Legal Library: Cases and Proceedings

The Federal Trade Commission is taking action against Invitation Homes, the country’s largest landlord of single-family homes, for an array of unlawful actions against consumers, including deceiving renters about lease costs, charging undisclosed junk fees, failing to inspect homes before residents moved in, and unfairly withholding tenants’ security deposits when they moved out.

Invitation Homes has agreed to a proposed settlement order that would require the company to turn over $48 million to be used to refund consumers harmed by its actions. The corporate landlord will also be required to clearly disclose its leasing prices, establish policies and procedures to handle security deposit refunds fairly, and stop other unlawful behavior.

The operators of a massive real estate investment coaching scheme face permanent bans and will pay approximately $12 million for consumer redress as part of a settlement in a lawsuit filed by the Federal Trade Commission and the Utah Department of Commerce Division of Consumer Protection (UDCP).

The FTC and UDCP alleged that Zurixx, LLC, its owners Cristopher Cannon, James Carlson, and Jeffrey Spangler, and a number of associated companies operated a real estate investment coaching scheme that sold live seminars and telephone coaching using false earnings claims that convinced tens of thousands of consumers to pay them thousands or tens of thousands of dollars.

The Federal Trade Commission is sending more than $12 million in refunds to consumers who paid Zurixx, LLC for a real estate investment training program that allegedly made empty promises about earning big profits by “flipping” houses.

Opendoor Labs Inc. promised to revolutionize home selling by offering to buy consumers homes for market value while reducing transaction costs. It promised to provide speed and certainty to home sellers while saving them thousands compared to selling on the market or selling traditionally, as the company describes such sales. Although Opendoor generally delivered on its promises to provide a faster and more certain transaction, it did not save consumers money. In fact, consumers who sold to Opendoor typically lost thousands compared to what they would have made on the market. Contrary to the company's marketing, it made submarket offers and had associated costs higher than in traditional sales. The company's marketing and the opacity of the transaction, however, left consumers unaware that they had lost money. The Commission approved a final order in this matter in October 2022. In April 2024, the FTC announced it was sending nearly $62 million in refunds to sellers deceived by advertising and marketing claims made by online real estate business.

As a result of a lawsuit filed by the Federal Trade Commission and the Utah Division of Consumer Protection (DCP), the principals of a Utah-based real estate investment training company will pay $15 million and be banned from selling money-making opportunities under a court order they have agreed to. In addition, two of the primary real estate celebrities who endorsed the training have agreed to orders that require them to pay $1.7 million.

The Federal Trade Commission is sending more than $10 million in refunds to consumers who paid for a real estate investment training program that allegedly made empty promises about earning big profits “flipping” houses.  

The Federal Trade Commission is sending more than $222,000 in refunds to consumers harmed by a deceptive mortgage relief operation known as Lanier Law. The scheme collected thousands of dollars in upfront fees from homeowners by promising to lower their monthly payments but then failed to deliver.

Under the terms of proposed federal court orders, several defendants in the case—including the companies behind Ganadores, the companies’ owners and managers Richard and Sara Alvarez, and an employee who played a key role in the marketing of the scheme, Bryce Chamberlain—will be permanently banned from selling ecommerce or real estate coaching services and will be required to turn over substantial assets to the FTC, which will be used to provide refunds to consumers harmed by the scam

The U.S. District Court for the District of Nevada has ruled in favor of the Federal Trade Commission in a case against the operators of a scheme that deceived financially distressed homeowners by falsely promising to make their mortgages more affordable.  The defendants also charged consumers illegal advance fees and unlawfully told consumers not to pay their mortgages to or communicate with their lenders.

In January 2024, The FTC sent more than $1.2 million in refunds to consumers who lost money to Consumer Defense.

In January 2023, the FTC issued an order requiring Denver-based HomeAdvisor, Inc. – a company affiliated with Angi, formerly known as “Angie’s List” – to pay up to $7.2 million for using a wide range of deceptive and misleading tactics in selling home improvement project leads to service providers, including small businesses operating in the “gig” economy. The Commission announced approval of the final consent order in April 2023.

In November 2018, the FTC announced that a federal district court in Maryland issued an order temporarily shutting down the largest overseas real estate investment scam the FTC has ever targeted. According to the FTC, the scam was established by Andris Pukke, a recidivist scammer currently living in California, and he perpetuated it even while serving a prison sentence for obstruction of justice. The alleged scheme took in more than $100 million, marketing lots in what supposedly would become a luxury development in Central America known by several names, including Sanctuary Belize, Sanctuary Bay, and The Reserve. The FTC alleged that the defendants misled consumers when selling these lots, lying about how risky investments in the development were, how the development was funded, what would be done with money paid for lots, what amenities the development would have, the timeframe those amenities would be built, consumers’ ability to resell lots, and Andris Pukke’s involvement. Several defendants settled prior to the January 2020 trial.

