United Wholesale Mortgage, LLC v. America's Moneyline, Inc.
2:22-cv-10228
E.D. Mich.Jul 1, 2025Background
- United Wholesale Mortgage (UWM), a wholesale lender, amended its broker agreement in March 2021 to prohibit broker partners (including America's Moneyline, AML) from working with competitors Rocket Mortgage and Fairway Mortgage, imposing liquidated damages for violations.
- AML continued to submit loans to both UWM and Rocket after the amendment, alleging it received verbal assurances from UWM that the new restrictions would not be enforced.
- AML eventually signed the amended agreement in June 2021 but claimed to later terminate this agreement, alleging it was coerced and based on false representations; however, AML continued doing business with UWM through December 2021.
- UWM sued AML for breach of contract, seeking enforcement of the liquidated damages and attorney’s fees provisions, while AML counterclaimed (largely dismissed) and raised antitrust and equitable defenses.
- UWM moved for partial summary judgment on liability, arguing AML had accepted and then breached the contract amendment; AML opposed, asserting invalid amendment, contract termination, defenses pending discovery, and unconscionability of damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Acceptance of amended terms by conduct | AML accepted by submitting loans after notice | Could only accept by signed writing; no valid acceptance | AML accepted by conduct; contract allowed such acceptance |
| Validity of contract termination | No proper termination notice was given | AML terminated agreement within a month of renewal | No genuine issue; no written or mutually waived termination |
| Enforceability of liquidated damages (post-10/21/21) | Clause is reasonable and compensates UWM | Clause is unconscionable; lacks actual damage formula | Provision enforceable for post-10/21/21 version |
| Prematurity due to outstanding discovery | Discovery sought is unrelated to liability issue | More discovery needed, especially on selective enforcement | Discovery not diligently pursued or shown relevant; summary judgment not premature |
| Attorney’s fees provision | Prevailing party entitled by contract | No substantive contest on enforceability | Clause enforceable; amount to be determined later |
Key Cases Cited
- Miller-Davis Co. v. Ahrens Constr., Inc., 848 N.W.2d 95 (Mich. 2014) (sets forth elements of breach of contract in Michigan)
- Quality Prods. & Concepts Co. v. Nagel Precision, Inc., 666 N.W.2d 251 (Mich. 2003) (establishes high standard for waiver/modification of contractual terms by conduct)
- Zeeland Farm Servs., Inc. v. JBL Enters., Inc., 555 N.W.2d 733 (Mich. Ct. App. 1996) (contractual attorney's fees provisions are judicially enforceable in Michigan)