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Civil Rights Litigation Clearinghouse
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Case Name Puello v. Citifinancial Services, Inc. FH-MA-0004
Docket / Court 1:08-cv-10417 ( D. Mass. )
State/Territory Massachusetts
Case Type(s) Fair Housing/Lending/Insurance
Case Summary
On March 13, 2008, a minority homeowner filed a class-action lawsuit in the U.S. District Court for the District of Massachusetts against private banks and lenders, Citifinancial Services and Citigroup Inc., under the Equal Credit Opportunity Act, 15 U.S.C. § 1691 et seq. ("ECOA"), the Fair ... read more >
On March 13, 2008, a minority homeowner filed a class-action lawsuit in the U.S. District Court for the District of Massachusetts against private banks and lenders, Citifinancial Services and Citigroup Inc., under the Equal Credit Opportunity Act, 15 U.S.C. § 1691 et seq. ("ECOA"), the Fair Housing Act, 42 U.S.C. § 3601 et seq. ("FHA"), 42 U.S.C. § 1981, and 42 U.S.C. § 1982. The plaintiffs alleged that the defendants maintained a pattern or practice that had a discriminatory impact on minority applicants in their home financing policies and practices. Specifically, the plaintiffs 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 minority homeowners, creating a significantly higher likelihood of exposure to discretionary points and fees. Plaintiff sought damages, declaratory and injuctive relief. On May 21, 2008, plaintiff filed an amended complaint, adding two named plaintiffs.

On July 21, 2008, the defendants filed a motion to dismiss the amended complaint on the basis of a failure to state a claim. On August 14, 2008, the Lawyers' Committee for Civil Rights Under Law of the Boston Bar Association, a non-profit organization established to provide pro bono legal counsel in cases of race and national origin discrimination, filed a motion to amicus brief. It opposed the motion to dismiss and argued that the weight of the precedent supports disparate impact claims under ECOA and FHA. On March 31, 2009, the Court (Mark L. Wolf) allowed the filing of the amicus brief and denied the motion to dismiss. The reasoning of the court is not available from PACER.

In the meantime, two of the individuals plaintiffs filed for bankruptcy. Trustee in bankruptcy filed a motion to substitute party and dismiss the action on October 22, 2009, which was granted by the Court on April 16, 2010, and their complaint was dismissed with prejudice. On May 12, 2010, the plaintiffs filed a second amended complaint, substituting the plaintiffs. The complaint reiterated the original allegations.

The parties went into mediation and reached a settlement. On August 1, 2011, the parties file a motion for preliminary approval of the settlement agreement. Under the agreement, the defendants agreed and represented: 1) to provide telephonic housing counseling services; 2) to continue non-discretionary pricing policy; 3) to enhance its Fair Lending policy to address concerns raised in this litigation; 4) to have personnel trained in fair lending. Some class members were eligible for a $90 check or a credit of $200 against closing costs. The defendant agreed to pay $400,000 in attorney's fees and $15,000 in service fees to the plaintiffs.

However, the Court denied the motion on December 22, 2011, as it ordered the parties to file memorandum explaining the effects of the Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), on certifying class in the present case. The parties filed their memorandums, and the Court issued an order of preliminary approval on March 6, 2012. The order certified class of "all African-American and Hispanic borrowers (including, without limitation, individual borrowers, joint-borrowers, and co-borrowers) who obtained a loan between January 1, 2004 and June 24, 2011."

Following a fairness hearing, the Court issued a final judgment approving the order August 10, 2012. That ended the case.

