Make your practice more effective and efficient with Casetexts legal research suite. 1987) (holding, in the context of an informant who is paid a contingent fee, that the fee should be treated "as a credibility factor"). (kw2s, Deputy Clerk) Download PDF Search this Case Google Scholar Google Books Legal Blogs Google Web Bing Web Google News Google News Archive Yahoo! 2006). Summ. The servicer "is liable for any economic damages caused by the violation." at 983. 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. For example, Nationstar's own internal procedures reveal that when a loss mitigation application is received, a processor reviews it to determine if all required information and documents have been received, and enters one code, specifically "code HMPC" in LSAMS signifying "Financial Application Complete," and a different code, specifically "code HMPA," signifying "Financial Application Incomplete." Claim Your Cash Every Week! Although each class member must individually show that they suffered "actual damages" under 12 U.S.C. Before the error was discovered, Mr. Robinson appealed this offer as insufficient on April 10, 2014. 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. Regulation X, which became effective on January 10, 2014, 78 Fed. 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." While the date that Nationstar's systems came into compliance, is unknown, Nationstar's systematic noncompliance presents common questions of law and fact for all class members. Id. 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. Parties, docket activity and news coverage of federal case Robinson et al v. Nationstar Mortgage LLC, case number 8:14-cv-03667, from Maryland Court. 2002), is misplaced. 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."). 89, 90, ECF No. 2605(f), is common question of law and fact that Mr. Robinson and the class members would all be required prove in their individual cases in order to qualify for statutory damages. After several customers of Green Earth Services canceled its services, the Robinsons sought loss mitigation in the form of a loan modification from Nationstar. See Stillmock v. Weis Markets, Inc., 385 F. App'x 267, 275 (4th Cir. Am. Therefore, the Court will grant in part and deny in part the Motion for Class Certification. 2d 1360, 1366 (S.D. The distinction is crucial. . Plaintiffs Demetrius and Tamara Robinson (the "Robinsons") have resided in a home in Damascus, Maryland that has been subject to a mortgage loan. Bouchat, 346 F.3d at 522. . 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. v. DEMETRIUS ROBINSON; TAMARA ROBINSON, Plaintiffs - Appellees, v. . Am. Robinson et al v. Nationstar Mortgage LLC, No. "); cf. In 2007, Mr. Robinson obtained a loan with the principal amount of $755,000 to refinance the property. Mortgage servicers seek government aid as forebearance requests soar, How this 39-year-old earns $26,000 a year in California. 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. McAdams v. Nationstar Mortg. Law 13-316(c), the Court will grant class certification as to those class members and claims. The "Nationwide Class" is composed of "[a]ll persons in the United States that submitted a loss mitigation application to Nationstar after January 10, 2014, and through the date of the Court's certification order." As for the claims of errors in Oliver's analysis, although this criticism is couched as his "misunderstanding the nature of Nationstar's various databases," Nationstar largely challenges Oliver's failure to use particular data fields, some which were never made available to him. Co, 445 F.3d 311, 318 (4th Cir. 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. 2605(f)(1)(B), a borrower cannot recover these additional damages "without first recovering actual damages." 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. 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. Local R. 105.6. Tagatz v. Marquette Univ., 861 F.2d 1040, 1042 (7th Cir. Law 13-316(c). 2010). Compl. 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. Code Ann., Com. Wright et al. Law 13-101 to 13-411 (West 2015). 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. The comments to that rule state that the "common law rule in most jurisdictions is . Anderson, 477 U.S. at 248. They have a home in Damascus, Maryland purchased by Demetrius Robinson ("Mr. Robinson"). Presently pending is Nationstar's Motion for Summary Judgment, Nationstar's Motion to Strike, and the Robinsons' Motion for Class Certification. 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. Fed. Order, ECF No. Petitioner: NATIONSTAR MORTGAGE, LLC: Respondent: TAMARA ROBINSON and DEMETRIUS ROBINSON: Case Number: 19-379: Filed: September 24, 2019: Court: U.S. Court of Appeals . Therefore, Nationstar was required to comply with section 1024.41 in processing it. 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. If more documents are required, then the same Remedy Star substatus and LSAMS code that denote missing documents are entered. Cal. 