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Frequently Asked Questions


Why Was The Settlement Notice Sent To Me?

Answer:

This Notice was sent to you because Defendants’ records indicate that your residential insurance policy lapsed, that a hazard, flood, or wind lender-placed insurance policy (“LPI Policy”) was issued for your residential property, and that you were charged by PennyMac, as your mortgage servicer, for this LPI Policy during the Class Period. The Court ordered this Notice to be sent to you because you have a right to know about the proposed Settlement of this class action lawsuit, which concerns LPI procured or issued by the QBE Defendants for which you were charged by PennyMac, and about your options, before the Court decides whether to approve the Settlement.

What Is The Settlement Notice?

Answer:

The Notice is part of a package sent to all potential Settlement Class Members like you. The package includes the Notice, the Instructions for the Class Action Claim Form, and the Class Action Claim Form. The package explains the lawsuit, the Settlement, your legal rights, what benefits are available, who is eligible for them, and how to get them. The Court in charge of the case is the United States District Court for the Southern District of Florida, and the case is known as Cooper v. PennyMac Loan Services, LLC, et al., Case No. 1:16-cv-20413-JEM, in the United States District Court for the Southern District of Florida. Plaintiff Gary Cooper sued on behalf of you and all Settlement Class Members and is called the “Plaintiff.” The companies he sued, PennyMac and the QBE Defendants are called the “Defendants.”

What Is This Lawsuit About?

Answer:

This lawsuit involves lender-placed insurance (“LPI”), which is insurance (hazard, flood, or wind) that is placed on a borrower’s property to protect the borrower and mortgage lender when the borrower’s insurance policy lapses, or when the borrower does not maintain a homeowner’s insurance policy that is acceptable to the mortgage lender. When an LPI Policy is placed pursuant to the borrower’s mortgage contract, PennyMac pays premiums to the LPI insurer who writes the policy, and then PennyMac charges the borrowers for those premiums. The Plaintiffs have brought claims on behalf of all persons in the Settlement Class (as defined in Answer #5). Plaintiffs allege that when a borrower was required to have insurance for his or her property pursuant to a residential mortgage or home equity loan or line of credit, and evidence of acceptable coverage was not provided (for example, when the insurance policy did not exist or had lapsed), PennyMac would place insurance in a manner such that PennyMac allegedly received an unauthorized benefit. Plaintiffs allege further that PennyMac did so primarily to receive “kickbacks” from the QBE Defendants. Plaintiffs also allege that the way in which LPI policies were obtained and placed caused the rates and the amount of coverage to be excessive. All Defendants expressly deny Plaintiffs’ allegations and assert their actions were fully authorized under the mortgage instruments and by law. They also expressly deny that they did anything wrong and that PennyMac ever received an “unauthorized benefit,” “kickback,” or commission as a result of any LPI placement. There has been no court decision on the merits of this case and no finding that Defendants committed any wrongdoing.

Why Is There A Settlement?

Answer:

Both sides have agreed to a Settlement to avoid the cost and risk of a trial and so that borrowers can get benefits in exchange for releasing Defendants from liability.

Who Is A Settlement Class Member?

Answer:

To see if you will be affected by this class action, you first have to determine if you are a member of the Settlement Class. All borrowers in the United States who, within the Class Period, were charged by PennyMac Loan Services, LLC under a hazard, flood, or wind LPI policy issued or procured by QBE Specialty Insurance Company, Praetorian Insurance Company, QBE FIRST Insurance Agency, Inc. n/k/a NGLS Insurance Services, Inc., QBE Insurance Corporation, Balboa Insurance Company, Meritplan Insurance Company, Seattle Specialty Insurance Services, Inc., or one of their predecessors, successors, agents, or affiliates (collectively, the “QBE Defendants”) for Residential Property, and who, within the Class Period, either (i) paid to PennyMac the Net Premium for that LPI Policy or (ii) did not pay to and still owe PennyMac the Net Premium1 for that LPI Policy. Excluded from the Class are: (i) individuals who are or were during the Class Period officers or directors of the Defendants or any of their respective affiliates; (ii) any justice, judge, or magistrate judge of the United States or any State, their spouses, and persons within the third degree of relationship to either of them, or the spouses of such persons; (iii) borrowers who only had an LPI Policy that was cancelled in its entirety such that any premiums charged and/or collected were fully refunded to the borrower or the borrower’s escrow account; and, (iv) all borrowers who file a timely and proper request to be excluded from the Class. The “Class Period” is from February 1, 2011 through October 18, 2016.

