Case Information
*2 Before S MITH , D ENNIS , and C LEMENT annual bonuses to agents who collect certain
Circuit Judges. high amounts of premiums. Mississippi Valley Title Insurance Company and Old Republic
J ERRY E. S MITH , Circuit Judge: National Title Insurance Company pay most of
their agents sixty percent of the premiums they In these cases consolidated for appeal, collect, but agents with certain high volumes plaintiffs sued for alleged violations of the Real receive seventy percent of their collections. Estate Settlement Procedures Act (“RESPA”),
12 U.S.C. § 2601 et seq. , in connection with Plaintiffs allege that these compensation their purchase of title insurance. The district plans violate RESPA’s anti-kickback and fee- court in each case ruled that RESPA’s one- splitting provisions, 12 U.S.C. § 2607(a)-(b). year statute of limitations bars recovery. They sued more than one year after their real Agreeing with that conclusion, we affirm. estate closings. Defendants argued that
RESPA’s one-year statute of limitations, 12 I. U.S.C. § 2614, therefore barred the suits. The Plaintiffs are putative classes of real estate district courts agreed and entered judgment for purchasers. Defendants are title insurance defendants.
companies. Plaintiffs bought title insurance
from agents working for the defendant compa- II.
nies. Plaintiffs paid for the insurance at their These appeals have different procedural real estate closings. postures. The Snow court entered a judgment
of dismissal under F ED . R. C IV . P. 12(b)(6); the
Though defendants have different compen-
Chenault
court entered summary judgment
sation plans, plaintiffs allege that these plans
under F ED . R. C IV . P. 56(c). When reviewing
have a common effect: The agents receive ad-
a dismissal, we take the well-pleaded facts in
ditional compensation for generating high vol-
the complaint as true.
Kane Enters. v. Mac-
umes of title insurance sales for defendants.
Gregor (U.S.A.) Inc.
,
ment, though, we look to whether the plaintiff
adduced specific evidence creating a genuine
Neither district court certified a class before
issue of material fact.
Chaplin v. Nations-
Credit Corp.
,
2002).
*3
plans. These differences do not affect our review,
The statute of limitations for private
because plaintiffs and defendants in both cases
plaintiffs suing for an alleged violation of
agree on the relevant facts and dispute only the
§ 2607 is one year. 12 U.S.C. § 2614. The
meaning of certain statutory language in
parties disagree over what triggers this one-
§ 2614. We therefore accept the undisputed
year statute of limitations. Section 2614 states
facts and review the question of statutory in-
that the limitations period runs “from the date
terpretation
de novo
.
United States v. Phipps
,
of
the occurrence of
the violation.”
occurred at the closing when the agents earned III. the allegedly prohibited credit toward future Congress enacted RESPA “to ensure that payment under defendants’ compensation real estate consumers ‘are provided with great- plans. Thus, defendants conclude that § 2614 er and more timely information on the nature bars these suits because plaintiffs sued more and costs of the settlement process and are than one year after their closings. protected from unnecessarily high settlement
charges caused by certain abusive practices.’”
Plaintiffs acknowledge that a violation (if
O’Sullivan v. Countrywide Home Loans, Inc.
any) occurred at the closing and therefore that
“[T]he term ‘thing of value’ includes any We agree with defendants’ interpretation: payment, advance, funds, loan, service, or oth- The phrase “the date of the occurrence of the er consideration.” 12 U.S.C. § 2602(2). The violation” refers to the closing, i.e., when the RESPA regulations elaborate this statutory de- plaintiffs paid for the insurance, because that is finition to include “credits representing monies when the agents earned the allegedly that may be paid at a future date.” 24 C.F.R. prohibited “thing of value.” We interpret § 3500.14(d). The parties agree that de-
fendants gave, and their agents received, a “thing of value” when plaintiffs paid for the title insurance at their closings, because the agents thereby earned a credit toward future payment under defendants’ compensation of value” violated the statute, but we need not address that question. Defendants, of course, contest that this “thing We use “closing” interchangeably with the
(continued...) *4 § 2614 in this way for four main reasons. limitations. The Secretary of Housing and
Urban Development, state attorneys general, First and most importantly, the statutory and state insurance commissioners may sue text and structure better support this reading. within three years of any violation of RESPA. In § 2614, Congress spoke of a single 12 U.S.C. § 2614. Private plaintiffs, too, have triggering violation, not multiple violations. a three-year limitations period for suits “Any action pursuant to . . . section . . . 2607 alleging a violation of § 2605. Id. Only for . . . may be brought in [a court] . . . where the private plaintiffs suing under §§ 2607 and violation is alleged to have occurred, within 2608 did Congress impose a one-year . . . 1 year in the case of a violation of section limitations period. Id.
2607 . . . from the date of the occurrence of
the violation [.]” 12 U.S.C. § 2614 (emphasis By extending indefinitely the limitations pe- added). Had Congress wanted the various riod for private plaintiffs suing under § 2607, steps in a single transaction to trigger the stat- plaintiffs’ interpretation would “create[ ] a ute of limitations multiple times, it would have limitations period that is longer than Congress spoken of multiple “violations.” could have contemplated,” Klehr v. A.O.
Smith Corp.
