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UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF FLORIDA
FORT LAUDERDALE DIVISION
CASE NO. 12-CV-60936-COHN/SELTZER
PHILIP PULLEY, DEVRA PULLEY,JEROME DAVIS, and SUSAN DAVIS,individually and on behalf of themselvesand all others similarly situated,
Plaintiffs,v.
JPMORGAN CHASE BANK, N.A.,
CHASE BANK USA, N.A., CHASEINSURANCE AGENCY, JP MORGANINSURANCE AGENCY, ASSURANT,INC., AMERICAN SECURITYINSURANCE COMPANY, andVOYAGER INDEMNITY INSURANCECOMPANY,
Defendants.
CLASS ACTION STIPULATION ANDSETTLEMENT AGREEMENT ANDRELEASE
STIPULATION AND SETTLEMENT AGREEMENT
This Stipulation and Settlement Agreement (Agreement) is made and entered into by
and among the Plaintiffs Philip Pulley, Devra Pulley, Jerome Davis, and Susan Davis
(Plaintiffs), on behalf of themselves and all Class Members as defined herein, and JPMorgan
Chase Bank, N.A., Chase Insurance Agency, Inc., and JP Morgan Insurance Agency, Inc.
(Chase Defendants).
1. RECITALS
1.1. On May 17, 2012, Plaintiffs Philip and Devra Pulley commenced this litigation
against JPMorgan Chase Bank, N.A. and Chase Bank USA, N.A (the Litigation).
1.2. On June 5, 2012, Plaintiffs filed their First Amended Complaint, which,inter alia,
sought damages on behalf of a nationwide class of residential mortgage loan or line of credit
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borrowers whose loans or lines of credit were serviced by the Chase Defendants and were
subjected to the force placement of wind insurance on the secured property.
1.3. In July 2012, Plaintiffs and the Chase Defendants entered into intensive mediation
through JAMS mediator David Geronemus, who has extensive mediation experience.
1.4. The mediation included the exchange of mediation statements, numerous days of
face to face meetings, and dozens of conference calls. It also included the collection, production,
and review of thousands of pages of documents and electronically-stored data concerning wind
lender-placed insurance.
1.5. While settlement negotiations were ongoing, Plaintiffs served document requests,
to which Defendants responded. Pursuant to the Courts Scheduling Order, on March 4, 2013,
Plaintiffs filed a motion for class certification and a memorandum in support thereof. Plaintiffs
also filed a Second Amended Complaint, which added additional Plaintiffs Jerome Davis and
Susan Davis and additional Defendants Chase Insurance Agency, JP Morgan Insurance Agency,
Inc., Assurant Inc., American Security Insurance Company, and Voyager Indemnity Insurance
Company as parties. The Chase Defendants, as well as Chase Bank USA, N.A., and the
Assurant Defendants filed separate motions to dismiss, which, along with Plaintiffs motion for
Class Certification, currently remain pending.
1.6. Beginning in mid-January 2013, Plaintiffs and Chase Defendants began a series of
extensive telephonic negotiations that culminated in a Memorandum of Understanding
(MOU), which was executed on April 12, 2013. The MOU provides the outline of an
Agreement to settle and resolve all issues in the Litigation on a class-wide basis and to dismiss
with prejudice all claims against Defendants (the Settlement).
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1.7. As part of the MOU, Chase Defendants have produced additional documents and
data requested by Plaintiffs to confirm, among other things, certain aspects of the Settlement and
to value the injunctive relief contained in the Settlement.
1.8. Plaintiffs have also made extensive use of publicly-available information,
including hearings before the New York Department of Financial Services and the Florida
Insurance Commissioner, Fannie Mae documents, and various banking and insurance
publications.
1.9. Class Counsel believe that the Litigation has significant merit and that the
evidence developed supports Plaintiffs claims. Class Counsel recognize and acknowledge,
however, that prosecuting this Litigation through fact and expert discovery, class certification,
dispositive motions, trial, and appeals will involve considerable time and expense.
1.10. Class Counsel have concluded that it is in the best interests of the Class as a
whole that the claims asserted in the Litigation be resolved on the terms and conditions set forth
in this Agreement. Class Counsel reached that conclusion after extensive consideration and
analysis of the factual and legal issues presented in the Litigation, the substantial benefits that
Class Members will receive as a result of the Settlement, the risks and uncertainties of continued
litigation, the expense that would be necessary to prosecute the Litigation through trial and any
appeals that might be taken, and the likelihood of success at trial.
1.11. Defendants have denied and continue to deny each and every allegation of
liability, wrongdoing, and damages, and assert that they have substantial factual and legal
defenses to all claims and class allegations in the Litigation. Defendants maintain and continue
to maintain that they have acted in accordance with governing law. Defendant Chase Bank
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USA, N.A. separately denies the factual allegations against it and that it has or had anything to
do with lender-placed insurance or the subject of this Litigation. Nonetheless, Chase Defendants
have concluded that because continuation of the Litigation would be protracted and expensive, it
is desirable that the Litigation be fully and finally settled on a class-wide basis in the manner and
upon the terms set forth in this Agreement.
1.12. Without admitting any liability or wrongdoing whatsoever, Chase Defendants
agree to the terms of this Agreement, provided that all Released Claims are settled and
compromised, in order to resolve all issues relating to the subject matter of the Litigation.
NOW, THEREFORE, for and in consideration of the mutual understandings contained
herein, and for other good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, Plaintiffs, on behalf of the Class, and Chase Defendants stipulate and
agree as follows:
2. DEFINITIONS
As used herein, the following terms have the meanings set forth below.
2.1. Administrator or Settlement Administrator means a qualified third party
appointed by the Court for the oversight and/or dissemination of Class Notice, the processing
and fulfillment of claims in connection with this Settlement, and ensuring that claims fulfillment
is properly implemented.
2.2. Agreement or Settlement Agreement means this Settlement Agreement,
including all exhibits thereto.
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2.3. Attorneys' Fees and Expenses means fees and expenses allowed by the Court
that are sought by Plaintiffs' Counsel in the prosecution of the Litigation. Any Attorneys Fees
and Expenses shall be paid from the Settlement Fund.
2.4. Award means a payment to a Settlement Class Member under the Settlement
pursuant to the Plan of Allocation in Paragraph 5 of this Agreement.
2.5. CAFA Notices means the notice of this settlement to be served upon State and
Federal regulatory authorities as required by the Class Action Fairness Act of 2005, 28 U.S.C.
1715.
2.6. Case Contribution Award means compensation for the Named Plaintiffs in the
Litigation for their time and effort undertaken in this Litigation.
2.7 Cashed Settlement Check Member List means the list of class members who
have cashed settlement checks within 120 days under the Plan of Allocation described in
Paragraph 5.
2.8. Chase Bank means JPMorgan Chase Bank, N.A. It does not include Chase
Bank USA, N.A..
2.9. Class Counsel means the law firm of Meredith & Narine.
2.10. Class List refers to the list of borrower on whose property Chase Defendants
placed wind insurance during the period January 1, 2008 through March 4, 2003, as identified in
Paragraph 5.1 of this Agreement.
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2.11. Class Member Payment List means the list of the Settlement Class Members
who have not opted out and who will receive settlement payments under the Plan of Allocation
described in Paragraph 5 of this Agreement.
2.12. Class Notice means the Court-approved form of notice to Settlement Class
Members, in substantially the same form as Exhibit A, which, among other things, will comply
with the requirements of Paragraphs 5.5 and 12 and will notify Settlement Class Members of the
preliminary approval of the Settlement and the scheduling of the Final Approval Hearing.
2.13. Class Period means the period of time from January 1, 2008 through March 4,
2013.
2.14. Court means the United States District Court for the Southern District of
Florida.
2.15. Days means calendar days, except that, when computing any period of time
prescribed or allowed by this Agreement, the day of the act, event, or default from which the
designated period of time begins to run shall not be included. Further, when computing any
period of time prescribed or allowed by this Agreement, the last day of the period so computed
shall be included, unless it is a Saturday, a Sunday, or a legal holiday, in which event the period
runs until the end of the next day which is not a Saturday, Sunday, or legal holiday.
2.16. Defendants mean all named defendants in this Litigation, including the Chase
Defendants, Chase Bank USA, N.A., and the Assurant Defendants.
a. Chase or Chase Defendants means JPMorgan Chase Bank, N.A.,
Chase Insurance Agency, Inc., and JP Morgan Insurance Agency, Inc.. Chase or Chase
Defendants does not include Chase Bank USA, N.A.; and
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b. Assurant or Assurant Defendants means Assurant, Inc., American
Security Insurance Company, and Voyager Indemnity Insurance Company.
