Judge grants victory to LoanStream in TCPA lawsuit

A lender has defeated a spam-call complaint only a few months after the plaintiff mounted an attempt to certify a class of over 50,000 affected consumers. 

A California federal judge entered final judgment in favor of LoanStream this week, ending a two-year-long Telephone Consumer Protection Act complaint. The wholesale and non-qualified mortgage lender, which was sued by its OCMBC name, won its motion for summary judgment last week after successfully arguing against a class certification attempt. 

Plaintiff Kimberly Hudson-Bryant earlier this spring attempted to certify a class of 53,726 members who were alleged recipients of over 272,000 calls in a LoanStream campaign. U.S. District Judge Fred W. Slaughter denied that certification in May, and the lender moved for summary judgment in June. 

In a 26-page order last week, Slaughter rejected some of LoanStream's arguments against Hudson-Bryant's standing to file the lawsuit but also found a lack of evidence to proceed against the lender.

"Plaintiff does not offer sufficient evidence to create a genuine dispute that LoanStream can be held liable for the call(s) plaintiff received on any theory of direct or vicarious liability," wrote Slaughter. 

The case is a notable victory for a mortgage lender battling TCPA claims, as litigants have swarmed federal courts with dozens of complaints against industry players. While some smaller cases have either settled or been dismissed, the LoanStream case was a rare TCPA lawsuit this year to advance to class certification and summary judgment stages. 

A LoanStream executive declined to comment this week, while an attorney for Hudson-Bryant didn't respond to an inquiry from National Mortgage News.

How the lender beat the case

The consumer sued LoanStream in early 2024 over two phone calls placed in October 2021. One of those calls went unanswered, while Hudson-Bryant said she took a second one placed to her mother's number and had a brief conversation with someone representing LoanStream. 

The plaintiff claims she sent a letter to LoanStream in 2023 regarding the alleged TCPA violation, requesting $6,000 in damages but offering to settle for $4,000. While the TCPA provides for penalties from $500 to 1,500 per violation, lenders have settled for larger sums in the past. 

In May, Judge Slaughter denied Hudson-Bryant's motion for class certification, in part because of a rules violation by her attorney regarding filing and conferring with opposing counsel. The motion was also defeated because of the judge's findings regarding the plaintiff's representation for the class.

In weighing the sides' summary judgment filings, Slaughter denied some of LoanStream's arguments that Hudson-Bryant lacked standing, including a question of whether she was the person who registered the phone number in question to the national Do Not Call Registry. 

Rather, the judge found that Hudson-Bryant could not prove that LoanStream supervised or approved of the telephone campaign. The calls were orchestrated by a call center in Jamaica, via a tangled web of third parties, which performed mortgage solicitations for two other additional lenders. 

A former company executive testified that the lender was unaware of the calls and wouldn't approve of them anyways. Judge Slaughter also found no evidence that LoanStream was responsible for the calls via a marketing payment to one of the parties involved.

Plaintiffs have filed at least 30 spam-call lawsuits against independent mortgage banks and brokerages since the beginning of the year, many of which remain pending. Attorneys have warned of the litigation risk to industry players, as TCPA filings are up 30% through June compared to the same stretch last year.