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. 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. Id. McLean v. GMAC Mortg. 2015). Baez, 709 F. App'x at 983. 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. Reg. Regulation X, which became effective on January 10, 2014, 78 Fed. Code Ann., Com. Nationstar has no process for standardizing file names. Law 13-316(e), for the reasons stated above, see supra part I.B.4, the Robinsons have provided sufficient evidence to create a genuine issue of material fact whether they have suffered economic damages, in the form of administrative costs, fees, and interest. 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. Nationstar's Motion will be denied as to this claim. A "borrower" may enforce the provisions of Regulation X pursuant to 12 U.S.C. That is not so here. 1024.41 (2019), and the Maryland Consumer Protection Act ("MCPA"), Md. 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. Make your practice more effective and efficient with Casetexts legal research suite. 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. See Hayes v. Wal-Mart Stores, Inc., 725 F.3d 349, 356-57 (3d Cir. Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir. In the Amended Complaint, the Robinsons claim that Nationstar's representations that it offered many loss mitigation plans and "would evaluate" borrowers "for eligibility for all these loss mitigation plans" were false. Signed by Judge Theodore D. Chuang on 8/18/2015. 2014). This field is for validation purposes and should be left unchanged. 2001) (striking expert testimony because of a contingent fee arrangement), aff'd, 43 F. App'x 547 (4th Cir. He asserted that the amount of fees was calculated based on Nationstar's statements, but he could not specify the nature of the fees. Ass'n, 375 F.2d 648, 653 (4th Cir. 2002) (affirming without addressing the propriety of the striking of the expert testimony). The commonality requirement is also met. Accordingly, a loan servicer must comply with Regulation X as to the first loss mitigation application submitted after the effective date. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). 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. Fed. 12 C.F.R. 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. or other representation . 12 U.S.C. 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. Id. That claim will be subject to common proof, namely sampling and analysis of loan files along the lines suggested by Oliver. Nelson, 2017 WL 1167230, at *3 (collecting cases). A code is also added to LSAMS to put a hold on foreclosure proceedings. Code Ann., Com. 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. Reg. at 359-60. Md. at 151. Finally, the named plaintiff must "fairly and adequately protect the interests of class" without a conflict of interest with the absent class members. They have claimed $141,000 in interest; $6,147.12 in fees assessed by Nationstar; $2,275 in consulting fees; $50.58 in administrative costs; and lost time and labor of approximately 120 hours; as well as punitive and statutory damages. Law 13 . Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 348-49 (2011) ("[A] class representative must be part of the class and possess the same interest and suffer the same injury as the class members." Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act ("Regulation X"), 78 Fed. Fed. 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. Although Nationstar argues that Mr. Robinson has a conflict of interest because he wishes to avoid foreclosure and to delay payments on his mortgage, the record does not reflect that proposition. As a result, the Robinsons' claim that Nationstar violated certain Regulation X procedures with respect to their loan modification application and those of the class members. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. 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. An expert's testimony is "critical" where it is "important to an issue decisive for the motion for class certification." 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. Rather than rendering the testimony inadmissible, the fee arrangement is relevant to the expert's credibility. Joint Record ("MSJ JR") 0102. Furthermore, according to Nationstar, to identify the content of a letter sent to a borrower, the letter itself must be viewed. Nationstar sent Mr. Robinson two letters denying his loan modification application on July 17, 2014 and September 9, 2014, but there is no evidence in the record that the Robinsons submitted an appeal to either of those letters. Rules 19-303.4(b) (2018). Id. Id. 2010). The loan is then evaluated for loan modification options. On September 9, 2014, Nationstar sent Mr. Robinson a letter denying the loan modification application and stating that it could not offer him any modification because his income was not high enough to cover the mortgage payments under any modification option. 1024.41(i). For purposes of ascertainability, the requirements of 12 C.F.R. 