CrossCountry seeks dismissal in kickback suit

CrossCountry Mortgage has asked a federal judge to dismiss a lawsuit alleging the lender engaged in an illegal kickback arrangement with a Raleigh real estate firm.

Homebuyer Jeremiah VonBlohn, who filed suit at the end of July, claims his agent at Raleigh Realty directed him to CrossCountry in 2022 under a co-marketing agreement that gave the lender prominent placement on the firm’s website.

Several other borrowers also filed suits in June and July, accusing the national lender of paying Raleigh Realty $15,000 per month in 2021 and 2022 in exchange for exclusive client referrals.

All of the plaintiffs, including VonBlohn, are seeking unspecified damages under RESPA and North Carolina’s Unfair and Deceptive Trade Practices Act, arguing they could have obtained lower mortgage rates and fees if not for the alleged steering.

In a motion filed on Sept. 29, CrossCountry said that VonBlohn’s claims should be thrown out because the case was filed more than a year after VonBlohn closed on his mortgage, which exceeds RESPA’s statute of limitations.

CrossCountry also argued that VonBlohn’s complaint does not show that he was overcharged or otherwise injured, a requirement for standing under both federal and state law.

The company also maintained that its co-marketing deal with Raleigh Realty was lawful, saying it paid $15,000 a month for actual website marketing services, which falls under RESPA’s safe harbor for “services actually performed.”

The case is pending in the U.S. District Court for the Eastern District of North Carolina. At the time of publication, Raleigh Realty did not return HousingWire’s request for comment. A CrossCountry spokesperson said that the company does not comment on pending legal matters. 

Raleigh Realty did not file a dismissal motion on Sept. 29, but instead asked the court for a time extension, moving its deadline to respond to the complaint from Sept. 29 to Oct. 16, 2025.

Where do the other suits stand?

CrossCountry has not filed a motion to dismiss on the other suits, but they remain active. Each separate suit’s plaintiffs, along with the defendants, filed joint motions seeking to extend deadlines at the end of September.

Under the proposed schedule for the suit between CrossCountry and plaintiffs John and Carolyn Kessler, and a separate suit between CrossCountry and plaintiffs Cassandra Anderson and Patrick Anderson, defendants would have until Oct. 9 to file motions to dismiss, the plaintiffs would have until Nov. 6 to respond, and defendants would have until Dec. 4 to reply. This is according to the suit’s documents available on PACER.

Other joint motions seeking to extend deadlines give a different set of deadlines for CrossCountry and Raleigh Realty. Motions filed by plaintiffs Claudia Salazar, Rodney Little and Deborah Little and Angela Sims give the defendants a deadline to file motions to dismiss the amended complaint by Oct. 16. The plaintiffs’ responses are due by Nov. 13 and the defendants’ reply briefs are due by Dec. 11.