That notice must be provided within 30 days of receiving the complete loss mitigation application. Regulation X, which became effective on January 10, 2014, 78 Fed. 1024.41(i). Code Ann., Com. "If a borrower's complete loss mitigation application is denied for any trial or permanent loan modification option available to the borrower," the servicer must state in the required notice to the borrower "the specific reason or reasons for the servicer's determination for each such trial or permanent loan modification and, if applicable, that the borrower was not evaluated on other criteria." Cal. 2010). Nationstar asserts that Oliver's testimony should be stricken because this fee arrangement includes an unethical contingency fee. 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. Filed by Janie Robinson. Ass'n, 375 F.2d 648, 653 (4th Cir. . "); see also 1 William Rubenstein et al., Newberg on Class Actions 2:3 (5th ed. P. 23(a)(3); Deiter v. Microsoft Corp., 436 F.3d 461, 466-67 (4th Cir. 1024.41 (2019), and the Maryland Consumer Protection Act ("MCPA"), Md. Deiter, 436 F.3d at 466-67. For the requirements that hinge on the timing of a communication or response, Oliver's methodology consists of using Nationstar's data from the LSAMS and FileNet software applications relating to a sample of 400 loans to identify the dates when certain events occurredsuch as the filing of a loan modification application, when a loan modification application became complete, and the sending of an acknowledgment or decision letter to a borrowerand then counting the days between the dates to assess whether a RESPA timing requirement was satisfied. Nationstar employees use four software applications and databases to store and track electronic information relating to loans: (1) Loan Services and Accounting Management System ("LSAMS"), Nationstar's primary loan servicing software, which contains data for loans, including the permanent records of the accounting history, communication logs, and letters documented with codes that were sent to the borrower; (2) Remedy Star, Nationstar's proprietary loss mitigation and loan modification management system, which, among other tasks, tracks the status and timeline of a loan modification and links to documents stored in FileNet; (3) LPS Desktop ("LPS"), an application which Nationstar uses to track and manage foreclosure processes and communicate with outside attorneys; and (4) FileNet, a platform that houses PDF images of documents, including letters sent to borrowers by Nationstar. The Fourth Circuit has stated that 74 members is "well within the range appropriate for class certification," Brady v. Thurston Motor Lines, 726 F.2d 136, 145 (4th Cir. If you are a member of the Settlement Class, you must submit a completed Claim Form to receive a payment. 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. 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. In its Motion to Strike, Nationstar moves to strike the report of the Robinsons' expert witness, Geoffrey Oliver, on the grounds that (1) Oliver was hired pursuant to an ethically improper contingency fee agreement; and (2) his testimony does not meet the requirements of Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). 15-0925, 2015 WL 5165415, at *4 (D. Md. Mr. Robinson then submitted another loan modification application on August 25, 2014. Ballard v. Blue Shield of S.W. 12 C.F.R. at 151. 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. 1024.41(i). If the Court approves the Settlement and it becomes final and effective, and you remain in the Settlement Class, you will receive a payment. When those scripts did not produce data that allowed the Robinsons to conduct the sampling, the Magistrate Judge ordered Nationstar on April 3, 2018 to run certain "structural scripts" on two of its four databases. The comments to that rule state that the "common law rule in most jurisdictions is . 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. 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. See Farmer v. Ramsay, 159 F. Supp. . 1024.41(a). See Torres v. Mercer Canyons Inc., 835 F.3d 1125, 1137 (9th Cir. In Robinson v., Under the RESPA, civil liability is limited to "borrowers": "[w]hoever fails to comply with any provision of, Full title:DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE, Court:UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND. MCC JR 318, 530-531. Id. Because such information is stored electronically and based on objective criteria, the members of the class will be ascertainable without significant administrative burden. 2010). Code Ann., Com. Code Ann., Com. HealthSystem, 669 F.3d 802, 812 (7th Cir. In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." 2002) (affirming without addressing the propriety of the striking of the expert testimony). 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. 1024.41(c)(1)(i). 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. A plaintiff has the burden to show that all of the necessary prerequisites for a class action have been met. A class action allows representative parties to prosecute not only their own claims, but also the claims of other individuals which present similar issues. 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."). After this missed payment, Nationstar assessed a late fee. Fed. 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. . 164. 19-303.4 cmt.3. See Tyson Foods, 136 S. Ct. at 1046-47 (holding that representative sampling was a permissible method to prove whether time spent donning and doffing gear resulted in violations of the Fair Labor Standards Act). Nationstar's Motion for Summary Judgment will be granted as to Tamara Robinson. Since Mrs. Robinson may not bring a claim under Regulation X, she may not be a named class representative. A code is entered in Remedy Star when the letter is sent. 15-05811, 2016 WL 3055901 (N.D. Cal. 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. 