Action Settlement (ECF No. 451, including the parties' Stipulation and Settlement Agreement

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1 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 1 of 13 UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION Case Number: ClV-M ARTINEZ-GOODMAN GARY COOPER, on behalfof himself and al others sim ilarly situated, Plaintiff, PENNYM AC LOAN SERVICES, LLC, et al., D efendants. ORDER GRANTING MOTION FOR PRELIM INARY A - PPROVAL OF CLASS ACTION SETTLEM ENT. CERTIFYING CLASS FOR SETTLEMENT PURPOSES. DIRECTING ISSUANCE OF CLASS NOTICE. AND SCHEDULING FINAL APPROVAL HEARING U pon review and consideration of Plaintiffs M otion for Prelim inary A pproval of Class Action Settlement (ECF No. 451, including the parties' Stipulation and Settlement Agreement (the tksetlement Agreement') and al exhibits, and having been fuly advised in the premises, it is hereby O RDERED AND ADJUDG ED that the m otion is GRANTED as folows: Settlem ent. Plaintiff and D efendants have negotiated a potential settlem ent of this action (the Slcooper Litigation' or the tsaction') to avoid the expenses uncertainties, and burden of protracted litigation, and to resolve the Released Claims against (a) Defendants and each of their respective divisions, parents, subsidiaries, predecessors, investors, parent com panies, and A ffiliates, w hether past or present, any direct or indirect subsidiary of any of the Defendants and each of their respective divisions, parents, subsidiaries, predecessors, investors, parent com panies, and A ffiliates, whether past or present, and a 1 of the officers, directors, em ployees, agents, brokers, distributors, representatives, and attorneys of a11 such entities, including, but not limited to, PennyM ac Loan Services, LLC (lçpennymac') and QBE Specialty lnsurance Company (CQBE Specialty'), Praetorian lnsurance Company (çspraetorian'), QBE FIRST lnsurance Agency, Inc. n/k/a NGLS lnsurance Services, lnc. (SIQBE F1RST'), QBE Insurance Corporation (SIQBE lnsurance'), Balboa lnsurance Company (1%a1boa'), Meritplan

2 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 2 of 13 lnsurance Company (dfmeritplan'), Seatle Specialty lnsurance Services, lnc. (klseattle Specialty') (collectively CIQBE Defendants'); (b) any Other insurance carriers that issued or may have issued LPI for PennyM ac insuring real property owned by any Setlem ent Class M ember; and (c) any trustee or investor of a mortgage securitization trust, which included loans made to any Setlem ent Class M em ber, including, but not lim ited to, any direct or indirect subsidiary of any of them, and al1 of the officers, directors, em ployees, agents, brokers, distributors, representatives, and atorneys of al such entities. 2. Review. The Court has carefuly reviewed the Setlement Agreement, as wel as the files, records, and proceedings to date in this mater. The terms and conditions in the Setlem ent Agreement are hereby incorporated as though fu ly set forth in this Order, and, unless otherw ise indicated, capitalized term s in this O rder sha l have the m eanings attributed to them in the Settlem ent A greem ent. 3. Preliminary Approval. The Setlement Agreement entered into by and among the Plaintiff Gary Cooper (çkplaintiff '), on behalf of himself and the Settlement Class, PennyM ac, and the QBE Defendants (collectively iûdefendants') has been negotiated at arm's length and is approved on a prelim inary basis as fair, reasonable, and adequate. 4. Settlem ent Class R elief. The proposed Settlem ent Relief to the Setlem ent Class M embers, as identified in Section 4 of the Setlement Agreement, is approved on a prelim inary basis as fair, reasonable, and adequate. The Settlem ent Class sha l consist of: a. The lsclass' shall include all borrow ers in the U nited States w ho, w ithin the Class Period, were charged by PermyM ac Loan Services, LLC under a hazard, tlood, or wind LPl policy issued or procured by QBE Specialty lnsurance Company, Praetorian Insurance Company, QBE FIRST Insurance Agency, Inc. n/k/a NGLS lnsurance Services, lnc., QBE lnsurance Corporation, Balboa Insurance Company, Meritplan Insurance Com pany, Seatle Specialty lnsurance Services, lnc., or one of their predecessors, successors, agents, or aftiliates (collectively ûcqbe Defendants') for Residential Property, and who, within the Class Period, either (i) paid to PennyM ac the

