A federal jury said today that online mortgage giant Quicken Loans doesn’t owe overtime pay to hundreds of former loan officers.
A Center for Public Integrity investigation published last month about the trial in U.S. District Court in Detroit and other lawsuits examined how Quicken’s day-to-day tactics are at odds with its squeaky clean image and ranking as one of America’s best places to work. It detailed claims from borrowers and ex-employees who accuse the company of taking advantage of vulnerable homeowners and using falsified information to push through bad deals.
Jurors came back with a verdict today in Quicken’s favor after just over two days of deliberations in the five-week-long trial.
Attorneys for more than 300 former employees who worked as a “loan consultants” for the company from 2002 to 2006 had argued that they were salespeople who were entitled to overtime compensation. The company countered that the workers were exempt from overtime rules because they were administrative workers who provide advice to borrowers, in much the way that stockbrokers provide advice to investors.
As much as $10 million in back pay was at stake in the case, according to Crain’s Detroit Business.
After the verdict was announced, Quicken founder and chairman Dan Gilbert told the Detroit Free Press that the case was “never about money for us. It was always about right and wrong. . . . People, including juries, are willing to stand up to extortionist law firms.”
As big as the victory is for the Detroit-based Quicken, it doesn’t bring an end to its legal battles. Attorneys for the ex-employees plan to appeal the case, and they said they would press forward with three other overtime cases against Quicken involving more than 1,000 workers.
Quicken, meanwhile, has promised to appeal a $2.7 million verdict against the company by a West Virginia judge who ruled that the lender had had defrauded a borrower by misleading her about her loan and using an inflated property appraisal. Gilbert has called last month’s judgment in Ohio County (W.Va.) Circuit Court “irrational and incomprehensible.”
Quicken strongly denies the allegations that accuse the company of high-pressure salesmanship targeting vulnerable homeowners and of misleading borrowers about their loans. “We always try to do the right thing,” Gilbert told the Center last month. “If we truly make an honest mistake, it usually doesn’t even get to court—if we discover it, we make things right.”
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