Outcome: $1,474,314.00 Settlement and Injunctive Relief
Lembeck, et al. v. Arvest Central Mortgage Co., Case No. 4:20-cv-03277 in the United States District Court for the Northern District of California
In the class action lawsuit against Arvest Central Mortgage Co., plaintiff Valerie Lembeck successfully alleged that the mortgage servicer was in violation of the Rosenthal Fair Debt Collection Practices Act and the Unfair Competition Law by levying Pay-to-Pay Fees. The lawsuit, which encompassed all persons holding residential mortgage loans serviced by Arvest in Florida, Texas, or California who paid a fee for telephone, IVR, or internet loan payments within the defined class period (January 1, 2017, to December 31, 2020), concluded with the defendant denying all assertions of liability. However, the legal proceedings resulted in a settlement in which TZ, along with another firm, represented the class’s interest.
The settlement bears significant financial and injunctive impact, marking a win for consumer rights. Arvest paid a settlement fund of $1,474,314, equating to nearly half of the $2,966,198 total fees collected from the class during the stated period. Beyond the monetary compensation, the settlement has achieved vital injunctive relief; starting January 1, 2021, Arvest has pledged to discontinue charging Pay-to-Pay Fees for mortgage loan payments to any member in the settlement class and borrowers in California, Florida, and Texas. Affirming this commitment, they have further agreed to refrain from reinstating such fees for a minimum of three years following the Final Approval Order, ensuring cost savings and fairer practices for borrowers going forward.