,
argument, however, because the same term
should be given the same meaning throughout Furthermore, Congress directed RESPA the statute. United States v. Ho , 311 F.3d toward the closing. The primary ill that 589, 606 (5th Cir. 2002). § 2607 is designed to remedy is the potential
for “unnecessarily high settlement charges,” Plaintiffs’ interpretation also would upset § 2601(a), caused by kickbacks, fee-splitting, Congress’s policy choices regarding limitations and other practices that suppress price periods for RESPA actions. Section 2614 competition for settlement services. This ill actually contains three separate statutes of occurs, if at all, when the plaintiff pays for the service, typically at the closing. Plaintiffs therefore could have sued at that moment, and (...continued) “the standard rule [is] that the limitations date of plaintiffs’ payment for the title insurance, period commences when the plaintiff has a because they are identical in this case, as they are complete and present cause of action.” Bay in most real estate transactions. We recognize, Area Laundry & Dry Cleaning Pension Trust however, the possibility that purchasers could pay Fund v. Ferbar Corp. , 522 U.S. 192, 201 for a settlement service subject to § 2607(a)-(b) at a time other than the closing, in which case “the
date of the occurrence of the violation” presumably
would be the date of payment, not the unrelated
closing.
(1997) (quotation marks omitted). [4] Plaintiffs’ interpretation also would let the
statute of limitations regenerate itself like a Indeed, plaintiffs should be indifferent to phoenix from the ashes. Plaintiffs note that whether defendants pay their agents in the some insurance companies, instead of cash future, because it would not affect the price payments, might give their high-volume agents plaintiffs paid for title insurance. This trips to events such as annually-occurring golf statutory emphasis on the closing further tournaments. Suppose, however, that a indicates that the limitations period begins to company rewarded its highest volume agents run when the agents earned the allegedly with trips to the Olympics. In this situation, prohibited credit at the closing. plaintiffs contend that the limitations period
would begin at the closing and expire a year
Second, plaintiffs’ interpretation would cre-
later, only to be restarted years later when the
ate several absurd results, which we must
agents travel to the Olympics and then to run
endeavor to avoid.
United States v. Ret.
for another year. Neither the statute nor the
Servs. Group
,
interpretation would allow them to recover In addition, under plaintiffs’ interpretation, twice for a single violation in connection with like plaintiffs would face unalike limitations a single settlement service, once for the periods. Suppose two persons buy title violation at closing and again for the violation insurance from the same agent on the same at payment. Nothing in the statute authorizes day at the same price and subject to the same this double recovery. To the contrary, compensation plan. For the first purchaser, Congress already imposed treble damages for the agent remits the full premium to the any kickback or fee-splitting violation. 12 insurance company but is credited with a U.S.C. § 2607(d)(2).
[5] (...continued) See also Clark v. Iowa City , 87 U.S. (20 terpretation, why they could not recover twice for the treble value of the single charge paid. They Wall.) 583, 589 (1875) (“All statutes of limitations also argue that Congress used the plural “pro- begin to run when the right of action is hibitions or limitations” to describe the violation complete[.]”).
but used the singular “charge paid” to describe the Plaintiffs attempt but fail to dispel the possi- measure of liability. Yet, the phrase “prohibitions bility of such double recovery. They emphasize or limitations” plainly refers to the multiple rules § 2607(d)(2), which states that “[a]ny person or imposed by § 2607, not the number of violations persons who violate the prohibitions or limitations committed under the section.
of this section shall be . . . liable to the person . . .
charged for the settlement service involved in the Cf. Reiter v. Cooper , 507 U.S. 258, 267 (1993) (“While it is theoretically possible for a violation in an amount equal to three times the statute to create a cause of action that accrues at amount of any charge paid for such settlement one time for the purpose of calculating when the service.” They argue first that the measure of statute of limitations begins to run, but at another damages is the “charge paid,” and, because they time for the purpose of bringing suit, we will not paid only one charge, there can only be one re- infer such an odd result in the absence of any such covery. Yet, there is no reason, under their in- indication in the statute.”). (continued...)
future payment. For the second purchaser, the
periods.”
Klehr
,
remits the remainder to the company. The first Fourth, the caselaw, albeit limited, uniform- purchaser enjoys an indefinitely extended ly supports defendants’ interpretation. No limitations period, whereas the limitations circuit has interpreted the phrase “the date of clock begins to tick immediately for the second the occurrence of the violation” in § 2614. purchaser. One district court, in a thorough opinion, has
held that “the violation occurs and the
RESPA nowhere suggests that Congress
limitations period begins once a borrower
intended such dissimilar treatment. “If
overpays for a settlement service that is
Congress had
intended
the statute of
subject to [§ 2607].”
Mullinax
, 199 F. Supp.
limitations to float in this way, it could have so
2d at 325. Several other courts have assumed
provided in explicit language.”
Mullinax v.
in
dictum
that the violation occurs when a
Radian Guar. Inc.
,
that holds or even assumes that the limitations Third, we create a simple and workable rule period can restart when the defendant pays an for the application of § 2614 by interpreting allegedly illegal kickback or fee.
the phrase “the date of the occurrence of the
violation” as the date of the closing, which is AFFIRMED.
a definite and indisputable date known to
potential plaintiffs and defendants. The date
when defendants pay their agents, on the other
hand, is unknown to plaintiffs; it could occur
weeks, months, or even years after the closing.
Plaintiffs’ interpretation thus would
generate confusion and uncertainty about the
timeliness of many RESPA claims. In practice,
it would encourage tardy plaintiffs to sue and
hope that discovery turns up a recent payment
that restarts the limitations period. This in-
terpretation “thereby conflicts with a basic
objective SS repose SS that underlies limitations
Notes
[7] Plaintiffs have not raised, and we therefore express no opinion on, the question whether § 2614 is subject to equitable tolling. Compare Hardin v.
[8]
See, e.g.
,
Salois v. Dime Savs. Bank
, 128 F.3d
City Title & Escrow Co.
,