3 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 3 of 13 Net Premium for that LPl Policy or (ii) did not pay to and stil owe PennyM ac the Net Premium for that LPI Policy. Excluded from the Class are: (i) individuals who are or were during the Class Period officers or directors of the Defendants or any of their respective affiliates; (i) any justice, judge, or magistrate judge of the United States or any State, their spouses, and persons within the third degree of relationship to either of them, or the spouses of such persons; (ii) borrowers who only had an LPl Policy that was canceled in its entirety such that any prem ium s charged and/or colected were fully refunded to the bonower or the borrower's escrow account; and (iv) a1 bonowers who tile a tim ely and proper request to be excluded from the Class. The dtclass Period' shal com mence on February 1, 201 1, and shall continue through and including the date of this Order. 5. Prelim inary Certification of Settlem ent Class. The Court makes the folowing determ inations as to certitication of the Settlem ent Class: (a) The Coul't preliminarily certifies the Settlement Class for purposes of settlement only, under Fed. R. Civ. P. 23(a) and (b)(3). im practicable; Settlem ent Class; of the Setlem ent Class; (b) The Setlement Class is so numerous that joinder of al members is There are questions of law or fact common to the members of the (d) The claims of the Plaintiff are typical of the claims of the other members Plaintiff is capable of fairly and adequately protecting the interests of the m em bers of the Setlem ent Class, in connection w ith the Settlem ent A greem ent; Comm on questions of law and fact predom inate over questions affecting only individual m em bers of the Setlem ent Class; (g) The Settlement Class is ascertainable; and

4 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 4 of 13 (h) Ttesolution ofthe claims in this Litigation by way of a nationwide se tlem ent is superior to other available m ethods for the fair and e fcient resolution of the claim s of the Settlement Class. 6. Designation of C lass R epresentative. Plaintiff G ary Cooper is designated as the representative of the Setlem ent Class for the sole purpose of seeking a settlement of the Cooper Litigation. 7. Designation of Class Counsel. The law firms of Kozyak, Tropin, & Throckm orton, P.A., Podhurst O rseck, P.A., and H arke Clasby & Bushm an LLP, are hereby designated as Class Counsel for the Settlem ent Class. 8. Final A pproval H earing. A hearing regarding final approval of the Setlem ent (tifinal Approval Hearing') wil be held at 2:00 p.m. on April , in M iami before the Honorable Jose E. M artinez, to determine, among other things: (i) whether the Setlement of the Cooper Litigation should be approved as fair, reasonable, and adequate; (ii) whether the Cooper Litigation should be dismissed with prejudice pursuant to the tenns of the Setlement Agreement; ( i) whether Setlement Class M embers should be bound by the Release set forth in the Setlement Agreement; (.iv) whether Setlement Class Members should be subject to a permanent injunction which, among other things, bars Settlement Class M embers who have not opted out of the settlement from filing, commencing, prosecuting, intervening in, participating in (as class members or othenvise), organizing, or soliciting the participation of other Setlement Class Members to pursue any action in any jurisdiction based on or relating to any of the Released Claims or the facts and circumstances relating thereto; and (v) whether the application of Class Counsel for an award of A torneys' Fees and expenses, and the proposed Case Contribution A w ard To Plaintiff, should be approved.

5 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 5 of Class Notice. (a) The Court approves the Class Notice in the Setlement Agreement, including the M ail Notice atached as Exhibit D to the Setlem ent Agreem ent and the m anner of providing Mail Notice to Setlement Class Members described in Section 6 of the Setlement A greem ent. The C oul't finds that this is the best practicable notice under the circum stances and is reasonably calculated, under all the circum stances, to apprise the Setlem ent Class M em bers of the pendency of this Action, the terms of the Setlement Agreement, and their right to object to the Settlem ent A greem ent or exclude them selves from the Setlem ent Class. The Court further finds that Mail Notice and the other forms of Class Notice in the Setlement Agreement are reasonable, constitute due, adequate, and sufficient notice to all persons entitled to receive notice, and m eet the requirem ents of due process. (b) The M ail Notice shall be mailed not less than ninety (90) days befbre the date set by the Court for a Final Approval Hearing regarding the Setlem ent. The M ail Notice shal include the Claim lnstructions (attached as Exhibit B to the Setlement Agreement) and Claim Form (attached as Exhibit C to the Settlement Agreement). A sim ilar but abbreviated Sum m ary Publication N otice of C lass A ction, Proposed Setlem ent, Final Approval Hearing, and Right to Appear shall be published not less than forty-five (45) days before the date set by the Court for the Final Approval Hearing regarding this Settlem ent. (d) No later than the posting of the M ail Notice, the Settlement Administrator shall establish an lnternet site (the itsetlement W ebsite'), which shal contain copies of the Setlem ent Agreement and Exhibits and the M ail Notice, and alow Settlement Class m embers to upload and t5le their claim form s. The Setlem ent W ebsite shall also contain Claim Form

