Class-action status is rejected in WaMu case

By Peter Lewis
Seattle Times consumer-affairs reporter

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The ruling marked the second time this year that a court has declined to confer class-action status in a case making similar allegations against WaMu. The earlier ruling came in March in King County Superior Court.

WaMu spokeswoman Libby Hutchinson said WaMu is pleased the New Jersey court concluded "the plaintiffs had failed to demonstrate that their claims were based on any common policy or practice."

In her ruling, Superior Court Judge Patricia LeBon, sitting in Burlington, N.J., did not grant WaMu everything it wanted.

The judge ruled that WaMu's conduct did not rise to the level of an "unconscionable commercial practice" and therefore dismissed claims under the state's consumer-fraud act. But she also found sufficient evidence to support allegations of shoddy accounting and bookkeeping, according to Lisa Rodriguez, a lawyer for the plaintiffs. Rodriguez said she wasn't sure what would happen next.

In their complaint, lead plaintiffs Frank and Deborah Aversa of Mount Laurel, N.J., alleged they had made timely mortgage payments to WaMu but the lender mishandled them. Instead of correcting its mistakes, WaMu continued sending the Aversas dunning notices, falsely wrecked their credit rating, and hounded them to pay up, according to the lawsuit.

In response, WaMu alleged that the Aversas missed a payment on their loan and were in default. But instead of foreclosing on the couple, WaMu repeatedly attempted to help them remedy the problem, WaMu maintained.

In the King County case, the parties reached a settlement last fall after the judge declined to confer class-action status.

Under the deal, affecting about 1,000 customers, WaMu agreed to help fix the account problems of those who maintained that the lender lost mortgage payments, charged erroneous fees and mishandled payments of property taxes.

It agreed to review disputes and to take steps to correct account problems on a case-by-case basis, including refunding fees that were mistakenly charged, according to one of the law firms involved.

Peter Lewis: 206-464-2217 or plewis@seattletimes.com

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