2.17. Defense Counsel means Defendants counsel of record in the Litigation.
2.18. Effective Date means the date the Judgment in this case becomes Final (as
defined in Paragraph 2.20 below).
2.19. Fairness Hearing means the hearing held by the Court to determine whether the
terms of this Agreement are fair, reasonable, and adequate for the Settlement Class as a whole,
whether the Settlement should be granted final approval, and whether the Judgment should be
entered.
2.20. Final with respect to the Judgment or to any award of Attorneys Fees and
Expenses means that the time for appeal or writ review has expired or, if an appeal or petition for
review is taken and dismissed or the Settlement (or award of Attorneys Fees and Expenses) is
affirmed, the time period during which further petition for hearing, appeal, or writ of certiorari
can be taken has expired. If the Judgment is set aside, materially modified, or overturned by the
Court or on appeal, and is not fully reinstated on further appeal, the Judgment shall not become
Final.
2.21. Final Approval means the Court Order approving the Settlement after the
Fairness Hearing is conducted.
2.22. Force-Placed or Lender-Placed as used herein, means the placement of wind
insurance pursuant to a mortgage or home equity loan agreement serviced by Chase Defendants
to cover a borrowers failure to maintain required wind insurance coverage on the property that
is securing the loan.
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2.23. Individual Net Premium means the Net Premium for a given borrower.
2.24. Judgment means the judgment to be entered by the Court pursuant to the
Settlement.
2.25. Litigation means the action styledPulley et al. vs. J.P. Morgan Chase Bank,
N.A. et al., Case No. 0:12-60936-Civ-Cohn/Seltzer pending in the Southern District of Florida.
2.26. Named Plaintiffs means Philip and Devra Pulley and Jerome and Susan Davis.
2.27. Net Premium means the amount of premium charged to a borrower for lender-
placed wind insurance during the Class Period less any refund paid or credited to the borrower.
2.28. Net Settlement Fund means the Settlement Fund less Notice and Administrative
Costs, Case Contribution Awards, and Attorneys Fees and Expenses.
2.29. Notice and Administrative Costs means the reasonable and authorized costs and
expenses of disseminating and publishing the Class Notice in accordance with the Preliminary
Approval Order, and all reasonable and authorized costs and expenses incurred by the Settlement
Administrator in administering the Settlement, including but not limited to costs and expenses
associated with assisting Class Members, processing claims, escrowing funds and issuing and
mailing Settlement Payments, paying taxes and tax expenses, and other reasonable and
authorized fees and expenses of the Settlement Administrator.
2.30. Notice Date means the first day on which the Settlement Administrator or its
designee disseminates the Class Notice.
2.31. Notice Program means the plan approved by the Court for disseminating the
Class Notice to the Settlement Class.
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2.32. Objection Date means the date identified in the Preliminary Approval Order
and Class Notice by which a Settlement Class Member must serve written objections, if any, to
the Settlement in accordance with Paragraph 12.3 to be able to object to the Settlement. The
Objection Date shall be 90 days after the dissemination of Class Notice pursuant to Paragraph
5.5.
2.33. Opt-Out Deadline means the date identified in the Preliminary Approval Order
and Class Notice by which a request for exclusion must be filed in writing with the Settlement
Administrator in accordance with Paragraph 12.4 in order for a Settlement Class Member to be
excluded from the Settlement Class. The Opt-Out Deadline shall be 90 days after the
dissemination of Class Notice pursuant to Paragraph 5.5.
2.34. Parties means all Plaintiffs and Defendants.
2.35. Plaintiffs Counsel means Meredith & Narine, Christopher & Weisberg, P.A. ,
Hagens Berman Sobol Shapiro LLP, Freed Kanner London & Millen LLC and Gilman Law
LLP.
2.36. Preliminary Approval Order means an order providing for, among other things,
preliminary approval of the Settlement; dissemination of the Notice to the Settlement Class; and
finding that the Notice set forth in the Preliminary Approval Order is reasonably calculated to
apprise the Settlement Class Members of the pendency of the Litigation, the material terms of the
proposed Settlement, and the Settlement Class Members option and rights with respect thereto.
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2.37. Premium means the amount charged to a borrower for a wind insurance policy
that was lender placed by Chase Defendants.
2.38. Refund means the amount of money received or credited to a borrower when a
force placed wind insurance policy is cancelled.
2.39. Release or Releases means the releases of claims by the Releasing Persons
against the Released Persons, as detailed in Paragraph 10.
2.40. Released Claims means the claims released pursuant to Paragraph 10 of the
Settlement Agreement.
2.41. Released Persons means: (a) Defendants and each of their respective former
and current predecessors, affiliates, parents, investors, subsidiaries, employees, officers,
directors, successors, and agents; and (b) any other insurance carriers, such as SWBC Mortgage
Corporation and WNC Insurance Services, Inc., which issued or may have issued lender-placed
wind insurance to any Settlement Class Member for Chase Defendants and/or any of Chases
predecessors, affiliates, parents, investors, subsidiaries, employees, officers, directors,
successors, and agents during the period January 1, 2008 to March 4, 2013.
2.42. Releasing Persons means Plaintiffs, on behalf of themselves and each of the
Settlement Class Members, and their respective heirs, administrators, successors and assigns.
2.43. Settlement means the settlement set forth in this Agreement.
2.44. Settlement Classmeans all members of the class of borrowers in this Litigation
that will be certified by the Court for settlement purposes. The Settlement Class shall consist of
all persons in the United States that have or had a residential mortgage loan or line of credit
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serviced by the Chase Defendants and secured by property on which wind insurance was lender-
placed at any time between January 1, 2008 and March 4, 2013. Specifically excluded from the
Settlement Class are: (a) theDefendants and their respective board members, directors, and
officers; and (b) borrowers whose wind lender-placed insurance policy was cancelled in its
entirety so that any premiums collected were fully refunded to the borrower.
2.45. Settlement Class Member means any member of the Settlement Class.
2.46. Settlement Fund means the $4,750,000 that Chase Defendants have agreed to
pay in Settlement of this Litigation.
2.47. Settling Parties means, collectively, Chase Defendants, the Releasing Persons,
and all Settlement Class Members.
2.48. Total Net Premium means the total of all Net Premiums on wind policies lender
placed by Chase Defendants during the Class Period.
3. CONDITIONS AND OBLIGATIONS RELATING TO THE EFFECTIVENESS OF
THE SETTLEMENT
Settlement is expressly contingent upon the satisfaction, in full, of the material
conditions set forth below.
3.1 Condition No. 1: District Court Approval. The Settlement must be approved by
the District Court in accordance with the following steps:
3.1.1. Application for Preliminary Approval of Proposed Settlement, Class
Certification, and Class Notice. After good faith consultation with counsel for Defendants, Class
Counsel will present a Preliminary Approval Application to the District Court by June 14, 2013.
The Preliminary Approval Application shall include a Preliminary Approval Order and a
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Proposed Class Notice, in substantially similar form as Exhibit A. The Settling Parties shall, in
good faith, take reasonable steps to secure expeditious entry by the District Court of the
Preliminary Approval Order and shall request that the District Court schedule a Final Approval
Hearing no earlier than ninety (90) days after the service of the required Notice under 28 U.S.C.
1715.
3.1.2 Settlement Class Certification. In connection with the proceedings on
Preliminary and Final Approval of the proposed Settlement, the Named Plaintiffs shall seek
orders (preliminary and final, respectively) certifying the Settlement Class pursuant to Rule 23 of
the Federal Rules of Civil Procedure for purposes of this Settlement only.
