Complying with the mortgage-servicing requirements in the Real Estate Settlement Procedures Act is hard enough. Complicating the matter is the ease with which mortgage-servicing lawsuits can thrive in court. A recent decision from an Ohio federal court significantly shifts the balance of authority in favor of suing borrowers.

In the case, Askin v. Ocwen Loan Servicing, LLC, the borrower alleged that his mortgage servicer failed to properly respond to several qualified written requests (QWRs) from his attorney. When Ocwen answered the borrower’s complaint, it attached various letters to the plaintiff that supposedly met the company’s burden under RESPA. That law obligates a mortgage servicer to take one of three actions upon receipt of a valid QWR: (1) correct the problem; (2) investigate and, if appropriate, explain why the situation is not incorrect; or (3) investigate and, if proper, explain why it cannot provide the information sought.

For two reasons, the plaintiff in Askin was able to defeat Ocwen’s motion for judgment on the pleadings with little effort. First, the presiding judge refused to consider the attachments to Ocwen’s answer, thus gutting the company’s claims that it did not violate RESPA. Second, the plaintiff was deemed to have sufficient actual damages (in the form of copying and postage charges, plus lawyer’s fees) based on nothing more than his pleading allegations.

The teaching moment from Askin is that even mortgage servicers that can prove they complied with RESPA might have to contend with a baseless lawsuit for at least some period of time. Ocwen would likely have been able to prevail at a later stage, like summary judgment. Also, by refusing to surrender to baseless lawsuits and by spending extra money to defeat those claims on the merits, a real estate business can deter other would-be plaintiffs, showing them that the company will not roll over to spurious filings.