Hagens Berman Joins Class-Action Suit Against Wells Fargo as Co-lead Counsel

Hagens Berman, a nationally recognized law firm with extensive experience in home foreclosure lawsuits, has joined a suit against Wells Fargo (NYSE:WFC) as co-lead counsel in a case alleging that Wells Fargo extracted payments from defaulted mortgage customers by falsely promising them the opportunity to retain their homes through an illusory forbearance-to-modification program.

The case, filed on April 19, 2010 in the United States District Court for the Northern District of California, claimed that the nation’s fourth-largest bank duped thousands of Californians into agreements that were designed to give the impression that the bank was offering a trial loan-modification program to assess their ability to make regular, reduced payments. In fact, the lawsuit claims that the bank never intended to modify the loan.

According to the suit, the vast majority of those who participated in the program lost their homes to foreclosure despite following the terms of the agreement.

The forbearance-to-modification program was offered to homeowners, who submitted financial information to Well Fargo, in form letters saying the bank had “good news” about their loan. The letters contained other language designed to convince homeowners that the plan could save their homes from foreclosure, the suit states.

“We are representing thousands of homeowners who fell victim to all sorts of nefarious lending practices, and this has to be one of the worst,” said Steve Berman, co-lead counsel for the plaintiffs and managing partner of Hagens Berman. “We intend to show that this forbearance program is nothing more than a sham, a way for Wells Fargo to extract revenue with no intention of providing homeowners the opportunity to hold on to their homes.”

On Jan. 3, 2011, United States District Court for the Northern District of California Judge Joseph C. Spero ruled against Wells Fargo in its motion to dismiss the suit.

Hagens Berman seeks certification of the lawsuit as a class action. Eligible class members include Californians who received a form letter from Wells Fargo, which offered the “opportunity to retain [their] home … [b]ased on the financial information [they] provided.” The letter also came with an agreement, which offered a modified payment plan for several months as “a trial period showing you can make regular monthly payments.”

Members of the class include Californians who signed the agreement and made the monthly payments on time, only to have their property foreclosed upon by Wells Fargo.

The case was originally filed on April 19, 2010, by the Law Office of Peter Fredman and the Law Office of David Pitvorak. Steve Berman and Tom Loeser of Hagens Berman are joining the suit as co-lead counsel.

Hagens Berman believes the letter and agreement that Wells Fargo sent homeowners were misleading and seeks restitution of the payments they made as part of the agreement. Hagens Berman also seeks the recovery of all other funds or property lost as a result of Wells Fargo’s alleged illegal activities.

If you signed a forbearance agreement with Wells Fargo, paid your payments on time and in full, and your home was then foreclosed, contact Hagens Berman at WellsFargoMortgage@hbsslaw.com or call 206-623-7292 for a free consultation.

About Hagens Berman

Seattle-based Hagens Berman Sobol Shapiro LLP is a national class-action and complex litigation law firm founded in 1993. The firm fights to protect the legal rights of consumers, investors, employees and whistleblowers in large, multi-state lawsuits. More about the law firm and its successes can be found at www.hbsslaw.com.