CLASS ACTION COMPLAINT AND JURY DEMAND

Transcription

1 District Court, Denver County, State of Colorado Court Address: 1437 Bannock Street, Room 256 Denver, CO Phone: Plaintiffs: RODRICK KEMP, as personal representative of the estate of Oliver B. Kemp, and on behalf of all others similarly situated v. Defendants: ARONOWITZ & MECKLENBURG, LLP, a Colorado Limited Liability Partnership XCELERON, LLC, a Colorado Limited Liability Company ROBERT ARONOWITZ, an individual STACEY ARONOWITZ, an individual JOEL MECKLENBURG, an individual Plaintiffs Attorneys: ALLEN & VELLONE, P.C. Kevin D. Allen, (# 8878) Patrick D. Vellone, (#15284) Shelley Thompson, (#39999) Tatiana G. Popacondria, (#42261) 1600 Stout Street, Suite 1100 Denver, Co Telephone: (303) Fax: (303) kallen@allen-vellone.com pvellone@allen-vellone.com sthompson@allen-vellone.com tpopacondria@allen-vellone.com COURT USE ONLY Case No: Courtroom: CLASS ACTION COMPLAINT AND JURY DEMAND COMES NOW Rodrick Kemp, as a personal representative of the estate of Oliver B. Kemp, and on behalf of all others similarly situated, (the Named Plaintiff ) by and through their counsel, ALLEN & VELLONE, P.C., and for their Complaint against Aronowitz & 1

2 Mecklenburg, LLP, Xceleron, LLC, Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg (collectively Defendants ) allege as follows: I. JURISDICTION AND VENUE 1. Pursuant to C.R.C.P. 98(c), venue is proper in this Court because Defendants Aronowitz & Mecklenburg, LLP and Xceleron, LLC are residents of Denver County, Colorado. 2. Pursuant to the Colorado Constitution, Article VI 9, this Court is vested with the subject matter jurisdiction over the claims asserted in this action. II. PARTIES 3. Plaintiff Rodrick Kemp ( Plaintiff Kemp ) brings this action in his capacity as the duly appointed personal representative of the Estate of Oliver B. Kemp, probate case number 11PR0525 in the Denver Probate Court, State of Colorado, and on behalf of all others similarly situated. Plaintiff Kemp resides in Brighton, Colorado, Defendant Aronowitz & Mecklenburg, LLP ( A&M ) is a Colorado limited liability partnership conducting business in the state of Colorado, with the principal business address of 1199 Bannock Street, Denver, CO Defendant Xceleron, LLC ( Xceleron ) is a Colorado limited liability company, conducting business in the state of Colorado, with the principal business address of 2017 Lawrence St., Denver, CO Defendants Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg are individuals residing in the state of Colorado and doing business in the Denver County and, upon information and belief, are the sole partners of A&M and members/managers of Xceleron. III. FACTUAL ALLEGATIONS A. Defendants Foreclosure Billing Practices 7. The Named Plaintiff discovered the unlawful facts and allegations underlying the claims asserted in this Complaint in July of 2013, after the findings of the investigation conducted by the office of the Attorney General of the State of Colorado were made public. 8. A&M is the second largest foreclosure firm in the state of Colorado and is, upon information and belief, a registered debt collector in the state of Colorado. 9. Mortgage servicers retain A&M and similar law firms to process foreclosures in Colorado. Upon information and belief, A&M and similar law firms are to receive, as payment for their services, reasonable attorneys fees which are usually simple flat-rate fees (currently 2