6 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 6 of 13 lnstructions and a Claim Form,which m ay be downloaded or printed from the Settlement W ebsite. In addition, the Settlem ent W ebsite shall a low for the option of com pleting Claim Form s online w ithin the settlem ent w ebsite, utilizing an esignature fonuat. How ever, w hen the Claim Form is completed online, the Settlement Class member must separately upload the required verification docum ents to the Setlem ent W ebsite, pursuant to the instructions on the W ebsite, no later than the Claim Deadline. The Setlem ent W ebsite shall have a Uniform Resource Locator that identifies the Setlem ent W ebsite as m.coopersetlem entlnfo.com. The Settlement W ebsite shal rem ain open and accessible through the last day for Setlement Class M embers to subm it a Claim for Setlement Relief. Further, the Setlem ent Administrator shal make advertisements on the internetdirected to Class Members in fonn and content mutualy acceptable to Class Counsel and Defendants as agreed upon in the Settlement. The Settlem ent Adm inistrator shall establish a to l-free interactive voice response ($tivr') phone number with script recordings of information about this Setlement, including inform ation about the Claim Form, utilizing the relevant portions of the language contained in the Notice and Claim Fonn.The phone number shall remain open and accessible through the last day for SettlementClass Members to submit a Claim. The Setlement A dm inistrator shall m ake reasonable provision for Class Counsel to be prom ptly advised of recorded messages left on the phone number by Setlement Class Members concerning the A ction and/or this Settlem ent, so that Class Counsel m ay tim ely and accurately respond to such inquiries; provided however, the A dm inistrator shall review the recorded m essages before providing them to Class Counsel, and if one or m ore of the m essages requests a blank Claim Fonn or other sim ilar adm inistrative assistance only, then the A dm inistrator sha l handle such administrative requests), but the Administrator shall provide al1 other messages to Class

7 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 7 of 13 Counsel for any further response to the Setlem ent Class M ember. If any subm ited Claim Forms are deemed invalid for any reason (e.g., because they are defective or incomplete in any way), the Administrator shall promptly advise Class Counsel on a weekly basis so that Class Counsel m ay folow-up with the Class M ember who submited such Claim Form in order to cure any defciency. The Settlement Administrator shal send a notice to claim ants submiting deficient claims identifying the deficiency. Any defective Claim Fonn may be cured and shall be accepted by the Administrator so long as the defect is resolved within 30 days after Claim Deadline. (t) No later than 10 days prior to the Final Approval Hearing, Class Counsel shal obtain from the Setlement Adm inistrator and shal file with the Court a proof of mailing of the M ail Notice and of establishing of the Setlem ent W ebsite. (g) Defendmzts shal comply with the obligation to give notice under the Class Action Fairness Act, 28 U.S.C. j 171 5, in connection with the proposed settlement. No later than 10 calendar days before the Final Faim ess Hearing, counsel for D efendants shal file with the Court one or more declarations stating that Defendants have complied with its notice obligations under 28 U.S.C. j l 715. l0. A dm inistrators. The Court authorizes and directs D efendants to retain one or m ore Adm inistrators to im plem ent the terms of the Setlem ent Agreem ents and authorizes and directs such Administrators to (i) mail the M ail Notice, (i) establish the IVR phone line system, (ii) initiate the lnternet advertising campaign, (iv) establish the Setlement W ebsite, (v) receive and process settlement claims, and (vi) carry out such other responsibilities as are provided for in the Setlement Agreement or may be agreed to by the Parties in the Action.

