An affirmative defense of res judicata is emerging based on class action settlements in recent cases. I explored the issue in the context of a lender force-placed insurance case in the Southern District of Florida and the effect of a class action settlement in that case on other LFPI cases around the nation, in an article published in NWLawyer, the journal of the Washington State Bar Association: “Class Action Settlements Have Consequences, From Florida to the State of Washington,” 69 NWLawyer 27 (April/May 2015).
Here is how the topic is introduced in the article:
Most people agree to pay for force-placed insurance. They just may not realize it.
When we borrow money, we almost always give our lenders collateral to back the loan. We also agree that we will buy insurance to protect the collateral if the collateral is particularly big, such as our house in a mortgage loan. In the event that we do not make the loan payments, or if we do not keep insurance in place to protect the collateral, we also agree that our lenders can place insurance to protect the collateral and force us, the borrowers, to pay for it.
But we generally do not agree to pay the additional price of kickbacks and other secret charges which insurance companies allegedly pay to banks in exchange for a place on the lenders’ approved list of insurance companies offering force-placed insurance.
Here is the rest of the article.
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