King v. Homeward Residential Inc
3:14-cv-00183
E.D. Ark.Aug 1, 2017Background
- Plaintiffs Savoil and Dorothy King sued Homeward Residential, Inc. and Ocwen Loan Servicing, LLC on behalf of themselves and a putative Arkansas class alleging wrongful force-placed insurance charges.
- Mr. King died during the litigation; Ms. King continues to pursue claims. Class certification was denied by the court.
- Defendants refunded the force-placed insurance charges after the lawsuit; King admits the refund but contends it is incomplete because it omitted interest and she also seeks punitive damages.
- One refunded charge covered insurance billed from August 18, 2012 until refunded on August 4, 2014 — nearly two years during which defendants held King’s funds.
- Defendants also argued Ocwen should not be liable merely because it purchased Homeward; King’s complaint alleges Ocwen serviced the loan beginning March 2013 and took independent actions, including cancelling and reimbursing charges.
- The court denied defendants’ summary judgment motion because genuine disputes remain about entitlement to interest and punitive damages and factual issues as to Ocwen’s own liability.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether refund makes King "whole" | Refund was incomplete; King seeks interest for time value and punitive damages | Refund eliminates injury; summary judgment appropriate because money was returned | Denied — defendants did not address entitlement to interest and punitive damages; withheld funds warranted inquiry into interest/unjust enrichment/conversion remedies |
| Entitlement to interest on refunded amounts | King argues full compensation requires interest for lost use of money | Defendants did not dispute refund suffices (argued made whole) | Issue unresolved — court found a wrongdoer should not retain benefits or interest and question remains for trial or further briefing |
| Punitive damages | King seeks punitive damages for wrongful conduct | Defendants sought summary judgment without addressing punitive damages | Denied — punitive damages entitlement not addressed and factual disputes remain |
| Ocwen's liability for conduct | King alleges Ocwen independently serviced loan, charged and reimbursed fees, and profited | Defendants argue Ocwen is not liable merely because it acquired Homeward and is a distinct corporate entity | Denied — complaint alleges Ocwen’s own conduct; defendants’ factual assertions did not entitle them to judgment as a matter of law |
Key Cases Cited
- Anderson v. Liberty Lobby, 477 U.S. 242 (summary judgment standard)
- Christianson v. Poly-Am., Inc. Med. Ben. Plan, 412 F.3d 935 (8th Cir.) (wrongdoer should not retain interest on withheld funds; unjust enrichment/conversion remedies)
- Cobb v. PayLease LLC, 34 F. Supp. 3d 976 (D. Minn.) (awarding interest/unjust enrichment principles in similar contexts)
- First Nat’l Bank of Brinkley v. Frey, 668 S.W.2d 533 (Ark.) (conversion/unjust enrichment principles applicable under Arkansas law)