A Division of NBC Universal. Summ. 1024.41(b)(1), (b)(2)(i)(B), and (c)(1)(ii) and Md. 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. It will be otherwise denied. For the Regulation X provisions that require the servicer to communicate specific information to a borrower, Oliver's methodology involves reviewing a sample of loan files and identifying a specific communication to a borrower based on the file name. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Co v. Adair, 764 F.3d 347, 359-60 (4th Cir. 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. 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. 2017) (holding that "incidental costs related to the sending of correspondence" to the servicer, including "postage and travel," are not actual damages under RESPA because such a rule "would transform virtually all unsatisfactory borrower inquiries into RESPA lawsuits"). Tagatz, 861 F.2d at 1042; cf. 2601-2617 (2012), specifically RESPA's implementing regulations known as "Regulation X," 12 C.F.R. FCRA). 3d 249, 266 (D. Md. 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. 12 C.F.R. 2010). Co., 595 F.3d 164, 179-80 (4th Cir. Nationstar's reliance on Accrued Financial Services v. Prime Retail, Inc., 298 F.3d 291 (4th Cir. 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. Ass'n, 375 F.2d 648, 653 (4th Cir. Mr. Robinson then submitted another loan modification application on August 25, 2014. 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. 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. 16-0307, 2017 WL 1167230, at *3 (E.D.N.C. 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." Id. 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. However, Nationstar did not comply with all requirements of Regulation X, which became effective on January 10, 2014. Id. Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. Filing fee paid $ 402, Receipt number AOHNDC-10680087. In 2007, Mr. Robinson obtained a loan with the principal amount of $755,000 to refinance the property. Law 13 . From January 2014 to the present, the Robinsons have not pursued other loss mitigation options, such as a short sale. 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. 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." 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. Every mortgage has a unique loan number that can be used to identify the borrower and the loan in each of the four databases. 20-cv, -2202, 2021 WL 4462909, at *1 (S.D. 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). See Torres v. Mercer Canyons Inc., 835 F.3d 1125, 1137 (9th Cir. 12 U.S.C. Nationstar has no process for standardizing file names. Moreover, whether Nationstar engaged in a "pattern or practice" of Regulation X violations, within the meaning of 12 U.S.C. "When these issues were identified several years ago, we immediately made restitution to our impacted customers and invested in process improvements to prevent reoccurrence," Jay Bray, CEO and chairman of Mr. Cooper said in a statement Monday. Several states also fined Nationstar in 2018 over failing to have proper procedures in place and "unfair and deceptive" mortgage modification policies. 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. 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. Md. J. Code Ann., Com. A separate Order shall issue. Thus, the Court concludes that common computerized analysis can largely answer the question of whether Nationstar violated these RESPA provisions with respect to individual borrowers. 16-0117, 2017 WL 4347826, at *15 (D. Md. Fed. 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. 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." 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. ("MCC") 2, ECF No. To satisfy the numerosity requirement, the proposed class must be so numerous that "joinder of all members is impracticable." 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. If the initial application is complete, the substatus in Remedy Star is changed to refer the application to an underwriter for review, and an additional code is added in LSAMS. In addition to the fines and restitution, Delaware Attorney General Kathleen Jennings said the settlements require Nationstar to adhere to increased "servicing standards." In contrast, the Court finds that there is a genuine issue of material fact whether the administrative costs and fees incurred by the Robinsons resulted from Nationstar's RESPA violations. Mot. 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. See Tagatz, 861 F.2d at 1042. While Mr. Robinson signed the promissory note ("the Note"), the deed of trust ("the Deed"), and the balloon payment rider for the 2007 loan, Tamara Robinson ("Mrs. Robinson") signed only the Deed and balloon payment rider and did not sign the Note. Because Oliver analyzed proprietary databases and data specifically disclosed for this litigation pursuant to a protective order, such that Oliver's peers lack access to the same information, Oliver's expert testimony is not of the type that ordinarily would be subject to peer review, and it would be unfair to require "general acceptance within a relevant scientific community." ; 78 Fed. Although similar to Rule 23(a)'s commonality requirement, the test for predominance under Rule 23(b)(3) is "far more demanding" and "tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation." v. Windsor, 521 U.S. 591, 623-24 (1997). Id. Because such information is stored electronically and based on objective criteria, the members of the class will be ascertainable without significant administrative burden. 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. 