Case: Allen v. Decision One Mortgage Company

1:07-cv-11669 | U.S. District Court for the District of Massachusetts

Filed Date: Sept. 6, 2007

Closed Date: 2010

Clearinghouse coding complete

Case Summary

On September 6, 2007, a black homeowner filed a class-action lawsuit in the U.S. District Court for the District of Massachusetts against private banks and lenders, Direct One Mortgage Company and HSBC Finance Corporation, under the Equal Credit Opportunity Act ("ECOA"), the Fair Housing Act ("FHA"), 42 U.S.C. § 1981, and 42 U.S.C. § 1982. The plaintiff alleged that the defendants maintained a pattern or practice that had a discriminatory impact on black applicants in their home financing polic…

On September 6, 2007, a black homeowner filed a class-action lawsuit in the U.S. District Court for the District of Massachusetts against private banks and lenders, Direct One Mortgage Company and HSBC Finance Corporation, under the Equal Credit Opportunity Act ("ECOA"), the Fair Housing Act ("FHA"), 42 U.S.C. § 1981, and 42 U.S.C. § 1982. The plaintiff alleged that the defendants maintained a pattern or practice that had a discriminatory impact on black applicants in their home financing policies and practices, including fraudulent concealment. Specifically, the plaintiff alleged that the defendants' policy authorizing unchecked, subjective surcharge of additional points and fees to an otherwise objective risk-based financing rate, had a discriminatory impact on black homeowners, creating a significantly higher likelihood of exposure to discretionary points and fees. Plaintiff sought declaratory and injuctive relief.

On November 2, 2007, the defendants filed a motion to dismiss, though after the plaintiff amended his complaint, the Court (Judge George A. O'Toole, Jr.) ruled the motion to dismiss moot.

On November 27, 2009, the plaintiff filed an amended complaint. The complaint added three named plaintiffs, who were Hispanic. Thus, the complaint was not a class action on behalf of similarly situated black and Hispanic homeowners. The complaint also added several defendants, who were subsidiaries of HSBC. In other respects, the compliant reiterated the original allegations. On the same day, the plaintiffs filed a notice of settlement.

Under the settlement agreement, the parties sought to certify class consisting of "all African-American or Hispanic persons throughout the United States who, between January 1, 2004 and the date of entry of the Preliminary Approval Order, obtained residential closed-end real estate secured loans from any of the following businesses: Decision One, HFC/Beneficial, HSBC Mortgage Corp. (USA) or HSBC Mortgage Services Telesales. The defendants agreed to identify class members based on their data. The defendants agreed to pay $6,500,000.00 for the benefit of the settlement class, including $1,800,000.00 in attorney's fees and $15,000.00 in service fees to the plaintiffs. Class members, who borrowed from Decision One, could claim $200 per loan. Two organizations received $125,000.00 to support financial education, homeownership education and/or foreclosure counseling activities. If anything remained, the two organizations would be paid a larger amount, but not exceeding $750,000.00. Any residual monies would be paid to charitable organizations engaged in housing assistance or consumer credit education, to be chosen by the mutual agreement of the parties. The defendants agreed to provide quarterly reports to the class counsel for the duration of the agreement. The defendants agreed to provide loan restructuring and foreclosure mitigation programs to class members until June 30, 2010.

On December 9, 2009, the Court issued an order preliminarily approving the settlement and certifying class. Following a fairness hearing, the Court issued the final judgment in the case approving the settlement on May 13, 2010.

Summary Authors

Zhandos Kuderin (7/31/2014)

People

For PACER's information on parties and their attrorneys, see: https://www.courtlistener.com/docket/4824895/parties/allen-v-decision-one-mortgage-company-llc/


Judge(s)

O'Toole, George A. Jr. (Massachusetts)

Attorneys(s) for Plaintiff

Becker, Nance F. (California)

Chavez, Mark A. (California)

Ciolko, Edward W. (Pennsylvania)

Costello, Kevin (Massachusetts)

Fanning, Lori A. (Illinois)

Feiner, Gillian R (Massachusetts)

Friedman, Andrew S. (Arizona)

Gertler, Jonathan E. (California)

Harrison, Wendy J. (Arizona)

Judge(s)

O'Toole, George A. Jr. (Massachusetts)

Attorneys(s) for Plaintiff

Becker, Nance F. (California)

Chavez, Mark A. (California)

Ciolko, Edward W. (Pennsylvania)

Costello, Kevin (Massachusetts)

Fanning, Lori A. (Illinois)

