Supreme Court to Look at RESPA Case

Last week, the U.S. Supreme Court decided to hear a class action case involving the Real Estate Settlement Procedures Act (RESPA).

The case is known as First American Financial Corp. v. Edwards. Broadly, the case revolves around a consumer’s purchase of title insurance based upon a referral by a real estate settlement agency. The consumer claims that the conditions under which the purchase was made violated RESPA’s anti-kickback provisions. The case has significant implications for credit unions as it will consider if a consumer can sue in federal court when there is no evidence of actual injury.

The defendants, First American Corp. and First American Title Insurance, argue that the plaintiff, Denise Edwards, has not suffered a “concrete injury” and has not alleged that the charge for title insurance was higher than it would have been without the exclusivity agreement.

If the Supreme Court rules against Edwards, CUNA Deputy General Counsel Mary Dunn noted, it could help credit unions battle against unjustified “gotcha” lawsuits that are sometimes filed against lenders under RESPA.

Questions? Contact the Compliance Hotline: 1.800.546.4465, compliance@nwcua.org.

Posted in Around the NW, Compliance.