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. Regulation X's effective date reflected "an intent not to apply it to conduct occurring prior to that date." For the Regulation X provisions that require the servicer to communicate specific information to a borrower, Oliver's methodology involves reviewing a sample of loan files and identifying a specific communication to a borrower based on the file name. 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. Discovery Order, ECF No. 1024.41(c)(1)(ii), 1024.41(b)(1), the Court concludes that common computerized analysis will substantially advance the resolution of such claims, even if not entirely eliminating the need for reviewing certain specific file documents. application to Nationstar after January 10, 2014, and through the date of the Court's . . Code Ann., Com. Mrs. Robinson was the primary point of contact for the Robinsons in interacting with Nationstar. The fee arrangement will be considered as an issue potentially affecting the credibility, rather than the admissibility, of the expert testimony. First, to the extent that there was a period of time during which Nationstar failed to implement procedures to comply with RESPA, the facts establishing such a gap would be highly relevant to a pattern or practice determination and would be common in every case. Id. Robinson, 2015 WL 4994491, at *4 (citing Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. Nationstar's Motion to Strike will be DENIED. Nationstar will need to enhance its policies and processes around how it handles consumer complaints, performs escrow analyses and conducts audits, for example. 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. 1024.41(c)(1)(i)-(ii), (g). You will not receive a payment if you fail to timely submit a completed Claim Form, and you will give up your right to bring your own lawsuit against the Defendant about the claims in this case. 20-cv, -2202, 2021 WL 4462909, at *1 (S.D. 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. While Mrs. Robinson stated that she was conducting bookkeeping for Green Earth Services during the relevant time frame, she testified that her work was less than six hours per week, and the Robinsons have not shown that her time spent communicating with Nationstar "resulted in actual pecuniary loss" to Mr. Robinson or the business. A 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. MSJ JR 0284. 2605(f)(2), "Rule 23 contains no suggestion that the necessity for individual damage determinations destroys commonality, typicality, or predominance, or otherwise forecloses class certification." The Robinsons and Nationstar then engaged in a series of tortured exchanges over the next several months. 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. . After March 2014, Mrs. Robinson was primarily responsible for communicating with Nationstar and PaCE. News Ask a Lawyer In addition to the fee paid to PaCE, the Robinsons also assert as damages $50.58 in administrative costs, specifically postage fees for sending information relating to their loan modification application to Nationstar, and 120 hours of time expended on the loan modification process. Mr. Robinson then submitted another loan modification application on August 25, 2014. 2d 452, 468 (D. Md. The Robinsons assert, and Nationstar does not argue otherwise, that litigation regarding Regulation X is not proceeding against Nationstar in another forum. 164. Nationstar Call Settlement Administrator. Id. loan" did not have standing to bring a RESPA claim); Nelson v. Nationstar Mortg. "We will be watching the mortgage interest industry to ensure they are treating homeowners fairly and fulfilling their obligations.". There is no reason to conclude that individual class members have any particular interest in individually controlling the litigation through separate actions, or that this Court is an undesirable forum to host this litigation, since Nationstar services loans in this district, is subject to jurisdiction here, and has presented no argument that Maryland is an inconvenient forum. Nationstar's Motion will be denied as to this claim. ("Opp'n') 13, ECF No. The relevant rule prohibits an attorney from "offer[ing] an inducement to a witness that is prohibited by law." The Final Approval Order, approving the Class-wide Settlement, was entered December 11, 2020. 2015) Court Description: MEMORANDUM OPINION. 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. Actual damages may also include "non-pecuniary damages, such as emotional distress and pain and suffering." The ruling serves as a reminder that Florida remains one of the top states for both mortgage fraud and lender errors. Your Email Please enter your email. TDC-14-3667, 2019 WL 4261696 (D. Md. Nationstar filed a notice of settlement and a joint motion to proceed before a magistrate . See id. 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. Id. Compl. LLC, No. "Mortgage servicers are entrusted with handling significant financial transactions for millions of Americans, including struggling homeowners. 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. 2016) (dicta). During this period, in August 2013, the Robinsons retained a forensic loan auditor, Professional Compliance Examiners ("PaCE"), and paid it $2,275 to help them communicate with Nationstar. Therefore, the Court will grant in part and deny in part the Motion for Class Certification. Law 13-301 and 303. "[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.'" Contact the Class Action Administrator at 1-855-917-3477 (Toll-Free). 12 U.S.C. From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. 2003). Presently pending is Nationstar's Motion for Summary Judgment, Nationstar's Motion to Strike, and the Robinsons' Motion for Class Certification. 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. 2011) ("[T]he possibility that a well-defined class will nonetheless encompass some class members who have suffered no injury . 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. 1024.41(b)(2)(B), (c)(1)(ii); Md. Bouchat v. Balt. 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." 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. When combined with the state settlements, Nationstar is on the hook to pay a total of $91 million overall: $85 million to harmed consumers and $6 million in civil penalties. This assertion mischaracterizes the burden of proof in a civil case. Law 13-303(4)-(5), 13-408. 