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. The Nationstar Mortgage Unwanted Phone Calls Class Action Lawsuit is Wright, et al. 13-316(e)(1). McLean I, 595 F. Supp. To prepare his expert report, Oliver reviewed a randomly selected sample of 400 loans serviced by Nationstar in which a loan modification application was submitted. The Robinsons appealed the Magistrate Judge's ruling because it did not require Nationstar to run a structural script for a third database. 2010). The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. Universal Athletic Sales Co. v. Am. 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. RESPA's implementing regulations, codified at 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. Petitioner: NATIONSTAR MORTGAGE, LLC: Respondent: TAMARA ROBINSON and DEMETRIUS ROBINSON: Case Number: 19-379: Filed: September 24, 2019: Court: U.S. Court of Appeals . Id. Regulation X's effective date reflected "an intent not to apply it to conduct occurring prior to that date." 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." Nationstar's failings resulted in "substantial consumer harm," CFPB Director Kathleen Kraninger said in a statement. 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"). Id. Certification will not be granted as to the claims under 12 C.F.R. An "unfair or deceptive" trade practice includes a "false . 16-0117, 2017 WL 4347826, at *15 (D. Md. 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. . According to Nationstar's Underwriting Workflow Procedures, which sets forth the steps followed to review loans for modifications, when a borrower submits a loan modification application, a code is entered into LSAMS and updates the loan's substatus in Remedy Star. LLC, No. 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. 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. 17-0982, 2018 WL 4111938, at *5-6 (M.D. . 1024.41(b)(1). The relevant rule prohibits an attorney from "offer[ing] an inducement to a witness that is prohibited by law." 26-1. If the application is denied, a notice to that effect is sent to the borrower. Code Ann., Com. All but $28.6 million of its. 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. Nationstar's reliance on Accrued Financial Services v. Prime Retail, Inc., 298 F.3d 291 (4th Cir. In assessing the Motion, the Court views the facts in the light most favorable to the nonmoving party, with all justifiable inferences drawn in its favor. Many impacted consumers have already received refunds and more will be contacted by the settlement administrator in the coming weeks. Furthermore, Nationstar's argument that the Robinsons are not typical largely recycles the same arguments made in the Motion for Summary Judgment. See Johnson v. Ocwen Loan Servicing, 374 F. App'x 868, 873 (11th Cir. uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results." 2017), the United States Court of Appeals for the Eleventh Circuit held that postage costs incurred by the plaintiff to send the "initial request for information is not a cost to the borrower 'as a result of the failure' to comply with a RESPA obligation," because a violation has not occurred and will not "necessarily occur" at the time the plaintiff paid the postage. ("MCC") 2, ECF No. application to Nationstar after January 10, 2014, and through the date of the Court's . 1024.41(b)(1), (b)(2)(i)(B), and (c)(1)(ii) and Md. at 300. In response, on May 30, 2014, Mr. Robinson sent Nationstar the exact same application that he had submitted on March 7, 2014. The Magistrate Judge ordered Nationstar to run those scripts and return the electronic data to the Robinsons. at 983 (quoting 12 U.S.C. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. Whether an application is complete depends on the requirements of the investor who holds the loan. 1024.41(c)(1)(ii), which requires a servicer to respond to a completed loan modification application; or Md. 2007)), aff'd sub nom. Id. See id. 09-08213, 2011 WL 11651320 (C.D. 1967). . Stewart v. Bierman, 859 F. Supp. 2d 1360, 1366 (S.D. (quoting East Tex. 1024.41(f), (g), and (h) because there is no evidence in the record that Nationstar violated those provisions. 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." 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. See id. Although section 13-316 provides a remedy only for economic damages arising from a mortgage servicer's failure to respond to an inquiry, see Md. 1024.41(d). Portland, OR 97208-3560. 1024.41(f), (g), and (h) and Md. Law 13-316(c), which requires a response to a mortgage servicing complaint or inquiry within 15 days. 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. . That claim will be subject to common proof, namely sampling and analysis of loan files along the lines suggested by Oliver. Cf. Several states also fined Nationstar in 2018 over failing to have proper procedures in place and "unfair and deceptive" mortgage modification policies. 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. 2013)). The first of these prerequisites is that the class must exist and be "readily identifiable" or "ascertainable" by the court through "objective criteria." v. DEMETRIUS ROBINSON; TAMARA ROBINSON, Plaintiffs - Appellees, v. . 1993) (quoting Blum v. Yaretsky, 457 U.S. 991, 1001 n.13 (1982)). "There are going to be a lot of homeowners who need a home loan modification or other assistance," Raoul says. 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. 2014). To view the settlement agreement and consent order, please visit the CSBS's website. 1024.41(f), (g), and (h), and Md. See D. Md. Id. Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. Nationstar Call Settlement Administrator. If the initial application is not complete, a different Remedy Star substatus notation and LSAMS code are entered, and a letter is created and sent to the borrower asking for the required documents. In 2017, the CFPB fined Nationstar $1.75 million for failing to report accurate data about its mortgage transactions. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir.
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