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Lucas E. Mccarn, Individually and On Behalf of All Other Similarly Situated v. Hsbc Usa

April 12, 2012

LUCAS E. MCCARN, INDIVIDUALLY AND ON BEHALF OF ALL OTHER SIMILARLY SITUATED, PLAINTIFFS,
v.
HSBC USA, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Lawrence J. O'Neill United States District Judge

ORDER GRANTING A PARTIAL STAY OF THE LITIGATION (Docket Nos. 42, 47, 55, 60)

I. INTRODUCTION

On March 12, 2012, Plaintiff filed a putative class-action complaint asserting, inter alia, violation of the Real Estate Settlement Procedures Act of 1974 ("RESPA") against defendants HSBC USA, Inc.; HSBC Bank USA, N.A.; HSBC Mortgage Corp.; HSBC Reinsurance (USA), Inc. (collectively, "HSBC Defendants"); PMI Mortgage Insurance Co., ("PMI"), Genworth Mortgage Insurance Corp. ("Genworth"); United Guaranty Residential Insurance Co. ("United Guaranty"); Republic Mortgage Insurance Co. ("Republic"); Mortgage Guaranty Insurance Corp. ("Mortgage Guaranty"); and Radian Guaranty, Inc. ("Radian").

On April 3, 2012, Plaintiff filed a motion to stay the action pending the outcome of the United States Supreme Court's decision in First American Financial Corporation, et al. v. Edwards ("Edwards").*fn1 (Doc. 42.) The Supreme Court granted certiorari in Edwards to consider whether a private purchaser of real estate settlement services, such as Plaintiff here, has standing under Article III, § 2 of the United States Constitution to assert a RESPA § 8 claim absent a showing that the alleged violation affected the price, quality, or other characteristics of the settlement services provided. (See Doc. 42, ¶ 1; Doc. 47, 12:18-22.) Plaintiff contends that the outcome of Edwards may materially impact the claims and/or defenses asserted in the action.

On April 6, 2012, Defendants Mortgage Guaranty, PMI, Republic, and Radian (collectively, "Moving Defendants") jointly filed a motion seeking a partial stay in light of Edwards and a motion to dismiss. (Docs. 47, 54.) Moving Defendants assert that, while a partial stay of the litigation in light of the pendency of Edwards is appropriate, Plaintiff lacks standing to file suit against them regardless of the Supreme Court's decision in Edwards. In light of this, Moving Defendants request that a partial stay be imposed permitting them to proceed with their motion to dismiss. (Doc. 47, 10:2-6 ("Although Moving Defendants could, in theory, agree to the complete stay pending the decision in Edwards [footnote omitted], they request the right to file a limited motion to dismiss under Rule 12(b)(1) that only addresses the failure of the Plaintiff to allege that these four defendants engaged in the complained of practices with the Plaintiff.").)

On April 9, 2012, the HSBC Defendants and Plaintiff filed a stipulated request that the HSBC Defendants be granted an extension of time to respond to the complaint until 30 days after the Court's order on Plaintiff's motion to stay. (Doc. 55, 3:2-8.)

On April 11, 2012, Plaintiff and Defendants United Guaranty and Genworth filed a stipulated request that the action be stayed against United Guaranty and Genworth pending the decision of the United States Supreme Court in Edwards. (Doc. 60, 2:26-28.) The parties further stipulated that United Guaranty and Genworth's time to move, answer, or otherwise respond to the complaint would be extended until 45 days after the date on which the Court lifts the stay. (Doc. 60, 3:4-6.) Plaintiff also indicated in the stipulation that he "intends to formally oppose the Non-Stipulating Defendants' motion seeking a partial stay." (Doc. 60, 2:20-22.)

Accordingly, currently pending before the Court are the following motions and stipulations:

1. Plaintiff's motion to stay the entire litigation pending a decision in Edwards (Doc. 42);

2. Moving Defendants' motion for a partial stay of the litigation (Doc. 47);

3. Moving Defendants' motion to dismiss (Doc. 54);

4. The USBC Defendants and Plaintiff's stipulated request that the USBC Defendants' time to file an answer or otherwise respond to the complaint be extended until 30 days after the Court decides Plaintiff's motion to stay (Doc. 55); and

5. Genworth, United Guaranty, and Plaintiff's stipulation to stay the litigation as to Genworth and United Guaranty and to extend their time to respond to Plaintiff's complaint until 45 days after the Court lifts the stay (Doc. 60).

For the reasons that follow, Moving Defendants' motion for partial stay is GRANTED; Plaintiff's motion to stay, currently set before Magistrate Judge Sheila K. Oberto, is DENIED as MOOT; all responses to Plaintiff's complaint that have not yet been filed shall be due 45 days from the date the Court issues an order lifting the stay ...


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