[Please note the author has no involvement with this case, other than reporting about it here. If you have questions about the case, please direct them to the attorneys representing the plaintiff, for whom contact information from the complaint is provided below.]  

On December 2, 2013, three law firms in New Jersey, Washington and Colorado teamed together to file a class action complaint on behalf of real estate agents and others allegedly owed unpaid fees for broker price opinions ordered by BrokerPriceOpinion.com.  The complaint also names three-related companies First Valuation, LLC, First Valuation Services, LLC, and First Valuation Technology, LLC as defendants on the basis that they are “alter egos” of BrokerPriceOpinion.com and do not have true corporate separateness in their operation.  The lawsuit was filed in federal court in Colorado, where the defendants are based.

The named plaintiff in the lawsuit is Kathy Wornicki, a Florida real estate agent, who alleges that she is owed $880 for a number of BPOs performed in 2012 and early 2013.  The fee for each assignment was generally $25 or $35.  She contends that BrokerPriceOpinion.com has breached a contract to pay for those services within 60 days.  She further alleges that the defendants have not only failed to pay her but also failed to pay hundreds or thousands of other persons performing BPOs.  The plaintiff’s lawyers refer in a few places to BPOs as “evaluations” and “appraisals” but the lawsuit appears only to relate to fees for actual BPOs and not any other services managed by the defendants.  For jurisdictional purposes, the complaint alleges that the total amount of fees at issue exceeds $5 million but does not allege the number of agents or others owed money.  However, the complaint seeks to litigate the case as a class action on behalf of all such persons and firms.  These are the allegations in the complaint regarding members of the proposed class:

Many significant financial and legal issues affecting appraisal management companies in recent years have been discussed on this site.  Of particular relevance is a post from January in which I explained why lenders need to pay attention to these issues when contracting with appraisal management companies.  For OCC-supervised lenders, the financial stability and responsibility, and litigation and insurance matters as well, of third party service providers like AMCs is now a front-and-center compliance issue on which the OCC focused in its October 30, 2013, bulletin Risk Management Guidance for Third-Party Relationships.

 

Peter Christensen

I am an attorney and principal of the Christensen Law Firm. The matters that I handle are focused on real estate valuation, valuation firms, appraisers and appraisal management.