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Failed Firm Faced Flurry of Litigation

A New York-based lender has shut down amid a flurry of litigation. More than 150 employees were impacted by the closing.

Homebridge Mortgage Bankers Corp. is out of business.

Calls to its offices were answered with the recorded message, “No one is available to take your call at the moment.” But one person, when reached, confirmed that the company had stopped doing business.

No response was received for requests for a statement from company officials — including Chairman and Chief Executive Officer Nicholas Bratsafolis, who had arrived at the company in 1996. No listing was found on the staff directory for company president David Pankin.

The Syosset, N.Y.-based company had reportedly had trouble meeting payroll since December.

Homebridge, which specialized in refinances and FHA-insured mortgages, also does or has done business as TAM Equity Corp., Hometrust Mortgage Bankers and Melrose Mortgage Bankers. The company, which was founded in 1989, officially changed its name to Refinance.com in November 2005 after purchasing the Refinance.com domain name for a reported $706,850. But it continued to use the Homebridge name.

Last November, the California Corporations Commissioner Preston DuFauchard revoked the license of Refinance.com, dba Homebridge, for failure to comply with the California Residential Mortgage Lending Act’s requirement that an assessment be paid to the commissioner. And Homebridge’s Tennessee license expired at the end of last year without being renewed.

In October 2006, Homebridge filed a lawsuit in U.S. District Court for the Southern District of New York against Vantage Capital Corp. and its two top officials who were former Homebridge employees. The suit alleged a breach of a settlement and purchase agreement regarding costs of their taking over Homebridge’s former Deerfield Beach, Fla., office. Homebridge sought a sum in excess of $260,000, pre-judgment interest at the rate of 10 percent per annum, attorney fees and “the costs of this action.”

On Dec. 5, 2008, a district court judge dismissed Homebridge’s motion for summary judgment and instead granted the defendants’ cross-motion for partial summary judgment, which excluded the payment Homebridge had sought for its legal fees and expenses. Less than a month later, Homebridge’s law firm filed a motion to withdraw as counsel because of “Homebridge’s failure to pay outstanding legal fees owed to K&L.”

On Jan. 9, a district court judge dismissed the motion “without prejudice to renewal.”

More than two years after Homebridge’s original complaint was filed, still to be tried, the judge stated, are issues involving Homebridge’s obligations to pay bonuses to its former Deerfield Beach employees and the amounts to be paid and whether Homebridge violated the agreement with Vantage by soliciting two Vantage employees to return to Homebridge.

Also unresolved are four class actions against Homebridge filed in 2007 by a total of 43 employees seeking to recover unpaid compensation for overtime plus interest, attorneys’ fees and costs for violations of the Fair Labor Standards Act. The cases, originally filed in the U.S. District Courts for the Southern District of Florida, the Southern District of New York and the Eastern District of New York, were combined, last June, into one suit in the Eastern District of New York, where Homebridge’s headquarters are located.

The law firm originally representing Homebridge in the class action, which is different than the one handling the Vantage suit, was fired last October by Homebridge and that firm’s motion to withdraw was granted on Jan. 6. The combined suit is now awaiting the outcome of a status conference with new legal counsel for Homebridge in place.

With 170 employees, Homebridge originated $1 billion in residential mortgages in 2007, according to an archived posting. In the October 2006 lawsuit, Homebridge claimed it had 150 employees in Syosset and 55 employees in a branch in Deerfield Beach, Fla. It was licensed in 35 states and also had offices in California and Michigan.

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