Justices rule again in Quicken Loans case

By Kyla Asbury | Jan 8, 2015

CHARLESTON – The West Virginia Supreme Court of Appeals reversed and remanded a lawsuit against Quicken Loans.

Justice Brent Benjamin delivered the majority opinion of the court, and Justice Allen Loughry concurred in part and dissented in part.

The original June 18, 2013, order of the circuit court is reversed and remanded with directions, according to the Nov. 25 opinion.

The court ruled that the portion of the circuit court's order creating a lien on Lourie Brown and Monique Brown's property be reversed and the case be remanded with directions to the circuit court to order that the loan principal be returned to Quicken by deducting the amount of the loan principal from the plaintiffs' recovery in the case.

The court also reversed the circuit court's award of an additional $98,800 in compensatory damages and reduced the compensatory damages award to $17,476.72.

The circuit court’s award of attorney fees and costs for both the first appellate proceeding and the post-appellate proceedings were reversed and the court reduced the total amount of attorney fees to which the plaintiff is entitled to $596,199.89.

The court reversed the circuit court's increase in the punitive damages award, and reduced the amount of that award to $2,168,868.75.

Finally, the court reversed the circuit court’s order refusing to offset the plaintiff’s award of attorney fees and costs by the $700,000 pretrial settlement between the plaintiffs and codefendants Appraisals Unlimited Inc. and appraiser Dewey Guida.

"We remand the case with directions to the circuit court to offset the award of compensatory damages and attorney fees and costs by the amount of the pretrial settlement," the majority opinion states.

The Browns filed their lawsuit in 2008 in Ohio Circuit Court, claiming Quicken violated debt collection laws by contacting them after being notified they were represented by counsel.

In 2006, Quicken loaned to the plaintiffs $144,800, secured by a deed of trust encumbering the property owned by the plaintiffs. Later, Quicken denied the plaintiffs requests for a loan modification.

Quicken was notified that the Browns were represented by counsel, however, the company continued to contact the Browns directly, instead of through their counsel.

In February 2010, the loan was ruled void by a trial and Quicken was found liable for $18,000, $2.1 million in punitive damages and $600,000 in attorneys' fees.

In November 2012, the state Supreme Court affirmed the earlier ruling over the loan.

Ohio Circuit Judge David J. Sims entered an opinion and order on June 18, 2013, and Quicken appealed that order, alleging the circuit court did not comply with the direction of the state Supreme Court.

In his concurring in part and dissenting in part opinion, Loughry said he wholly rejects the majority’s decision to uphold the original award of punitive damages assessed in this matter.

"A mere five months after mishandling a substantial punitive damages verdict in Manor Care v. Douglas ... the majority has chosen to ignore federal jurisprudence by affirming a punitive damage verdict that violates principles of due process," his opinion states. "I write separately not only to express my disagreement with the majority’s decision to affirm the punitive damage award in the instant case, but to articulate my staunch disagreement with the court’s related decision in Quicken Loans Inc. v. Brown ... to characterize attorney’s fees and costs as compensatory damages."

Loughry said while he agreed with the majority’s conclusion that the circuit court exceeded the mandate of Quicken I on remand and its commensurate reduction of the damages and application of the off-set, he rejected the majority's decision in regard to punitive damages.

"What all of the foregoing makes clear is that a majority of this court fails either to understand or properly apply United States Supreme Court precedent when reviewing awards of punitive damages," his opinion states. "Disturbingly reminiscent of the majority’s mishandling of the Manor Care verdict, the majority again exhibits its decision to turn a blind eye to the United States Supreme Court’s admonition that a reviewing court has a duty to 'promot[e] systemic consistency' with regard to punitive awards."

Lougry said at this juncture, the only "consistency" to be found in the court’s review of punitive damage awards is its "contumacious refusal to heed the United States Supreme Court’s holdings and its insistence on a result-oriented analysis to uphold plainly-excessive punitive damage awards."

Quicken Loans is represented by Thomas R. Goodwin and Johnny M. Knisely of Goodwin & Goodwin.

The Browns are represented by James G. Bordas Jr. and Jason E. Causey of Bordas & Bordas.

W.Va. Supreme Court of Appeals case number: 13-0764

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