3 $1,225 per file). The attorneys fees include all services required to be performed under the state law to process and prosecute the foreclosure. 10. Mortgage servicers are to pay A&M for its actual, reasonable, and necessary costs. A&M represents the truth and accuracy of its costs when it presents such costs for payment to the mortgage servicers. The costs for which A&M is paid include services such as posting notices, mailing notices of hearing, court filing costs, and title searches. 11. Generally, mortgage servicers are reimbursed by the third-parties, e.g., homeowners who cure and modify the loan, persons who purchase the property at auction, and the loan investors, for all amounts paid to A&M. 12. If the foreclosure sale is initiated, A&M represents the truth and accuracy of the foreclosure fees and costs in the bid statements filed with the public trustees and relied upon and considered by the purchasers in, inter alia, formulating a bid amount. 13. If the homeowner seeks to cure a default and reinstate the loan, A&M represents the truth and accuracy of the fees and costs on the cure statements filed with the office of the public trustee and sent to the homeowners. 14. In order to cure any default, reinstate the loan through the public trustee, and keep their homes, the homeowners are required to pay all fees and costs enumerated in the cure statement filed with the public trustee and then sent by the public trustee to the homeowners. 15. A&M thus represents its fees and costs to the general public, homeowners, public trustees, and potential purchasers, as actual, reasonable, and necessary costs and fees. As explained, supra, these costs and fees are ultimately borne by the public, not the mortgage servicer who employed A&M. 16. Beginning at least in 2009 and continuing at least until 2013, the exact date being unknown to the Named Plaintiff, Defendants agreed amongst each other to, inter alia: (a) take control of the market, (b) fix, raise, maintain and/or stabilize at an artificially high level the price for posting of the foreclosure notices; and (c) make a profit from the costs associated with posting of the foreclosure notices. 17. To fulfill this goal, the parties, inter alia, (a) agreed upon a price to be charged, (b) concealed and/or misrepresented the fact that the price of the service was highly inflated and was not actual, necessary, and reasonable; (c) represented the inflated price on the statements sent to the public trustee, the homeowners, and mortgage servicers; (d) received payments from the unsuspecting parties and retained profits yielded by their scheme. 18. To further fulfill this goal, in July of 2009, Robert Aronowitz, a partner of A&M, formed Xceleron, a company owned and controlled solely by the three partners of A&M, Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg. 3

4 19. Xceleron is a posting company, a straw entity created by the principals of A&M to mislead and defraud consumers with respect to the actual, reasonable, and necessary costs of posting notices and to direct significant profits to Defendants Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg. 20. Xceleron has an exclusive relationship with A&M, i.e., A&M is Xceleron s sole client and Xceleron is A&M s only vendor posting the notices. 21. By way of a background, in Colorado, two notices have to be posted regarding foreclosure on the property a notice of a limited opportunity to defer foreclosure for 90 days (H.B ) and a notice of the Rule 120 hearing (H.B notice). The posting of such notices only requires a single visit to the property to tape the notice to the door. 22. The process serving companies in Colorado, unrelated to the foreclosure law firms, charge approximately $25 for this service to account for reasonable expenses of operating a business, while A&M has been charging $125 or $150 for the same service. 23. The scheme to mislead and defraud consumers described, infra, evolved as follows. For some period of time beginning in August of 2009, Xceleron, a company owned and controlled by the partners of A&M, charged A&M $50 or $75 per posting. This amount is significantly higher than Xceleron s actual costs of $7 plus mileage per posting and twice or three times more than the costs charged by other companies for such services. A&M then further inflated the posting costs to $150 or $125 on the bids, cures, and invoices. Upon information and belief, the Defendants agreed to set the amount Xceleron would be charging to A&M and the amount A&M would be charging to the public. 24. At a later time, apparently realizing that their scheme was too transparent, Defendants agreed that Xceleron would be charging A&M the same amount as A&M had been representing on the cure statements, bids, and invoices. Thus, Xceleron began charging A&M $150 or $125 for the posting and A&M represented the same amounts on the bids, cures, and invoices. 25. Although other companies charge approximately $25 for posting of the notices and Xceleron incurs a cost of $7 per notice plus mileage, A&M charged $125 or $150 for such service performed in connection with foreclosures on the property of the Named Plaintiff and members of the Class. This scheme yielded significant profits to the Defendants Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg, the sole owners and persons in control of both Xceleron and A&M, who caused Xceleron and A&M to represent and charge the agreed upon inflated amounts. 26. Defendants Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg also agreed and conspired to make additional money from other foreclosure costs, including but not limited attorney s fees charged in the contested foreclosure matters and title costs. 4

