The law firm representing members of a class action against Commonwealth Land Title in Pennsylvania made public announcement of the lawsuit yesterday.  The lawsuit alleges that Commonwealth charged Pennsylvania homeowners a full rate for refinance and reissue title insurance policies for which the homeowners were entitled to a discount.

The class action, A.D. Alberton and Mark C. Kessler v. Commonwealth Land Title, was conditionally approved by a Pennsylvania court in 2008, and final approval to send out notice to class members was given by the court this March.  Eligible members of the class action will automatically be a party to the lawsuit, but may choose to opt out.

Notices will be sent to approximately 60,000 Pennsylvania landowners who meet the criteria of the class action.  Another 30,000 people may be eligible, but have not been specifically identified, according to an estimate in court documents.

The class action covers persons who obtained title insurance from Commonwealth Title on a refinance transaction between July 25, 2000 until August 1, 2005, provided that they had  purchased a prior title insurance policy on the same property within the previous ten years, and provided that they were not charged the applicable discounted reissue rate or refinance rate for title insurance.

Pennsylvania title insurance rates are governed by a ratings bureau, which files rates with the Pennsylvania Insurance Commissioner which apply to all title insurers operating in the state.  Pennsylvania has-- and had at the time covered by the class action-- a three-tiered pricing structure for title insurance. Pennsylvania rates entitle a homeowner to a rate of 80% of the normal policy rate to obtain a new policy if the new policy is obtained within three years of a prior policy (the "refinance" rate) and 90% of the normal policy rate for policies obtained three to ten years after the prior policy (the "reissue" rate).

The lawsuit demands an unspecified amount of compensatory damages, declaratory relief, triple damages, restitution, prejudgment and post-judgment interest and expert fees, attorneys’ fees and costs.  Commonwealth believes it has a "meritorious defense" of the claims made in the lawsuit, according to a regulatory filing by Fidelity National Financial, Commonwealth Title's parent company.

Fidelity National Financial subsidiaries are currently defending, or have recently defended, a number of class action lawsuits regarding improper charges to consumers.  Similar suits regarding refinance policy overcharges against both Commonwealth Title and another Fidelity subsidiary, Lawyers Title, were settled in 2007 and 2009 respectively.  Another similar class action case against Commonwealth is being argued in Florida courts.  In addition, Fidelity National Financial says that it is a defendant in "a number of other purported class action cases pending in various states that include allegations that certain consumers were overcharged for title insurance and/or related services."  

Commonwealth Title and Lawyers Title were both owned by another title insurer, LandAmerica, during the periods covered by these class actions.  Fidelity National Financial acquired both companies when LandAmerica declared bankruptcy in 2008.