DON EASTER, Plaintiff, and JOHN ZACHER; BONNIE ZACHER, and the marital community composed thereof; on their own behalf and on behalf of all others similarly situated; GREGORY ZORO; JEFFREY STONE; JANITA STONE, and the marital community composed thereof; MARK MAYFIELD; TAMARA MAYFIELD, and the marital community composed thereof; JAMES BROWN; MARGARET BROWN, and the marital community composed thereof, on their own behalf and on behalf of all others similarly situated; PAULA SCOTT, Plaintiffs-Appellants, v. AMERICAN WEST FINANCIAL, a Nevada Corporation, Defendant, and UNION FINANCIAL CORP, a California Corporation; PSB LENDING CORPORATION, a Nevada corporation; EMPIRE FUNDING HOME LOAN OWNER TRUST 1997-1, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1997-2, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1997-3, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1997-4, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1998-1, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1998-2, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1998-3, a Delaware business trust; EMPIRE FUNDING HOME LOAN OWNER TRUST 1999-1, a Delaware business trust; OCWEN FEDERAL BANK FSB, a United States savings bank; TRIPOINT CAPITOL CORPORATION, a California Corporation; ARGENT MORTGAGE CORPORATION, a Calfornia corporation fka Clearview Capital Corporation; TMS MORTGAGE INC, a New Jersey corporation; FINANCIAL ASSET SECURITIES CORP MEGO MORTGAGE HOME LOAN OWNER TRUST 1997-1, a Delaware business trust; FINANCIAL ASSET SECURITIES CORP MEGO MORTGAGE HOME LOAN OWNER TRUST 1997-2, a Delaware business trust; ZACHER v. UNION FINANCIAL CORP. 12365 FINANCIAL ASSET SECURITIES CORP MEGO MORTGAGE HOME LOAN OWNER TRUST 1997-3, a Delaware business trust; FINANCIAL ASSET SECURITIES CORP MEGO MORTGAGE HOME LOAN OWNER TRUST 1997-4, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER TRUST 1995-3; FIRSTPLUS HOME LOAN OWNER TRUST 1995-4; FIRSTPLUS HOME LOAN OWNER TRUST 1996-1; FIRSTPLUS HOME LOAN OWNER TRUST 1996-2; FIRSTPLUS HOME LOAN OWNER 1996-4; FIRSTPLUS HOME LOAN OWNER TRUST 1997-1; FIRSTPLUS HOME LOAN OWNER TRUST 1997-2; [[]]FIRSTPLUS HOME LOAN OWNER TRUST 1997-3; US BANK NA ND; AMERICAN MORTGAGE PROFESSIONALS INC, a California corporation; FIRSTPLUS HOME LOAN OWNER TRUST 1996-3, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER TRUST 1997-4, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER 1998-1, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER TRUST 1998-2, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER TRUST 1998-3, a Delaware business trust; FIRSTPLUS HOME LOAN OWNER 1998-4, a Delaware corporation; FIRSTPLUS HOME LOAN OWNER TRUST 1998-5, a Delaware business trust; GERMAN AMERICAN CAPITAL CORPORATION, a Maryland corporation; PAINE WEBBER REAL ESTATE SECURITIES, INC., a Delaware corporation; ACE SECURITIES CORPORATE HOME LOAN TRUST 1999A, a Delaware business trust; SOVEREIGN BANK, a United States savings bank; REAL TIME RESOLUTIONS INC, a Texas corporation; PB REIT INC; PB INVESTMENT CORP; UNITED NATIONAL HOME LOAN OWNER TRUST 1999-1; UNITED NATIONAL BANK HOME LOAN OWNER TRUST 1999-2, Defendants-Appellees., 381 F.3d 948
Summary
The borrowers obtained residential second mortgage loans at interest rates greater than 12 percent from two entities. Invoking diversity jurisdiction, defendants in each action removed all putative class actions to federal court. The district court consolidated the actions, designated the lead actions, and stayed the others. The complaints alleged causes of action for (1) statutory usury; (2) violations of Washington's Consumer Protection Act (CPA); (3) negligence; and (4) common law usury. Borrowers contended that their loans were usurious because the initial two entities were not licensed by the state of Washington to charge interest in excess of 12 percent. The court found that the district court properly interpreted state law to find that a broker who arranged a table-funded loan did not need to be licensed under the Consumer Lending Act. The court reversed the district court's grant of summary judgment on certain borrowers' CPA claim and other common law usury claim for payments ...