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. See 12 C.F.R. Ins. Law 13-301 and 13-303, and that Mr. Robinson therefore may not assert such claims on behalf of the class, Mr. Robinson's remaining claims and defenses are typical of the class members. Cf. According to Oliver, if he used incorrect data, that was a result of the limited data fields and definitions provided to him. Filed by Janie Robinson. Accordingly, the Motion is denied as to such claims. See, e.g. 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. Joint Record ("MCC JR") 0907. It is the plaintiffs who bear the burden of proving their claims. 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. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. Subscribe to our free newsletter right now. 1024.41(i). A Division of NBC Universal. 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."). Fla. 2009), aff'd, 398 F. App'x 467, 471 (11th Cir. It follows that only borrowers may bring a claim that a loan servicer has violated Regulation X. 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. R. Civ. That is not so here. Id. Summary judgment will therefore be entered for Nationstar on the claims that Nationstar violated subsections (f) and (g). v. Nationstar Mortgage LLC, Case No. See, e.g., Ward v. Dixie Nat. Regulation X's effective date reflected "an intent not to apply it to conduct occurring prior to that date." Regulation X went into effect on January 10, 2014. 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. See Wirtz, 886 F.3d at 719-20. Since Mrs. Robinson may not bring a claim under Regulation X, she may not be a named class representative. TDC-14-3667, 2019 WL 4261696 (D. Md. R. Civ. 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. The Class Action Administrator would then begin distribution of the settlement funds. PO Box 3560. In Robinson v. Nationstar Mortgage LLC, No. The Court will not revisit this determination. United States v. Valona, 834 F.2d 1334, 1344 (7th Cir. 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. See Hayes v. Wal-Mart Stores, Inc., 725 F.3d 349, 356-57 (3d Cir. 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." Id. Signed by Magistrate Judge Jillyn K Schulze on 9/9/2016 . See id. During this time and up until September 25, 2017, Nationstar had not begun any foreclosure proceedings on the Robinsons' home. Those claims arose from Nationstar's alleged The relevant rule prohibits an attorney from "offer[ing] an inducement to a witness that is prohibited by law." Auto. In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." Law 13-316(c), which requires a response to a mortgage servicing complaint or inquiry within 15 days. . 1024.41(i). application to Nationstar after January 10, 2014, and through the date of the Court's . Id. Code Ann., Com. 2007)), aff'd sub nom. A code is entered in Remedy Star when the letter is sent. The ruling serves as a reminder that Florida remains one of the top states for both mortgage fraud and lender errors. Rules 19-303.4(b) (2018). An 85-year Harvard study found the No. After two more extensions were granted, based on a finding by the Magistrate Judge that "Defendant has failed to comply" with its discovery obligations and delayed the process, discovery closed on March 22, 2018. This abandoned high school was converted into a 31-unit apartment building, number of unlawful practices in handling mortgages following the Great Recession. Class Cert. 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. Bouchat v. Balt. May 31, 2016), the plaintiff had signed the deed of trust but not the promissory note but was nevertheless deemed to have standing because she had owned the home with a right of survivorship with her deceased husband, who had signed the note. 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'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. Id. Id 1024.41(c)(1). 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. TDC-14-3667 (D. Md. Mot. 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. During discovery, Oliver revealed that his fee arrangement with the Robinsons includes a flat fee for his expert services, but that a portion of the fee is contingent on the certification of a class in this case. Opp'n Mot. 16-0307, 2017 WL 1167230, at *3 (E.D.N.C. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." See id. Sep. 9, 2019). In contrast, Nationstar maintains that there is no way to reliably identify when a loss mitigation application is submitted or complete using codes and status change entries in its existing software, and that the only way to make those determinations is through a file-by-file review. 1024.1 to 1024.41 and known as "Regulation X," see 12 C.F.R. The Court does not find such a prohibition in the Maryland Attorneys' Rules of Professional Conduct. 