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Case Name United States v. Plaza Home Mortgage FH-CA-0013
Docket / Court 3:13-cv-02327-H-RBB ( S.D. Cal. )
State/Territory California
Case Type(s) Fair Housing/Lending/Insurance
Attorney Organization U.S. Dept. of Justice Civil Rights Division
Case Summary
On September 26, 2013, the United States of America filed a lawsuit in the Southern District of California against Plaza Home Mortgage, Inc., under the Fair Housing Act and the Equal Credit Opportunity Act. The plaintiff, represented by the Department of Justice, alleged that the defendant ... read more >
On September 26, 2013, the United States of America filed a lawsuit in the Southern District of California against Plaza Home Mortgage, Inc., under the Fair Housing Act and the Equal Credit Opportunity Act. The plaintiff, represented by the Department of Justice, alleged that the defendant discriminated against African American and Hispanic borrowers in its residential mortgage lending and sought declaratory judgment, injunctive relief, compensatory damages to all of the victims of the defendant's discriminatory policies, and a civil penalty,

In 2009, the Federal Trade Commission ("FTC") determined that the defendant had substantial disparities in the rates given to minority versus non-Hispanic white borrowers. The FTC requested more information from the defendant, including loan data and the company's policies, and in 2011 the Department of Justice took over the investigation. The data obtained from the investigation showed that from 2006 through at least 2010, the defendant permitted its mortgage brokers to charge excessive fees beyond the fee caps to African American and Hispanic borrowers more frequently than white borrowers based solely on race and national origin. The defendant had a two-step process set in place where the first step determined whether the applicant satisfied objective criteria. The second step was more subjective and allowed mortgage brokers to charge fees with little checks on their discretion. The defendant did not set up objective criteria to guide the mortgage brokers in setting fees or interest rates. The disparities between the rates given to whites and minorities were prevalent in thousands of loans made in numerous states.

On October 1, 2013, the District Court (Judge Marilyn L. Huff) entered a consent order between the parties. The defendant did not admit to any pattern or practice of discrimination. The order enjoined the defendant from engaging in any discriminatory act or practice and subjects the defendant to monitoring. The defendant was also required to pay $3 million into a settlement fund to compensate those affected by its discrimination. The order terminates after three years if the defendant has complied during that time period.

Perry Miska - 03/10/2014


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Issues and Causes of Action
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Issues
Content of Injunction
Discrimination Prohibition
Monitoring
Provide antidiscrimination training
Reporting
Defendant-type
Bank or credit provider
Discrimination-area
Lending
Discrimination-basis
National origin discrimination
Race discrimination
General
Disparate Impact
Funding
Pattern or Practice
Predatory lending
National Origin/Ethnicity
Hispanic
Plaintiff Type
U.S. Dept of Justice plaintiff
Race
Black
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
Declaratory Judgment Act, 28 U.S.C. § 2201
Defendant(s) Plaza Home Mortgage, Inc.
Plaintiff Description Plaintiff is the U.S. on behalf of African American and Hispanic borrowers who were charged higher fees than non-Hispanic white borrowers in their residential mortgage lending due to their race and national origin.
Indexed Lawyer Organizations U.S. Dept. of Justice Civil Rights Division
Class action status sought No
Class action status granted No
Prevailing Party Plaintiff
Public Int. Lawyer Yes
Nature of Relief Declaratory Judgment
Damages
Injunction / Injunctive-like Settlement

Source of Relief Settlement
Form of Settlement Court Approved Settlement or Consent Decree
Order Duration 2013 - 2016
Case Closing Year 2013
Case Ongoing Yes
Docket(s)
3:13-cv-02327-H-RBB (S.D. Cal.) 10/01/2013
FH-CA-0013-9000.pdf | Detail
PACER [Public Access to Court Electronic Records]
General Documents
Complaint 09/26/2013
FH-CA-0013-0001.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Order Entering Consent Order between United States of America and Plaza Home Mortgage, Inc. 10/01/2013 (S.D. Cal.)
FH-CA-0013-0002.pdf | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Judges Huff, Marilyn L. (S.D. Cal.)
FH-CA-0013-0002 | FH-CA-0013-9000
Monitors/Masters None on record
Plaintiff's Lawyers Duffy, Laura E. (California)
FH-CA-0013-0001
Montag, Coty R (District of Columbia)
FH-CA-0013-0001
Price, Joseph Patrick Jr. (California)
FH-CA-0013-0001 | FH-CA-0013-9000
Rosenbaum, Steven H. (District of Columbia)
FH-CA-0013-0001
Samuels, Jocelyn (District of Columbia)
FH-CA-0013-0001
Defendant's Lawyers Alessio, John D (California)
FH-CA-0013-9000
Selden, Lynde II (California)
FH-CA-0013-0002
Other Lawyers None on record

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