Feiner, Gillian R (Massachusetts)

Friedman, Andrew S. (Arizona)

Gertler, Jonathan E. (California)

Harrison, Wendy J. (Arizona)

Kavanagh, Shennan Alexandra (Massachusetts)

Klein, Gary E. (Massachusetts)

Matthews, Gregory (Massachusetts)

Meltzer, Joseph H. (Pennsylvania)

Miller, Coty R. (California)

Moffa, Donna Siegel (Pennsylvania)

Rothman, Robert M. (New York)

Sobol, Thomas M. (Massachusetts)

Stoia, John J. (California)

Taren, Jeffrey L. (Illinois)

Van Tine, Matthew E. (Illinois)

Attorneys(s) for Defendant

Allensworth, R. Bruce (Massachusetts)

Blase, Gregory M. (Massachusetts)

Freidel, Irene C. (Massachusetts)

Glass, Andrew C. (Massachusetts)

Hancock, Paul F. (Florida)

Messenger, Lucas A. (California)

Newman, Stephen J. (California)

Sanchez, Melissa D. (Florida)

Strickland, Julia B. (California)

Documents in the Clearinghouse

Document

1:07-cv-11669

Docket (PACER)

April 8, 2011

April 8, 2011

Docket
1

1:07-cv-11669

Class Action Complaint

Allen v. Decision One Mortgage Company, LLC

Sept. 6, 2007

Sept. 6, 2007

Complaint
32

1:07-cv-11669

Order

Allen v. Decision One Mortgage Company, LLC

Sept. 22, 2008

Sept. 22, 2008

Order/Opinion
59-2

1:07-cv-11669

Stipulation and Agreement of Settlement

Allen v. Decision One Mortgage Company, LLC

Nov. 27, 2009

Nov. 27, 2009

Settlement Agreement
58

1:07-cv-11669

Jury Trial Demanded

Allen v. Decision One Mortgage Company, LLC

Nov. 27, 2009

Nov. 27, 2009

Pleading / Motion / Brief
71

1:07-cv-11669

Preliminary Approval Order

Allen v. Decision One Mortgage Company, LLC

Dec. 9, 2009

Dec. 9, 2009

Order/Opinion
87

1:07-cv-11669

Final Approval Order and Judgment

Allen v. Decision One Mortgage Company, LLC

2010 WL 1930148

May 13, 2010

May 13, 2010

Settlement Agreement

Resources

Docket

See docket on RECAP: https://www.courtlistener.com/docket/4824895/allen-v-decision-one-mortgage-company-llc/

Last updated Aug. 15, 2022, 3:19 a.m.

ECF Number Description Date Link Date / Link
87

Judge George A. OToole, Jr: ORDER entered. FINAL APPROVAL ORDER AND JUDGMENT (Lyness, Paul)

May 13, 2010

May 13, 2010

RECAP

Case Details

State / Territory: Massachusetts

Case Type(s):

Fair Housing/Lending/Insurance

Special Collection(s):

Multi-LexSum (in sample)

Key Dates

Filing Date: Sept. 6, 2007

Closing Date: 2010

Case Ongoing: No

Plaintiffs

Plaintiff Description:

Black and Hispanic homeowners, who took out loans from Direct One Mortgage Company and HSBC Financing Corporation.

Plaintiff Type(s):

Private Plaintiff

Public Interest Lawyer: No

Filed Pro Se: No

Class Action Sought: Yes

Class Action Outcome: Granted

Defendants

HSBC Financing Corporation, Private Entity/Person

Defendant Type(s):

Bank or credit provider

Case Details

Causes of Action:

Fair Housing Act/Fair Housing Amendments Act (FHAA), 42 U.S.C. §§ 3601 et seq.

Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691

Availably Documents:

Trial Court Docket

Complaint (any)

Monetary Relief

Injunctive (or Injunctive-like) Relief

Outcome

Prevailing Party: Plaintiff

Nature of Relief:

Injunction / Injunctive-like Settlement

Attorneys fees

Damages

Source of Relief:

Settlement

Form of Settlement:

Court Approved Settlement or Consent Decree

Amount Defendant Pays: 6,500,000.00

Order Duration: 2010 - 2010

Content of Injunction:

Develop anti-discrimination policy

Reporting

Issues

General:

Disparate Impact

Pattern or Practice

Predatory lending

Discrimination-area:

Lending

Discrimination-basis:

National origin discrimination

Race discrimination

Race:

Black

National Origin/Ethnicity:

Hispanic