8 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 8 of 13 Exclusion from the Settlement Class. Any Settlement Class Member who wishes to be excluded from theclass must send a writen Request for Exclusion to the Settlem ent A dm inistrator, by first-class m ail, postage prepaid, to the address provided in the Mail Notice and Setlement Website. Any such Request for Exclusion must be postmarked no later than thirty (30) days before the Final Approval Hearing. To be valid, the Request for Exclusion must: (a) identify the case name and number; (b) identify the name and address of the Setlement Class Member; (c) be personally signed by the Settlement Class M ember requesting exclusion; and (d) contain a statement that indicates a desire to be excluded from the Setlement Class in the Cooper Litigation, such as kt1 hereby request that l be excluded from the proposed Se tlem ent Class in the Cooper Class A ction.' M ass or class opt outs sha l not be a low ed. (b) Setlement Class M ember who desires to opt out must take timely affirmative writen adion pursuantto this (lrder and the Setlem ent Agreem ent, even if the Settlement Class M ember desiring to opt out of the Class (a) tiles or has filed a separate action against any of the Released Persons, or (b) is, or becomes, a putative class member in any other class action filed against any of the Released Persons. Except for those Setlem ent Class M embers who tim ely and properly file a request for exclusion, all other Setlem ent Class M em bers w ill be deem ed to be Setlem ent Class M embers for al purposes under the Agreem ent, and upon the Final Setlement Date, wil be bound by its telnns, including, but not lim ited to, the Releases in Section 10 of the Setlem ent Agreement. (d) lf the number of Setlement Class M embers who properly and timely exercise their right to opt out of the Setlement Class exceeds 5 percent (5%) of the total number

9 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 9 of 13 of Setlem ent Class M em bers, the Setling Parties stipulate and agree that Defendants shall have the right to terminate this Agreem ent without penalty or sanction. If the proposed setlement is approved, any Settlement Class Member who has not subm ited a timely, written Request for Exclusion from the Class shall be bound by al subsequent proceedings, orders, and judgments in this Action, even if he or she has pending, or subsequently initiates, litigation against D efendants relating to any of the R eleased Claim s to Settlem ent A greem ent. Objections and Appearances. Any Setlement Class M ember who has not filed a timely writen Request for Exclusion and who complies with the requirements of this Paragraph may object to any aspect of the proposed settlement either on his or her own or through an attorney hired at his or her expense. Any Setlement Class M em ber who wishes to object to the Setlement Agreement must do so in writing and must file with the Clerk of Court and serve on Class Counsel and Defendants' Counsel, at the addresses listed below, a written statement of objection in accordance with the requirements set forth below and in the Settlement Agreement no later than thirty (30) days before the Final Approval Hearing: For Plaintiff and Settlem ent C lass Adam M. M oskowitz K ozyak, Tropin, & Throckm orton, P.A Ponce de Leon B lvd., 9th Floor C oral G ables, FL Telephone: (305) Facsimile: (305) For PennyM ac M arc J. Gottlieb Akerman LLP 350 East Las O las Boulevard, Suite 1600 Fort Lauderdale, FL Telephone: (954) Facsim ile: (954)

10 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 10 of 13 Counselfor PennyMac For the OBE Defendants Robyn C. Quatrone Buckleysandler LLP th Street, N W Suite 700 W ashington, DC Telephone: (202) Facsimile; (202) (a) The requirements to assert a valid written objection shal be set forth in the Class Notice and on the Setlement W ebsite, and shal include: (a) the case nan;e and number; (b) the name, address, telephone number of the Person objeding and, if represented by counsel, of his/her counsel; (c) the basis for the objection', and (d) a statement of whether he/she intends to appear at the Final Approval Hearing, either w ith or w ithout counsel; (b) Any Setlement Class Member who fails to object to the Setlement in the manner described in the Class Notice and consistent with this Section shall be deemed to have waived any such objection, shal not be permited to object to any tenns or approval of the Settlem ent at the Final Approval H earing, and sha l be foreclosed from seeking any review of the Settlem ent or the term s of the A greem ent by appeal or other m eans; Any Settlement Class Member who submits a timely writen objection m ay appear, in person or by counsel, at the Final A pproval H earing held by the Court, to show cause why the proposed Settlement Agreem ent should not be approved as fair, adequate, and reasonable, provided that the objecting Setlement Class M ember: (a) files with the Clerk of the Court a notice of intention to appear at the Final Approval Hearing (itnotice of lntention to Appear'), which must include the case name and number and the Setlement Class M ember's name, address, telephone number, and signature, by the Objection Deadline; and (b) serves the

