Opinion ID: 3015339
Heading Depth: 2
Heading Rank: 2

Heading: Separate Class Actions

Text: The Community Bank class action began as the following six separate actions: Kessler v. GMAC-RFC, No. 03-0425 (W.D. Pa.) was originally filed in the Court of Common Pleas of Allegheny County, Pennsylvania on February 26, 2003. Plaintiffs, a class of Pennsylvania borrowers, charged that RFC had assignee liability under Pennsylvania state law for the “bogus” loan origination and title service fees charged ostensibly by CBNV and GNBT. On March 26, 2003, RFC removed the case to the United States District Court for the Western District of Pennsylvania, asserting that Sections 85 and 86 of the National 8 Banking Act (“NBA”), 12 U.S.C. §§ 85-86, and Section 521 of the Depository Institutions Deregulation and Monetary Control Act (“DIDA”), 12 U.S.C. § 1831d, completely preempt any state law attempting to limit the amount of interest and fees a national or federally insured state-chartered bank could charge. Plaintiffs did not challenge removal. Before the Kessler action was filed there were five other related actions pending in the same District Court premised on the same Shumway lending scheme. In Davis v. CBNV, No. 021201, initially filed on May 1, 2001, different plaintiffs sought to represent both a class of Pennsylvania borrowers and a class of nationwide borrowers. They asserted claims against CBNV, RFC, and Sovereign Bank (a purchaser of CBNV loans on the secondary market). On behalf of the Pennsylvania class, plaintiffs asserted that defendants violated Pennsylvania’s mortgage lending usury statute, 41 Pa. Cons. Stat. §§ 101 et seq., and the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 Pa. Cons. Stat. §§ 201-1, et seq. On behalf of the nationwide class, the Davis plaintiffs asserted a violation of the fee split and disclosure provisions of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2607(b). The case, originally filed in a Pennsylvania state court, was later removed by defendants to the federal court based on the existence of federal question jurisdiction. In Sabo v. CBNV, No. 02-1563, filed on September 11, 2002, in the United States District Court for the Western District of Pennsylvania, plaintiffs commenced a putative nationwide class action suit against CBNV and RFC asserting claims under RESPA. In Ulrich v. GNBT, No. 02-1616, filed on September 19, 2002, in the same federal court, plaintiffs filed a similar putative nationwide class action suit asserting claims under RESPA, but this one named as defendants GNBT and RFC. One month later, on November 16, 2002, plaintiffs filed Mathis v. GNBT, No. 02-1999, in the Court of Common Pleas of Allegheny County asserting various state law mortgage lending claims against GNBT and RFC, including violations of Pennsylvania’s mortgage lending usury statute, 41 Pa. Cons. 9 Stat. §§ 101 et seq., and the Unfair Trade Practices and Consumer Protection Law, 73 Pa. Cons. Stat. §§ 201-1, et seq. On November 19, 2002, Defendants removed the Mathis case to the federal court based on the doctrine of complete preemption. As in Kessler, these plaintiffs did not challenge removal. Finally, on October 23, 2002, plaintiffs filed Picard v. CBNV, 02-2000, in the Court of Common Pleas of Allegheny County against CBNV, GNBT, and RFC. On November 19, 2002, Defendants removed the case to the federal court based on the doctrine of complete preemption. Plaintiffs initially filed a motion to remand, but on February 27, 2003, they filed an amended class action complaint asserting claims under RESPA and the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962, in addition to the various state law mortgage claims asserted in the original state complaint. R. Bruce Carlson of the Pittsburgh, Pennsylvania law firm Specter, Specter, Evans, & Manogue, P.C. (now with Carlson Lynch), was the principal plaintiffs’ class attorney in each of the above actions, including Kessler.