Nationstar broke that trust by engaging in unfair and deceptive practices," Kraninger added. These letters are based on standard Nationstar templates, and the code reflects the type of letter sent. TDC-14-3667, 2019 WL 4261696 (D. Md. 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. 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. 3d at 1014. Mar. Rather than rendering the testimony inadmissible, the fee arrangement is relevant to the expert's credibility. See Wirtz, 886 F.3d at 719-20. See D. Md. For example, it was undisputed that on May 30, 2014, Mr. Robinson, in response to Nationstar's requests for additional information, resubmitted the same information sent with his March 2014 loan modification application. Co., 595 F.3d 164, 179-80 (4th Cir. Every mortgage has a unique loan number that can be used to identify the borrower and the loan in each of the four databases. 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. They have a home in Damascus, Maryland purchased by Demetrius Robinson ("Mr. Robinson"). And given that the class includes all borrowers who have submitted an application since January 10, 2014, joinder of all members is eminently impractical. Specifically, the loan servicer failed to honor borrowers' loan modification agreements. Nationstar also asserts that the Robinsons have not identified evidence sufficient to support their MCPA claims. Law 13-316(c), which requires a response to a loan modification application within 15 days. at 983. Nationstar further argues that summary judgment must be entered in its favor on the Robinsons' claims under 12 C.F.R. 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. 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. 12 U.S.C. (2012), and the Maryland Consumer Protection Act ("MCPA"), Md. 1976) (holding that while it may be unethical for a lawyer to testify on behalf of a client as an expert, "it does not necessarily follow that any alleged professional misconduct" would require exclusion of the testimony because the rules of professional conduct do "not delineate rules of evidence"); United States v. Fogel, 901 F.2d 23, 26 (4th Cir. 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. 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). 15-0925, 2015 WL 5165415, at *4 (D. Md. If a borrower is experiencing issues or not getting the help needed, contact your state attorneys general. . The Court will address the varying claims in turn. at 358. See Johnson v. Ocwen Loan Servicing, 374 F. App'x 868, 873 (11th Cir. The first of these prerequisites is that the class must exist and be "readily identifiable" or "ascertainable" by the court through "objective criteria." v. Nationstar Mortgage LLC. Code Ann., Com. Date: September 9, 2019, Civil Action No. Thus, the Court concludes that, while Nationstar may have defenses as to some borrowers, the common proof that establishes the asserted violations, as well as the common question of whether the Robinsons can prove a pattern-or-practice violation by Nationstar, will predominate over the individual issues as to these claims. After they became delinquent on their loan, the Robinsons submitted another loan modification application to Nationstar on March 7, 2014. However, the burden is on the plaintiffs to show that other class members exist and that their joinder is impracticable; a court may not rely on mere speculation that numerosity has been satisfied. 1024.41(b)(2)(B). 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." 2605(f)(2) is not fatal to the predominance inquiry. Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). 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. See Krakauer v. Dish Network, L.L.C., 925 F.3d 643, 658 (4th Cir. P. 23(a)(3); Deiter v. Microsoft Corp., 436 F.3d 461, 466-67 (4th Cir. That claim will be subject to common proof, namely sampling and analysis of loan files along the lines suggested by Oliver. Law 13 . at 248-49. 2d 1360, 1366 (S.D. 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. 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. 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. 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. Id. . 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. But see Ayres v. Ocwen Loan Servicing, LLC, 129 F. Supp. v. Windsor, 521 U.S. 591, 623-24 (1997). That's one reason why the settlement, particularly the provisions requiring Nationstar to adhere to enhanced standards, is crucial. is generally unproblematic as the non-injured parties can just be sorted out at the remedies phase of the suit."). Code Ann., Com. R. Civ. 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. uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results." 2018); Renfroe v. Nationstar Mortg., LLC, 822 F.3d 1241, 1247 n.4 (11th Cir. Law 13-301(1). "); see also 1 William Rubenstein et al., Newberg on Class Actions 2:3 (5th ed. If the application is complete "more than 37 days before a foreclosure sale," the servicer may not move for a foreclosure judgment or conduct a foreclosure sale, but instead must first "[e]valuate the borrower for all loss mitigation options available to the borrower," send to the borrower "a notice in writing stating the servicer's determination of which loss mitigation options, if any, it will offer," and include a statement of applicable appeal rights. Id. 2605(f)(2). The denial letters stated that the loan's principal balance exceeded the limit under HAMP. Subsequent to the Court's approval, one of the objectors to the settlement filed an appeal. 2007)), aff'd sub nom. 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. In Robinson v. Nationstar Mortgage LLC, No. 1994) (noting that a single common issue is sufficient to meet the commonality requirement). After this missed payment, Nationstar assessed a late fee. See, e.g., Ward v. Dixie Nat. 2010). 