What If I Am Not Sure Whether I Am Included In The Settlement Class?

Answer:

If you are not sure whether you are included in the Settlement Class, or you have questions about the case, you may call the toll free number, 1-866-254-8702.

What Are The Terms Of The Settlement?

Answer:

Defendants have agreed to provide a cash award or credit to each Settlement Class Member in the following amounts: (i) A sum equal to 5.5% of the Net Premium if you were charged by PennyMac for an LPI Policy procured or issued by Praetorian, QBE Insurance, Balboa, or Meritplan; (ii) A sum equal to 10.5% of the Net Premium if you were charged by PennyMac for an LPI Policy procured or issued by QBE Specialty, Seattle Specialty, or Southwest Business Corporation; Payments will be made provided that the Settlement Class Member submits a valid and properly completed Claim Form, including, for some Settlement Class Members, providing a form of verification of their identity. Each Settlement Class Member must submit a Claim Form to be eligible to receive these benefits. Defendants also have agreed to additional injunctive relief from which you may benefit. The Settlement benefits are described in further detail in the Settlement Agreement.

How Do I Receive A Cash Award Or Credit?

Answer:

To receive a cash award or credit towards what you currently owe, you must be a Settlement Class Member and must submit a properly completed and accurate Class Action Claim Form by the Claim Deadline, which will be no earlier than July 13, 2017. The Class Action Claim Form Instructions and a Class Action Claim Form are available by clicking here, or you can call for one at the toll-free number of 1-866-254-8702. Please read the Claim Form Instructions carefully. If your Claim Form is not properly completed and/or all required information is not provided, it will be deemed invalid.

How Do I Know Whether I Am Eligible For A Cash Award Versus A Credit Towards What I Owe PennyMac?

Answer:

The Class Action Claim Form Instructions and Claim Form explain the different relief available to Settlement Class Members, depending upon whether they paid their LPI premium. As explained on the Claim Form, Settlement Class Members are eligible for a cash award if during the Class Period they made at least one full monthly mortgage payment to PennyMac after either: (a) their existing escrow account was adjusted to charge the increased premium for the LPI Policy; or (b) an escrow account was created to charge the increased premium for the LPI Policy and was charged for the LPI Policy. All other Settlement Class Members who, during the Class Period, were charged by PennyMac for their LPI Policy, and who have not paid and still owe the charged net premium for that policy, are eligible for a reduction of what they currently owe PennyMac in the amount of 10.5% or 5.5% of the Net Premium charged to the claimant during the Class Period for the LPI Policy by PennyMac. The net premium is the amount of the LPI premium minus any refunds already provided to the borrower. Alternatively, Defendants may elect, in their sole discretion, to send partial cash award checks to such claimants.

How do I answer Question 1 and Question 2 on the Claim Form?

Answer:

You should not check the same answer to both questions. For example, if you answered “Yes” to Question 2 indicating that you paid all or a portion of the premium, then you should check “No” as to Question 1. You may only check the “Yes” box to Question 2 (indicating you were charged by PennyMac and paid all or a portion of the LPI premium), which may make you eligible for a cash payment, if you made at least one full monthly mortgage payment after you were charged the premium for the LPI Policy. If you were charged by PennyMac and still owe the premium for your LPI Policy to PennyMac but you did not make a monthly mortgage payment, you must check the “No” box to Question 2, but you may check the “Yes” box to Question 1.

When Would I Receive My Cash Award Or Credit?

Answer:

The Court will hold a hearing on April 14, 2017 to determine whether to approve the Settlement. If Judge Martinez approves the Settlement, there may be appeals after that. It is always uncertain when any appeals, if taken, will be resolved. You will receive your cash award or credit within 180 days after the Settlement becomes final and effective, i.e., after all appeals are resolved.

