Hernandez v. Wells Fargo Bank, N.A.
- William Alsup
- 3:18-cv-07354
- U.S. District Court · Northern District of California
- 3
In Hernandez v. Wells Fargo, Judge Alsup preliminarily approved a $21.9 million supplemental class settlement for 741 previously omitted borrowers.
The ruling affects the 741 newly identified members of the previously certified nationwide class, who may receive economic-harm compensation, apply for severe-emotional-distress payments, object, or opt out. It also affects Wells Fargo Bank, N.A., the defendant, and the administration of the supplemental settlement.
What happened
In Alicia Hernandez et al. v. Wells Fargo Bank, N.A., 741 people were identified as members of a previously certified nationwide class but had been left off the original list of borrowers provided by Wells Fargo. The lawsuit alleges that excessive attorney fees affected decisions on home loan modifications or repayment plans, followed by foreclosure sales.
The parties agreed to a supplemental settlement totaling $21,865,690. It uses the original settlement’s formula to compensate the newly identified class members for economic harm and gives them the same opportunity to seek additional payments for severe emotional distress. They may also object to or opt out of the supplemental settlement.
The court preliminarily approved the settlement, along with the notice, claim form, schedule, and appointment of a special master, subject to further review at a final approval hearing. Judge William H. Alsup also set that hearing for December 2, 2021.
The detailed version
- Hernandez v. Wells Fargo Bank, N.A. · No. 3:18-cv-07354
- William Alsup
- July 26, 2021
Background
This is a breach-of-contract class action. A prior order certified a nationwide class under Federal Rule of Civil Procedure 23(b)(3). The class consists of people in the United States who, between 2010 and 2018, qualified for certain home loan modifications or repayment plans; were not offered one by Wells Fargo because excessive attorney fees were included in the decision process; and whose homes Wells Fargo sold in foreclosure.
After final approval of the original settlement, the parties discovered that 741 people who met the class definition had not been included in the class list. Plaintiffs moved for preliminary approval of a supplemental settlement addressing those people. The opinion states that the motion was unopposed.
Supplemental Settlement
The proposed supplemental settlement totals $21,865,690. It provides the newly identified class members compensation for economic harm using the same formula as the first settlement. It also gives them the same opportunity to apply for additional settlement payments for severe emotional distress. The new class members may object to or opt out of the supplemental settlement.
Court’s Ruling
The court applied the standard that a settlement should be fundamentally fair, adequate, and reasonable. It stated that preliminary approval is appropriate when a settlement appears to result from serious, informed, non-collusive negotiations; has no obvious deficiencies; does not improperly favor class representatives or parts of the class; and falls within the range of possible approval.
For reasons stated on the record, the court found that the proposed settlement fell within the range of possible approval and granted Plaintiffs’ motion. It preliminarily approved the supplemental class settlement, subject to further review at the final approval hearing. The court also approved the claim form for the severe-emotional-distress fund, the proposed notice, and Plaintiffs’ proposed schedule; appointed Cathy Yanni as special master to process claims for that fund; and set the final approval hearing for December 2, 2021, at 11:00 a.m.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.