1024.41(a). Joint Record ("MSJ JR") 0102. The Robinsons also claim as damages interest overcharges of approximately $141,000. Although based on imperfect data, Oliver's expert report reveals that such analysis can substantially address whether Nationstar violated 12 C.F.R. 2d 452, 468 (D. Md. "); 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. USCA4 Appeal: 21-1087 Doc: 38 Filed: 06/15/2021 Pg: 9 of 33 The Magistrate Judge ordered Nationstar to run those scripts and return the electronic data to the Robinsons. Wright et al. 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. 2019) (noting that the purpose of certifying a class "is not to identify every class member at the time of certification, but to define a class in such a way as to ensure that there will be some administratively feasible [way] for the court to determine whether a particular individual is a member at some point" (internal citation omitted) (quoting EQT Production Co. v. Adair, 764 F.3d 347, 358 (4th Cir. 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. Nationstar broke that trust by engaging in unfair and deceptive practices," Kraninger added. 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. He is joined by 49 other Attorneys General, the District of Columbia, and other state and federal agencies. Law 13-316(c) are triggered upon the submission of a loss mitigation application, while 12 C.F.R. . Actual damages may include late fees; denial of credit or access to the full amount of a credit line; out-of-pocket expenses incurred in dealing with a RESPA violation, such as expenses for preparing and copying correspondence; and lost time and inconvenience, including time spent away from employment while preparing correspondence "to the extent it resulted in actual pecuniary loss." If a class is ascertainable, it must then satisfy all four elements of Rule 23(a): numerosity, commonality, typicality, and adequacy. P. 23(a)(4); Ward v. Dixie Nat'l Life Ins. The company has already paid about $57.5 million in restitution to affected consumers, according to the CFPB. Id. 1024.41, a regulation of RESPA that outlines loss mitigation procedures. 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. 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. Id. P. 23(b)(3). Id. 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. DEMETRIUS ROBINSON and TAMARA ROBINSON, Plaintiffs, v. NATIONSTAR MORTGAGE LLC, Defendant. Thorn v. Jefferson-Pilot Life Ins. When Nationstar received the application, it prevented late fees from being assessed and put a hold on any foreclosure proceedings. at 358. 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. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A fact is "material" if it "might affect the outcome of the suit under the governing law." . Code Ann., Com. Part 1024). Since the Court already considered and ruled on these issues, see supra part I.B, it will not revisit those arguments here. 2014))). Since Mrs. Robinson may not bring a claim under Regulation X, she may not be a named class representative. See 12 C.F.R. 2605(f)(1). 1976). "There are going to be a lot of homeowners who need a home loan modification or other assistance," Raoul says. 09-08213, 2011 WL 11651320 (C.D. Code Ann., Com. 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." 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. This abandoned high school was converted into a 31-unit apartment building, number of unlawful practices in handling mortgages following the Great Recession. Law 13-316(c). On February 10, 2022, the Court of Appeals issued a decision affirming the Final Approval Order. 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 the same interest in establishing the liability of defendants." The Class Action Administrator would then begin distribution of the settlement funds. 2012) (citing Lloyd v. Gen. Motors Corp., 916 A.2d 257, 277 (Md. Those claims arose from Nationstar's alleged 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. 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. McLean v. GMAC Mortg. As a result, on January 29, 2018, the Magistrate Judge granted the Robinsons' Motion to Compel in which the Robinsons had sought to have the Court order Nationstar to accept and run scripts created by the Robinsons' expert to extract the relevant data from Nationstar's databases on the sample of loans from which they could test their methodology for identifying members of the proposed classes. 2014). The Robinsons assert that they have paid a total of $6,147.12 in unspecified fees to Nationstar. See Lierboe v. State Farm Mut. Nationstar argues that summary judgment should be granted against Mrs. Robinson because she is not a "borrower" within the meaning of RESPA. The Nationwide Class and the Maryland Subclass are ascertainable and satisfy the Rule 23(a) factors. 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. TDC-14-3667, 2019 WL 4261696 (D. Md. Many impacted consumers have already received refunds and more will be contacted by the settlement administrator in the coming weeks. "Mortgage servicers are entrusted with handling significant financial transactions for millions of Americans, including struggling homeowners. In Frank v. J.P. Morgan Chase Bank, N.A., No. 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"). Co., 595 F.3d 164, 179 (4th Cir. After this missed payment, Nationstar assessed a late fee. Ask to speak in court about the fairness of the Settlement. See 12 C.F.R. 1984), and has upheld the certification of a class with as few as 18 members, Cypress v. Newport News Gen. & Nonsectarian Hosp. 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. 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. United States v. Valona, 834 F.2d 1334, 1344 (7th Cir. Law 13-301 and 13-303, because the Robinsons do not have standing to bring those claims. Lembach v. Bierman, 528 F. App'x 297 (4th Cir. or misleading oral or written statement . Presently pending is Nationstar's Motion for Summary Judgment, Nationstar's Motion to Strike, and the Robinsons' Motion for Class Certification. 2010). 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.