Fernandez v. Rushmore Loan Management Services LLC

A Court authorized the notice because you had a right to know about the Settlement of this class action lawsuit, and about all of your options, before the Court decided whether to give Final Approval to the Settlement. This website explains the lawsuit, the Settlement, and your legal rights.

The United States District Court for the Central District of California is overseeing this case. The case is known as Fernandez v. Rushmore Loan Management Services LLC, Case No. 8:21-cv-00621-DOC-(KESx) (the “Action”). The person who sued is called the “Plaintiff.” The Defendant is Rushmore Loan Management Services LLC (“Rushmore”).

To view a copy of the Notice, click here.

A Settlement has been reached in a class action lawsuit that alleges Rushmore charged borrowers convenience fees to make mortgage payments by phone. The Action asserts that Rushmore’s practice of charging such fees, among other things, violated the Fair Debt Collection Practices Act and the Rosenthal Fair Debt Collection Practices Act, and breached the terms of the borrowers’ loan agreements. Rushmore denies the allegations asserted in the Action.

A “Convenience Fee” is a fee charged by Rushmore to borrowers for making a loan payment by telephone or interactive voice response (IVR).

In a class action, one or more people called class representatives (in this case, Plaintiff Phitsamay Fernandez) sue on behalf of people who have similar claims. The people included in the class action are called the Settlement Class (or “Class Members”). One court resolved the issues for all Class members, except for those who timely excluded themselves from the Settlement Class.

The Court has not decided in favor of either the Plaintiff or Defendant. Instead, both sides agreed to the Settlement. By agreeing to the Settlement, the parties avoid the costs and uncertainty of a trial, and Class Members receive the benefits described below. The Class Representative and Class Counsel believe the Settlement is best for everyone who is affected.

The Court has determined that every person who fits the following description is a Class Member:

All borrowers with a mortgage loan serviced by Rushmore from whom Rushmore collected a Convenience Fee during the period from January 1, 2013, through September 19, 2021.

A “Convenience Fee” is a fee charged by Rushmore to borrowers for making a loan payment by telephone or interactive voice response (IVR).

The complete terms of the Settlement are set forth in a formal Settlement Agreement, which is on file with the Court and also available here. The information on this page is only a summary of the Settlement, and in case of any conflict between website and the Settlement Agreement, the terms of the Settlement Agreement will control.

In the Settlement, Rushmore has agreed to create a $1,645,840.00 Settlement Fund. Notice and Administrative Costs, any Court-awarded Attorneys’ Fees and Expenses to Class Counsel, and any Service Award to the Class Representative will be paid out of the Settlement Fund first. The remaining balance of the Settlement Fund (the “Net Settlement Fund”) will be distributed among the Class Representative and all Class Members who are not excluded from the Settlement class, as set forth below (the “Settlement Class Members”).

Allocations of the Settlement Fund will be calculated on a loan-by-loan basis, not a borrower-by-borrower basis, such that the settlement payment on any loan with more than one Class Member borrower shall be made payable jointly to all Class Member borrowers on that loan. For each loan on which a Class Member is a borrower, the Settlement Administrator shall allocate the amount of the Net Settlement Fund that represents the proportional amount of Convenience Fees charged by Rushmore within the Class Period on that loan. By way of illustration, if you are a borrower on a loan that paid one percent of the total Convenience Fees collected by Rushmore during the Class Period, you (and any co-borrower or joint borrower on the loan) will be allocated one percent of the Net Settlement Fund.

If there is any amount in the Settlement Fund that remains following the distribution of payments to Class Members, then, with the Court’s approval, the remaining amount will be paid to a 501(c)(3) charitable organization that will be proposed by the parties in advance of Final Approval.

Attorneys’ Fees and Expenses, and Service Award. Class Counsel has asked the Court to award attorneys’ fees in an amount not to exceed one third of the Settlement Fund, plus litigation costs and expenses. Class Counsel has also requested Court approval of a Service Award to the Class Representative in the amount of $5,000. Class Counsel has filed that request, along with all supporting documents. The request and all supporting papers are available for your review here on the settlement website. The Settlement is not conditioned upon approval of any of the attorneys’ fees, costs, or service award amounts.

You are not required to make any payments to Class Counsel in this action.

As long as you did not exclude yourself from the Settlement, you will automatically receive relief and do not need to take further action. You had the option to receive any payment by check or by a digital payment method (Venmo, PayPal, or Zelle).

If you did not select a payment option, you will receive any payment by mail in the form of a paper check.

