The plaintiffs in a kickback class action have moved for preliminary approval of a class action settlement of all claims asserted against a bank that allegedly engaged in an illegal kickback scheme with All Star Title. A hearing on the motion has been scheduled for Oct. 12.
In the case, Joseph and Karen Somerville, et al. v. West Town Bank & Trust (U.S. District Court for the District of Maryland, No. PJM-19-490), the Somervilles and others allege that West Town Bank & Trust and its brokers, employees and/or agents participated in an illegal kickback scheme with All Star Title Inc. They specifically allege that All Star paid West Town illegal kickbacks in exchange for West Town’s assignment and referral of residential mortgage loans, refinances and reverse mortgages to All Star for title and settlement services. They allege this scheme went on between Jan. 1, 2010, and Dec. 31, 2015, in violation of RESPA and the Racketeer Influenced and Corrupt Organizations Act (RICO).
The parties reached the proposed settlement on Aug. 12, 2022, with respect to all claims involving West Town. The agreement provides that West Town would fund a $10 million common fund from which settlement benefits, settlement administration costs and court approved attorneys’ fees and expenses and class representative service awards will be paid. It is estimated that each class member would receive $3,550 in settlement benefits. This would amount to 210 percent of the average title and settlement service charges involved in the alleged violations.
The settlement class would include all individuals in the United States who were borrowers on a mortgage loan obtained from West Town Bank & Trust, a/k/a West Town Savings Bank, for which All Star Title, Inc. provided a settlement service, as identified in Section 1100 on the borrower’s HUD-1 or as appearing in the loan processing records of All Star Title, between Jan. 1, 2010, and Dec. 31, 2015.
Exempted from this class are (i) any person who, during the period of Jan. 1, 2010, through December 31, 2015, was an employee, officer, member and/or agent of West Town Bank & Trust, a/k/a West Town Savings Bank, or All Star Title, Inc.; (ii) any judicial officer who handles this case, and the immediate family members of such judicial officer(s); and/or (iii) any person who elected to be excluded from the West Town Class and the Litigation in accordance with the Court’s Nov. 23, 2021 Order, approving the class notice and notice plan.