A Seattle-based finance company will try to overturn or modify a $71 million judgment against it at a hearing on Tuesday in Yazoo City.
On June 12, a jury awarded the money to 23 borrowers in a suit against Washington Mutual Financial Group. The borrowers were to receive a total of more than $2.2 million in compensatory damages, with the individual awards ranging from $5,000 to $250,000. Each plaintiff also was awarded $3 million in punitive damages.
The plaintiffs include six residents of Leflore County, 16 from Holmes County and one from Carroll County. They had sued Washington Mutual in Holmes County Circuit Court, accusing the company of treating them unfairly.
Washington Mutual has asked for a new trial, a judgment overturning or amending the verdict and/or a reduction in the damages. The hearing will be at 9 a.m. Tuesday in Yazoo County Circuit Court before Judge Jannie Lewis.
Among other things, the plaintiffs have accused Washington Mutual of:
- Illegally requiring them to buy certain kinds of insurance and claiming that they were essential to the loan packages when the law says they are not.
- Failing to tell the borrowers that Washington Mutual received commissions from insurance companies for selling these policies.
- Failing to disclose a number of costs to the borrowers.
- Enticing them to refinance their loans if they were late on payments, increasing the cost to the borrowers.
- Charging excessive interest rates and fees without explaining them.
Washington Mutual has said it withheld no information that it was obligated to provide.The borrowers consented to the refinancing and agreed that the insurance was optional, the company said.
The jury instructions improperly defined the standard for "good faith and fair dealing," imposing too many obligations on Washington Mutual, the company said.
The lender also said it had adequately notified the plaintiffs that it profited from insurance sales. As for the amount of the profits, the company said its rates had been approved by the state Department of Insurance.
Washington Mutual also has protested the damage awards and the lack of a limit to punitive damages in Mississippi law.
The suit originally included 44 plaintiffs. Some were transferred to federal court when they had to file for bankruptcy, and others' complaints have been handled in arbitration.
Don Brock Jr. of Greenwood is one of the attorneys who have represented the plaintiffs. Others include Edward Blackmon Jr. of Canton; T. Roe Frazer II and Michael Hartung, both of Jackson; Richard A. Freese of Birmingham, Ala.; and Tim Goss and Mikel Bowers, both of Dallas.
Washington Mutual Finance Corp. is a subsidiary of Washington Mutual Inc. Firms representing Washington Mutual include Dickinson, Ros, Wooten & Samson, PLLC of Gulfport and Severson & Werson of San Francisco.
