Wholesale mortgage giant claims firm launched "coordinated campaign" to damage its business and stock value
Boies Schiller Flexner, the law firm representing homebuyers in a class action lawsuit against United Wholesale Mortgage (UWM), is denying claims that they’ve colluded with a hedge fund to damage UWM’s stock value.
The lawsuit, filed in April, accuses UWM of conspiring with brokers to steer customers into higher-cost mortgages, allegedly raking in billions in unnecessary fees.
UWM, the largest wholesale mortgage lender in the US, responded by asking the court to dismiss the case and sanction Boies Schiller, claiming that the law firm has ties to Hunterbrook Capital, a hedge fund betting against UWM’s stock.
According to UWM, this lawsuit is part of a larger campaign aimed at hurting the company’s business and reputation.
In its latest filing, Boies Schiller denied any connection with Hunterbrook. The firm said that no Hunterbrook-associated entity was funding the class action. The firm also clarified that it has “no interest — none — in any trade by any Hunterbrook entity on UWM’s stock.”
The firm dismissed UWM’s push for sanctions as a “side-show”, arguing that the lender is using these claims to distract from its alleged unfair lending practices.
The lawsuit was filed after an investigation by Hunterbrook Press, the media arm of Hunterbrook Capital, questioned UWM’s business practices. Boies Schiller acknowledged that the nonprofit Hunterbrook Foundation shared research and data with the firm before the legal action was initiated.
However, UWM claimed that Boies Schiller and Hunterbrook have launched a “coordinated campaign” to damage its business and stock value.
Read more: UWM wins dismissal of antitrust case over broker ultimatum
“Counsel and plaintiffs — without qualification — had complete control over whether and when to commence this action,” Boies Schiller asserted in its filing, rejecting UWM’s “specious allegations” of professional misconduct.
The case, Escue v. United Wholesale Mortgage LLC, is currently being heard in the U.S. District Court for the Eastern District of Michigan (No. 2:24-cv-10853).
Representing the plaintiffs are John Zach and Marc Ayala of Boies Schiller Flexner, along with Brandon Hubbard of Dickinson Wright. UWM’s defense team includes Jeffrey Jones, Stephen Cowen, and Rebekah Byers Kcehowski from Jones Day.
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