Our firm’s client Loan Originator Services (“LOS”) won its motion to dismiss the CFPB and DOJ’s claims of reverse redlining against the company.  The CFPB and DOJ brought reverse redlining claims against LOS in federal district court in Texas as a co-defendant in its lawsuit against Colony Ridge.  The CFPB and DOJ alleged that LOS, by providing back-office document and disclosure generation services for the actual lender in the case, committed reverse redlining in violation of the Equal Credit Opportunity Act (“ECOA”) and the Fair Housing Act (“FHA”).  Our firm, along with co-counsel, Rob Hargrove and Lisa Paulson at Davis, Gerald & Cremer, filed a motion to dismiss on behalf of LOS, in which we argued, in part, that the CFPB and DOJ’s complaint did not allege any activity by LOS that would support a claim of reverse redlining. 

The federal district court issued its opinion on the defendants’ motions to dismiss today, September 13, 2024.  The court granted LOS’s motion to dismiss, but provided the government leave to amend their complaint. 

Please contact me at rich@garrishorn.com if you would like to discuss the issues in this case or any other fair lending issues.