Between July 2010 and November 2013, the Robinsons submitted and Nationstar denied three applications for a loan modification under the Home Affordable Modification Program ("HAMP"). at 358. Since the Court has already concluded that Nationstar is entitled to summary judgment on the Robinsons' claims under 12 C.F.R. J. See id. This abandoned high school was converted into a 31-unit apartment building, number of unlawful practices in handling mortgages following the Great Recession. A letter noting receipt of the application is automatically generated and sent to the borrower, and a Nationstar employee checks the application's documentation to determine if it is complete based on a checklist. Law 13-101 to 13-411 (West 2015). Although each class member must individually show that they suffered "actual damages" under 12 U.S.C. Mortgage servicers seek government aid as forebearance requests soar, How this 39-year-old earns $26,000 a year in California. Id. 1024.41(h)(1). The Court does not find such a prohibition in the Maryland Attorneys' Rules of Professional Conduct. Id. Nationstar will need to enhance its policies and processes around how it handles consumer complaints, performs escrow analyses and conducts audits, for example. After several customers of Green Earth Services canceled its services, the Robinsons sought loss mitigation in the form of a loan modification from Nationstar. 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. Since it is the plaintiff's burden to establish that the requirements of Rule 23 have been met and Mr. Robinson has failed to do so, the Motion for Class Certification will be denied as to any claims that Nationstar violated 12 C.F.R. In February 2014, after their income had further decreased, the Robinsons ceased making payments on the mortgage loan. If the loan servicer denies a loan modification application where the complete application was received more than 90 days before a foreclosure sale, the servicer must allow the borrower to appeal and must respond to the appeal within 30 days of receiving it by stating in writing whether the appeal was granted and a loan modification will be offered. Because of the manner in which class discovery was conducted, see supra part II.A, Oliver did not have access to all of Nationstar's data fields for the representative sample of loans. Before the error was discovered, Mr. Robinson appealed this offer as insufficient on April 10, 2014. EQT Prod. 1024.41(b)(1), (b)(2)(i)(B), and (c)(1)(ii) and Md. Accordingly, Nationstar's Motion for Summary Judgment will be granted as to the MCPA claims under sections 13-301 and 13-303. 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. Law 13-316(c). Summ. 1024.41(b)(1). Id. MSJ JR 0284. 125. 2d 452, 467 (D. Md. Where a contingency fee arrangement for expert witnesses is not expressly prohibited by the Maryland Rules of Professional Conduct, the Court declines to find that the fee arrangement here constituted an ethical violation. 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."). Plaintiff and Class Representative Demetrius Robinson, along with Class Counsel Tycko & Zavareei LLP and The Bestor Law Firm, respectfully move this Court for an award of $1,300,000 in reasonable attorneys' fees and expenses, as well as a $5,000 service award for Mr. Robinson. Mrs. Robinson was the primary point of contact for the Robinsons in interacting with Nationstar. He was retained by the Robinsons under an arrangement through which he is to be paid a flat fee of $125,000: $62,500 up front, with an additional $62,500 to be paid if a class is certified in this case. 2014))). . Finally, the named plaintiff must "fairly and adequately protect the interests of class" without a conflict of interest with the absent class members. Law 13-303(4)-(5), 13-408. 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. At the time, Nationstar had not completed the process of updating its systems to conform to those requirements. Finally, a loan servicer "is only required to comply with the requirements" of section 1024.41 "for a single complete loss mitigation application for a borrower's mortgage loan account." Fed. Mot. Id. 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. 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. Date: September 9, 2019, Civil Action No. 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. Wright et al. Nationstar has no process for standardizing file names. When Nationstar received the application, it prevented late fees from being assessed and put a hold on any foreclosure proceedings. (kw2s, Deputy Clerk) Download PDF Search this Case Google Scholar Google Books Legal Blogs Google Web Bing Web Google News Google News Archive Yahoo! Since Mr. Robinson has the same goal as the other class members of establishing that Nationstar violated Regulation X with respect to his loan, he will adequately protect their interests. Nelson, 2017 WL 1167230, at *3 (collecting cases). TDC-14-3667 (D. Md. Order, ECF No. From this methodology, Oliver concluded that Nationstar failed to inform borrowers of their appeal rights in 39 percent of the sampled loans and failed to exercise reasonable diligence by improperly requested the same documentation already provided in 18 percent of the loans. Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. Plaintiffs "must present specific evidence to establish a causal link between the [servicer's] violation and their injuries." . 2605(f). Code Ann., Com. Sept. 2, 2015). Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. 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. cause[d] damages retroactively" and "transmogrifie[d]" the costs that predate the RESPA violation into damages. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. Some courts have held that administrative costs that predate the alleged RESPA violation cannot constitute "actual damages." Specifically, if a loss mitigation application is received "45 days or more before a foreclosure sale," the loan servicer must provide a notice to the borrower "in writing within 5 days" of receiving it in which the servicer acknowledges receipt of the application and states whether the "application is either complete or incomplete." 3d 1011, 1015 (W.D. See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. 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. 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. Similarly, since Mr. Robinson has not suffered injury under these provisions, he may not bring those claims on behalf of the class. 