Pago Pago, AMERICAN SAMOA — More than $400,000 will be paid to close to 300 adjustable mortgage loans made by ANZ Guam Inc.’s bank branches in American Samoa — ANZ Amerika Samoa Bank, according to the latest documents filed with the federal court in Guam, overseeing a lawsuit filed against the financial institution by three local residents.

The documents also argue that the proposed settlement of the case — instead of going to trial — will benefit all current and future mortgage holders in American Samoa.

The class action complaint was filed March 2018 by local residents Ronald Parker, Fa’afetai Parker, and Tualagi Gaoteote. Plaintiffs allege that ANZ fails to provide homeowners with accurate periodic statements, fails to provide adequate notice when it changes the interest rates on adjustable rate mortgages, and charges excessive late fees.

The plaintiffs further allege that ANZ is liable for its systematic violations of the Truth in Lending Act  (TILA) of 1968, and Regulation Z, for failing to provide homeowners with accurate periodic statements regarding the mortgages it services.

Early this month the parties filed the Stipulation and proposed Settlement Agreement — subject to court approval — in which ANZ denies the allegations in the lawsuit. However, the parties wish to avoid the costs associated with further litigation, and have agreed to a full, complete and final settlement on the terms and conditions outlined in the Agreement. (See Samoa News edition Mar. 4th for details)

Since that time, Samoa News had receive a few inquiries from ANZ customers, seeking an update if the federal court has issued a final decision on the proposed settlement.

While awaiting court approval, the parties on Tuesday (Monday in American Samoa) submitted new filings including a motion for preliminary approval of the proposed Settlement and a statement in support of the motion.

“The parties have now agreed to settle the litigation by providing monetary relief directly to Class Members and ensuring that Defendant improves its practices going forward,” according court filings.

Furthermore, the “significant relief secured by the Settlement represents the culmination of vigorous advocacy on behalf of the proposed Settlement Class and Defendant, providing for not only monetary relief, but long-term, mutually beneficial practice changes”.

Specifically, the Settlement requires ANZ to pay a Settlement Payment of $1,500 per household to the proposed Settlement Class - the Settlement Payment - or approximately $435,000 in total across 290 Covered Loans, which represents a significant proportion of the possible maximum damages recoverable in a class action under TILA.

If a Settlement Class Member currently has a mortgage balance with ANZ, the Settlement Payment will be applied to their account; if they no longer have a mortgage, the Settlement Payment will be paid in cash.

For the defendant, ANZ “will enact and continue to implement, where applicable, several practice changes.

The first one is that on monthly basis, ANZ will issue a document similar to the current Payment Due Notice to the current mortgage holders on American Samoa as well as a separate sheet providing  information about the “Other Charges” that appear on the Payment Due Notice.

Second, ANZ has corrected the method by which it calculates late fees to properly account for escrow amounts. Court documents revealed that ANZ has already refunded excessive late fees charged from 2015 to 2020, totaling $33,889.41.

“Going forward, [ANZ] will use a corrected method for the calculation of late fees,” court filings said.

The proposed Settlement will benefit not only the proposed Settlement Class, but all of ANZ’s current and future mortgage holders on American Samoa, the filings said.

The parties argued that the Settlement is clearly within the range of fairness, reasonableness, and adequacy, and the proposed Settlement Class satisfies all requirements for class certification.

Despite the Settlement, ANZ reiterated in a footnote in the motion that it does not concede that it has violated federal TILA or Regulation Z, or is liable for any allegations in the Complaint. ANZ further asserts that it is exempt from certain notice requirements because ANZ is a Small Servicer under federal regulations. Nor does ANZ necessarily agree with other factual or legal assertions by Plaintiffs set forth in this motion.

The court was further informed that the parties have agreed that within two weeks of an Order granting Preliminary Approval, ANZ will mail the notice of the Settlement Agreement, to every member of the proposed Settlement Class.

According to court documents, the parties began discussing the possibility and potential structure of a possible resolution of the matter, starting in the Fall of 2019.

The discussions continued into 2020, but were  delayed due to the global pandemic and other factors. As part of these discussions, Defendant produced additional documents in October 2020. In November 2020, counsel for the parties met in person for face-to-face negotiations in New York City. The Parties continued to discuss the possibility of settlement and reached an agreement in principle in February 2021.

Documents submitted as sworn affidavits and exhibits filed with the court showed that the plaintiffs - during negotiations — was represented “pro hac vice” by attorney Mathew Insel-Pruitt, of the New York City-based law-firm of Wolf Popper LLP — which submitted a 20-page document outlining its history and hight light cases the law-firm argued over the years.

Plaintiffs’ American Samoa attorney “pro hac vice” is Thomas Jones, of Jones & Associates LLC law-firm and in Guam, they are were represented by the Law Office of Peter C. Perez.

In conclusion, the plaintiffs — with the consent of defendant, request that the court grant preliminary approval of the proposed settlement, approve the Notice and enter the proposed preliminary approval order.

No indication on court records on when a decision will be made on the parties’ requests