3.1.3 Entry of Preliminary Approval Order. The District Court shall enter a
Preliminary Approval Order, which shall, among other things:
i. Certify a nationwide Settlement Class, approving the Named
Plaintiffs as class representatives and appointing Meredith & Narine as Class Counsel, pursuant
to Fed. R. Civ. P. 23;
ii. Preliminarily approve the Settlement as fair, reasonable and
adequate;
iii. Approve the Settlement Administrator;
iv. Order the issuance of Notice to the Settlement Class, and
determine that such Notice complies with all legal requirements, including, but not limited to, the
Due Process Clause of the United States Constitution;
v. Schedule a date and time for a Final Approval Hearing to
determine whether the Preliminary Approval Order should be finally approved by the Court;
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vi. Require Settlement Class Members who wish to exclude
themselves to submit an appropriate and timely written request for exclusion by the Exclusion
Deadline, as directed in the Settlement Agreement and Class Notice, and advise that a failure to
do so shall bind those Settlement Class Members who remain in the Class;
vii. Require Settlement Class Members who wish to object to the
Settlement Agreement to submit an appropriate and timely written statement by the Opt Out
Deadline, as directed in the Settlement Agreement and Class Notice, and advise that a failure to
do so shall prevent those Settlement Class Members from doing so;
viii. Require attorneys representing any Settlement Class Member, at
the Class Members expense, to file a notice of appearance;
ix. Authorize the Settling Parties to take all necessary and
appropriate steps to establish the means necessary to implement the Settlement Agreement; and
x. Issue related orders to effectuate the preliminary approval of the
Settlement Agreement.
3.1.4 Issuance of Class Notice. Pursuant to the Preliminary Approval Order to
be entered by the District Court, Class Counsel shall cause the Class Notice to be issued pursuant
to Paragraph 12 below.
3.1.5 Settlement Class Members have the option to participate in the Final
Approval Hearing at their own expense by obtaining their own attorney(s). Settlement Class
Members who choose this option will be responsible for any attorneys fees or costs incurred as a
result of this election. The Class Notice will advise Settlement Class Members of this option.
3.1.5 Final Approval Hearing. In connection with the Preliminary Approval
Application, the Settling Parties will request that the District Court schedule and conduct a
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hearing after dissemination of Class Notice, at which it will consider whether the Settlement is
fair, reasonable, and adequate pursuant to Rule 23 of the Federal Rules of Civil Procedure
(Final Approval Hearing). Specifically, Named Plaintiffs, after good faith consultation with
counsel for all Defendants, shall request that, on or after the Final Approval Hearing, the District
Court: (i) enter Final Judgment, granting final approval of the Settlement and dismissing with
prejudice this Litigation; (ii) determine the legal fees and expenses that should be awarded to
Class Counsel as contemplated in the Settlement Agreement; and (iii) determine the Case
Contribution Award, if any, that should be awarded as contemplated by the Settlement
Agreement. Any application for legal fees and expenses shall be made at least thirty (30) days
prior to the Objection Date or Opt-Out Deadline. The Settling Parties agree to support entry of
Final Judgment. The Settling Parties otherwise covenant and agree that they will reasonably
cooperate with one another in seeking entry of Final Judgment.
3.2 Condition No. 2: Finality of Final Judgment. The Final Judgment must be Final
in accordance with Paragraph 2.20 above, and shall, among other things:
a. Find that (1) the District Court has personal jurisdiction over all Class
Members; (2) the District Court has subject matter jurisdiction over the claims asserted in this
Litigation; and (3) venue is proper;
b. Finally approve the Settlement Agreement, pursuant to Fed. R. Civ. P. 23,
as fair, reasonable and adequate;
c. Finally certify the Settlement Class for settlement purposes only;
d. Find that the form and means of disseminating the Class Notice complied
with all laws, including, but not limited to, the Due Process Clause of the United States
Constitution;
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e. Enter Final Judgment with respect to the claims of all Settlement Class
Members and dismiss the claims of all Settlement Class Members and the Litigation with
prejudice;
f. Make the Releases in Paragraph 10 of the Settlement Agreement effective
as of the date of the Final Judgment;
g. Bar and permanently enjoin Plaintiffs and all Settlement Class Members
from prosecuting any and all Released Claims against the Released Parties;
h. Find that, by operation of the entry of the Judgment, as of the Effective
Date, Plaintiffs and all Settlement Class Members shall be deemed to have forever released,
relinquished, and discharged the Released Parties from any and all claims arising out of, relating
to, or in connection with the initiation, settlement, prosecution, or dismissal of this Litigation.
i. Authorize the Settling Parties to implement the terms of the Settlement
Agreement;
j. Retain jurisdiction relating to the administration, consummation,
enforcement, and interpretation of the Settlement Agreement, the Final Judgment, and for any
other necessary purpose; and
k. Issue related orders to effectuate the final approval of the Settlement
Agreement and its implementation.
4. SETTLEMENT CONSIDERATION, BENEFITS, AND OTHER RELIEF
4.1 In consideration of the Release set forth in Paragraph 9, Chase Defendants will
provide the benefits described below.
4.2 Settlement Monetary Consideration. Chase Defendants agree to pay four million
seven hundred fifty thousand dollars ($4,750,000.00), which shall include all Notice and
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Administrative Costs, Attorneys Fees and Expenses, and Case Contribution Awards, into a
Settlement Fund pursuant to the terms and conditions set forth below.
4.2.1 No portion of the Settlement Fund shall revert to Defendants at any time.
4.2.2. A Settlement Fund shall be established in the amount of $4,750,000,
which will,inter alia,fund monetary payments to Settlement Class Members. The Settlement
Fund shall pay: (a) all Notice and Administrative Costs, including the cost of Notice; (b) all
payments to Settlement Class Members; (c) the Case Contribution Awards, if any; and (d) the
Attorneys Fees and Expenses, if any. The Settlement Fund will be placed in an account
administered by the Settlement Administrator pursuant to an agreement acceptable to the
Plaintiffs and the Chase Defendants, with a third party financial institution to be jointly selected
by the Settling Parties. Within thirty (30) calendar days of Preliminary Approval of this
Settlement, Defendants will wire transfer the sum of four million seven hundred fifty thousand
dollars ($4,750,000.00) U.S. dollars into an interest-bearing bank account designated by the
Settlement Administrator. Any interest that accrues on the Settlement Fund before the
Settlement Fund is distributed shall be retained by the Settlement Fund. Prior to the Effective
Date, all funds in the Settlement Account shall be invested and reinvested in short-term United
States Agency or Treasury Securities of a duration to maturity of twelve months or less from the
date of purchase.
4.2.3. No later than fourteen (21) business days after the Effective Date, the
Settlement Administrator will distribute the Settlement Fund as set forth in Paragraph 5.
4.2.4. If Chase Defendants are obligated, ordered, or otherwise required to make
any additional payments in connection with this Settlement other than those specified in
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Paragraph 4.2, Chase Defendants shall have the right to terminate this Agreement without
penalty or sanction.
4.3. Deficiencies for Chase-Owned Loans. With respect to all Settlement Class
Members loans owned by any Chase Defendant that have been foreclosed or that have gone to
short sale, the Settling Parties agree that Chase Defendants shall not seek collection on any
deficiency balance or deficiency judgment in the amount of the lender-placed wind insurance net
written premium. As soon as is practicable following Final Approval of the Settlement, the
Settlement Administrator shall send a written notice to all Settlement Class Members to whom
this provision applies identifying the dollar amount of any deficiency balance or deficiency
judgment (as such amount is currently being reported on the Chase Defendants servicing and
recovery systems) equal to the total charge for lender-placed wind insurance and informing the
borrower that this amount of the deficiency is released.
4.4. Deficiencies for Non-Owned Chase Loans. With respect to all Settlement Class
Members loans serviced by any Chase Defendant on behalf of a non-Chase investor, including
Fannie Mae and Freddie Mac, that have been foreclosed or that have gone to short sale, Chase
Defendants shall formally attempt to obtain a waiver (and follow up in good faith) from the
investor of any deficiency judgment rights the investor may have, such that, in connection with
the Final Approval of the Settlement Agreement, neither Chase Defendants nor the investor shall
seek collection of any deficiency balance or deficiency judgment that exists as of the date of
Final Approval of the Settlement in the amount of the lender-placed wind insurance net written
premiums. For those Settlement Class Members for whom such a waiver is obtained, as soon as
is practicable following Final Approval of the Settlement, the Settlement Administrator shall
send a written notice to whom this provision applies identifying the dollar amount of any
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deficiency balance or deficiency judgment (as such amount is currently being reported on the
Chase Defendants servicing and recovery systems) equal to the net written premium for lender-
placed wind insurance and informing the borrower that this amount of the deficiency is released.
4.5 Injunctive Relief. The Settling Parties agree to the injunctive and programmatic
relief set forth below.