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. The Court agrees that costs, including administrative costs, "incurred whether or not the servicer complied with its obligations" are not actual damages "caused by, or 'a result of,'" the RESPA violation, whether or not they occurred before or after the violation. Under Federal Rule of Civil Procedure 56(a), the Court grants summary judgment if the moving party demonstrates that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. Id. . A dispute of material fact is only "genuine" if sufficient evidence favoring the nonmoving party exists for the trier of fact to return a verdict for that party. 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. 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. 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. 2015) (holding that Regulation X did not apply to loss mitigation applications submitted before the effective date). 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. 1024.41(a). Moreover, Nationstar cites no authority for the proposition that a loss mitigation application would not be deemed "complete" for purposes of RESPA upon such a formal designation, and any rule that would deem such an application incomplete in the event that an underwriter subsequently decided to ask for additional material would be entirely unworkable. Reg. 12 U.S.C. Code Ann., Com. Nationstar claims that manual review of each file would take about 60 to 90 minutes per file. Id. Nationstar denies all allegations of wrongdoing and no judgment or determination of wrongdoing has been made. 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. P. 23(a)(3); Deiter v. Microsoft Corp., 436 F.3d 461, 466-67 (4th Cir. Nationstar argues that summary judgment should be entered on the Robinsons' MCPA claim under section 13-316 because the Robinsons have not shown that they submitted a complaint or inquiry that triggers a duty to respond. Proof of these claims requires a showing of the dates that an application was received, an acknowledgment letter was sent, an application became complete, Nationstar sent a decision letter to the borrower, and a foreclosure sale is scheduled. Commonality requires that a class have "questions of law or fact common to the class" which are capable of classwide resolution, such that the determination of the truth or falsity of the common issue "will resolve an issue that is central to the validity of each one of the claims in one stroke." 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 denial letters stated that the loan's principal balance exceeded the limit under HAMP. A conflict of interest will not defeat the adequacy requirement when "all class members share common objectives[,] the same factual and legal positions, and . Fed. 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"). A fact is "material" if it "might affect the outcome of the suit under the governing law." Regulation X's effective date reflected "an intent not to apply it to conduct occurring prior to that date." Once the documents are received, the Remedy Star substatus and LSAMS code are changed again to mark the application complete. Nationstar filed a notice of settlement and a joint motion to proceed before a magistrate . 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. According to Oliver, to determine that certain disclosures or specific information were conveyed to borrowers, the "objectid" field used in FileNet can be used to identify the type of letter sent. 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. 12 U.S.C. See id. Sept. 29, 2017); Billings v. Seterus, Inc., 170 F. Supp. . The Robinsons assert that they have paid a total of $6,147.12 in unspecified fees to Nationstar. 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. 218. Class Cert. Ballard v. Blue Shield of S.W. Cent. Several states also fined Nationstar in 2018 over failing to have proper procedures in place and "unfair and deceptive" mortgage modification policies. Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir. 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. Indeed, Nationstar does not seriously contest the commonality prong. 15-05811, 2016 WL 3055901 (N.D. Cal. 1024.41, a regulation of RESPA that outlines loss mitigation procedures. Sept. 29, 2021). That provision provides, in parallel, that a loan servicer which does not comply with Regulation X is liable "to the borrower." (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"). 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." P. 23(a)(2); Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 350 (2011). 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. 2d at 1366. See supra parts I.B.1, I.B.3, I.C.1. Nationstar's Motion will be denied as to this claim. 1024.41(f), (g), and (h) and Md. Where Accrued Financial addresses a different scenario with a different remedy, the Court does not find that it requires that the testimony of an expert witness paid on contingency fee basis must be excluded. Ask to speak in court about the fairness of the Settlement. Furthermore, according to Nationstar, to identify the content of a letter sent to a borrower, the letter itself must be viewed. McLean I, 595 F. Supp. at 983. 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. 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. See 12 C.F.R. Code Ann., Com. that it is improper to pay an expert witness a contingent fee." For the foregoing reasons, Nationstar's Motion for Summary Judgment will be GRANTED IN PART and DENIED IN PART. If you are a member of the Settlement Class, you must submit a completed Claim Form to receive a payment. See Keen, 2018 WL 4111938, at *5-6. A "borrower" may enforce the provisions of Regulation X pursuant to 12 U.S.C. 13-316(e)(1). After March 2014, Mrs. Robinson was primarily responsible for communicating with Nationstar and PaCE. All but $28.6 million of its. Some of the alleged damages are not supported in law or in fact. On February 16, 2017, the Court referred the case to United States Magistrate Judge Charles B. Thorn v. Jefferson-Pilot Life Ins. 2d 1360, 1366 (S.D. . MCC JR 530. See 12 C.F.R. Nationstar's failings resulted in "substantial consumer harm," CFPB Director Kathleen Kraninger said in a statement. Law 13-316(e)(1), and "actual damages," 12 U.S.C. Code Ann., Com. is generally unproblematic as the non-injured parties can just be sorted out at the remedies phase of the suit."). 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. A separate Order shall issue. 2015). From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. THEODORE D. CHUANG United States District Judge. The CFPB estimates about 40,000 borrowers were harmed by Nationstar's allegedly unfair and deceptive practices, according to a statement released Monday. 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. Johnson, 374 F. App'x at 873; Keen v. Ocwen Loan Servicing, LLC, No. Nationstar said in a statement that its settlements were based on "loan-servicing practices" that the company used between 2010 and 2015 and has since discontinued. 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. 2004). 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.