The United States District Court for the Central District of California announced on Monday that a notification program began this week as ordered by the court to alert consumers about a proposed class action settlement to remediate auto finance customers of Wells Fargo who may have been financially harmed due to issues related to auto collateral protection insurance (CPI) policies.
The announcement recapped that the proposed settlement resolves a lawsuit originally filed on July 30, 2017 that alleged between Oct. 15, 2005 and Sept. 30, 2016 the defendants unlawfully placed CPI policies on retail installment contracts. CPI is a type of insurance that Wells Fargo purchased from National General to cover potential damage to vehicles that served as collateral for Wells Fargo auto financing.
The lawsuit alleged, among other things, that the CPI policies that the defendants placed on settlement class members’ accounts were duplicative, unnecessary and overpriced.
Under the Settlement, the defendants will distribute at least $393.5 million to settlement class
Officials explained the Settlement Class is defined as Wells Fargo Dealer Services (WFDS) customers who had a CPI policy placed on their account(s) that became effective at any time between Oct. 15, 2005 and Sept. 30, 2016 and Wells Fargo Auto Finance (WFAF) customers who had a CPI Policy placed on their account(s) that became effective at any time between Feb. 2, 2006 and Sept. 1, 2011.
The definition of class and settlement class excludes non-compensable flat cancels, as defined in Exhibit A to the settlement agreement, according to the announcement.
The court indicated notices will be sent to settlement class members and are scheduled to appear in a national online notice campaign leading up to a hearing on Oct. 28 when the court will consider whether to grant final approval to the settlement.
The court has appointed the following law firms to represent the settlement class:
— Baron & Budd in Encino, Calif.
— Robins Kaplan in Los Angeles
— Casey Gerry Schenk Francavilla Blatt & Penfield in San Diego
— Gibbs Law Group in Oakland, Calif.
— Levin Sedran & Berman in Philadelphia
— Weitz & Luxenberg in Detroit
Officials pointed out individuals affected by this settlement can ask to be excluded from, or object to, the settlement and its terms. The deadline for exclusions and objections is Oct. 7.
More details about the agreement are available at www.WellsFargoCPISettlement.com.