Does Each Person Listed On The Claim Form Need To Submit Their Contact Information and Sign the Claim Form?

Answer:

Yes. All persons listed at the top of the Claim Form you received must fill out the requested contact information and sign the Claim Form for it to be considered a valid submission. If you are not sure if there is more than one claimant for this form, you may call the toll-free number, 1-866-254-8702 for assistance.

What Am I Giving Up To Be Part Of The Settlement Class?

Answer:

If you are a Settlement Class Member, then unless you exclude yourself, you are staying in the Settlement Class. That means you cannot sue, continue to sue, or be part of any other lawsuit against Defendants or Released Parties about LPI or the issues that were or could have been raised in this case. It also means that all of the Court’s orders concerning the Settlement Class will apply to you and legally bind you, including the Release described in detail in Section 10 of the Settlement Agreement. This Release provision describes the legal claims that you give up if this Settlement is approved and you do not exclude yourself. Please carefully read this Release and the Settlement Agreement.

What Happens If I Do Nothing?

Answer:

If you do nothing as a Settlement Class Member, you’ll receive no money or credit from this Settlement. But, unless you exclude yourself from the Settlement, you will not be able to start a lawsuit or continue with a lawsuit against Defendants ever again about the legal issues that were or could have been raised in this case.

How Do I Get Out Of The Settlement?

Answer:

If you fall within the definition of the Settlement Class, you are automatically a member of the Settlement Class. However, you can exclude yourself, or “opt out” of the Settlement Class, if you do not wish to participate. This means you will receive no payment or credit as part of this Settlement, nor any of the additional Settlement benefits. You cannot ask to be excluded over the phone or via the internet. To exclude yourself, you must mail a written request for exclusion to the Settlement Administrator that includes: (1) a statement requesting exclusion from the proposed Settlement, such as “I hereby request that I be excluded from the proposed Settlement Class in the Cooper Class Action”; (2) your name, your address, and the case name; and (3) your original signature. Your written request for exclusion must be postmarked no later than March 15, 2017 and mailed to Cooper Settlement Center, c/o Rust Consulting - 5301, P.O. Box 2563 Faribault, MN 55021-9563. You may not seek to “opt out” of the Settlement on behalf of other members of the Settlement Class.

What If I Do Not Opt Out Of The Settlement?

Answer:

Any member of the Settlement Class who does not opt out of the Settlement in the manner and by the deadline described above shall be part of the Settlement Class, shall be bound by all orders and proceedings in this action, and shall give up the right to sue any of the Defendants for the claims that this Settlement resolves. If you desire to opt out, you must take timely affirmative written action even if you have filed a separate action against any of the Defendants or are a putative class member in any other class action filed against any of the Defendants. If you have a pending lawsuit, please contact your lawyer in that lawsuit immediately. Remember, the exclusion deadline is March 15, 2017.

If I Exclude Myself, Can I Receive Money Or A Credit From This Settlement?

Answer:

No. If you are a Settlement Class Member and exclude yourself, do not send in a Claim Form to ask for any money or a credit. But, you may sue or continue to sue Defendants individually or be part of a different lawsuit against Defendants.

How Can I Object To The Settlement?

Answer:

You may object to or comment on all or part of the proposed Settlement if you are a Settlement Class Member and do not opt out of the Settlement. To do so, you (or your attorney on your behalf) must submit a valid objection. To be valid, your objection must be in writing, personally signed by you, and must include: (a) the case name and number; (b) your name, address, telephone number, and, if represented by counsel, their contact information; (c) the basis for your objection; and (d) a statement of whether you intend to appear at the Final Approval Hearing. Your objection must be filed with the Clerk of Court, with copies mailed to all of the parties identified below, postmarked no later than February 17, 2017: CLERK OF THE COURT Clerk of the United States District Court for the Southern District of Florida 400 North Miami 8th Floor Miami, FL 33128 CLASS COUNSEL Adam M. Moskowitz Kozyak, Tropin, & Throckmorton, P.A. 2525 Ponce de Leon Blvd., 9th Floor Coral Gables, FL 33134 COUNSEL FOR QBE DEFENDANTS Robyn C. Quattrone BuckleySandler LLP 1250 24th Street, NW, Suite 700 Washington, DC 20037 COUNSEL FOR PENNYMAC Marc J. Gottlieb Akerman LLP 350 East Las Olas Boulevard, Suite 1600 Fort Lauderdale, FL 33301

Do I Have A Lawyer In This Case?