4.5.1 Commissions. Chase Defendants will maintain a moratorium on
commission-based arrangements with its lender-placed wind insurance carriers for six (6) years
from the date of Final Approval of the Settlement. Pursuant to this provision, Chase Defendants
shall not accept commissions, or any substitute for commissions, from lender-placed insurers in
connection with the placement of wind insurance during this time period. In addition, other than
the premiums that Chase Defendants are charged for wind lender-placed insurance and any fees
imposed by any government entity on wind insurance (which may be charged to the borrower),
Chase Defendants shall not charge any additional fees to borrowers for placing wind insurance
for six (6) years from the date of final approval of the Settlement.
4.5.2 Wind Coverage Requirement. Subject to any subsequently enacted laws,
regulations, investor requirements, or mortgage contract provisions that would require it to
maintain different requirements for mortgages or lines of credit on residential properties, Chase
Defendants shall maintain for a period of at least six (6) years from the date of final approval of
the Settlement, new wind insurance coverage requirements pursuant to which the amount of
required wind insurance shall not exceed 100% of the replacement cost value of the
improvements to the property.
4.5.3 Maintenance of Existing Insurance Coverage. When the borrower has an
escrow account, but the deposit balance is not sufficient to pay wind insurance premiums on an
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existing policy and borrower fails to pay those premiums, Chase Bank will advance funds on
behalf of the borrower to pay the past due premiums upon written notice to Chase Bank that: (a)
states that the wind insurance premiums have not been paid by the borrower; and (b) identifies
the amount of the premiums for the borrowers existing policy. The borrower shall be
responsible for all funds advanced pursuant to this Paragraph. Lender placed wind insurance
may only be placed when the Chase Defendants do not have adequate proof of sufficient wind
coverage on the property.
When the borrower does not have an escrow account, Chase Bank will
advance funds to pay the past due premiums of a wind insurance policy upon a written request
from the borrower that: (a) requests that Chase Bank advance funds to pay the past due
premiums because the wind insurance premiums have not been paid by the borrower; and (b)
identifies the amount of the premiums for the borrowers existing policy. If a borrower complies
with the conditions in this Paragraph, an escrow account will be created for the borrower that
reflects the borrowers debt for the payments made by Chase Bank to pay the past due premiums
and to cover future wind insurance premiums. The borrower shall be responsible for all funds
advanced pursuant to this Paragraph.
4.5.4. Compliance with Best Practices. Chase Bank shall take actions to
implement and comply with the current best practices announcements by the Consumer
Financial Protection Bureau and by non-Chase investors, including, but not limited to, Fannie
Mae and Freddie Mac, that have not been waived, that are in effect and are being enforced, and
that are relevant and applicable to lender-placed wind insurance, including practices designed to
increase or assist borrowers ability to maintain their existing insurance policy coverage on the
property and to mitigate or minimize, if not eliminate, the need for lender-placed wind insurance.
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4.5.5. Request for Proposal for Lender-Placed Wind Insurance Provider. Within
a reasonable amount of time after the signing of the MOU, Chase Bank shall use a request for
proposal process to select a lender-placed insurance provider. In connection with this process,
Chase Bank shall take reasonable measures to ensure that the premiums for lender-placed wind
insurance charged by such providers to borrowers are based on a competitive market-based
pricing model for lender-placed wind insurance.
5. PLAN OF ALLOCATION OF SETTLEMENT PAYMENTS
5.1. Within 10 days after Preliminary Approval of the Settlement, Chase Defendants
shall provide to the Settlement Administrator the Class List in electronic format, which shall
consist of all borrowers on whose property Chase Defendants placed wind insurance during the
period January 1, 2008 through March 4, 2013.
5.2. The Class List shall include the following data fields:
(a) Borrowers names
(b) Wind LPI Policy number
(c) Property address
(d) Date(s) of placement
(e) Last known residence address
(f) Last known telephone number, if possible
(g) Last known email address, if possible
(h) Wind LPI Premium amount charged
(i) Wind LPI Premium amount refunded
5.3. The Settlement Administrator shall compute the Total Net Premium charged for
lender-placed wind insurance during the Class Period.
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5.4. Each class member shall be entitled to a share of the Net Settlement Fund that is
equal to the percentage of the Total Net Premium that is represented by the Individual Net
Premium for the Settlement Class Member. Stated differently, each Settlement Class Member
shall receive payment in the amount of the percentage of his or her Individual Net Premium
relative to the Total Net Premium of the Settlement Class.
5.5. Within 30 days after Preliminary Approval of the Settlement, the Settlement
Administrator shall disseminate the Class Notice. In addition to those elements set forth in
Paragraph 12 of this Settlement Agreement, the Class Notice shall: (a) explain the formula for
determining each Settlement Class Members monetary recovery; (b) set forth the Total Net
Premium and the Individual Net Premium for each Settlement Class Member, as determined
from Chase Defendants records; and (c) inform each Settlement Class Member that if he or she
disputes the Individual Net Premium, the Settlement Class Member may so advise the Settlement
Administrator in writing within 45 days after Preliminary Approval of the Settlement and
provide back-up documentation to support his or her position. Settlement Class Members may
also provide an alternative address to which the Settlement Administrator should send their
monetary award.
5.5.1. The Class Notice shall be sent to each Settlement Class Member at his or
her last known address and, if available, to his or her last known email address.
5.5.2. In those instances where the Class Notice is returned as undeliverable, the
Settlement Administrator will make all reasonable efforts to locate the Settlement Class Member,
including trying to contact the Settlement Class Member telephonically.
5.6 At least 20 days prior to the hearing on Final Approval, the Settlement
Administrator shall prepare and disseminate to counsel a Class Member Payment List that shall
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identify: (a) each Settlement Class Member; (b) the Individual Net Premium Amount for each
Settlement Class Member, including any revision of Individual Net Premium Amounts; (c) the
deliverable address for each Settlement Class Member; (d) the percentage of monetary recovery
available to each Settlement Class Member; and (e) any Settlement Class Members who have
opted out of the Settlement Class.
5.7. Within 14 business days following the Effective Date of the Settlement, the Class
Administrator shall prepare and disseminate to counsel a final Class Member Payment List.
5.8. Within 21 business days following the Effective Date of the Settlement, the
Settlement Administrator shall draw and send checks in the amounts set forth in Paragraph 5.7
above to each Settlement Class Member on the Class Member Payment List.
5.8.1 Any checks which are returned as undeliverable or are not cashed within
120 days shall be voided and the money returned to the Settlement Fund.
5.9. Within 150 days of the initial dissemination of Settlement Checks to the
Settlement Class Members, the Settlement Administrator shall determine the amount of money,
if any, remaining in the Settlement Fund as the result of voided or undeliverable checks pursuant
to Paragraph 5.8 If the amount of money remaining in the Settlement Fund exceeds three
percent (3%) of the Net Settlement Fund, the Settlement Administrator then shall prepare a
Cashed Settlement Check List that identifies: (a) all Settlement Class Members who received
and cashed the Settlement Checks that were issued pursuant to this Settlement; and (b) the
amount that each Settlement Class Member shall receive pursuant to a second distribution, based
upon the formula identified in Paragraph 5.9.1. The Cashed Settlement Check List shall be sent
to counsel for the Parties.
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5.9.1 Within 10 business days after the Cashed Settlement Check List is
finalized and sent to counsel for the Parties, the Settlement Administrator shall perform a second
distribution of the money remaining in the Settlement Fund by issuing a check to each
Settlement Class Member on the Cashed Settlement Check List. The distribution shall be based
on the Individual Net Premium of each Settlement Class Member identified on the Cashed
Settlement Check List according to the following formula: each individual plaintiffs net
premium as a percentage of the total amount remaining in the Settlement Fund.
5.10. Any monies remaining in the Settlement Fund, either after the second distribution
of checks or if, after the first distribution, the amount of money remaining in the Settlement Fund
is three percent (3%) or less of the net Settlement Fund, shall be delivered to Habitat for
Humanity. The amount, if any, will be set forth in a report to counsel for the Parties.
5.11. At no point shall any remaining funds in the Settlement Fund revert back to
Defendants.
6. NOTICE AND ADMINISTRATIVE COSTS
6.1. All Notice and Administrative Costs, as provided in the Preliminary Approval
Order, will be paid by Plaintiffs.
6.2. All costs associated with the implementation and provision of the notifications,
and disclosures required by the Settlement, will be paid by Plaintiffs.