5 27. To fulfill this goal, the parties, inter alia, (a) determined a price to be charged, (b) concealed and/or misrepresented the fact that the price of the service was inflated and was not actual, necessary, and reasonable; (c) represented the inflated price on the statements sent to the public trustee, the homeowners, and mortgage servicers; and (d) received payments from the unsuspecting parties and retained monies yielded by their scheme. 28. With respect to the attorneys fees, the practice was to inflate the hours billed on the contested Rule 120 matters. Namely, A&M s clients faced with a contested Rule 120 matter authorized A&M to bill them for up to 8-12 hours of hourly fees; A&M would bill for the full amount, regardless of the actual amount of time spent. With respect to the title costs, the company affiliated with A&M, presently unknown, improperly charged inflated prices for title work during the foreclosure process. 29. All of the inflated and overstated costs were ultimately borne by persons such as the Named Plaintiff and the members of the Class. 30. Upon information and belief, nearly 150,000 foreclosures were filed in Colorado between 2009 and 2012 alone. A&M filed the second most foreclosures in the state. Given the amount of foreclosures handled by A&M since 2009, most of which required two postings, the disparity between the actual costs and A&M s represented and charged costs amounted to several millions of dollars. 31. Defendants actions described in this Complaint caused damages to the Named Plaintiff and the Class. B. Plaintiff Kemp 32. On or about April 4, 2005, Oliver B. Kemp (the Deceased ) executed an adjustable rate note in the original principal amount of $294, (the Kemp Note ) for the benefit of Union Federal Bank of Indianapolis. 33. The Deceased took out the loan to finance the purchase of the real property with the address of 4997 Nepal Street, Denver, CO (the Kemp Property ). 34. The Note was secured by the provisions of the deed of trust executed by the Deceased on April 4, 2005 (the Kemp Deed of Trust ) covering the Kemp Property. 35. Bank of New York Mellon ( BNYM ) is the purported current qualified holder of the Kemp Note and the alleged beneficiary of the Kemp Deed of Trust. 36. The Deceased made each payment due on the loan, until his sudden death on April 3, 2011 at the age of 50 from cardiac arrhythmia. 5

6 37. On or about June 7, 2011, by the Order of the probate court, Plaintiff Kemp was duly appointed and currently is the personal representative of the estate of the Deceased (the Order of Appointment ). 38. The Letters of Testamentary were issued by the probate court on June 13, 2011 stating that Plaintiff has authority to act pursuant to C.R.S , et. seq. without any restrictions. 39. On or about August 31, 2011, A&M initiated the foreclosure action pursuant to Colo.R.Civ.P. 120 on behalf of the BNYM against the Kemp Property. 40. On September 27, 2011, Plaintiff Kemp filed a response in the foreclosure action requesting a chance to cure any default under the Kemp Note and the Kemp Deed of Trust and reinstate the loan. 41. On October 24, 2011, Plaintiff Kemp filed a Notice of Intent to Cure in the foreclosure action. 42. The October 31, 2011 and the December 30, 2011 cure statement received by Plaintiff Kemp from the public trustee s office contained foreclosure fees costs itemized and represented by A&M that had to be paid in order to cure and reinstate the loan and thus save the home from foreclosure. Among these items were attorneys fees in amount of $2,162.50, HB 1240 posting costs in the amount of $125, and title costs in the amount of $ On or about January 16, 2012, Plaintiff Kemp cured all of the defaults then outstanding and reinstated the loan by paying the full amount represented by A&M on the cure statement. 44. Upon information and belief, A&M inflated and overstated the foreclosure costs and fees on the cure statement that were paid by Plaintiff Kemp, including, but not limited to, posting costs, attorneys fees and title costs. 45. Payment of such inflated and overstated foreclosure costs caused damages to Plaintiff Kemp. IV. CLASS ACTION ALLEGATIONS 46. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 47. Pursuant to Colorado Rule of Civil Procedure 23, the Named Plaintiff brings this action and seeks certification of the claims and issues in this action on behalf of a Class defined as follows: 6