11 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 11 of 13 Notice of Intention to Appear on a1 counsel designated in the Class Notice by the Objection Deadline. The Notice of Intention to Appear m ust include copies of any papers, exhibits, or other evidence that the objecting Setlement Class Member wil present to the Court in connection with the Final Approval Hearing. Any atorney who intends to represent an objecting Settlement Class M ember at the Final ApprovalHearing must do so at the Setlem ent Class Member's expense and must file a notice of appearance at least two weeks before the Final Approval Hearing. Any Setlement Class Member who does not file a Notice of Intention to A ppear in accordance w ith the deadlines and other specifications set forth in the A greem ent and Class Notice will not be entitled to appear at the Final Approval Hearing to raise any objections. R eleases. lf the Settlem ent is finaly approved, al1 Setlem ent Class M em bers who have not tiled a tim ely and proper Request for Exclusion sha l release the R eleased Persons from a 1 Released Claim s, as described in Section 10 of the Settlem ent A greem ent, including, inter alia, al claim s, charges, or dem ands that relate, concern, arise from, or pertain in any w ay to the Released Persons' conduct, policies, or practices concerning PennyM ac's placem ent, or the QBE Defendants' issuance, of LPI Policies during the Setlement Class Period, including but not lim ited to conduct, policies or practices concerning LPI Policies or to charges for PennyM ac's Placem ent of LP1 Policies during the Setlem ent Class Period. 14. A ttorneys' Fees and Expenses, and C ase C ontribution A w ards. Plaintiff and Class Counsel agree not to seek an aw ard of Attonw ys' Fees and Expenses in the Action in an amount exceeding $670,725. Defendants agree not to oppose the application for a Case Contribution Award of $5,000 for the Named Plaintiff Gary Cooper for his work and assistance in this Action. Plaintiff and Class Counsel agree not to seek a Case Contribution Aw ard in excess of $5,000 for the N am ed Plaintiff.

12 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 12 of Prelim inary Injunction. A11 Settlement Class M embers who do not tim ely exclude themselves from the Settlement Class are hereby preliminarily enjoined from directly or indirectly (i) filing, commencing, prosecuting, intervening in, or participating in (as class members or otherwise), any lawsuit in any jurisdiction for the Released Claims; or (i) organizing any Settlem ent Class M em bers into a separate class for purposes of pursuing as a purported class action any lawsuit (including by seeking to amend a pending complaint to include class allegations, or seeking class certification in a pending action) based on or relating to the claim s and causes of action, or the facts and circum stances relating thereto, in this A ction and/or the Released Claim s. Service of Papers. Defendants'Counsel and Class Counsel shalt serve on each other and on al1 other parties who have filed notices of appearance, at or before the Final Approval Hearing, any further documents in support of the proposed Settlem ent, including responses to any papers filed by Setlem ent Class M em bers. Defendants' Counsel and Class Counsel shall promptly furnish to each other any and all objections or writen requests for exclusion that may come into their possession and shall file such objections or requests for exclusion w ith the Court on or before the date of the Final A pproval Hearing. 17. Term ination of Settlem ent. This O rder shall becom e nu l and void, and shal be without prejudice to the rights of the Parties, a11 of whom shal be restored to their respective positions existing immediately before this Court entered this Order, if (i) the proposed Setlem ent is not finally approved by the Coul't, or does not becom e Final, pursuant to the terms of the Setlement Agreement; or (i) the Setlement Agreement is terminated pursuant to the term s of the Settlem ent A greem ent for any reason. ln such event, and except as provided therein, the proposed Setlem ent and Settlem ent Agreem ent shall becom e null

13 Case 1:16-cv JEM Document 46 Entered on FLSD Docket 10/18/2016 Page 13 of 13 and void and be of no further force and effect; the prelim inary certification of the Setlement Class for se tlem ent purposes shall be autom atica ly vacated; neither the Setlem ent Agreement nor the Court's Orders, including this Order, shal be used or refered to for any purpose whatsoever; and the Parties shall retain, without prejudice,any and al objections, argum ents, and defenses w ith respect to class certification Use of Order Folowing Termination of Settlement. This Order shal be of no force and effect if the Settlement does not become final and shall not be construed or used as an adm ission, concession, or declaration by or against any Defendant of any fault, wrongdoing, breach, or liability, or by or against Plaintiff or the Setlement Class M embers that their claim s lack m erit or that the relief requested in the Class Com plaint in this Action is inappropriate, improper, or unavailable, or as a waiver by any party of any defenses they may have. 19. N ecessary Steps. The Court authorizes the Parties to take a l necessary and appropriate steps to im plem ent the Settlem ent A greem ent. DONE AND ORDERED in Chambers at Miami, Florida, this l '-2 day of October, Copies provided to: M agistrate Judge G oodm an A ll Counsel of Record / /,$ JOSE. ARTINEZ UNIT STATES DIST CT JUDGE