January 14, 2014 – More good news! The Circuit Court of Jackson County, Missouri issued its Order giving final approval of the $14.5 class action settlement with Defendant Residential Funding Corporation (“RFC”) in Mitchell v. Residential Funding, et al. As a result, the conditional approval of the settlement by the he United States Bankruptcy Court for the Southern District of New York the Mitchell Settlement Class automatically became final and the Mitchell Settlement Class now has an allowed claim for $14.5 million against the Borrowers Claims Trust established under RFC’s Chapter 11 bankruptcy plan.
December 17, 2013 – Good news! The United States Bankruptcy Court for the Southern District of New York entered an Order in Residential Funding Corporation’s Chapter 11 bankruptcy approving the $14.5 million class action settlement with Defendant Residential Funding Corporation (“RFC”) in Mitchell v. Residential Funding, et al., on condition that Class Counsel also obtains the Circuit Court of Jackson County’s final approval of the settlement. The Bankruptcy Court’s Order also lifted the automatic stay of litigation imposed on Class Counsel by RFC’s Chapter 11 bankruptcy filing on May 14, 2013, in order to permit them to seek final approval of the settlement in the Jackson County Circuit Court, and further provides that upon final approval by the Jackson County Circuit Court, the Mitchell Settlement Class shall have an allowed claim for $14.5 million against the Borrowers Claims Trust established under RFC’s Chapter 11 bankruptcy plan.
August 17, 2012 – The Circuit Court of Jackson County has entered its order giving final approval to the Settlement Agreement reached with Household Finance Corp. in Mitchell v. Residential Funding Corp. The order will become final on September 26, and we anticipate sending distribution checks to Settlement Class Members beginning after that date. This settlement resolves claims and ends the litigation against Household Finance Corp., but does not affect any claims against any other defendants in the Mitchell case.
July 13, 2012 – The Circuit Court of Jackson County has entered its order giving final approval to the Settlement Agreement reached with Wells Fargo Bank in Mitchell v. Residential Funding Corp. The order will become final toward the end of August, and we anticipate sending distribution checks to Settlement Class Members beginning sometime in early September. This settlement resolves claims and ends the litigation against Wells Fargo, but does not affect any claims against any other defendants in the Mitchell case.
July 5, 2012 – The Court has preliminarily approved another settlement in Mitchell v. Residential Funding Corp. Under this newly-approved settlement, Household Finance Corporation III (“Household”) will pay $3.2 million to resolve claims for punitive damages asserted by borrowers whose second mortgage loans were purchased by, assigned to or serviced by Household.
This settlement will resolve all claims and end the litigation against Household. This settlement does not affect any claims against any of the other defendants in the Mitchell case. The $3.2 million agreed to in settlement of the punitive damages claims against Household is in addition to the $566,802.46 of compensatory damages and interest previously recovered from Household and distributed to class members whose illegal loans were handled by Household.
Household Settlement Class Members can see what we currently estimate the amount of the settlement payment to be by accessing the Proposed Distribution Schedule. To access the Proposed Distribution Schedule for your settlement benefit, click here.
May 14, 2012 – Residential Funding Company, LLC (“RFC”), filed Chapter 11 bankruptcy in the United States Bankruptcy Court for the Southern District of New York, case no. 12-12019. The bankruptcy is part of a consolidated proceeding, case no. 12-12020, in which RFC and its parent company ResCap, LLC, along with numerous other affiliated subsidiaries, have sought bankruptcy protection.
Once the bankruptcy was filed, an automatic stay of litigation against RFC went into effect. Accordingly, the hearing for final approval of the settlement that was scheduled for May 18, 2012, could not and did not occur as scheduled. Currently, hearing on the approval of the settlement with RFC has been continued to a date which is currently unknown.
Unfortunately, the effect of the bankruptcy will prevent final approval by the Court of the settlement with RFC, and RFC because of the bankruptcy will currently be unable to fund the settlement. Effectively, this will prevent any payments of funds related to the settlement, including any amounts for attorneys’ fees and expenses to be paid to our firm and any settlement payments to class members.
At this time, we are unable to predict what will ultimately occur in the bankruptcy proceedings, when the bankruptcy will be resolved, whether or when the Settlement will be finally approved or if finally approved what funds RFC will have to pay the claims under the settlement.
May 25, 2012 – The Court has preliminarily approved another settlement in Mitchell v. Residential Funding Corp. Under this newly-approved settlement, Wells Fargo Bank (formerly known as Wachovia Equity Servicing and The Money Store) will pay $5 million to resolve claims for punitive damages asserted by borrowers whose second mortgage loans were purchased by, assigned to or serviced by Wells Fargo.
This settlement will resolve all claims and end the litigation against Wells Fargo. This settlement does not affect any claims against any of the other defendants in the Mitchell case. The $5 million agreed to in settlement of the punitive damages claims against Wells Fargo is in addition to the $816,452.60 of compensatory damages and interest previously recovered from Wells Fargo and distributed to class members whose illegal loans were handled by Wells Fargo.
Wells Fargo Settlement Class Members can see what we currently estimate the amount of their settlement payment to be by accessing the Proposed Distribution Schedule. To access the Proposed Distribution Schedule for your settlement benefit, click here.
April 16, 2012 – We are pleased to announce that the Court has granted preliminary approval to a partial class action settlement in Mitchell v. Residential Funding Corp., et al. with Defendant Residential Funding Company (“RFC”).