7 All persons in the state of Colorado who paid inflated and overstated real property foreclosure costs and fees represented by A&M to cure defaults and reinstate their loans, during the period extending from August 2009 through and to the filing date of this Complaint. 48. The Named Plaintiff reserves the right to amend the Class definition if further investigation and discovery indicates that the foregoing definition should be narrowed, expanded, or otherwise modified. 49. Excluded from the Class are governmental entities, and Defendants partners, employees, affiliates, legal representatives, successors, subsidiaries, and assigns. Also excluded from the Class is any judge, justice, or judicial officer presiding over this matter and the members of their immediate family and judicial staff. 50. Defendants practices and omissions were applied uniformly to all members of the Class, including any subclass arising out of the claims alleged herein, so that the questions of law and fact are common to all members of the Class and any subclass. 51. All members of the Class and any subclass were and are similarly affected by the Defendants conduct described herein, and the relief sought herein is for the benefit of the Named Plaintiff and members of the Class and any subclass. 52. Based on the number of foreclosures filed by Defendant A&M between 2009 and present, it is apparent that the number of the aggrieved parties in both the Class and any subclass is so large as to make joinder impractical, if not impossible. 53. Questions of law and fact common to the Named Plaintiff, the Class and any subclass exist that predominate over questions affecting only individual members, including, inter alia: a. Whether Defendants practices and representations related to the foreclosure billing were unfair, deceptive and/or unlawful in any respect, thereby violating Colorado s Consumer Protection Act, Colo. Rev. State , et. seq. b. Whether Defendants practices and representations related to foreclosure billing violated Colorado s Fair Debt Collection Practices Act. c. Whether Defendants actions described herein violated Colorado s Antitrust Act. d. Whether Defendants conduct as set forth herein injured persons residing in the state of Colorado and if so, the extent of the injury. 7

8 e. Whether money was lost due to Defendants misrepresentations, omissions, and concealment of material facts. f. Whether Defendants are liable for negligent misrepresentation. g. Whether Defendants supplied false information to others. h. Whether defendants fraudulently concealed and/or misrepresented facts. i. Whether Defendants were unjustly enriched at the expense of the Named Plaintiff and members of the Class. j. Whether Defendants committed theft knowingly and/or with intent to permanently deprive the Named Plaintiff and members of the Class of their valuable property. k. Nature and amount of damages suffered by the Named Plaintiff and members of the Class. 54. The claims asserted by the Named Plaintiff in this action are typical of the claims of the members of the Class and any subclass, as the claims arise from the same course of conduct by Defendants, and the relief sought within the class and any subclass is common to the members of each. 55. The Named Plaintiff will fairly and adequately represent and protect the interests of the members of the Class and any subclass. 56. The Named Plaintiff retained counsel competent and experienced in commercial, consumer protection, and class action litigation. 57. Certification of this class action is appropriate under Colorado Rule of Civil Procedure 23 because the questions of law or fact common to the representative members of the Class and any subclass predominate over questions of law or fact affecting only individual members. This predominance makes class litigation superior to any other method available for a fair and efficient decree of the claims. 58. Absent a class action, it would be highly unlikely that the Named Plaintiff or any other members of the Class or any subclass would be able to protect their own interest because the costs of litigation through individual lawsuits would greatly exceed expected recovery. 59. Certification is also appropriate because Defendants acted, or refused to act, on grounds generally applicable to both the Class and any subclass, thereby making appropriate the relief sought on behalf of the Class and any subclass as respective wholes. Further, given the 8

