The Lakin Law Firm in Wood River

Gary E. Peel of The Lakin Law Firm filed many of class action cases Dec 30

On the last day to file in 2004, clerks in Madison County Circuit Court were kept busy by The Lakin Law Firm of Wood River.

In the year's waning hours, six class action lawsuits were filed by the high-volume Metro-East plaintiff's firm on Dec. 30. The courthouse was closed in observance of the new year's holiday Dec. 31.

In 2004, a total of 82 class action lawsuits were filed in Madison County.

Of the six new class action suits, five cases are against mortgage companies--Creve Coeur Mortgage of Creve Coeur, Mo., Fifth Third Mortgage of Cincinnati, Ohio, US Bank of Minneapolis,Minn., Countrywide Home Loans of Calabasas, Calif. and Wells Fargo Home Mortgage of Des Moines, Iowa.

Daniel Jones, D.C. also filed a class action against Sentry Insurance Company, a foreign corporation doing business in Madison County, according to his complaint.

In the suits against mortgagors, four cases challenge the defendants’ practice of charging loan discount fees on home mortgage loans without actually reducing the interest rate on the borrowers’ loans.

In the case against Fifth Third Mortgage, Michael and Helen Stevens allege that Fifth Third charged them a $175 “loan discount fee,” but failed to lower the interest rate in exchange for that fee.

Other cases involve the following identical allegations:

  • Jamie Kissell, an Illinois resident, claims that Creve Coeur Mortgage charged her a $640 loan discount fee; and plaintiff Rex Buckingham of Granite City claims Creve Coeur charged him a $404 fee. Both allege their interest rates were not lowered in exchange for that fee.

  • Todd Morgan, a Madison County resident, also alleges that Countrywide Home Loans charged him $686.25 for a loan discount fee without lowering his interest rate for that fee.

  • Katherine Lee Henderson of Alton alleges Wells Fargo charged her a $1,101.50 loan discount fee, but failed to lower her interest rate in exchange for the fee.

    All plaintiffs allege that the mortgage companies should not be permitted to keep the loan discount fees they collected since they did not lower interest rates for those fees.

    “The plaintiffs’, on behalf of themselves and all others similarly situated assert claims against defendants’ for breach of contract, violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, and the substantially similar consumer protection statutes of other states, and for unjust enrichment,” the complaints against the mortgagors state.

    While the plaintiffs do not challenge the dollar amounts of defendants’ discount fees, they do challenge the practice of failing to reduce interest rates in exchange for payment of those fees, according to the suits.

    Kissell, Buckingham, Stevens, Henderson and Morgan allege that by using the term “loan discount fee” the mortgage companies intended to create the impression that it had reduced the interest rate in exchange for the fee. And, the defendants engaged in deceptive practices by concealing the fact that it did not reduce interest rates in exchange for the fees they charged.

    The plaintiffs’ claim that if they had known they would not have had reduced rates in exchange for the fee, and it was just simply another source of profit; they would have refused to pay the fee or would have sought alternative financing.

    The plaintiffs are seeking damages not to exceed $75,000 to any individual class member, excluding attorney fees and court costs.

    The fifth class action against a mortgage company, filed by Robert E. Shaw of Alton, alleges US Bank charged him in excess of $5 for fax fees when mortgagors pay off their home loans.

    In breach of the mortgage contract, Shaw alleges US Bank commits fraud by misrepresenting that it will not release the mortgage unless the mortgagor pays the fee.

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