2010). 1024.41 (2019), and the Maryland Consumer Protection Act ("MCPA"), Md. Accordingly, the Motion is denied as to such claims. Those claims arose from Nationstar's alleged 2605(f). (2000) (reflecting that the prior version of the rules of professional conduct prohibited an attorney from "acquiesc[ing] in the payment of compensation to a witness contingent on the content of his testimony or the outcome of the case"). 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. Rather than rendering the testimony inadmissible, the fee arrangement is relevant to the expert's credibility. 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. 2605(f). Code Ann., Com. 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. Wright et al. 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. 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." 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. 26-1. 1994) (noting that a single common issue is sufficient to meet the commonality requirement). 1984), and has upheld the certification of a class with as few as 18 members, Cypress v. Newport News Gen. & Nonsectarian Hosp. Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). 2003) ("[I]f Lierboe has no stacking claim, she cannot represent others who may have such a claim, and her bid to serve as a class representative must fail. On February 16, 2017, the Court referred the case to United States Magistrate Judge Charles B. . 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. 2605(f)(1)(A); see 12 C.F.R. See 12 C.F.R. 1024.1 to 1024.41 and known as "Regulation X," see 12 C.F.R. Nationstar also allegedly foreclosed on borrowers with pending forbearance applications after promising not to do so and failed to properly handle escrow payments and accounting for homeowners who were in Chapter 13 bankruptcy proceedings. Robinson v. Nationstar Mortgage, LLC Complaint with jury demand against Nationstar Mortgage, LLC. 15-05811, 2016 WL 3055901 (N.D. Cal. Accordingly, a loan servicer must comply with Regulation X as to the first loss mitigation application submitted after the effective date. The Robinsons' expert had written the scripts using data dictionaries and without accessing the databases. In Washington v. Am. Furthermore, according to Nationstar, to identify the content of a letter sent to a borrower, the letter itself must be viewed. 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. . Co., 595 F.3d 164, 179 (4th Cir. 13-316(e)(1). P. 23(a)(1). 1993) (quoting Blum v. Yaretsky, 457 U.S. 991, 1001 n.13 (1982)). Id. J. Messner v. Northshore Univ. See Baby Neal for and by Kanter v. Casey, 43 F.3d 48, 56-57 (3d Cir. 28, 2017). 1967). See, e.g. Aug. 19, 2015). Although based on imperfect data, Oliver's expert report reveals that such analysis can substantially address whether Nationstar violated 12 C.F.R. That notice must be provided within 30 days of receiving the complete loss mitigation application. Id. Md. 2018); Renfroe v. Nationstar Mortg., LLC, 822 F.3d 1241, 1247 n.4 (11th Cir. at 983 (quoting 12 U.S.C. . Co., 595 F.3d 164, 179-80 (4th Cir. Additional facts relevant to the pending motions are set forth below. See 12 C.F.R. WASHINGTON, D.C. The Consumer Financial Protection Bureau (CFPB) today ordered Nationstar Mortgage LLC to pay a $1.75 million civil penalty for violating the Home Mortgage Disclosure Act (HMDA) by consistently failing to report accurate data about mortgage transactions for 2012 through 2014. Thorn v. Jefferson-Pilot Life Ins. Here, Mrs. Robinson signed the Deed but did not sign the Note. In its Motion to Strike, Nationstar argues that Oliver's methodology has not been peer reviewed, has a high error rate because he used the wrong data fields to identify the dates of events, failed to consider the timing of foreclosure sales relative to the dates of the submission of loan modification applications, and did not propose a specific methodology for calculating damages. Class litigation would also promote consistent results on the common question whether Nationstar engaged in a pattern or practice of violating Regulation X and would provide Nationstar with finality and closure on that issue. 12 C.F.R. v. Nationstar Mortgage LLC, Case No. In this photo illustration, the Nationstar Mortgage Holdings Inc. logo seen displayed on a smartphone. Therefore, Nationstar was required to comply with section 1024.41 in processing it. 2010). which has the capacity, tendency, or effect of deceiving or misleading consumers." UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. After several customers of Green Earth Services canceled its services, the Robinsons sought loss mitigation in the form of a loan modification from Nationstar. Nationstar's Motion for Summary Judgment will be granted as to Tamara Robinson. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. 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. Id. Md. Law 13-301 and 13-303, because the Robinsons do not have standing to bring those claims. 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. 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. R. Evid. Thus, based on his report and experience, Oliver concludes that Nationstar "failed to comply" with Regulation X and that it is possible to "identify violations" of Regulation X "using the methodologies" he described, without the necessity of a file-by-file review. Neither the rule nor the comment, however, state whether Maryland is one such jurisdiction. See Lierboe v. State Farm Mut. Id 1024.41(c)(1). Fed. 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. Because Oliver analyzed proprietary databases and data specifically disclosed for this litigation pursuant to a protective order, such that Oliver's peers lack access to the same information, Oliver's expert testimony is not of the type that ordinarily would be subject to peer review, and it would be unfair to require "general acceptance within a relevant scientific community." TDC-14-3667 (D. Md. . Day to address discovery issues. 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. The Court will address the varying claims in turn. 2d 873, 883 (D. Md. James Robinson v. National Student Clearinghouse Toggle navigation Home Commonly Asked Questions Documents The Court approved the settlement at the July 7, 2020 Fairness Hearing. 