Date: 02-11-2006

Case Style: Romeo Jergess, Romeo Jergess, Michael & GLenda Diamond, Frederick Lewerenz and Elaine Miller v. Chicago Title Insurance Co., Transnation Title Insurance Co. of Arizona, First American Title Insurance Co. of California and Lawyer's Title Insurance Corp. of Virginia

Case Number: Unknown

Judge: Avern Cohn

Court: United States District Court for the Eastern District of Michigan, Wayne County

Plaintiff's Attorney:

Patrick Bruetsch of Hardy, Lewis & Page, P.C., Birmingham, Alabama

Jeffrey Yellen of Nemier, Tolari, Landry, Mazzeo & Johnson, P.C. , Farmington Hills, Michigan

David Davis and Timothy K. McConaghy of Hardy, Lewis & Page, P.C., Birmingham, Michigan

Timothy K. McConaghy,

Defendant's Attorney:

William Holmes of Warner Norcross & Judd LLP, Grand Rapids, Michigan

Francis R. Ortiz of fDickinson Wright, PLLC, Detroit, Michigan

Description:

Plaintiffs' Complaint alleges that the four defendants violated 12 USC 2607(a) and (b) "RESPA" by giving illegal kickbacks in the form of discounts to builders who sent their buyers to the same title insurance company for their simultaneously issued title insurance loan policies.

Two policies are reeuiqred in each financed purchase in Michigan: a so-called Owner's policy" is provided by the seller to the buyer guaranteeing good title and a second "loan policy" must be bought by the purchaser to insure his lender. Usually ( in a used home sale) the lender's policy is issued for a premium of 40% of the Owner's Policy cost and the Owner's Policy is sold to hte Seller for the "full published rate." In this scenario, the builder only pays $25.00 for its policy and the buyer does not get the 60% discount. Because builders are good sources of business, Plaintiffs allege this was a glorified referral scheme.

The practice is being discontinued in Michigan by the four Defendants, who now are not giving builders discounts to encourage referrals.

Outcome: Judge Avern Cohn gave preliminary approval for a $27,550,000 settlement with all four defendants on behalf of 62,500 Michigan residents who bought new homes from builders in Michigan from 1998 to July, 2005.

Judge Cohn has set May 16th as the Final Settlement Hearing date in the case. The average payout to claimants will be between $300 and $400 but will be made on a pro-rata basis depending upopn what they overpaid for their title insurance.

Plaintiff's Experts: Unknown

Defendant's Experts: Unknown

Comments: None