Answer:

The Court appointed the following lawyers to represent you and all other Settlement Class Members. Together, these lawyers are called Class Counsel. You will not be charged any money to pay for these lawyers. Adam M. Moskowitz amm@kttlaw.com Kozyak, Tropin, & Throckmorton, P.A. 2525 Ponce de Leon Blvd., 9th Floor Coral Gables, FL 33134 Telephone: (305) 372-1800 Facsimile: (305) 372-3508 Aaron S. Podhurst apodhurst@podhurst.com Podhurst Orseck, P .A. City National Bank Building 25 West Flagler Street, Suite 800 Miami, FL 33130 Telephone: (305) 358-2800 Facsimile: (305) 358-2382 Lance A. Harke lharke@harkeclasby.com Harke Clasby & Bushman LLP 9699 NE Second Ave. Miami Shores, FL 33138 Telephone: (305) 536-8220 Facsimile: (305) 536-8229

How Will The Class Counsel Lawyers Be Paid?

Answer:

Class Counsel will ask the Court for attorneys’ fees and expenses up to $670,725, and a case contribution award of $5,000 paid to Named Plaintiff Gary Cooper for his time and effort undertaken in the matter. The Court may award less than these amounts. Defendants will separately pay the fees and expenses, and the case contribution awards that the Court awards, up to maximums of $670,725 in fees and expenses and $5,000 to Named Plaintiff Gary Cooper. These amounts will not reduce the amount of any cash awards or credits to Settlement Class Members.

When And Where Will The Court Decide Whether To Approve The Settlement?

Answer:

The Court has scheduled a Final Approval Hearing for 2:00 p.m. on April 14, 2017, in Courtroom 11-3 of the Wilkie D. Ferguson, Jr. United States Courthouse, 400 North Miami Avenue, Miami, Florida. At this hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate. If there are valid and timely objections, the Court will consider them. Please note that the time and courtroom are subject to change. Please check this website for the most up-to-date information about the Final Approval Hearing. The Court may listen to people who have properly asked to speak at the hearing beforehand, and in writing. After the hearing, the Court will decide whether to approve the Settlement. We do not know how long this decision will take.

As A Settlement Class Member, May I Speak At The Hearing?

Answer:

You cannot speak at the hearing if you have excluded yourself from the Settlement Class. However, if you are part of the Settlement Class, you may ask the Court for permission for you or your attorney to speak at the Final Approval Hearing. To do so, you must file with the Clerk of the Court and serve on all counsel for the parties (at the addresses identified in Answer #16 of the Notice) a notice of intention to appear at the Final Approval Hearing. The notice of intention to appear must include the case name and number; your name, address, telephone number, and signature, and, if represented by counsel, their contact information; and copies of any papers, exhibits, or other evidence that you intend to present to the Court in connection with the Final Approval Hearing. The notice of intention to appear must be filed with the Clerk of Court and served on all counsel no later than March 15, 2017. If you do not file a notice of intention to appear in accordance with the deadlines and other specifications set forth in the Settlement Agreement and the Notice, you will not be entitled to appear at the Final Approval Hearing to raise any objections.

Where Can I Get More Details About The Settlement?

Answer:

More details are in the Settlement Agreement, which is available through this Settlement Website at www.CooperSettlementInfo.com. You may also contact Class Counsel, as identified above. In addition, you may call 1-866-254-8702 toll free, or visit the Settlement Website, to find answers to common questions about the Settlement, a Claim Form, and other information to help you determine whether you are eligible for relief from this Settlement.

Disclaimer

This site is not operated by the Court, Class Counsel, Defendant’s Counsel, or Defendants. This class action settlement is supervised by the Court and is administered by a consulting firm that handles all aspects of settlement administration.

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