CoreLogic Named as Defendant in Antitrust Lawsuit

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MORTGAGE EXPERT
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The same day that CoreLogic Inc. launched a new credit product, it was sued over alleged antitrust practices. Attorneys in the lawsuit hope to make the case a class action.

On Tuesday, FICO Mortgage Score, a new “high-performance consumer credit risk score,” was jointly announced by the Santa Ana, Calif.-based service provider and FICO. The new score maintains the same scoring range and reason codes as existing FICO scores.

Using traditional credit data from the national credit repositories along with CoreLogic’s CoreScore credit report, a more comprehensive view of credit risk is provided. The enhanced score factors in property transaction data, landlord and tenant data, borrower-specific public data and other alternative credit data.

“The new scoring model was designed specifically to predict mortgage loan performance and has shown a substantial improvement in risk prediction over other generally available risk scores in use today,” the announcement said.

The new offering, which is powered by CoreLogic, promises to increase mortgage originations and improve the quality of decisions being made by lenders. CoreLogic executive Tim Grace speculated that a lender processing 300,000 applications a year could see 3,900 more loans approved annually.

Also on Tuesday, CoreLogic was named as a defendant along with Experian in a lawsuit filed in a Florida federal court by Credit Bureau Services Inc., according to an announcement from the plaintiff’s counsel, Rubin PLLC.

The complaint alleges that the defendants violated antitrust laws because they conspired in 2008 to deny smaller credit agencies access to Experian’s mortgage credit information for tri-merged mortgage credit reports.

Experian, which was CoreLogic’s partner in Credco, agreed to eliminate 87 percent of CoreLogic’s rivals in exchange for CoreLogic’s help in maintaining Experian’s monopoly in mortgage credit information, the complaint alleges.

“The suit claims that the number of qualified suppliers of mortgage credit reporting agencies has declined nationwide from over 1,500 at the beginning of the century to fewer than 100 today,” the statement said.

Damages and injunctive relief are sought in the lawsuit, which seeks class-action certification on behalf of all impacted resellers of the reports.

Last week CoreLogic announced that the U.S. Federal Circuit Court of Appeals affirmed a lower court decision holding that the patent asserted against subsidiary MarketLinx was invalid as obvious. That lawsuit was filed in 2009 against by CollegeNET Inc. in U.S. District Court for the Western District of Texas.

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