Ocwen Financial Corp. (OCN) on Friday won the dismissal of two securities class actions that arose from alleged compliance issues related to servicer agreeing to a $150 million settlement in 2014 with the New York's Department of Financial Services last December.
U.S. Judge William Dimitrouleas dismissed a lawsuit filed in a federal Southern Florida district court by shareholders seeking to recover losses suffered from alleged false statements the company made about its business practices and regulatory compliance leading up to that settlement.
The shareholders in the lawsuit charged that Ocwen made false statements about its business practices and regulatory compliance.
Ocwen admitted in the agreement with the New York regulatory agency that it didn't properly deal with distressed homeowners and failed to maintain adequate systems for servicing hundreds of billions of dollars in mortgages.
Under the agreement, Ocwen agreed to undertake significant operational reforms to address serious servicing misconduct and conflict of interest issues at the company; and to have an NYDFS-selected, independent monitor on site for up to an additional three years. That was in addition to the $150 million to be paid to New York residents who were serviced by Ocwen.
Ocwen was up 5% in early trading to above $8.19, which is a four-week high.