Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_02-cv-01240/USCOURTS-cand-4_02-cv-01240-2/pdf.json

Nature of Suit Code: 371
Nature of Suit: Truth in Lending
Cause of Action: 28:1441 Petition for Removal

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50307436v3 

STIPULATION AND [PROPOSED] ORDER RE MODIFICATION OF SETTLEMENT 

AGREEMENT – Case No. C02-1240 CW (and related cases) 

STROOCK & STROOCK & LAVAN LLP 

JULIA B. STRICKLAND (State Bar No. 83013) 

STEPHEN J. NEWMAN (State Bar No. 181570) 

2029 Century Park East, Suite 1800 

Los Angeles, California 90067-3086 

Telephone: 310-556-5800 

Facsimile: 310-556-5959 

HELLER EHRMAN WHITE & McAULIFFE 

JONATHAN P. HAYDEN (State Bar No. 104520) 

ANNA S. McLEAN (State Bar No. 142233) 

333 Bush Street 

San Francisco, California 94101-2878 

Telephone: 415-772-6000 

Facsimile: 415-772-6268 

Attorneys for Defendants 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

OAKLAND DIVISION 

IN RE: 

HOUSEHOLD LENDING LITIGATION 

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Case No. C02-1240 CW 

(and related cases C02-2529, C02-4646, 

C02-4867, C02-5520 and C03-0368) 

CLASS ACTION

ORDER GRANTING STIPULATION RE 

MODIFICATION OF SETTLEMENT 

AGREEMENT 

WHEREAS, this Court entered its final approval order in regard to the Stipulation and 

Agreement of Settlement (the “Settlement”) on April 30, 2004; and 

WHEREAS, the Settlement provides, at Section III(A)(5), for the creation of a “Foreclosure 

Avoidance Program” (the “FAP”), which is designed to provide financial relief to low-income 

Class Members1

 at risk of losing their homes to foreclosure; and 

 

1

 All capitalized terms used herein, unless otherwise defined, shall have the same meaning as is set 

forth in the Settlement. 

Case 4:02-cv-01240-CW Document 418 Filed 03/02/06 Page 1 of 4
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50307436v3 - 2 -

STIPULATION AND [PROPOSED] ORDER RE MODIFICATION OF SETTLEMENT 

AGREEMENT – Case No. C02-1240 CW (and related cases) 

WHEREAS, the Settlement sets forth an aggregate funding level of $72,000,000 for the 

FAP (the “Funding Cap”); and 

WHEREAS, the Settlement further sets forth that HFC/Beneficial is entitled to credit 

against the Funding Cap for certain extraordinary relief, up to a maximum credit of $12,000,000, as 

described in greater detail in Section VI of Exhibit 1 to the Settlement (the “Extraordinary Relief 

Subcap”); and 

WHEREAS, the parties believe that the Funding Cap and the Extraordinary Relief Subcap 

will be reached in advance of the five year period described in Section III(A)(5)(a) of the 

Settlement Agreement; and 

WHEREAS, HFC/Beneficial is prepared to enhance the FAP by increasing the Funding 

Cap and the Extraordinary Relief Subcap by a total of $10,000,000 (TEN MILLION DOLLARS), 

in consideration for a variation in the administration of the “Live Check” provisions of the 

Settlement, as set forth in greater detail below; and 

WHEREAS, Section III(B)(12) of the Settlement sets forth certain limitations for a three 

year period on the use of “Live Checks” for marketing purposes (the “Live Check Terms”); and 

WHEREAS, Plaintiffs and Class Counsel believe that adequate protection of the Class can 

be obtained by modifying the Live Check Terms to allow use of Live Check marketing, subject to 

restrictions on the number of real estate secured loans booked through such marketing; and 

WHEREAS, Plaintiffs and Class Counsel believe that the Class will benefit immensely 

from the $10 million in increased funding for the FAP, and that this benefit vastly outweighs any 

impact to the Class from modifying the Live Check Terms as set forth below; 

WHEREAS, Plaintiffs, Class Counsel and HFC/Beneficial believe that additional notice to 

the Class should not be required, in light of the nature of the modification and the prohibitive cost 

of giving further notice to the more than 900,000 Class Members; and 

WHEREAS, Section XII of the Settlement provides that this Court retains jurisdiction to 

approve amendments to the Settlement, and to address issues relating to implementation of the 

Settlement. 

