June 26--More than 125 mortgage lenders for Wells Fargo Bank in Orlando stand to gain a slice of nearly $15 million the bank has agreed to pay to settle claims that it shorted the employees' paychecks over nearly two years, the plaintiffs said Wednesday.
The class-action lawsuit -- initially filed by two now-former Wells Fargo loan officers in Central Florida -- alleged that Wells Fargo Home Mortgage had breached their compensation contract by failing to pay millions of dollars in commissions they had earned from April 2011 to January 2013.
Wells Fargo contested the claims but agreed to a deal that paid the eligible employees more than 30 percent of the amount that was due, lawyers for plaintiffs said.
About 7,800 current and former Wells Fargo employees in the U.S. -- including more than 500 in Florida -- are eligible to receive compensation from the deal, which was approved last month by a federal court in California.
It was a satisfying end to a tough fight, said Bobbie Dyer of Melbourne, a longtime Wells Fargo home-loan manager in Brevard County and one of the main co-plaintiffs. She is among nearly a dozen former Wells Fargo mortgage brokers in Brevard who are eligible for a payment. Patricia Stafford of Orlando, the other co-plaintiff, would not comment on the settlement.
Melbourne lawyer Mark Malek, co-counsel for the plaintiffs, said Dyer will receive nearly $3,000 in unpaid commissions and an additional award of $15,000 for her role as a principal plaintiff.
The suit accused Wells Fargo of making tens of millions of dollars off its lenders by low-balling their commission payments and violating terms that were clearly spelled out in the employment contracts. Employees said the bank routinely refused to pay the higher commissions that were due for originating loans backed by Fannie Mae and Freddie Mac, according to the suit.
"I'm not one to sue people. I've never sued anyone before this," said Dyer, who left Wells in April 2012 and started her own home-loan business in Melbourne. "I didn't know if I wanted to put myself out there as a class-action plaintiff and put myself through all of that. But I believe this was the only way to right a wrong."
Wells denied the allegations, insisting that it had correctly calculated the commission payments. In its reply to the lawsuit, the bank also argued that the employees' claims were moot because they had violated their employment agreements by failing to use a company-mandated dispute resolution process.
"We believe our compensation practices were appropriate and have agreed to settle this lawsuit to avoid protracted litigation," said Tom Goyda, vice president of consumer lending, in a prepared statement. "We view the settlement as a compromise, and believe it to be fair and equitable for all parties represented in the class action."
Many Wells employees who were affected by the commission shortfall did, however, take their complaints all the way through the organization's process without resolution, Malek said.
He credited Dyer and Stafford for putting in years of research, documentation, depositions and travel to help bring the lawsuit to a successful conclusion.
"We've gotten emails from people all over the country thanking them for making this happen," Malek said. "This suit was mostly about a very poorly drafted compensation plan and, in the end, Wells Fargo did the right thing. This settlement was on the higher end as class actions go."
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