Zhandos Kuderin - 07/30/2014


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Issues and Causes of Action
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Issues
Content of Injunction
Develop anti-discrimination policy
Provide antidiscrimination training
Defendant-type
Bank or credit provider
Discrimination-area
Lending
Discrimination-basis
National origin discrimination
Race discrimination
General
Disparate Impact
Pattern or Practice
Predatory lending
National Origin/Ethnicity
Hispanic
Plaintiff Type
Private Plaintiff
Race
Black
Causes of Action Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691
Fair Housing Act/Fair Housing Amendments Act (FHAA), 42 U.S.C. §§ 3601 et seq.
Defendant(s) Citifinancial Services Inc.
Citigroup Inc.
Plaintiff Description African-American and Hispanic home owners, who were subject to discretionary loan pricing policy by the defendants.
Indexed Lawyer Organizations None on record
Class action status sought Yes
Class action status granted Yes
Prevailing Party Plaintiff
Public Int. Lawyer Yes
Nature of Relief Attorneys fees
Injunction / Injunctive-like Settlement
Source of Relief Settlement
Form of Settlement Court Approved Settlement or Consent Decree
Order Duration 2012 - 2012
Case Closing Year 2012
Case Ongoing No
Docket(s)
1:08−cv−10417 (D. Mass.) 08/10/2012
FH-MA-0004-9000.pdf | Detail
PACER [Public Access to Court Electronic Records]
General Documents
Class Action Complaint 03/13/2008
FH-MA-0004-0007.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Amicus Curiae Brief of the Lawyer's Committee for Civil Rights Under Law of the Boston Bar Association 08/11/2008
FH-MA-0004-0002.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Second Amended Class Action Complaint 05/12/2010
FH-MA-0004-0003.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Reply in Support of Plaintiff's Motion to Compel Defendants to Produce Documents 12/07/2010
FH-MA-0004-0004.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Declaration of John Marsh 06/23/2011
FH-MA-0004-0005.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Settlement Agreement 08/01/2011
FH-MA-0004-0008.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Order [Denying Preliminary Approval for Class Action Settlement] 12/22/2011 (D. Mass.)
FH-MA-0004-0009.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Preliminary Approval Order 03/06/2012 (D. Mass.)
FH-MA-0004-0010.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Joint Stipulation Concerning Release 08/09/2012
FH-MA-0004-0006.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Final Approval Order and Judgment 08/10/2012 (D. Mass.)
FH-MA-0004-0001.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Judges Wolf, Mark Lawrence (D. Mass.)
FH-MA-0004-0001 | FH-MA-0004-0009 | FH-MA-0004-0010 | FH-MA-0004-9000
Monitors/Masters None on record
Plaintiff's Lawyers Cain, Kevin C. (Massachusetts)
FH-MA-0004-9000
Costello, Kevin (Massachusetts)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0006 | FH-MA-0004-0007 | FH-MA-0004-0008 | FH-MA-0004-9000
Delbaum, Charles M. (Massachusetts)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007 | FH-MA-0004-9000
Fanning, Lori A. (Illinois)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007
Friedman, Andrew S. (Arizona)
FH-MA-0004-0004 | FH-MA-0004-9000
Harrison, Wendy J. (Arizona)
FH-MA-0004-0004 | FH-MA-0004-9000
Hofeld, Al Jr. (Illinois)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0008
Kavanagh, Shennan Alexandra (Massachusetts)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0006 | FH-MA-0004-0007 | FH-MA-0004-9000
Klein, Gary E. (Massachusetts)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0006 | FH-MA-0004-0007 | FH-MA-0004-9000
Miller, Marvin A. (Illinois)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007
Reich, Mark S. (New York)
FH-MA-0004-0007
Rossman, Stuart T. (Massachusetts)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007 | FH-MA-0004-0008 | FH-MA-0004-9000
Rothman, Robert M. (New York)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007
Rudman, Samuel H. (New York)
FH-MA-0004-0007
Van Tine, Matthew E. (Illinois)
FH-MA-0004-0003 | FH-MA-0004-0004 | FH-MA-0004-0007
Defendant's Lawyers Ames, Brook L. (Massachusetts)
FH-MA-0004-9000
Borden, Katherine (Massachusetts)
FH-MA-0004-0006 | FH-MA-0004-9000
Huang, Joyce S. (New York)
FH-MA-0004-9000
Sharton, Brenda R. (Massachusetts)
FH-MA-0004-0006 | FH-MA-0004-0008 | FH-MA-0004-9000
Von Wells, Theodore Jr. (New York)
FH-MA-0004-9000
Other Lawyers Aleo, Michael E. (Massachusetts)
FH-MA-0004-0002 | FH-MA-0004-9000

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