To class action lawyers, the much maligned Maryland title agency Genuine Title, LLC, has been a gift many times over. That one company has spawned eight class actions and two public enforcement cases. But, after four years of exhaustive litigation, the federal judge presiding over the class lawsuits has finally thrown them out.
The reason for the dismissal is that the newer plaintiffs are simply suing too late, in violation of the one-year statute of limitations in the Real Estate Settlement Procedures Act (RESPA). Allegations about Genuine Title paying kickbacks have been public since 2014, when the first of the eight class actions was filed. After that, Genuine Title went bankrupt. The Consumer Financial Protection Bureau (CFPB) and the Maryland Attorney General filed enforcement actions against Wells Fargo Bank and JPMorgan Chase Bank for their purported involvement with Genuine Title’s scam. The lawyers from the first class action, Fangman, then went on to file seven more, against various entities with whom Genuine Title had done business.
In a series of three recent opinions (here, here, and here), the Maryland federal judge presiding over the remaining cases dismissed them on statute-of-limitations grounds. The question before the court was whether the plaintiffs could delay the statute of limitations based on the doctrine of equitable tolling. That doctrine gives a plaintiff more time to file a lawsuit if the defendant actively concealed his wrongdoing and the plaintiff was diligent in pursuing his rights.
One of the more notable aspects of the rulings dismissing the cases was that the court took into consideration actions the plaintiff’s lawyers had taken in investigating and publicizing the claims. Those activities served as warnings to potential plaintiffs, making it harder for them to later claim that they didn’t know about the alleged kickbacks until after that.
Since these rulings are now on appeal, it remains to be seen whether the trial court’s analysis will prove correct. An appellate reversal could be very worrisome for the real estate industry.