No Class, no problem: Discriminatory lending actions in the wake of Wal-Mart v. Dukes

Countrywide recently won a major class certification victory against plaintiffs suing the retail lender for alleged discriminatory mortgage lending practices in violation of the Equal Credit Opportunity Act (“ECOA”) and the Fair Housing Act (“FHA”).  See, In re Countrywide Financial Mortgage Lending Practices Litigation, 2011 U.S. Dist. LEXIS 118695 (W.D. Ky. 2011).  But Countrywide also recently paid out $335 million in a settlement of nearly identical claims brought by the Attorney General of the United States.  While the decision out of Kentucky reinforces the lesson from Wal-Mart v. Dukes, 131 S. Ct. 2541 (2011), that statistical significance is not a substitute for demonstrating Rule 23 commonality, Countrywide’s massive payout also illustrates that Dukes is not a panacea for lending institutions concerned about the growing wave of discriminatory lending litigation.

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