March 24, 2017
On March 24, 2017, the three person arbitration panel issued their binding decision mandating that PNC Bank, as successor to Community Bank of Northern Virginia, pay $24 million in settlement of damages to certain members of the Class that had obtained predatory second mortgage loans from Community Bank. The settlement award came after 13 days of presenting evidence and argument to the Panel in the U.S. District Court for the Western District of Pennsylvania. The award was made in what is known as a “baseball” arbitration in which the arbitrators chose between two numbers (as happens in Major League Baseball player salary arbitrations) after the case against PNC was settled at the behest of the District Court. The $24 million award was made against PNC, as successor to Community Bank whose net worth at the time the offending loans were originated ranged from $9.7 million to $20.9 million. Although we are disappointed that the Panel did not choose the $70 million dollar settlement amount, we are pleased to have concluded this case as to PNC Bank’s liability resulting in settlements for class members in sub-classes 2 and 3 that range from $43.17 to $2,879.80. Our work over the 13 year history of this case, included three victories in the Third Circuit Court of Appeals resulting in opinions benefiting both the Class and other class actions for years to come.
A copy of the Unanimous Decision of the Arbitrators can be accessed here.
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