Peliminary approval granted for class action settlement in suit against ANZ
Pago Pago, AMERICAN SAMOA — US District Court Chief Judge Frances M. Tydingco-Gatewood with the federal court in Guam this week gave preliminary approval to a proposed class action settlement over a lawsuit brought by three American Samoa residents against ANZ Guam Inc. and its local operation, ANZ Amerika Samoa Bank.
Tydingco-Gatewood issued a 7-page order following a hearing on Apr. 27th (in Guam) and also scheduled a final approval hearing later this year for the class action complaint filed March 2018 by plaintiffs 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.
In March this year, the parties reached a 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.
In summary, under the agreement, ANZ will make a payment in the amount of $1,500 for each of the Covered Mortgage Loans the borrowers have with ANZ on real property in American Samoa. There will be one payment per Covered Mortgage Loan regardless of how many borrowers are on the loan.
Settlement Class Members with existing mortgage loan balances with ANZ as of the Effective Date shall receive credit to the mortgage loan account of the borrower on such loan. Settlement Class Members who no longer have balances on Covered Mortgage Loans with ANZ as of the Effective Date, shall receive a check.
In addition, ANZ has agreed to make certain changes in how they handle the mortgage loans. These include: Enclosing with the “Payment Due Notice” sent to borrowers on a monthly basis a flyer which will include further explanation of “other charges”; change the way that late fees are calculated; and change the form of notice of interest rate adjustment for adjustable rate mortgages to be in a form consistent with the templates provided pursuant to TILA and Regulation Z.
According to court documents, total settlement payment is approximately $435,000 to 290 Covered Loans, which represents a significant proportion of the possible maximum damages recoverable in a class action under TILA.
The Tydingco-Gatewood order states that the court finds that the Settlement Agreement was reached as a result of arm’s length negotiations between the Parties and their counsel. Furthermore, plaintiffs and their counsel had sufficient information to evaluate the strengths and weaknesses of the case and to conduct informed settlement discussions.
For purposes of the settlement only, “the court certifies the Settlement Class, which consists of all persons who, as of March 21, 2018, were borrowers on an adjustable rate residential mortgage loan secured by real property in American Samoa, with ANZ Guam, Inc. branches in American Samoa,” the judge’s order states.
Documents submitted as sworn affidavits and exhibits filed with the court in March showed that the plaintiffs — during settlement negotiations — were represented “pro hac vice” by attorney Mathew Insel-Pruitt, of the New York City-based law-firm of Wolf Popper LLP. Plaintiffs’ American Samoa attorney “pro hac vice” is Thomas Jones, of Jones & Associates LLC law-firm and in Guam, they were represented by the Law Office of Peter C. Perez.
Tydingco-Gatewood’s order conditionally designates the three law firms to represent the Class Members and Plaintiffs for the purpose of the settlement.
Since the Settlement Agreement is within the range of reasonableness and possible final approval, notice shall be provided to the Settlement Class pursuant to the Settlement Agreement as set forth in the Notice, according to the court order.
ANZ shall cause the Mailed Notice to be mailed and the Publication Notice to be published in accordance with the provisions of the Settlement Agreement within two weeks of the date of the court’s Apr. 27th order.
Tydingco-Gatewood ordered that a final approval hearing will be held Sept. 1st to address whether the proposed settlement should be finally approved as fair, reasonable, and adequate, and whether the Final Approval Order should be entered.
According to the judge, responsibility for settlement administration, including, but not limited to, notice and related procedures, shall be performed by ANZ, subject to the oversight of the Parties and this Court as described in the Settlement Agreement.
The judge’s order also states that any member of the Settlement Class who desires to be excluded from the Settlement Class, and therefore not be bound by the terms of the Settlement Agreement, must submit a request for exclusion, pursuant to the instructions set forth in the Mailed Notice. Instructions are provided in the Mailed Notice of the deadline to file a request to be excluded.
“Any member of the Settlement Class who elects to be excluded shall not receive any benefits of the settlement, shall not be bound by the terms of the Settlement Agreement, and shall have no standing to object to the settlement or intervene in the litigation,” the order states.
If the settlement is granted final approval, all Settlement Class Members who do not submit in a timely manner a valid request for exclusion will be bound by the order of final approval and final judgment, and enjoined from bringing or prosecuting any action relating to the released claims.
“This Order shall not be construed as an admission or concession by ANZ of the truth of any allegations made by the Plaintiffs or of liability or fault of any kind,” said Tydingco-Gatewood.
Furthermore, this “Order shall also not be construed as an admission or concession by Plaintiffs of any weakness or infirmity of any claim or allegation made by the Plaintiffs in this Action.”