A California judge declined to give class action certification to a suit lodged three years prior accusing Wells Fargo of discriminatory practices.
In an order dated Aug. 5, U.S. District Judge James Donato, wrote that there is no "glue" to hold together the plaintiffs' claims to justify the granting of class status. Over
"Plaintiffs wish to sue about hundreds of thousands of home loan decisions at once. Without some glue holding the alleged reasons for all those decisions together, it will be impossible to say that examination of all the class members' claims for relief will produce a common answer to the crucial question 'why was I denied,'" wrote Judge Donato. "Plaintiffs did not identify any ties that bind for purposes of commonality."Law360 was the first to report on the development.
At the center of the litigation is
The judge overseeing the suit claims that the plaintiffs failed to demonstrate the connection between the bank's Enhanced Credit Scoring (ECS) system, a part of Wells' underwriting tech, and statistically significant disparities in approval rates.
"They have no evidence of how the CORE/ECS system might have caused racial disparities in approval rates on the basis of suspect factors," Judge Donato wrote in his ruling.
The attorney representing the plaintiffs said he is "disappointed" with the outcome and that his team is currently weighing options for their next steps.
Dennis S. Ellis, partner at Ellis George LLP, representing the injured party, highlighted that the regression analysis conducted by the plaintiffs' expert "showed that Wells Fargo's use of its own credit scoring model was discriminatory."
"The District Court's ruling on class certification does not change that undeniable fact, and if left unchallenged, could allow Wells Fargo to evade accountability for its pervasive discrimination based on a procedural issue, not the merits of Plaintiffs claims," Ellis wrote in a statement.
Wells Fargo declined to comment on the most recent development.
The litigation, originally lodged in 2022, was filed by plaintiff Christopher Williams who sued Wells Fargo for denying him a prime interest rate despite being well qualified. A second lawsuit followed,
The bank has strongly disputed accusations of fair housing and lending violations.
"Wells Fargo does not tolerate discrimination in any part of our business," the bank said in 2024 when the plaintiffs announced they would be seeking class action certification. "These unfounded allegations stand in stark contrast to our significant and long-term commitment to closing the minority homeownership gap."
The lawsuit included reviews of over 160,000 documents and the deposition of 42 witnesses between the parties. Plaintiffs have also accrued at least $3 million in legal expenses in hiring experts.