9 large number of the aggrieved persons, allowing individual actions to proceed in lieu of a class action would run the risk of yielding inconsistent and conflicting adjudications. 60. A class action is a fair and appropriate method for the adjudication of the claims and issues alleged herein, in that it will permit a large number of claims to be resolved in a single forum simultaneously, efficiently, and without the unnecessary hardship that would result from the prosecution of numerous individual actions and the duplication of discovery, effort, expense, and burden on the courts that individual actions would engender. 61. The benefits of proceeding as a class action, including providing a method for obtaining redress for claims that would not be practical to pursue individually, outweigh any difficulties that might be argued with regard to the management of this class action. V. CLAIMS FOR RELIEF FIRST CLAIM FOR RELIEF VIOLATION OF COLORADO S CONSUMER PROTECTION ACT COLO. REV. STAT , et. seq. Against Defendants A&M and Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg 62. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 63. Colorado s Consumer Protection Act is intended to deter and punish deceptive trade practices committed by businesses in dealing with the public. 64. This cause of action is brought pursuant to Colo.Rev.Stat (1)(l). 65. Defendants A&M, Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg engaged in an unfair or deceptive trade practice by, inter alia, making false or misleading statements or omissions of material facts concerning the actual, reasonable, and necessary foreclosure costs and fees on the cure statements, bids, and invoices to the mortgage servicers as described in this Complaint. 66. Defendants unfair or deceptive trade practices occurred in the course of Defendants foreclosure business, vocation, or occupation. 67. Defendants unfair or deceptive trade practices significantly impact the public as actual or potential consumers of the Defendants services. 68. The Named Plaintiff and Class members suffered injury in fact to a legally protected interest as described in this Complaint as a result of Defendants actions. 9

10 69. Where, as here, there is sufficient, common evidence of Defendants false or misleading statements or omissions of material facts, injury and causation elements may be inferred on a class-wide basis. 70. The Named Plaintiff and Class members were damaged as a result of Defendants unfair or deceptive trade practice in the amount to be proven at trial. SECOND CLAIM FOR RELIEF VIOLATION OF COLORADO S FAIR DEBT COLLECTION PRACTICES ACT COLO. REV. STAT , et. seq. Against Defendant A&M 71. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 72. A&M is a debt collector within the definition under the Colorado Fair Debt Collection Practices Act (the FDCPA ). 73. A&M violated the FDCPA by making false, deceptive and/or misleading representations in connection with the collection of a debt regarding the actual, necessary, and reasonable foreclosure costs on the cure statements, bids, and invoices submitted to mortgage servicers as described in this Complaint. 74. A&M violated the FDCPA by attempting to collect and collecting inflated foreclosure costs and fees not expressly authorized by the agreement creating the debt or permitted by law. 75. The Named Plaintiff and Class members were damaged as a result of A&M s conduct violating the FDCPA as described in this Complaint in the amount to be proven at trial. THIRD CLAIM FOR RELIEF VIOLATION OF COLORADO ANTITRUST ACT COLO. REV. STAT , et. seq. Against all Defendants 76. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 77. The Colorado Antitrust Act (the CAA ) provides that every contract, combination in the form of a trust or otherwise, or conspiracy in restraint of trade or commerce is illegal. CAA. 78. The Colorado Supreme Court has recognized that price fixing is prohibited by the 10

11 79. Here Defendants, in the course of their business, occupation, and/or vocation had agreed and conspired among each other to unlawfully fix, raise, maintain and/or stabilize at an artificially high level the prices to be charged for the foreclosure notice posting costs. 80. Defendants engaged in one or more overt acts in furtherance of the unlawful conspiracy, including, but not limited to: (a) agreeing on the price of the service; (b) representing such price on the bids and cure statements sent to the public trustee and to the homeowners, and invoices sent to the mortgage servicers; (c) concealing and/or misrepresenting that the amounts stated were not reasonable, necessary and actual; (d) collecting payments of such amounts; (e) receiving and keeping the profits yielded by the unlawful practice described in this Complaint; (f) using a related entity, Xceleron, owned and controlled by the same people who own and control A&M, for posting foreclosure notices and assistance with the scheme to inflate costs of such posting. 81. This unlawful conspiracy constitutes a per se violation of the CAA. Alternatively, conduct described herein violated the rule of reason analysis as the anticompetitive conduct clearly outweighs any pro-competitive justification. 82. The aforesaid combination and conspiracy had the following effects, including, but not limited to: (a) the costs borne by the Named Plaintiff and members of the Class were fixed, raised maintained and/or stabilized at an artificially high, supra-competitive levels and (b) the Named Plaintiff and members of the class were deprived of the benefits of free and open competition in foreclosure servicing industry. 83. As a direct and proximate result of the aforesaid conspiracy alleged in this Complaint, the Named Plaintiff and members of the Class have been injured as described above and damaged in an amount to be determined at trial. FOURTH CLAIM FOR RELIEF NEGLIGENT MISREPRESENTATION Against Defendant A&M 84. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 85. A&M negligently misrepresented or omitted/concealed material existing facts on the cure statements and bids, which they knew, or should have known, were false, to the Named Plaintiff and members of the Class. 86. The Named Plaintiff and members of the Class were ignorant of Defendants misrepresentations and/or concealment. 87. The Named Plaintiff and members of the Class reasonably relied on, and had no reason or opportunity to question, the truth and accuracy of the cure statements and bids in that 11