7. TAX TREATMENT OF SETTLEMENT FUND; CONSEQUENCES OF
TERMINATION
7.1. The Settling Parties will treat the bank account containing the Settlement Fund as
a qualified settlement fund within the meaning of Treasury Regulations 1.468B-I through
1.468B-5, 26 C.F.R. 1.468B-1 through 1.468B-5 (1992). They will treat the Settlement Account
as a qualified settlement fund for all reporting purposes under the federal tax laws. In addition,
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the Escrow Agent and, as required, Chase Defendants will jointly and timely make the relation-
back election (as defined in Treasury Regulation 1.468B-1) back to the earliest permitted date.
Such election will be made in compliance with the procedures and requirements contained in
such regulations. It will be the responsibility of the Escrow Agent to timely and properly prepare
and deliver the necessary documentation for signature by all necessary parties, and thereafter to
cause the appropriate filing to occur.
7.2. The Settlement Administrator will be the Escrow Agent within the meaning of
section 468B of the Internal Revenue Code of 1986 and Treasury Regulation 1.468B for the
Settlement Account. The Escrow Agent will timely and properly file all informational and other
tax returns necessary or advisable with respect to the Settlement Fund (including without
limitation the returns described in Treasury Regulation 1.468B-2(k)). Such returns will reflect
that all taxes (including any estimated taxes, interest or penalties) on the income earned by the
Settlement Fund will be paid out of the Settlement Fund or with the Additional Funds.
7.3. All (a) taxes (including any estimated taxes, interest or penalties) arising with
respect to the income earned by the Settlement Fund (inclusive of the Additional Funds)
(Taxes) and (b) expenses and costs incurred in connection with the operation and
implementation of settlement administration (including, without limitation, expenses of tax
attorneys and/or accountants and mailing and distribution costs and expenses relating to filing (or
failing to file) the returns) (Tax Expenses), will be paid out of the Settlement Fund or with the
Additional Funds; in no event will Chase Defendants have any liability or responsibility for the
Taxes, the Tax Expenses, or the filing of any tax returns or other documents with the Internal
Revenue Service or any other state or local taxing authority. The Escrow Agent and the
Settlement Fund will indemnify and hold Chase Defendants harmless for Taxes and Tax
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Expenses (including, without limitation, Taxes payable by reason of any such indemnification).
Furthermore, Taxes and Tax Expenses will be timely paid by the Escrow Agent out of the
Settlement Fund without prior Court order, and the Escrow Agent will be obligated
(notwithstanding anything herein to the contrary) to withhold from distribution to Claimants any
funds necessary to pay such amounts (as well as any amounts that may be required to be
withheld under Treasury Regulation 1.468B-2(1)-(2)); Defendants are not responsible for and
will have no liability therefore, or for any reporting requirements that may relate thereto. The
Settling Parties agree to cooperate with the Escrow Agent, each other, and their tax attorneys and
accountants to the extent reasonably necessary to carry out the provisions of this Paragraph and
settlement administration.
8. COVENANTS
The Settling Parties covenant and agree as follows:
8.1. Covenants not to sue. Named Plaintiffs and the Settlement Class covenant and
agree: (i) not to file any claim or litigation released under Paragraph 10 against any of the
Released Persons; and (ii) that the foregoing covenants and Agreement shall be a complete
defense to any such claims against any of the Released Persons.
8.2. Cooperation. The Settling Parties agree to cooperate reasonably and in good faith
with the goal of obtaining entry of a Final Judgment as quickly as is reasonably practicable and
expeditiously reaching agreement on the matters requiring mutual agreement as set forth in this
Settlement Agreement, including, but not limited to, the expeditious agreement to the terms of all
class notice documents and settlement administration protocols, and the preparation and
execution of all other reasonable documents necessary to achieve final approval of the
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Settlement by the District Court. Further, the Settling Parties shall consult with mediator David
Geronemus as necessary in effectuating this Paragraph.
9 REPRESENTATIONS AND WARRANTIES
9.1. Representations and Warranties.
9.1.1. Named Plaintiffs represent and warrant that they are the sole and exclusive
owners of all Released Claims and that they have not assigned or otherwise transferred any
interest in any of the Released Claims against any of the Released Persons, and further covenant
that they will not assign or otherwise transfer any interest in any of Plaintiffs Released Claims.
9.1.2. Named Plaintiffs represent and warrant that they shall have no surviving
claim or cause of action against any of the Released Persons with respect to any of the Released
Claims.
9.2. The Settling Parties Representations and Warranties. The Settling Parties, and
each of them on his, her, or its own behalf only, represent and warrant:
9.2.1. That they are voluntarily entering into the Settlement Agreement as a
result of arms-length negotiations among their counsel, that in executing the Settlement
Agreement, they are relying solely upon their own judgment, belief, and knowledge, and the
advice and recommendations of their own independently selected counsel, concerning the nature,
extent and duration of their rights and claims hereunder and regarding all matters which relate in
any way to the subject matter hereof; and that, except as provided herein, they have not been
influenced to any extent whatsoever in executing the Settlement Agreement by representations,
statements, or omissions pertaining to any of the foregoing matters by any Party or by any person
representing any party to the Settlement Agreement. Each of the Settling Parties assumes the
risk of mistake as to facts or law.
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10. RELEASES
10.1. Released Claims Of Settlement Class. Upon the Effective Date, each member of
the Settlement Class, other than the Named Plaintiffs, shall, by operation of the Final Judgment,
be deemed to have fully, conclusively, irrevocably, forever, and finally released, relinquished,
and discharged the Released Persons from any and all claims, actions, causes of action, suits,
debts, sums of money, payments, obligations, promises, damages, penalties, attorneys fees and
costs, liens, judgments, and demands of any kind whatsoever that each member of the Settlement
Class may now have or may have had in the past, whether in arbitration, administrative, or
judicial proceedings, whether as individual claims or as claims asserted on a class basis, whether
past or present, mature or not yet mature, known or unknown, suspected or unsuspected, whether
based on federal, state, or local law, statute, ordinance, regulations, contract, common law, or
any other source, that were or could have been sought or alleged in the Litigation and that relate,
concern, arise from, or pertain in any way to Chase Defendants placement of wind insurance
during the Class Period.
10.1.1. The Release in Paragraph 10.1 shall include, but not be limited to, all
claims related to charges for Chase Defendants placement of wind insurance during the Class
Period; the amount, duration, and alleged excessiveness of any wind insurance placed by the
Chase Defendants during the Class Period; payment or receipt of commissions, expense
reimbursements, alleged kickbacks, or any other compensation under any wind insurance
policy placed by the Chase Defendants during the Class Period; the disclosure or non-disclosure
of any payment, expenses, fees, or feature under any wind insurance policy placed by the Chase
Defendants during the Class Period; the receipt or non-disclosure of any benefit under any wind
insurance policy placed by the Chase Defendants during the Class Period; the content, manner,
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or accuracy of any communications regarding the placement of any wind insurance policy by the
Chase Defendants during the Class Period; and the regulatory approval or non-approval of any
wind insurance policy placed by the Chase Defendants during the Class Period.
10.1.2. The Release in Paragraph 10.1 shall not cover claims arising after the
Final Approval of the Settlement, or claims made under any wind insurance policy placed by the
Chase Defendants. Nothing in Paragraph 10.1 shall be deemed a release of any Settlement Class
Members respective rights and obligations under this Agreement.
10.1.3. Nothing in this Settlement Agreement shall be deemed a release of
Defendants from any existing obligation to any Settlement Class Member, other than named
Plaintiffs, under any loan, note, mortgage, or deed of trust, except to the extent that any such
obligation is being released pursuant to Paragraph 10.1.
10.2. Released Claims Of Named Plaintiffs. Upon the Effective Date, Named
Plaintiffs, on behalf of themselves, their family members, heirs, guardians, assigns, executors,
administrators, predecessors, and successors, hereby release and discharge the Released Persons
from any and all claims, actions, causes of action, suits, debts, sums of money, payments,
obligations, reckonings, promises, damages, penalties, attorneys fees and costs, liens,
judgments, and demands of any kind whatsoever that the Named Plaintiffs may have had in the
past or may now have against the Released Persons, whether in arbitration, administrative, or
judicial proceedings, whether as individual claims or as claims asserted on a class basis, whether
past or present, mature or not yet mature, known or unknown, suspected or unsuspected, whether
based on federal, state, or local law, statute, ordinance, regulations, contract, common law, or
any other source that were or could have been sought or alleged in the Litigation and that relate,
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concern, arise from, or pertain in any way to Chase Defendants placement of wind insurance
during the Class Period. In agreeing to this Release, Named Plaintiffs explicitly acknowledge
that unknown losses or claims could possibly exist and that any present losses may have been
underestimated in amount or severity.