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. 2006). 2013). 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. 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. 702, 703. Rules 19-303.4(b) (2018). 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. Robinson v. Nationstar Mortgage, LLC 1:2021cv00452 | US District Court for the Northern District of Ohio | Justia Log In Sign Up Find a Lawyer Ask a Lawyer Research the Law Law Schools Laws & Regs Newsletters Marketing Solutions Justia Dockets & Filings Sixth Circuit Ohio Northern District Robinson v. Nationstar Mortgage, LLC Robinson v. Section 13-316(c) governs "mortgage servicing" and, among other requirements, provides that a "servicer shall designate a contact to whom mortgagors may direct complaints and inquiries" and that the "contact shall respond in writing to each written complaint or inquiry within 15 days if requested." 14-3667, 2015 WL 4994491, at *1-2 (D. Md. Nationstar broke that trust by engaging in unfair and deceptive practices," Kraninger added. 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. United States v. Valona, 834 F.2d 1334, 1344 (7th Cir. The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. 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. Since the MCPA and Regulation X allow recovery only of "economic damages," Md. 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. Fed. 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. 1988) (distinguishing between a rule of professional conduct and admissibility of evidence); cf. Factors "pertinent" to the predominance and superiority requirements include the "class members' interests in individually controlling" the litigation, whether litigation on the matter has already been begun by other class members, whether concentrating the litigation in one forum is desirable or undesirable, and the potential difficulties managing the class action presents. 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. On February 10, 2022, the Court of Appeals issued a decision affirming the Final Approval Order. . The proposed settlement with the CFPB requires Nationstar to pay $73 million in restitution to affected borrowers, as well as a $1.5 million civil penalty to the agency. At this juncture, this allegation plausibly supports a finding of willful noncompliance. 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. Id. Am. However, Nationstar did not comply with all requirements of Regulation X, which became effective on January 10, 2014. For the following reasons, the Motion for Summary Judgment will be GRANTED IN PART and DENIED IN PART; the Motion to Strike will be DENIED; and the Motion for Class Certification will be GRANTED IN PART and DENIED IN PART. Id. In 2017, the CFPB fined Nationstar $1.75 million for failing to report accurate data about its mortgage transactions. Some of the alleged damages are not supported in law or in fact. "When these issues were identified several years ago, we immediately made restitution to our impacted customers and invested in process improvements to prevent reoccurrence," Jay Bray, CEO and chairman of Mr. Cooper said in a statement Monday. 1024.41(d). 1024.41(a). Fed. Regulation X went into effect on January 10, 2014. All but $28.6 million of its. Ins. 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. Indeed, Mr. Robinson testified that Mrs. Robinson did not sign the Note because she did not purchase the property with him. (quoting East Tex. That's one reason why the settlement, particularly the provisions requiring Nationstar to adhere to enhanced standards, is crucial. 2601-2617 (2012), specifically RESPA's implementing regulations known as "Regulation X," 12 C.F.R. The Robinsons assert that they have paid a total of $6,147.12 in unspecified fees to Nationstar. Because Oliver's methodology is reliable within the meaning of Federal Rule of Civil Procedure 702 and Daubert, Nationstar's Motion to Strike will be denied. Because there are, at a minimum, disputed issues of fact as to what fees, administrative costs, and interest constitute damages, the Court will deny the motion for summary judgment on the issue of actual damages. 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. 12 C.F.R. at 358. Reg. 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. The Motions are fully briefed, and no hearing is necessary to resolve the issues. 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." Finally, the Court finds that Mr. Robinson will adequately represent the absent class members. Id. Although this data was not provided to Oliver, there is no reason it could not be produced and used to make determinations on the timeliness of decisions on loss mitigation applications. . Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. If the Court approves the Settlement and it becomes final and effective, and you remain in the Settlement Class, you will receive a payment. 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. Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. And given that the class includes all borrowers who have submitted an application since January 10, 2014, joinder of all members is eminently impractical. Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. Cf. P. 23(a)(4); Ward v. Dixie Nat'l Life Ins. Sep. 9, 2019). An "unfair or deceptive" trade practice includes a "false . Code Ann., Com. Portland, OR 97208-3560. 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. 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." 2605(f)(1)(B), a borrower cannot recover these additional damages "without first recovering actual damages." 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. In Frank v. J.P. Morgan Chase Bank, N.A., No. A fact is "material" if it "might affect the outcome of the suit under the governing law." Id. Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir. McLean v. GMAC Mortg. If more documents are required, then the same Remedy Star substatus and LSAMS code that denote missing documents are entered. Nationstar's claim that the above-described coding is not dispositive, because an underwriter could subsequently determine that more information was needed after all, is not persuasive. The first of these prerequisites is that the class must exist and be "readily identifiable" or "ascertainable" by the court through "objective criteria."