12 these documents were supplied by the office of the public trustee, which office received the documents from attorneys and officers of the court subject to the rules of ethics. 88. At the time Defendants made the representations and/or omissions/concealment described herein, A&M had no reasonable grounds to believe they were true. 89. Where, as here, there is sufficient, common evidence of misrepresentations or omissions of material facts across the entire class, reliance and ignorance elements may be inferred on a class-wide basis. 90. As a result of Defendants actions, the Named Plaintiff and members of the Class were injured as described herein and damaged in the amount to be proven at trial. FIFTH CLAIM FOR RELIEF FRAUD Against Defendants A&M and Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg 91. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 92. As described herein, Defendants made false representations to the Named Plaintiff and members of the Class of the foreclosure costs and fees on the cure statements and bids. Defendants knew that their representations were false in that the foreclosure costs and fees represented were inflated and overstated. 93. The false representations made by Defendants were of material facts. If Defendants disclosed that the foreclosure costs were inflated, Plaintiff Kemp and members of the Class he represents would not have paid the whole amount. 94. The Named Plaintiff and members of the Class were ignorant of the falsity of Defendants representations since the falsity was actively concealed from them. The Named Plaintiff and members of the Class thus reasonably relied on, and had no reason or opportunity to question, the truth and accuracy of the cure statements and bids in that these documents were supplied by the office of the public trustee, which office received the documents from attorneys and officers of the court subject to the rules of ethics. 95. Defendants false representations were made with intent that they be acted upon. 96. Where, as here, there is sufficient, common evidence that Defendants fraudulently misrepresented material facts to the class members, reliance and ignorance elements may be inferred on a class-wide basis. 12

13 97. As a result of Defendants actions, the Named Plaintiff and members of the Class were injured as described herein and damaged in the amount to be proven at trial. SIXTH CLAIM FOR RELIEF FRAUDULENT CONCEALMENT Against Defendants A&M and Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg 98. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 99. Defendants A&M and Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg concealed material existing facts described in this Complaint from Named Plaintiff and members of the Class, including, but not limited to, the facts that (a) the costs and fees represented and charged were not reasonable, necessary and actual; (b) that the costs and fees represented and charged were inflated and overstated; (c) Defendants were receiving and keeping the profits yielded by the unlawful practice described in this Complaint; ( d) Defendants were using a related entity, Xceleron, owned and controlled by the same people who own and control A&M, Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg, for posting foreclosure notices and assistance with the scheme to inflate costs of such posting; and (e) Defendants conspired to fix the price of the posting costs These facts were material to the Named Plaintiff and members of the Class and were ought to have been disclosed in equity and good conscience The Named Plaintiff and members of the Class were ignorant of Defendants fraudulent concealment. The Named Plaintiff and members of the Class thus reasonably relied on, and had no reason or opportunity to question, the truth and accuracy of the cure statements and bids in that these documents were supplied by the office of the public trustee, which office received the documents from attorneys, officers of the law subject to the rules of ethics Defendants representations were made with intent that they be acted upon Where, as here, there is sufficient, common evidence that Defendants fraudulently concealed material facts from class members, reliance and ignorance elements may be inferred on a class-wide basis As a result of Defendants actions the Named Plaintiff and members of the Class were injured as described herein and damaged in the amount to be proven at trial. 13