10.2.1. The Release in Paragraph 10.2 shall include, but not be limited to, all
claims related to charges for Chase Defendants placement of wind insurance during the Class
Period; the amount, duration, and alleged excessiveness of any wind insurance placed by the
Chase Defendants during the Class Period; payment or receipt of commissions, expense
reimbursements, alleged kickbacks, or any other compensation under any wind insurance
policy placed by the Chase Defendants during the Class Period; the disclosure or non-disclosure
of any payment, expenses, fees, or feature under any wind insurance policy placed by the Chase
Defendants during the Class Period; the receipt or non-disclosure of any benefit under any wind
insurance policy placed by the Chase Defendants during the Class Period; the content, manner,
or accuracy of any communications regarding the placement of any wind insurance policy by the
Chase Defendants during the Class Period; and the regulatory approval or non-approval of any
wind insurance policy placed by the Chase Defendants during the Class Period.
10.2.2. This Release in Paragraph 10.2 shall not cover claims arising after the
Final Approval of this Settlement or claims made under any wind insurance policy placed by the
Chase Defendants. Nothing in Paragraph 10.2 shall be deemed a release of any Named
Plaintiffs respective rights and obligations under this Agreement.
10.2.3. Nothing in this Settlement Agreement shall be deemed a release of
Defendants from any existing obligation to Named Plaintiffs under any loan, note, mortgage, or
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deed of trust, except to the extent any such obligation relates, concerns, or pertains in any way to
wind lender-placed insurance and is being released pursuant to Paragraph 10.2.
10.2.4. The Named Plaintiffs and Class Counsel further represent that there are no
outstanding liens or claims against the Litigation, it being recognized that the Named Plaintiffs
will solely be charged with the responsibility to satisfy any other liens or claims asserted against
the Litigation.
10.3. Without in any way limiting their scope, these Releases cover by example and
without limitation, any and all claims for attorneys fees, costs, expert fees, or consultant fees,
interest, or litigation fees, or any other fees, costs, and/or disbursements incurred by Class
Counsel, or by the Named Plaintiffs, except to the extent otherwise specified in the Settlement
Agreement.
10.4. In connection with the foregoing Release, the Named Plaintiffs and each
Settlement Class Member shall be deemed, as of the entry of the Final Judgment, to have waived
any and all provisions, rights, benefits conferred by Section 1542 of the California Civil Code,
and any statute, rule and legal doctrine similar, comparable, or equivalent to California Civil
Code Section 1542, which provides that:
A general release does not extend to claims which the creditor does not know or suspect to
exist in his or her favor at the time of executing the release, which if known by him or her
must have materially affected his or her settlement with the debtor.
To the extent that anyone might argue that these principles of law are applicable
notwithstanding that the Settling Parties have chosen Florida law to govern this Settlement
Agreementthe Named Plaintiffs hereby agree, and each Settlement Class Member will be
deemed to agree, that the provisions of all such principles of law or similar federal or state laws,
rights, rules, or legal principles, to the extent they are found to be applicable herein, are hereby
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knowingly and voluntarily waived, relinquished and released. The Named Plaintiffs recognize,
and each Settlement Class Member will be deemed to recognize, that, even if they may later
discover facts in addition to or different from those which they now know or believe to be true,
they nevertheless agree that, upon entry of the Final Judgment, they fully, finally, and forever
settle and release any and all claims covered by these Releases. The Settling Parties
acknowledge that the foregoing Releases were bargained for and are a material element of the
Agreement.
10.5. This Agreement and the Releases herein do not affect the rights of Settlement
Class Members who timely and properly request exclusion from the Settlement.
10.6. The administration and consummation of the Settlement as embodied in this
Settlement Agreement shall be under the authority of the Court. The Court shall retain
jurisdiction to protect, preserve, and implement the Settlement Agreement, including, but not
limited to, enforcement of the Releases contained in the Agreement. The Court expressly retains
jurisdiction in order to enter such further orders as may be necessary or appropriate in
administering and implementing the terms and provisions of the Settlement Agreement.
10.7. Upon issuance of the Final Judgment: (i) the Settlement Agreement shall be the
exclusive remedy for any and all Settlement Class Members, except those who have properly
requested exclusion (opted out) in accordance with the terms and provisions hereof; (ii) the
Released Persons shall not be subject to liability or expense of any kind to any Settlement Class
Member(s) except as set forth herein; and (iii) Settlement Class Members shall be permanently
barred from initiating, asserting, or prosecuting any and all Released Claims against the Released
Persons in any federal or state court in the United States or any other tribunal.
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10.8. Nothing in this Settlement Agreement and Release shall preclude any action to
enforce the terms of the Settlement Agreement, including participation in any of the processes
detailed therein. The Releases set forth herein are not intended to include the release of any
rights or duties of the Settling Parties arising out of the Settlement Agreement, including the
express warranties and covenants contained herein.
11. SETTLEMENT ADMINISTRATOR
11.1. Plaintiffs shall select a Settlement Administrator, subject to the Chase
Defendants consent (which shall not be unreasonably withheld), and will request that the Court
appoint the Settlement Administrator. The Settlement Administrator will be approved by the
Court, will be an agent of the Court, and will be subject to the Courts supervision and direction
as circumstances may require. The Settlement Administrator will administer the Notice
Program, and oversee the distribution of Awards to Settlement Class Members in accordance
with the terms of the Settlement and orders of the Court.
11.2. The Settlement Administrator shall administer the monetary relief for Settlement
Class Members pursuant to the terms of this Agreement in a cost effective and timely manner.
The Settlement Administrator may request the assistance of the Settling Parties to identify Class
Members; to facilitate providing Notice directly or by publication; and to accomplish such other
purposes as may be approved by Chase and Class Counsel; and the Settling Parties shall
reasonably cooperate with such requests.
11.3. The Settlement Administrator shall maintain records of all payments to Settlement
Class members. The Settlement Administrator shall maintain all such records, until the later of,
120 days after either the Effective Date or the date the Settlement Fund has been fully
distributed, and such records will be made available upon request to Class Counsel and Defense
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Counsel. Supporting documentation will be kept confidential by the Settlement Administrator,
but may also be provided to the Court upon request and to Class Counsel and Defense Counsel to
the extent necessary to resolve settlement determination issues. The Settlement Administrator
also shall provide such reports and such other information to the Court as it may require.
11.4. The Settlement Administrator shall have the discretion to review Settlement Class
Members payments with the objectives of efficiency and effecting substantial justice to the
Settling Parties and the Settlement Class Members.
11.5. The Settlement Administrator shall, among other duties, cause the creation of a
website at www.chasewindinsurance.com (or similar domain name if that is not available) to
provide information and relevant documents related to this Settlement, including but not limited
to, all applicable deadlines; Class Notice; FAQs and answers; orders of the Court pertaining to
the Settlement; this Agreement; a toll-free telephone number; and contact addresses for the
Settlement Administrator for e-mail and U.S. mail. The cost of creating and maintaining this
website shall be a compensable Notice and Administrative Costs pursuant to Paragraph 2.29.
The Settling Parties shall agree on all information and documents to be posted on this website.
12. SETTLEMENT NOTICE, OBJECTIONS, AND OPT-OUT RIGHTS
12.1. Upon Preliminary Approval of the Settlement, as the Court may direct, the
Settlement Administrator shall cause the Class Notice to be disseminated to potential Settlement
Class Members as provided herein. Class Notice shall be disseminated pursuant to the Notice
Program on or before the Notice Date. A copy of the proposed form of Class Notice is attached
as Exhibit A.
12.2. The Class Notice shall:
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12.2.1. Contain a short, plain statement of the background of the Litigation
and the proposed Settlement;
12.2.2. Describe the proposed Settlement relief as set forth in this
Agreement;
12.2.3. Inform Settlement Class Members that, if they do not exclude
themselves from the Settlement Class, they shall receive relief and will release their claims;
12.2.4. Describe the procedures for participating in the Settlement and
advise Settlement Class Members of their rights, including their right to provide information
concerning their Award under the Settlement, to opt out of same, or object thereto;
12.2.5. Explain the impact of the proposed Settlement on any existing
litigation, arbitration or other proceeding;
12.2.6. State that any Award to Settlement Class Members under the
Settlement is contingent on the Court's final approval of the proposed Settlement;
12.2.7. Explain that neither Counsel for the Settling Parties, nor the
Settlement Administrator, may advise on the tax consequences of participating or not
participating in the Settlement;
12.2.8. Explain the procedures for opting out of the Settlement;
12.2.9. Specify that so-called mass or class opt outs shall not be
allowed; and
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12.2.10. Provide that any objection to the Settlement and any papers
submitted in support of said objection will be considered only if the Settlement Class Member
making an objection complies with the requirements in Paragraph 12.4.
