Nichols Kaster Attorneys At Law Files Overtime Case Against Flagstar Bank on Behalf of Mortgage Underwriters
The complaint alleges that Flagstar Bank misclassified Plaintiff and other mortgage underwriters, and as a result, improperly denied them from overtime compensation.
Santa Ana, CA (PRWEB) March 14, 2014
On March 13, 2014 a former employee of Flagstar Bank (“Flagstar”) filed suit in California federal court seeking unpaid overtime wages under federal law and California state law. The Plaintiff alleges that Flagstar misclassified himself and other mortgage underwriters as exempt from the overtime requirements of the Fair Labor Standards Act and California state law and as a result, improperly denied them overtime compensation.
The case is entitled Jefferson et al v. Flagstar Bank and was filed in the United States District Court for the Central District of California. The case number is 8:14-cv-00382.
According to the complaint, Flagstar uniformly classifies its mortgage underwriters as “exempt” from overtime pay and did not pay them overtime, even though Plaintiff believes that he and other mortgage underwriters were entitled to receive overtime pay.
Flagstar Settles Mortgage Suit for $110M
Flagstar Bancorp (FBC) in Troy, Mich., will pay $110 million to settle allegations that it misrepresented the quality of more than $1 billion of private label mortgage-backed securities it sold to investors.
The settlement ends a suit that MBIA Insurance Corporation brought in January, alleging that Flagstar lied about the quality of loans backing $1.1 billion of securities that MBIA insured in 2006 and 2007. MBIA said that it had to pay $165 million to cover losses the two securities trusts suffered.
Flagstar said Thursday that the settlement will have no significant financial impact due to its high litigation reserves. In February, Flagstar said it would set aside $161 million to cover potential losses in the MBIA case and other lawsuits over its mortgage-underwriting practices. The announcement came shortly after a federal judge ordered it to pay $90 million to bond insurer Assured Guaranty Municipal Corp over allegations it misled the insurer over the quality of loans backing $1 billion of securities. Flagstar said it disagrees with the ruling and intends to appeal.
NEW YORK, Sept 26 (Reuters) – Flagstar Bank, the ninth-largest mortgage lender in the United States, must face trial next month over allegations that it breached contracts for financial guaranty insurance on nearly $1 billion in securities backed by home equity loans.
A federal judge in New York, expanding on an order he issued in February, wrote in an opinion issued on Tuesday that the plaintiff, Assured Guaranty Municipal Corp, had provided enough evidence to survive the bank’s motion to throw out the case.
Flagstar spokeswoman Susan Bergesen said the savings bank had a policy of declining to comment on pending litigation.
In his opinion, U.S. District Judge Jed Rakoff said he was skeptical that Assured Guaranty’s allegations of Flagstar’s failure to follow customary servicing practices amounted to gross negligence, misfeasance or bad faith. But the judge added: “The court finds that the plaintiff has presented enough evidence to survive summary judgment on this claim.”
The trial is scheduled to start on Oct. 9, he said.