14 SEVENTH CLAIM FOR RELIEF UNJUST ENRICHMENT AND DISGORGEMENT OF PROFITS Against all Defendants 105. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 106. Defendants benefitted from their unlawful acts through the overpayment for the foreclosure services. It would be inequitable and unconscionable for Defendants to be permitted to retain the benefits of these overpayments, which were conferred by the Named Plaintiff and Class members and retained by Defendants The Named Plaintiff and members of the Class are entitled to have returned to each of them the amount of such overpayments as damages or restitution. EIGHTH CLAIM FOR RELIEF CIVIL THEFT COLO.REV.STAT & Against all Defendants 108. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 109. This claim for relief is made pursuant to C.R.S As described in the Complaint, Defendants knowingly obtained and exercised control over valuable property of the Named Plaintiff and members of the Class by deception and concealing of or misrepresenting material facts known to Defendants but not known to the Named Plaintiff and members of the Class Defendants acted with the intent to permanently deprive the Named Plaintiff and members of the Class of their valuable property Defendants knowingly used or concealed valuable property belonging to members of the Class and the Named Plaintiff The Named Plaintiff and members of the Class have been damaged by Defendants theft in the amount to be determined at trial. 14

15 NINTH CLAIM FOR RELIEF CONSPIRACY Against all Defendants 114. The Named Plaintiff hereby incorporates the allegations set forth in the preceding 115. Defendants, in the course of their business, occupation, and/or vocation had agreed and conspired with each other to accomplish a goal through unlawful means. The goal included, without limitation, taking control of the market, fixing the price of the service, and making a profit from the costs and fees associated with the foreclosure process, including posting costs, attorneys fees, and title fees One or more unlawful acts were performed to accomplish the goal, including without limitation: (a) agreeing on and fixing the price of the service; (b) representing such price on the bids and cure statements sent to the public trustee and to the homeowners, as well as invoices sent to the mortgage servicers; (c) concealing and/or misrepresenting that the amounts stated were not reasonable, necessary and actual; (d) collecting payments of such amounts; (e) receiving and keeping the profits yielded by the unlawful practice described in this Complaint and concealing this fact; (f) using a related entity, Xceleron, owned and controlled by the same people who own and control A&M, namely Robert Aronowitz, Stacey Aronowitz, and Joel Mecklenburg, for posting foreclosure notices and assistance with the scheme to inflate costs of such posting and concealed the same from all interested parties As a direct and proximate result of the conspiracy alleged in this Complaint, the Named Plaintiff and members of the Class have been injured as described above in an amount to be determined at trial. V. JURY DEMAND Plaintiff hereby demands a trial by jury on all issues so triable. VI. PRAYER FOR RELIEF WHEREFORE, the Named Plaintiff, individually, and on behalf of others similarly situated, requests that the judgment be entered on his Complaint against Defendants and in favor of the Named Plaintiff and members of the Class on all claims for relief as follows: a. Awarding actual and compensatory damages in the amount to be determined at trial; b. Requiring Defendants to make full restitution of all monies wrongfully obtained as a result of the conduct described in the Complaint; 15

16 c. Awarding damages under Colo.Rev.Stat , (1), and (1) & (2); d. Awarding pre- and post-judgment and moratory interest, costs incurred and reasonable attorneys fees as authorized by law; and e. Granting such other and further relief as the Court may deem just and proper. DATED THIS 6th day of August, Respectfully submitted, /s/tatiana G. Popacondria Kevin D. Allen, #8878 Patrick D. Vellone, #15284 Shelley Thompson, # Tatiana G. Popacondria, # ALLEN & VELLONE, P.C Stout Street, Suite 1100 Denver, Co Telephone: (303) PLAINTIFF KEMP S ADDRESS: Village Circle Brighton, CO