12.3. A Settlement Class Member who wishes to opt out of the Settlement Class must
do so in writing. In order to opt out, a Settlement Class Member must complete and send to the
Settlement Administrator a request for exclusion that is post-marked no later than the Opt Out
Deadline, as specified in the Class Notice and Preliminary Approval Order. The request for
exclusion must be personally signed by the Settlement Class Member requesting exclusion and
must contain a statement that indicates a desire to be excluded from the Settlement Class in this
Litigation, such as I hereby request that I be excluded from the proposed Settlement Class in the
PulleyClass Action. So-called mass or class opt outs shall not be allowed.
12.3.1 Any Settlement Class Member who does not opt out of the Settlement in
the manner described herein shall be deemed to be part of the Settlement Class. A Settlement
Class Member who desires to opt out must take timely affirmative written action pursuant to this
Paragraph, even if the Settlement Class Member desiring to opt out of the Class (a) files or has
filed a separate action against any of the Released Persons, or (b) is, or becomes, a putative class
member in any other class action filed against any of the Released Persons.
12.4 Any potential Settlement Class Member who does not opt out of the Settlement
may object to the Settlement. To object, the Settlement Class Member must comply with the
procedures and deadlines in Paragraphs 12.4.1 and 12.4.2.
12.4.1. Any potential Settlement Class Member who wishes to object to the
Settlement must do so in writing on or before the Objection Date, as specified in the Class Notice
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and Preliminary Approval Order. The written objection must be mailed to Class Counsel and
Defense Counsel (at the addresses identified in Paragraph 18) no later than the Objection Date.
The requirements to assert a valid written objection shall be set forth in the Class Notice and on
the Settlement Website, and shall include: (a) the name, address, telephone number of the
Person objecting and, if represented by counsel, of his/her counsel; (b) proof of ownership of a
property on which wind insurance was lender placed during the class period by Chase Bank or its
predecessors, subsidiaries, or affiliates; (c) the basis for the objection; and (d) a statement of
whether he/she intends to appear at the Final Approval Hearing, either with or without counsel.
Any Settlement Class Member who fails to object to the Settlement in the manner described in
the Class Notice and consistent with this Paragraph shall be deemed to have waived any such
objection, shall not be permitted to object to any terms or approval of the Settlement at the Final
Approval Hearing, and shall be foreclosed from seeking any review of the Settlement or the
terms of the Agreement by appeal or other means.
12.4.2. Subject to approval of the Court, any Class Member who submits a written
objection in accordance with Paragraph 12.4 and the Class Notice may appear, in person or by
counsel, at the Final Approval Hearing held by the Court, to show cause why the proposed
Settlement should not be approved as fair, adequate, and reasonable, provided that the objecting
Class Member: (a) files with the Clerk of the Court a notice of intention to appear at the Final
Approval Hearing by the date that is set forth in the Class Notice (Notice Of Intention To
Appeal); and (b) serves the Notice Of Intention To Appear on all counsel designated in the
Class Notice. The Notice of Intention to Appear must include copies of any papers, exhibits, or
other evidence that the objecting Class Member will present to the Court in connection with the
Final Approval Hearing. Any Class Member who does not file a Notice of Intention To Appear
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13.1. By June 14, 2013, the Settling Parties will apply to the Court for entry of the
proposed Preliminary Approval Order and setting of a Fairness Hearing.
13.2. Within ten (10) days of entry of the Preliminary Approval Order, Chase will serve
notices of the Settlement on State and Federal regulatory authorities as required by the Class
Action Fairness Act of 2005, 28 U.S.C. 1715 (CAFA Notices).
13.3. Not later than ten (10) days before the Fairness Hearing, the Settlement
Administrator will provide Class Counsel, and Defense Counsel with an affidavit or declaration
by a competent affiant or declarant, attesting that the Class Notice has been disseminated in
accordance with the Preliminary Approval Order. Class Counsel will file the affidavit or
declaration with the Court prior to the Fairness Hearing.
13.4. The Settling Parties will brief the issue of Final Approval of the Settlement in
accordance with the Preliminary Approval Order or such other or further order of the Court.
13.5. At the Fairness Hearing, the Settling Parties will move for Final Approval of the
Settlement and entry of the proposed Judgment and present their arguments in support thereof.
13.6. Promptly after the Effective Date, all pending claims that have brought by any
Settlement Class Member in any other action and that have been released pursuant to this
Settlement Agreement shall be dismissed with prejudice.
14. CERTIFICATION OF CONDITIONAL NATIONWIDE SETTLEMENT
CLASS
14.1. In applying for entry of the Preliminary Approval Order, Plaintiffs also will
withdraw their pending Motion for Class Certification and will apply for conditional certification
of a nationwide Class for purposes of the Settlement. In moving for Final Approval of the
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Settlement and entry of Judgment, Plaintiffs will also request that certification of said nationwide
Class for purposes of Settlement be made final.
14.2. Solely for purposes of this Settlement and consistent with this Paragraph, Chase
Defendants will not object that the Action proceed as a nationwide class. Chase Defendants
non-objection shall not constitute, in this or any other proceeding, an admission by Chase
Defendants of any kind or any determination that certification of a nationwide class or any other
class for trial purposes is appropriate. If the Settlement is not granted final approval, or this
Agreement is otherwise terminated or rendered null and void, the certification of the above-
described nationwide Class shall be automatically vacated and shall not constitute evidence or a
binding determination that the requirements for certification of a nationwide class for trial
purposes in this or any other action can be or have been satisfied; in such circumstances, Chase
Defendants reserve all rights to challenge certification of a nationwide Class or any other Class
for trial purposes in the Litigation, or in any other action, on all available grounds as if no
nationwide settlement Class had been certified.
15. ATTORNEYS FEES, EXPENSES AND REPRESENTATIVE
PLAINTIFFS CASE CONTRIBUTION AWARDS
15.1. Chase Defendants agree not to oppose an application for the award of Attorneys
Fees and Expenses in this Action not to exceed a total of $1,425,000 and Expenses. Such
Attorneys Fees and Expenses, plus accrued interest, will be paid from the Settlement Fund by
wire transfer within ten (10) business days after the Effective Date. This amount of Attorneys
Fees and Expenses includes any award for attorneys fees in connection with securing Final
Approval of this Agreement by the Court at the Fairness Hearing or other activities required by
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this Agreement. Defendants shall not be responsible for the payment of any Attorneys Fees and
Expenses, which shall be paid from the Settlement Fund.
15.2 Plaintiffs intend to seek Case Contribution Awards of $10,000 for the Pulley
Plaintiffs and $5,000 for the Davis Plaintiffs from the Settlement Fund for their work and
assistance in the litigation. Chase Defendants will not oppose these requests. Defendants shall
not be responsible for the payment of any Attorneys Fees and Expenses, which shall be paid
from the Settlement Fund.
15.3. The procedure for and the grant or denial or allowance or disallowance by the
Court of the Attorneys' Fees and Expenses and Case Contribution Awards are to be considered
by the Court separately from the Court's consideration of the fairness, reasonableness, and
adequacy of the Settlement, and any order or proceedings relating to the applications for
Attorneys Fees and Expenses and Case Management Awards, or any appeal from any order
relating thereto or reversal or modification thereof, will not operate to terminate or cancel this
Agreement, or affect or delay the finality of Judgment approving the Agreement and the
Settlement.
16. TERMINATION AND EFFECT THEREOF
16.1. This Agreement shall be terminable by any Party if any of the conditions of
Paragraph 3, Paragraph 4.2.4, and Paragraph 12.9 are not fully satisfied, unless they are waived
in writing signed by authorized representatives of the Settling Parties.
16.2. This Agreement shall also terminate at the discretion of any Settling Party if: (1)
the Court, or any appellate court(s), rejects, modifies, or denies approval of any portion of this
Agreement or the proposed Settlement that is material, including without limitation, the terms or
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relief, the findings, or conclusions of the District Court, the provisions, relating to notice, the
definition of the Class, and/or the terms of the release; (2) the District Court, or any appellate
court(s), does not enter or completely affirm, or alters or expands, any portion of the Final
Judgment, or any of the District Courts findings of fact or conclusions of law, that is material; or
(3) if all of the conditions required to be met before the Effective Date do not occur.
