Newrez is asking a Pennsylvania federal courtroom to throw out OneTrust Residence Loans’ latest counterclaims.
The 2 lenders have been sparring through authorized filings following the departure of James Hecht, former head of manufacturing at Newrez, and a handful of executives to OneTrust within the first half of the yr.
Newrez has accused Hecht, OneTrust’s CEO, of being a mastermind behind an elaborate ruse to raid workers from the Pennsylvania-based firm and steal commerce secrets and techniques.
In response to Newrez’s litigation, OneTrust accused Newrez of unfair competitors, tortious interference with contract, and defamation. Particularly, Newrez has made it onerous for OneTrust to recruit future workers, the San Diego-based firm claims.
The lender in its counter grievance additionally alleges that Newrez has had a “love and hate” relationship with its retail channel, which it purportedly tried to promote twice.
Newrez notes in a submitting June 5 that OneTrust has “did not state any declare upon which reduction might be granted.”
It additionally added that over 70 Newrez workers (and counting) have truly transitioned to OneTrust because the departure of Hecht and others, which has resulted “in substantial loss to Newrez.”
“OneTrust lobs unwarranted allegations of wrongdoing premised on Newrez bringing this lawsuit in opposition to OneTrust and obscure, speculative allegations of defamation in opposition to Newrez,” the latest submitting reads.
The mortgage lender goes on to take aside the claims made by its competitor, noting the “counterclaims comprise conclusory allegations of illegal conduct however lack any…factual substance.”
OneTrust’s unfair competitors declare relies upon drastically on Newrez submitting the swimsuit in opposition to it, alleging it was accomplished for improper functions and to unfairly compete in opposition to it. Newrez’s latest submitting argues this “is just not the kind of conduct that helps an unfair competitors declare [in Pennsylvania.]”
Moreover, OneTrust’s tortious interference of contract declare alleges Newrez is “stopping the departure of Newrez workers who search higher job alternatives with OneTrust.” However the Pennsylvania-mortgage lender and servicer argues this declare “consists of nothing greater than conclusory allegations and fails to particularly establish what contracts — current or potential — with which Newrez allegedly interfered.”
Newrez does admit, nonetheless, that round February 2024 OneTrust entered an employment contract with a former Newrez worker. She was going to be a supervisor however in the end opted to not work at OneTrust due to concern of litigation.
“This particular person resigned her place with OneTrust, and, as an alternative, joined a competing mortgage servicer,” the submitting says.
Joshua Eskine, founding father of OneTrust Residence Loans, mentioned in a press release Thursday the corporate totally stands behind the “details and claims we set forth.”
“[We] will forcefully reply to Newrez’s baseless movement in the end within the litigation the place the reality as we defined it would prevail.”
In the meantime, a spokesperson for Newrez mentioned the corporate doesn’t “touch upon energetic litigation.”
“Nevertheless, this submitting reiterates our dedication to defending our firm’s pursuits, values, and repute, and we are going to vigorously pursue all authorized cures out there to us,” he added.
Earlier this yr, Newrez reasserted its dedication to retail with an govt noting that it’s “100% dedicated to the distributed retail channel.” Additionally they highlighted that “connecting our servicing portfolio and our servicing leads on a localized foundation is basically the differentiator on how we join with our prospects.”
Talking of servicing, Newrez finalized the acquisition of Computershare Mortgage Providers and affiliate Specialised Mortgage Servicing LLC in early Could.
Actual property funding belief Rithm Capital Corp, guardian firm of Newrez, purchased the corporate for near $720 million as a way to additional develop its servicing presence.
The mixing of Computershare provides $149 billion in unpaid principal steadiness to the corporate. This consists of $104 billion in third-party servicing to Newrez’s portfolio, the corporate mentioned in a latest press launch
The New York-based firm posted web earnings of $261.6 million, equal to 54 cents per share within the first quarter. The mortgage originations and servicing section at Rithm, the guardian firm of Newrez, introduced in $311.9 million in web earnings throughout the quarter as mortgage manufacturing and truthful worth of MSRs each improved.