As described in FAQ 18, the Court held a Fairness Hearing on February 14, 2022, and decided to grant final approval of the Settlement. The Court found that the Settlement is fair, reasonable, and adequate. However, the final approval order the Court entered may be subject to appeal. If there are any such appeals, resolving them takes time. Payments to Settlement Class Members will only be made after the time for any appeals expires.

Payments to Class Members made in the form of a check will expire and become void 90 days after they are issued. For good cause shown by the Class Member involved, however, the Settlement Administrator may reissue a check for up to an additional 90-day period following the original 90-day period.

Now that the Settlement has received final approval from the Court, the Settlement is legally binding on all Settlement Class Members, including Settlement Class Members who object. If you, or someone acting on your behalf, are currently litigating claims against Rushmore or other released parties that are the same as or similar to those addressed here, you will be barred from pursuing the claims released by the Settlement unless you opted out.

The full terms of the release, which will bind all Class Members as to certain claims against Rushmore and certain affiliates and related entities (“Released Parties”), are set forth in the Settlement Agreement, which is on file with the Court and available here.

Unless you excluded yourself, you are a Settlement Class Member, and that means that any claims you have regarding Convenience Fees you paid to Rushmore will be fully and completely resolved, and that you cannot sue, continue to sue, or be part of any other lawsuit against Rushmore about Rushmore’s collection of Convenience Fees. It also means that the Court’s Orders approving the Settlement and the judgment in this case will apply to you and legally bind you.

If you excluded yourself, as set forth above, you will not receive any of the benefits of the Settlement, as described in FAQ 7.

The deadline to exclude yourself from the Settlement passed on January 24, 2022.

No. Unless you excluded yourself, you gave up the right to sue Rushmore for the claims that the Settlement resolves. You must have excluded yourself from this Settlement Class in order to try to pursue your own lawsuit.

No. You will not receive a payment if you excluded yourself from the Settlement.

The Court has appointed Bailey & Glasser LLP and Tycko & Zavareei LLP to represent you and other Class Members in this Action and for purposes of this Settlement, and for no other purpose. These attorneys are called “Class Counsel.” You will not be charged for these lawyers. If you want to be represented by your own lawyer in this case, you may hire one at your own expense.

Class Counsel has asked the Court to award attorneys’ fees in an amount not to exceed one third of the Settlement Fund, plus litigation costs and expenses. Class Counsel has also requested Court approval of a Service Award to the Class Representative in the amount of $5,000. Class Counsel has filed that request, along with all supporting documents. The request and all supporting papers are available for your review here on the settlement website. The Settlement is not conditioned upon approval of any of the attorneys’ fees, costs, or service award amounts.

The deadline to object to the Settlement passed on January 24, 2022.

Objecting is telling the Court that you do not like something about the Settlement. You could have objected to the Settlement only if you did not exclude yourself from the Settlement. Excluding yourself from the Settlement meant telling the Court that you did not want to be part of the Settlement. If you excluded yourself from the Settlement, you had no basis to object to the Settlement because it no longer affected you.

The Court held a Fairness Hearing on February 14, 2022, at 8:30 a.m. at the United States District Court for the Central District of California, Ronald Reagan Federal Building and United States Courthouse, 411 West Fourth Street, Courtroom 9D, Santa Ana, CA, 92701-4516, to hear any objections and to consider whether to give final approval to the Settlement. The Court heard objections at the hearing only from those who timely objected to the Settlement.

YOU DID NOT HAVE TO APPEAR AT THE HEARING TO RECEIVE THE BENEFITS OF THE SETTLEMENT.

No. Class Counsel answered any questions the Court had.

If you did nothing, you will still receive the benefits to which you are entitled under the Settlement Agreement. Unless you excluded yourself, you will not be able to start a lawsuit or be part of any other lawsuit against Rushmore relating to the issues in this Action.

The information on this page is only a summary of the Settlement and the Agreement. If you have questions regarding the Settlement, you may contact Class Counsel using the following contact information:

You may write the Settlement Administrator at the following address:

Rushmore Loan Settlement Administrator
P.O. Box 4875
Portland, OR 97208-4875

You may review the Court’s file during regular court hours at the following address:

U.S. District Court for the Central District of California
411 West Fourth Street
Santa Ana, CA 92701-4516

You may view additional information, including the Settlement Agreement and copies of other relevant documents and Court Orders, on the Important Documents page here.

PLEASE DO NOT TELEPHONE THE COURT, THE JUDGE, OR THE CLERK OF THE COURT.