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. at 248-49. The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. Gunnells, 348 F.3d at 424 (quoting Amchem, 521 U.S. at 615). that it is improper to pay an expert witness a contingent fee." On March 8, 2014, Nationstar sent to Mr. Robinson a letter stating that he was ineligible for a HAMP modification, but on March 15, 2014, it sent a different letter offering a loan modification under which Mr. Robinson would receive a reduced interest rate for two years. In Accrued Financial, the United States Court of Appeals for the Fourth Circuit held that where commercial real estate tenants assigned their potential claims against their landlords to a commercial real estate auditor under an arrangement through which the auditor would receive a percentage of any recovery in litigation, the assignments violated public policy because where the auditor's employees could testify in such litigation, the assignments "provide for supplying expert testimony for a contingent fee." 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. ("MCC") 2, ECF No. 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. Nationstar further argues that summary judgment must be entered in its favor on the Robinsons' claims under 12 C.F.R. 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. Code Ann., Com. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. 1976). Law 13-316(e)(1), and "actual damages," 12 U.S.C. The public policy interest at issue was one against "stirring up litigation or promoting litigating for the benefit of the promoter rather than for the benefit of the litigant or the public," an interest not implicated in the same manner by the fee arrangement with the particular expert witness in this case. RESPA's implementing regulations, codified at 12 C.F.R. 1024.41(c)(1)(i) and (d), because the Robinsons made no showing that the Rule 23 requirements were met. See 12 C.F.R. at 152. or misleading oral or written statement . Sept. 9, 2019), there were multiple other claims at issue, for which Oliver's expert report seemed better suited to address. 12 U.S.C. Broussard v. Meineke Discount Muffler Shops, Inc., 155 F.3d 331, 344 (4th Cir. Where the deed of trust explicitly states that Mrs. Robinson is not obligated on the loan, the Court finds that she is not a borrower under RESPA and cannot bring the claim against Nationstar under Regulation X. The Robinsons own a business called Green Earth Services, which provides waste and recycling services to clients. 2003). Md. Nationstar's Motion for Summary Judgment will be granted as to Tamara Robinson. A code is also added to LSAMS to put a hold on foreclosure proceedings. The Robinsons appealed the Magistrate Judge's ruling because it did not require Nationstar to run a structural script for a third database. See Farber, 2017 WL 4347826 at 15; Billings, 170 F. Supp. 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). 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. For purposes of ascertainability, the requirements of 12 C.F.R. 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. Where the PaCE consulting fee was a one-time fee to advise the Robinsons in their interactions with Nationstar paid in August 2013, several months before they first submitted the March 2014 loan modification application, this cost was incurred "whether or not [Nationstar] complied with its obligations." . 164. See MCC JR0529-31. 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. Because such a common question would have to be resolved in many if not all individual cases, it advances, rather than undermines, the argument in favor of predominance. Nationstar has no process for standardizing file names. Although the Robinsons contend that they would have pursued other loss mitigation options in the absence of the RESPA violations, they have not identified any such options in a way that would permit a calculation of damages associated with any lost opportunity. Aug. 19, 2015). On February 16, 2017, the Court referred the case to United States Magistrate Judge Charles B. 1024.41(c)(1)(i). Signed by Judge Theodore D. Chuang on 8/18/2015. Md. 2015) Court Description: MEMORANDUM OPINION. 1024.41(i). They do not seek damages in the Amended Complaint for emotional distress or include such a claim in their itemized list of damages submitted in discovery. 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. At the time, Nationstar had not completed the process of updating its systems to conform to those requirements. Moreover, the conflict must not be "merely speculative or hypothetical." 2605(f)(1). Under subsections (f) and (g), a loan servicer is not permitted to begin foreclosure proceedings or move for foreclosure judgment if "a borrower submits a complete loss mitigation application" except in certain circumstances. . Id. 1024.41(d). 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. Likewise, he concluded that for approximately 53 percent of sampled loans, Nationstar failed to comply with the requirement of acknowledging receipt of the application within five days.