In late August 2020, the district court issued its verdict, finding in favor of the FTC. In early 2021, the court issued final orders against Andris Pukke, Peter Baker, Luke Chadwick, John Usher, and the corporate defendants, limiting what types of business they can engage in moving forward and entering a $120.2 million judgment against them. The defendants appealed and largely lost. During the appeal, Luke Chadwick settled, turning over certain assets and agreeing to a modified order further limiting the types of business he can engage in. After the appeal, the district court entered an order confirming that Andris Pukke, Peter Baker, and John Usher must turn over $120.2 million as well as the corporate defendants and their assets to compensate their victims.  In August 2023, the FTC sent approximately $10 million to consumer defrauded by the Sanctuary Belize investment scheme.

In August 2023, the FTC approved a proposed consent order to resolve antitrust concerns surrounding Intercontinental Exchange, Inc.’s (ICE) proposed $13.1 billion acquisition of Black Knight, Inc. The proposed settlement ensures Black Knight’s divestiture of Empower and Optimal Blue, two businesses that provide critical services in the mortgage origination process. The FTC also secured other concessions to promote the success of the divested businesses. On November 3, 2023, the FTC approved the final consent order.  

The U.S. Department of Justice, on behalf of the Federal Trade Commission, and the Wisconsin Attorney General, filed suit against Consumer Law Protection and related companies, along with their owners and operators, Christopher Carroll, George Reed, Louann Reed, Scott Jackson, and Eduardo Balderas for scamming consumers—mostly older adults—out of more than $90 million in a massive timeshare exit scam.

The Federal Trade Commission and State of California are taking action against home improvement financing provider Ygrene Energy Fund Inc. for deceiving consumers about the potential financial impact of its financing, and for unfairly recording liens on consumers’ homes without their consent. The FTC and California allege that Ygrene and its contractors falsely told consumers that the financing wouldn’t interfere with the sale or refinancing of their homes, in many instances relying on high-pressure sales tactics or outright forgery to sign consumers up.

A proposed court order would require Ygrene to stop its deceptive practices and meaningfully oversee the contractors who have served as its salesforce. As part of the settlement, Ygrene will be required to dedicate $3 million to provide relief to certain consumers whose homes are subject to the company’s liens.

The Federal Trade Commission filed an administrative complaint against the Louisiana Real Estate Appraisers Board, alleging that the group is unreasonably restraining price competition for appraisal services in Louisiana, contrary to federal antitrust law. The complaint alleged that the appraisal board’s regulations exceeded the scope of the mandate outlined in the Dodd-Frank Act that required appraisal management companies to pay “a rate that is customary and reasonable for appraisal services performed in the market area of the property being appraised.” Specifically, the board required appraisal fees to equal or exceed the median fees identified in survey reports commissioned and published by the board. The board then investigated and sanctioned companies that paid fees below the specified levels. 

Shortly before the administrative trial was set to begin, the FTC and the board reached a proposed settlement agreement.

On April 5, 2022, the Commission announced the final consent agreement in this matter.

Ascension will be required to implement a comprehensive data security program as part of a settlement resolving FTC allegations that the firm failed to ensure one of its vendors was adequately securing personal data about tens of thousands of mortgage holders.

In September 2016, the FTC announced a court order banning the operators of an alleged mortgage relief scam that preyed upon distressed homeowners from the debt relief business. The final orders banned the defendants from selling secured or unsecured debt relief products or services, and prohibited them from misrepresenting any financial or other products or services. The orders imposed a judgment of more than $1.7 million. The FTC’s July 2014 complaint alleged the defendants claimed they could lower consumers’ mortgage payments and interest rates or prevent foreclosure, pretended to be affiliated with a government agency or consumers’ lenders or servicers, and illegally charged advance fees for these services. The FTC announced additional settlements in the case through March 2020.

In May 2021, the FTC sent payments totaling more than $147,000 in full refunds to people affected by the student loan debt relief scam.   

The Federal Trade Commission filed an administrative complaint and authorized a suit in federal court to block internet listing services provider CoStar Group Inc.’s proposed $587.5 million acquisition of competitor RentPath Holdings, Inc. The complaint alleged that the acquisition would significantly increase concentration in the already highly concentrated markets for internet listing services advertising for large apartment complexes in 49 individual metropolitan areas across the United States. On Dec. 31, 2020, the FTC issued a statement on the parties’ announcement that they had abandoned the acquisition.