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. The Court may rely only on facts supported in the record, not simply assertions in the pleadings. 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. "[A] trial court should consider the specific factors identified in Daubert where they are reasonable measures of the reliability of expert testimony." Nationstar argues that summary judgment should be granted against Mrs. Robinson because she is not a "borrower" within the meaning of RESPA. 10696, 10836. 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." 2002), is misplaced. 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. In Washington v. Am. Hickerson, 882 F.3d at 480 (quoting Cooper, 259 F.3d at 199). The Nationstar Mortgage Unwanted Phone Calls Class Action Lawsuit is Wright, et al. Campbell v. Nationstar Mortg., 611 F. App'x 288, 297-98 (6th Cir. Specifically, the loan servicer failed to honor borrowers' loan modification agreements. EQT Prod. Id. 1998). The Class Action Administrator would then begin distribution of the settlement funds. Va., Inc., 543 F.2d 1075, 1080 (4th Cir. Code Ann., Com. Finally, the Court finds that Mr. Robinson will adequately represent the absent class members. 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. 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. 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. Filing fee paid $ 402, Receipt number AOHNDC-10680087. On November 21, 2014, the Robinsons filed suit against Nationstar on behalf of themselves and a class of similarly situated individuals nationwide. Nationstar ultimately became the servicer of the Robinsons' loan. While the particulars of Mr. Robinson's application process will not necessarily prove that Nationstar mishandled the applications of other individual class members, these facts fairly encompass the types of claims that would be brought by the members of the class. 1024.41(b)(1), (b)(2)(i)(B), and (c)(1)(ii) and Md. at *2. The Robinsons also claim as damages interest overcharges of approximately $141,000. See Fed. Id. 2015) (holding that Regulation X did not apply to loss mitigation applications submitted before the effective date). 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. Gym, Recreational & Athletic Equip. 10696, 10708, provides that "[a] servicer is only required to comply with the requirements of this section for a single complete loss mitigation application for a borrower's mortgage loan account." 14-cv-10457, in the U.S. District Court for the Northern District of Illinois, Eastern Division.. Join a Free TCPA Class Action Lawsuit Investigation. 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. A conflict of interest will not defeat the adequacy requirement when "all class members share common objectives[,] the same factual and legal positions, and . Id. 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. 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." But see Sutton v. CitiMortgage, Inc., 228 F. Supp. 2605(f)(1)(A); 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. 8:2014cv03667 - Document 18 (D. Md. 28, 2017). 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. 1024.41(b)(1), which requires reasonable diligence in obtaining documents and information to complete a loss mitigation application; and Md. Whether an application is complete depends on the requirements of the investor who holds the loan. 1 . Instead, the Robinsons assert that Nationstar has not affirmatively proven that it conducted such reviews. 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. 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. 12 U.S.C. See Farmer v. Ramsay, 159 F. Supp. Therefore, Nationstar was required to comply with section 1024.41 in processing it. 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. 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. A servicer that fails to comply with Regulation X is liable for actual damages and, upon a finding of a "pattern or practice" of non-compliance by the servicer, up to $2,000 in statutory damages. The MCPA prohibits the use of an "unfair or deceptive trade practice" in the "[t]he extension of consumer credit" or "[t]he collection of consumer debts" and provides for a private right of action. Anderson, 477 U.S. at 248. 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. Every mortgage has a unique loan number that can be used to identify the borrower and the loan in each of the four databases. It is the plaintiffs who bear the burden of proving their claims. These events will be represented by discrete data points in Nationstar's databases, such that these violations may be proved through that data. (quoting East Tex. 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. Where it is now apparent, in hindsight, that Nationstar was permitted to withhold relevant and necessary data in the discovery process, it is unsurprising that Nationstar employees would then review loan files, with their complete data, and identify problems. 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 claims that manual review of each file would take about 60 to 90 minutes per file. Fed. 