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. From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. Others, however, have concluded that "all expenses, costs, fees, and injuries fairly attributable to" a servicer's RESPA violation are damages, "even if incurred before the" violation, because the "wrongful act . For the foregoing reasons, Nationstar's Motion for Summary Judgment will be GRANTED IN PART and DENIED IN PART. at 359-60. Fed. Presently pending is Nationstar's Motion for Summary Judgment, Nationstar's Motion to Strike, and the Robinsons' Motion for Class Certification. Fed. 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. Id. Code Ann., Com. Fed. . 2005))). Wesleyan Coll. If the named plaintiff satisfies all of the Rule 23(a) requirements and the Rule 23(b)(3) requirements, then class certification is appropriate. 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. R. Evid. 2d 452, 467 (D. Md. Therefore, the Court will grant in part and deny in part the Motion for Class Certification. 1024.41(b)(2)(i)(B) and Md. Ins. 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. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. "[A]n evaluation of the merits to determine the strength of plaintiffs' case is not part of a Rule 23 analysis." 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. Notably, Oliver's analysis did not consider foreclosure information because the data produced did not include dates of foreclosure sales. The entry under "objected" acts as a unique identifier for an electronic file, but it does not contain information about the file's substance and could in fact contain multiple submissions or documents relating to one borrower. 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. More Information Sept. 9, 2019), there were multiple other claims at issue, for which Oliver's expert report seemed better suited to address. Id. 2002), is misplaced. The Robinsons do not address this argument in their Opposition. 19-303.4 cmt.3. 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. The Robinsons' expert had written the scripts using data dictionaries and without accessing the databases. The Motion will be otherwise denied. Appellate Win Affirms $3 Million Settlement in Class Action against Nationstar Mortgage - Tycko & Zavareei LLP Contact Us We look forward to hearing from you. Thus, the nature of the proof of whether there has been a pattern or practice of RESPA violations provides substantial support for a finding of predominance. 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. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). 17-0982, 2018 WL 4111938, at *5-6 (M.D. Id. Tagatz, 861 F.2d at 1042; cf. After an additional period of expert discovery relating to the class certification motion, discovery closed on December 30, 2018. Law 13-316(c). Additional facts relevant to the pending motions are set forth below. The Deed specifies that a person who signs it but "does not execute the note" is a co-signer of the Deed in order to mortgage and convey that person's interest in the Property under the terms of the Deed, but "is not personally obligated to pay the sums secured by this Security Instrument," and her consent is not required to alter the terms of the Deed or the Note. Robinson, 2015 WL 4994491, at *4 (citing Marchese v. JPMorgan Chase Bank, N.A., 917 F. Supp. Compl. Indeed, Mr. Robinson testified that Mrs. Robinson did not sign the Note because she did not purchase the property with him. See Farmer v. Ramsay, 159 F. Supp. Finally, where Nationstar has offered no specific argument in its brief, beyond those addressed above, to refute Oliver's proffered analysis for identifying RESPA violations arising from the failure to notify borrowers of their appeal rights or the failure to exercise diligence in requesting documents based on repeated requests for the same documents, 12 C.F.R. 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. 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. 10696, 10836. Petitioner: NATIONSTAR MORTGAGE, LLC: Respondent: TAMARA ROBINSON and DEMETRIUS ROBINSON: Case Number: 19-379: Filed: September 24, 2019: Court: U.S. Court of Appeals . The language of the regulation states not that a loan servicer must comply with Regulation X's requirements only for a borrower's first loss mitigation application, but that a loan servicer must "comply with the requirements" only "for a single complete loss mitigation application." Finally, the Court finds that common issues of law and fact predominate. See Baby Neal for and by Kanter v. Casey, 43 F.3d 48, 56-57 (3d Cir. An expert's testimony is "critical" where it is "important to an issue decisive for the motion for class certification." the same interest in establishing the liability of defendants." 1024.41(a). 1024.41 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. 2015). State attorneys general are here for homeowners, Raoul adds. Id. 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. 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. In support of this argument, Nationstar contends that the ethical rules for attorneys prohibit contingency fee arrangements with expert witnesses. Law 13-303(4)-(5), 13-408. 26-1. (quoting East Tex. From January 2012 to December 2016, the CFPB and 50 state attorneys general claim Nationstar, which is now doing business asMr. Cooper, engaged in a number of unlawful practices in handling mortgages following the Great Recession. 218. 1 Nationstar later conceded that at the time the Robinsons submitted their application, it had not yet updated its systems to comply with Section 1024.41. The Court will therefore deny the Motion for Summary Judgment as to this argument. 2006). Sept. 29, 2021). The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. Reg. See MCC JR0529-31. 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. After attempts to modify their 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. 2013); Poindexter v. Teubert, 462 F.2d 1096, 1097 (4th Cir. 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. . FCRA). 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.