Case 4:02-cv-01240-CW Document 418 Filed 03/02/06 Page 2 of 4
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50307436v3 - 3 -

STIPULATION AND [PROPOSED] ORDER RE MODIFICATION OF SETTLEMENT 

AGREEMENT – Case No. C02-1240 CW (and related cases) 

NOW, THEREFORE, THE PARTIES, BY AND THROUGH COUNSEL, 

STIPULATE AND AGREE AS FOLLOWS: 

1. Upon approval of this stipulation, HFC/Beneficial shall not be required to comply 

with the requirements set forth in the second, third and fourth sentences of Section III(B)(12) of the 

Settlement (relating to use of Live Checks as solicitation leads). Notwithstanding the foregoing, 

HFC/Beneficial shall comply with the following restrictions between July 30, 2006 and April 30, 

2007: (a) the percentage of real estate secured loans made to customers who are directly upsold 

from a Live Check shall not exceed 4% (FOUR PERCENT) of the booked Live Checks from a 

Live Check campaign, calculated by reference to the number of loans within six months of initial 

booking; (b) the percentage of real estate secured loans directly upsold from Live Check customers 

or booked directly into a real estate secured loan as a result of the Live Check campaign shall not 

exceed 6% (SIX PERCENT) of the total loans booked from a Live Check campaign, calculated by 

reference to the number of loans within six months of the initial booking; (c) HFC/Beneficial shall 

limit the total number of real estate secured loans made to customers who received a Live Check 

within the previous six months to not more than 0.1% (ONE TENTH OF ONE PERCENT) of the 

total number of Live Checks mailed. 

2. Upon approval of this stipulation: HFC/Beneficial will increase the Funding Cap 

set forth in Section III(A)(5)(a) of the Settlement as the “aggregate benefit amount” from 

$72,000,000 to $82,000,000 (EIGHTY-TWO MILLION DOLLARS); the Year 4 annual target will 

increase from $12,000,000 to $17,000,000 (SEVENTEEN MILLION DOLLARS); the Year 5 

annual target will increase from $10,000,000 to $15,000,000 (FIFTEEN MILLION DOLLARS); 

the Year 1 through Year 3 annual targets shall remain unchanged; the Extraordinary Relief Subcap 

shall, as to relief granted subsequent to the date of approval of this stipulation, be deemed increased 

from $12,000,000 to $22,000,000 (TWENTY-TWO MILLION DOLLARS); and the figure 

“$72,000,000” set forth in Section III(A)(5)(b) of the Settlement shall be deemed amended to read 

“$82,000,000”. If the former Funding Cap is exceeded prior to the date of approval of this 

stipulation, HFC/Beneficial shall nonetheless receive credit against the new $82,000,000 Funding 

Cap for FAP relief granted in the interim. 

Case 4:02-cv-01240-CW Document 418 Filed 03/02/06 Page 3 of 4
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STIPULATION AND [PROPOSED] ORDER RE MODIFICATION OF SETTLEMENT 

AGREEMENT – Case No. C02-1240 CW (and related cases) 

3. This stipulation shall be null and void and of no effect if it is not approved as 

submitted. 

4. This stipulation shall be null and void and of no effect if the Court directs that 

further notice to the Class should be given. 

Dated: February 28, 2006 STROOCK & STROOCK & LAVAN LLP 

 JULIA B. STRICKLAND 

STEPHEN J. NEWMAN 

HELLER EHRMAN WHITE & McAULIFFE 

JONATHAN P. HAYDEN 

ANNA S. McLEAN 

 By: /s/ Stephen J. Newman 

 Stephen J. Newman 

 Attorneys for Defendants 

 

Dated: February 28, 2006 COTCHETT, PITRE, SIMON & McCARTHY 

JOSEPH P. COTCHETT, JR. 

NIALL P. McCARTHY 

CHARLES E. TILLAGE 

 By: /s/ Niall P. McCarthy / by permission SJN 

 Niall P. McCarthy 

 Attorneys for Certain Plaintiffs and for the Class 

 

ORDER

PURSUANT TO STIPULATION, IT IS SO ORDERED. 

 3/2/06 

DATED: ______________________. 

 /s/ CLAUDIA WILKEN 

 __________________________________________ 

 THE HONORABLE CLAUDIA WILKEN 

 UNITED STATES DISTRICT JUDGE 

Case 4:02-cv-01240-CW Document 418 Filed 03/02/06 Page 4 of 4