16.3. If this Agreement is terminated as provided herein, either automatically or by a
Party, the Settlement shall be null and void from its inception and the Settling Parties will be
restored to their respective positions in the Litigation as of the date of preliminary approval. In
such event, the terms and provisions of this Agreement will have no further force and effect with
respect to the Settling Parties and will not be used in the Litigation, or in any other proceeding
for any purpose, and any Judgment or order entered by the Court in accordance with the terms of
this Agreement will be treated as vacated, nunc pro tunc.
16.4. If this Agreement is terminated as provided herein, either automatically or by a
Party, the balance remaining in the Settlement Fund will be refunded to the Chase Defendants
within 10 days. Neither any Plaintiff nor Class Counsel or any Settlement Class Member will
have any obligation to repay Chase for any such amounts that have paid or incurred.
17. MISCELLANEOUS PROVISIONS
17.1 Named Plaintiffs and Settlement Class Members who have made or who make a
claim in the future on their lender-placed wind insurance policy will not be affected in any way
as a result of their participation in this Settlement, and may participate in this Settlement to the
same extent as Named Plaintiffs or Settlement Class Members who have not made a claim on
their lender-placed wind insurance policy.
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17.2 There will be no offset to any amounts received by any Named Plaintiff or
Settlement Class Member under this Settlement to account for any payments to Named Plaintiffs
or Settlement Class Members under the National Mortgage Settlement or any other settlement
between the Chase Defendants and any governmental or private entity. Nor will any payments to
any Named Plaintiff or Settlement Class Member be an offset against any payments to Named
Plaintiffs or Settlement Class Members under the National Mortgage Settlement or any other
settlement between the Chase Defendants and any governmental or private entity.
17.3. The Settling Parties acknowledge that it is their intent to consummate this
Agreement, and they agree to cooperate to the extent reasonably necessary to effectuate and
implement all terms and conditions of this Agreement and to exercise their best efforts to
accomplish the foregoing terms and conditions of this Agreement.
17.4. The Settling Parties intend the Settlement to be a final and complete resolution of
all disputes between them with respect to the Litigation. The Settlement compromises claims that
are contested and will not be deemed an admission by any Settling Party as to the merits of any
claim or defense. The Settling Parties agree that the consideration provided to the Settlement
Class and the other terms of the Settlement were negotiated in good faith and at arms length by
the Settling Parties, and reflect a settlement that was reached voluntarily after consultation with
competent legal counsel.
17.5. Neither this Agreement nor the Settlement, nor any act performed or document
executed pursuant to or in furtherance of this Agreement or the Settlement is or may be deemed
to be or may be used as an admission or evidence of the validity of any Released Claims, or of
any wrongdoing or liability of any Defendant; or is or may be deemed to be or may be used as an
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admission of, or evidence of, any fault, omission, wrongdoing or liability of any Defendant in
any civil, criminal, or administrative proceeding in any court, administrative agency or other
tribunal. Defendants may file this Agreement and/or the Judgment in any action that may be
brought against them in order to support any defense or counterclaim, including without
limitation those based on principles ofres judicata, collateral estoppel, release, good faith
settlement, judgment bar or reduction, or any other theory of claim preclusion, issue preclusion,
or similar defense or counterclaim.
17.6. All agreements made and orders entered during the course of the Litigation
relating to the confidentiality of information will survive this Agreement.
17.7. All of the Exhibits to this Agreement are material and integral parts hereof and are
fully incorporated herein by this reference.
17.8 This Agreement may be amended or modified only by a written instrument signed
by or on behalf of all Settling Parties or their respective successors-in-interest.
17.9. This Agreement and the Exhibits attached hereto constitute the entire agreement
among the Settling Parties, and no representations, warranties, or inducements have been made
to any Party concerning this Agreement or its Exhibits other than the representations, warranties,
and covenants covered and memorialized herein. Except as otherwise provided herein, the
Settling Parties will bear their own respective costs.
17.10. Class Counsel, on behalf of the Settlement Class, are expressly authorized by
Plaintiffs to take all appropriate action required or permitted to be taken by the Class pursuant to
this Agreement to effectuate its terms, and are expressly authorized to enter into any
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modifications or amendments to this Agreement on behalf of the Settlement Class that Class
Counsel deem appropriate.
17.11. This Agreement may be executed in one or more counterparts. All executed
counterparts and each of them will be deemed to be one and the same instrument. A complete set
of counterparts will be submitted to the Court.
17.12. This Agreement will be binding upon, and inure to the benefit of, the successors
and assigns of the Settling Parties.
17.13. The Court will retain jurisdiction with respect to implementation and enforcement
of the terms of this Agreement, and all Settling Parties hereto submit to the jurisdiction of the
Court for purposes of implementing and enforcing the Settlement.
17.14. None of the Settling Parties, or their respective counsel, will be deemed the
drafter of this Agreement or its Exhibits for purposes of construing the provisions thereof. The
language in all parts of this Agreement and its Exhibits will be interpreted according to its fair
meaning, and will not be interpreted for or against any Settling Party as the drafter thereof.
17.15. Class Counsel represent and warrant that they know of no other attorney who has
appeared on any document filed on behalf of any of the Plaintiffs in any of the actions
comprising the Litigation, and know of no other attorney who has any claim for attorneys' fees
arising from the Litigation separate from those fees to be awarded pursuant to this Agreement.
17.16. The Settling Parties stipulate to stay all proceedings in the Litigation until the
approval of this Agreement has been finally determined, except the stay of proceedings shall not
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prevent the filing of any motions, affidavits, and other matters necessary to obtain and preserve
final judicial approval of this Agreement.
17.17. Within 60 days after the Effective Date, Class Counsel shall destroy all
electronically stored information, testimony, or other information produced by Defendants in the
Litigation and shall so certify in writing.
17.18. The Settlement shall be governed by the laws of the State of Florida, except to the
extent that the law of the United States governs any matters set forth herein, in which case such
federal law shall govern.
17.19. The following principles of interpretation apply to the Agreement: (a) the plural
of any defined term includes the singular, and the singular of any defined term includes the
plural, as the case may be; (b) references to a person are also to the persons successor-in-
interest; and (c) whenever the words include, includes, or including are used in the
Agreement, they shall not be limiting, but rather shall be deemed to be followed by the words
without limitation.
17.20. The Settlement Agreement shall not be subject to collateral attack by any
Settlement Class Member or any receipt of the notices of the Settlement Class after the Judgment
is entered.
18. NOTICES
18.1. All Notices (other than the Class Notice and CAFA Notices) required by the
Agreement shall be made in writing and communicated by fax and mail to the following
addresses:
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All Notices to Class Counsel shall be sent to Class Counsel, c/o:
Meredith & Narine
Joel C. MeredithKrishna Narine100 South Broad Street, Suite 905Philadelphia, PA 19110Telephone: (215) 564-5182Facsimile: (267) 687-1628
All Notices to Defense Counsel shall be sent to Defense Counsel, c/o:
Robert M. BrochinBrian M. Ercole
Morgan Lewis & Bockius LLP200 South Biscayne Boulevard Suite 5300Miami, Florida 33131-2339Telephone: (305) 415-3000Facsimile: (305) 415-3001
Frank G. BurtFarrokh JhabvalaLandon K. ClaymanJorden Burt LLP1025 Thomas Jefferson Street, NW
Suite 400 EastWashington DC 20007-5208Telephone: (202) 965-8140Facsimile: (202) 965-8104
18.2. The notice recipients and addresses designated above may be changed by written
agreement of the Settling Parties.
18.3. Upon the request of any of the Settling Parties, the Settling Parties agree to
promptly provide each other with copies of objections, requests for exclusion, or other similar
documents received from Settlement Class Members in response to the Class Notice.
IN WITNESS WHEREOF, the Settling Parties have executed and caused this Settlement
on the dates set forth below.
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Dated _
Dated
Dated
Dated
By:NameJPMorgan Chase Bank, N.A.Defendant
By:NameChase Insurance Agency, Inc., on its ownand as successor by merger to JPMorganInsurance Agency, Inc.Defendant
By:Jerome Davislaintiff
By:Susan DavisPlaintiff
By: Vferedith NarineCounsel for the Settlement Class andforPlaintiff,>