Supreme Court Dismisses RESPA Case, Allowing Fair Housing Clinic to Pursue in District Court
The U.S. Supreme Court’s dismissal in First American Financial Corp. v. Edwards, 567 U. S. ____ (2012) allows C|M|LAW’s Fair Housing Clinic to go back to the District Court on a class action case asserting violations of the Real Estate Settlement Procedures Act. By dismissing the case, the Supreme Court let stand an appellate court decision holding that the plaintiffs-homeowners had standing. Edwards v. First Am. Corp. , 610 F.3d 514 (9th Cir. 2010). The Supreme Court dismissed the writ of certiorari as improvidently granted.
The issue before the Supreme Court was whether a homeowner has standing to sue under RESPA, 12 USC 2607, when a provider of title insurance gives kickbacks to title insurance agents involved in a home sale, but the price, quality, or other characteristics of the settlement services provided to that homeowner were not directly affected. The Fair Housing Clinic filed a merit brief with the Supreme Court for the Plaintiffs, asserting that RESPA creates a statutory cause of action, thus the Plaintiffs have standing. Congress created the cause of action to prevent conflicts of interest that arise when a real estate professional accepts kickbacks for referrals, because these conflicts tend to increase the cost and decrease the quality of settlement services for all consumers.
The Fair Housing Clinic is looking forward to pursuing the case on behalf of 3,000 to 3,500 Clevelanders who used a title insurance agent that allegedly received kickbacks.
Washington Post article.