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 20-cv, -2202, 2021 WL 4462909, at *1 (S.D. at 300. Amchem Prods. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." 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. MCC JR 318, 530-531. Code Ann., Com. 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. Co, 445 F.3d 311, 318 (4th Cir. In 2017, the CFPB fined Nationstar $1.75 million for failing to report accurate data about its mortgage transactions. 2007)), aff'd sub nom. . 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. 1024.41(h)(1), (4). 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. 2605(f)(2) is not fatal to the predominance inquiry. Law 13-316(e)(1), and "actual damages," 12 U.S.C. Id. 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. Mot. The regulation is silent on whether a loss mitigation application submitted before January 10, 2014 could qualify as the "single complete loss mitigation application." Since the Rule 23(a) factors are satisfied, the Court will now consider whether the Rule 23(b)(3) predominance and superiority considerations are met. 2013); Poindexter v. Teubert, 462 F.2d 1096, 1097 (4th Cir. 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." MSJ JR 0284. Co., 595 F.3d 164, 179 (4th Cir. The Robinsons, however, have not identified any evidence that Nationstar did not intend to, and did not, conduct such evaluations. Cf. 2010) (holding that a plaintiff who "was not a borrower or otherwise obligated on the . 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). 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. See id. 2006). Throughout discovery, Nationstar repeatedly stated that it could not produce the data on loss mitigation or loan modification applications from its databases in the form requested by the Robinsons. See D. Md. Where the results of such an analysis would apply to any individual claim, it would be highly inefficient and wasteful to require duplicative analysis in each such case. 2d 1360, 1366 (S.D. J. Thorn v. Jefferson-Pilot Life Ins. DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE LLC, Defendant. . As the Supreme Court noted in Kumho Tire Co. v. Carmichael, 526 U.S. 137 (1999), Daubert "made clear that its list of factors was meant to be helpful, not definitive," and it is not always the case that an expert witness's claim will have been subjected to peer review. The Robinsons own a business called Green Earth Services, which provides waste and recycling services to clients. 702, 703. THEODORE D. CHUANG United States District Judge. Nationstar filed a notice of settlement and a joint motion to proceed before a magistrate . Compl. Code Ann., Com. 1024.41(f), (g), and (h); and (4) there is no evidence of actual damages from any RESPA violation. 2010). 2605(f)(1)(B), a borrower cannot recover these additional damages "without first recovering actual damages." 2601-2617 (2012), specifically RESPA's implementing regulations known as "Regulation X," 12 C.F.R. at 983 (quoting 12 U.S.C. Plaintiffs Demetrius and Tamara Robinson (the "Robinsons") have resided in a home in Damascus, Maryland that has been subject to a mortgage loan. Finally, while Nationstar presented arguments for why the Robinsons have not shown damages as to most of the asserted categories, it did not advance any argument for why the interest damages claimed by the Robinsons were not attributable to Nationstar's Regulation X violations and thus is not entitled to summary judgment on that issue. Under a provision of Regulation X entitled "Loss mitigation procedures," mortgage servicers must take certain steps when a borrower applies for loss mitigation measures, such as the loan modifications sought in this case. Under Count I, the Robinsons allege a violation of 12 C.F.R. On February 16, 2017, the Court referred the case to United States Magistrate Judge Charles B. Nationstar asserts that Oliver's testimony should be stricken because this fee arrangement includes an unethical contingency fee. 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. 09-08213, 2011 WL 11651320 (C.D. In assessing this element, "numbers alone are not controlling" and a district court should consider "all of the circumstances of the case." LLCNo. TDC-14-3667 (D. Md. On July 16, 2018, the Court affirmed the Magistrate Judge's ruling and required Nationstar to produce all outstanding "records subject to discovery orders." To establish an MCPA violation under this provision, a plaintiff must establish that (1) the defendant engaged in an unfair or deceptive practice or misrepresentation; (2) the plaintiff relied upon the representation; and (3) doing so caused the plaintiff actual injury. 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. Some courts have held that administrative costs that predate the alleged RESPA violation cannot constitute "actual damages." 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. Indeed, Nationstar does not seriously contest the commonality prong. The Court will therefore deny the Motion for Summary Judgment as to this argument.