsons had sought to have the Court order Nationstar to accept and run scripts created by the Robinsons' expert to extract the relevant data from Nationstar's databases on the sample of loans from which they could test their methodology for identifying members of the proposed classes. Since Regulation X explicitly does not require a loan servicer to provide a loan modification, the Robinsons' claim that they suffered damages because they did not receive a loan modification is not cognizable under the statute. Discovery Order, ECF No. . 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. It will be otherwise denied. . 15-3960, 2017 WL 623465, at *8 (D. Md. 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. Nationstar further argues that summary judgment must be entered in its favor on the Robinsons' claims under 12 C.F.R. Code Ann., Com. The denial letters stated that the loan's principal balance exceeded the limit under HAMP. 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. A Division of NBC Universal. Accordingly, Nationstar's Motion for Summary Judgment will be granted as to the MCPA claims under sections 13-301 and 13-303. 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. News Ask a Lawyer 143. 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. The Robinsons do not address this argument in their Opposition. Nationstar Call Settlement Administrator. . 1024.41(b)(2)(B), (c)(1)(ii); Md. Under the terms of the Settlement, if nothing else occurs in the litigation, then the Settlement will become effective 95 days from the date of that decision by the Court of Appeals. Under Count I, the Robinsons allege a violation of 12 C.F.R. Finally, Nationstar argues that summary judgment should be entered on the RESPA claims because the Robinsons cannot establish that they have suffered actual damages as a result of Nationstar's violations of Regulation X. ("MCC") 2, ECF No. 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. Check out:Covid-19 pandemic is the first time 40% of Americans have experienced food insecurity, Don't miss:Amex Blue Cash Preferred is offering an elevated welcome bonus for a limited time, Get Make It newsletters delivered to your inbox, Learn more about the world of CNBC Make It, 2023 CNBC LLC. 1024.41(h)(1). 2601 et seq. Summ. Nationstar claims that manual review of each file would take about 60 to 90 minutes per file. See id. 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. 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. 1024.41(d). Although based on imperfect data, Oliver's expert report reveals that such analysis can substantially address whether Nationstar violated 12 C.F.R. That provision provides, in parallel, that a loan servicer which does not comply with Regulation X is liable "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. 877-683-9363. 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. To view the settlement agreement and consent order, please visit the CSBS's website. 2010). Id. DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE LLC, Defendant. Appellate Win Affirms $3 Million Settlement in Class Action against Nationstar Mortgage - Tycko & Zavareei LLP Contact Us We look forward to hearing from you. From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. 2010). 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). Actual damages may also include "non-pecuniary damages, such as emotional distress and pain and suffering." The record is undisputed that as of September 25, 2017, Nationstar had neither started foreclosure proceedings nor moved for foreclosure judgment on the Robinsons' home. The next day, Nationstar sent a letter noting that the August 25 application had been received and requesting additional information. Plaintiffs "must present specific evidence to establish a causal link between the [servicer's] violation and their injuries." The Class is represented by Rafey S. Balabanian of Edelson PC. Therefore, Nationstar was required to comply with section 1024.41 in processing it. Subsequent to the Court's approval, one of the objectors to the settlement filed an appeal. 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. Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). 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. Order, ECF No. In support of this argument, Nationstar contends that the ethical rules for attorneys prohibit contingency fee arrangements with expert witnesses. 2015). Specifically, the loan servicer failed to honor borrowers' loan modification agreements. 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. 15-05811, 2016 WL 3055901 (N.D. Cal. An 85-year Harvard study found the No. 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. See Robinson v. Nationstar Mortg. Code Ann., Com. See 12 C.F.R. 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. It follows that only borrowers may bring a claim that a loan servicer has violated Regulation X. 2d 873, 883 (D. Md. Code Ann., Com. Rather than rendering the testimony inadmissible, the fee arrangement is relevant to the expert's credibility. 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." This field is for validation purposes and should be left unchanged. At least one court has found a similar expert report by Oliver to meet the Daubert standard. See Broussard, 155 F.3d at 344. The comments to that rule state that the "common law rule in most jurisdictions is . Neither the rule nor the comment, however, state whether Maryland is one such jurisdiction. 1967). 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. A class action may be maintained under Rule 23(b)(3) if common questions of law or fact "predominate over any questions affecting only individual members" and a "class action is superior to other available methods for fairly and efficiently adjudicating the controversy." . 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. Mrs. Robinson was the primary point of contact for the Robinsons in interacting with Nationstar. Corp. ("McLean I"), 595 F. Supp. v. Windsor, 521 U.S. 591, 623-24 (1997). The ruling serves as a reminder that Florida remains one of the top states for both mortgage fraud and lender errors. 1024.41(i). See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. 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. Id. A settlement has been reached in a class action lawsuit alleging Nationstar Mortgage LLC (Nationstar or Defendant) violated the Real Estate Settlement Procedures Act (RESPA) by failing to adhere to its requirements with respect to its customers loss mitigation applications and that Nationstar violated Maryland law by not timely responding to its customers mortgage servicing complaints. Claim Your Cash Every Week! See Farmer v. Ramsay, 159 F. Supp. Id. or other representation . 15-0925, 2015 WL 5165415, at *4 (D. Md. Wright et al. 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. 20-cv, -2202, 2021 WL 4462909, at *1 (S.D. The commonality requirement is also met. MSJ JR 0284. R. Evid. Plaintiffs Demetrius and Tamara Robinson (the "Robinsons") have resided in a home in Damascus, Maryland that has been subject to a mortgage loan. The Nationstar Mortgage Unwanted Phone Calls Class Action Lawsuit is Wright, et al. But see Ayres v. Ocwen Loan Servicing, LLC, 129 F. Supp. at *2. Instead, the Robinsons assert that Nationstar has not affirmatively proven that it conducted such reviews. 1024.41(i). More Information 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. 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. Since the Court has already concluded that Nationstar is entitled to summary judgment on the Robinsons' claims under 12 C.F.R. In Washington v. Am. P. 23(a)(3); Deiter v. Microsoft Corp., 436 F.3d 461, 466-67 (4th Cir. While every class member will have to establish damages, that calculation will not be "particularly complex," as it will require identifying administrative costs and fees that would not have occurred but for the RESPA violation.