RFC will pay $14.5 million to resolve the claims for punitive damages for those borrowers whose second mortgage loans were purchased by, assigned to and/or serviced and/or master serviced by RFC (“RFC Settlement Class Members”).
This settlement will resolve and end the litigation and the Mitchell lawsuit as against RFC (and RFC only) for the RFC Settlement Class Members. This settlement does not include or affect the loans that were purchased by, assigned to and/or serviced and/or master serviced by a defendant other than RFC, which includes Defendants Household Finance Corp. III and Wells Fargo Bank, N.A. (formerly known as Wachovia Equity Servicing and The Money Store).
The amount received in settlement of the punitive damages claims is in addition to the $9,415,339.93 of compensatory damages and interest previously recovered from RFC by the Plaintiffs on behalf of the same RFC Class members. The compensatory damages and interest have been distributed previously.
RFC Settlement Class Members will be able see what we currently estimate the amount of their additional settlement payment to be by accessing the Proposed Distribution Schedule. To access the Proposed Distribution Schedule for your additional settlement payment, click here.
April 26, 2011 – Good News! The Supreme Court denied the defendants’ Applications to Transfer to the Supreme Court on Tuesday, April 26th. Click here to see the Minutes Entry,
Checks have been mailed out for compensatory damages. To see the breakdown for your check click here.
November 23, 2010 – We are pleased to now have the Court of Appeals ruling on a number of important issues for this and other similar cases with respect to Missouri’s Second Mortgage Loans Act. The Missouri Court of Appeals opinion affirms the liability of predatory lenders and their assignees under Missouri law in many important respects. This opinion will serve to protect Missouri citizens from the unscrupulous lending practices of lenders and secondary market purchasers of mortgage loans. The opinion affirms that lenders and their assignees who either directly or indirectly charge, contract or receive illegal fees and/or interest shall be held accountable for their conduct. While the Court held that a technicality regarding the wording of a jury instruction will require the issue of punitive damages to be retried, we welcome that opportunity. The appellate court has affirmed that the conduct of Residential Funding Company, LLC, Household Finance Corporation and Wachovia Equity Servicing, LLC was such that it was appropriate for the trial court to submit the issue of punitive damages to the jury for each of them. We believe that any jury faced with the facts of this case will again find the conduct of these lenders to be outrageous and in reckless disregard of the rights of the Missouri borrowers and we anticipate that a new trial on punitive damages will result in a similarly significant, if not greater, punitive damage assessment.
This case is but a small but powerful indictment of the excesses of the mortgage lending industry that exemplifies profit over people and has brought our national economy to the brink of disaster. Hopefully this opinion is one small step that will serve to reform the behavior of the mortgage lending industry’s insatiable appetite for profit at the expense of Missouri citizens and the laws that protect them as the loans move from Main Street to Wall Street. Click here to read the Opinion
August 3, 2010 – The case was recently submitted to the Court of Appeals for the Western District of Missouri, which heard oral arguments by the parties on July 8, 2010. The Court panel consisted of three judges: the Honorable Thomas H. Newton, the Honorable Gary D. Witt, and the Honorable Stephen K. Wilcox.
Typically, oral arguments before the Court of Appeals last approximately 23 minutes. In cases involving complex matters and cases, the Court may permit oral arguments lasting approximately 35 minutes. In our case, given the complexity, the number and importance of the issues, and the magnitude of Plaintiffs’ $100 million verdict, the Court extended oral argument to one full hour.
The oral arguments made by Plaintiffs and Defendants dealt with the issues on appeal and with Plaintiffs’ pending motion for sanctions against Defendants Wachovia Equity Servicing, LLC, Residential Funding Company, LLC, and Homecomings Financial, LLC, for alleged discovery violations that occurred while the case was pending before the Circuit Court of Jackson County, Missouri. The oral argument can be downloaded here.
There is no current time table for the Court of Appeals to issue an opinion on the case.
March 12, 2010 – The case is currently on appeal to the Court of Appeals for the Western District of Missouri. The briefing for the appeal was recently completed as Plaintiffs Final Reply Brief was filed on March 12, 2010. The parties are now awaiting an order from the Court of Appeals docketing the case for oral argument. In addition to the appeal, also pending before the Court of Appeals is Plaintiffs Motion for Sanctions filed against Defendants Wachovia Equity Servicing, LLC, Residential Funding Company, LLC, and Homecomings Financial, LLC, for alleged discovery violations that occurred while the case was pending before the Circuit Court of Jackson County, Missouri.
Jan. 4, 2008 – Jackson County jury awards $5.1 million in actual damages and $99 million in punitive damages in favor of plaintiffs’ class in Mitchell vs. Residential Funding Company, LLC. The plaintiffs’ class is comprised of those individuals who, on or after July 29, 1997, obtained a second mortgage loan secured by Missouri residential real estate from Mortgage Capital Resource Corporation, a now-defunct California mortgage lender. The second mortgage loans at issue were purchased and assigned to defendants Residential Funding Company, LLC, Household Finance Corporation, III and Wachovia Equity Servicing, LLC. Also named as a defendant was Homecomings Financial, LLC, which serviced some of the loans. Defendant Residential Funding Company has indicated that it plans to appeal.
Links to Documents
Links to Settlement Documents
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