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VOL. 125 | NO. 3 | Wednesday, January 06, 2010

Attorneys Unite Against Social Ills

By Andy Meek

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Two Memphis lawyers who have claimed the scalps of predatory lenders and slipshod property owners are combining their efforts in a new law practice.

Begun by Memphis Area Legal Services director of advocacy Webb Brewer and private attorney Steve Barlow, Brewer & Barlow PLC is built around the partners’ mutual interest in what they call “social justice” legal issues. The new practice will focus on everything from the rights of tenants to untangling borrowers from the trap of predatory lending.

“I’m thrilled and excited,” Barlow said. “There’s a lot of opportunity to use the law to enforce social justice principles. That’s at the heart of our partnership.

“I’m particularly appalled at any sort of inability of tenants who are suffering in terrible situations to force their landlords to provide basic amenities and have a basic level of services and habitability.”

Making a splash

Barlow hung out his own shingle in the fall after leaving his position as executive director of the University Neighborhood Development Corp. The UNDC is the community group that promotes revitalization of the area surrounding the University of Memphis campus.

Brewer is leaving MALS to team up with Barlow for reasons that were partly determined by outside circumstances. Now that Memphis and Shelby County governments have filed a lawsuit over unscrupulous mortgage-lending activity, Brewer is stepping away from the legal advocacy group to continue his involvement with that high-profile court action.

Both local governmental bodies last year decided to drag into court mortgage lenders whose practices may have worsened the local foreclosure problem. And for months, Brewer has been a sounding board for city and county officials as preparations for the suit moved forward.

The first project on tap for Brewer and Barlow’s fledgling law practice is serving as local counsel in the lawsuit against Wells Fargo.

At the heart of the suit are claims the bank singled out minority homeowners for expensive subprime loans while offering more customer-friendly mortgages to white homeowners. Washington, D.C.-based Relman & Dane PLLC also has been hired to represent the city and county in the suit, which was filed Dec. 30 in U.S. District Court.

Relman & Dane is representing the city of Baltimore in a suit against Wells Fargo that’s structured similarly to the local suit. Like the Baltimore action, this one also draws on testimony from former Wells Fargo loan officers who purport to have knowledge of the bank’s national lending practices.

Among other things, they say company officials referred to subprime loans marketed to black homeowners as “ghetto loans.”

A separate piece

The mortgage-lending lawsuit, perhaps the most significant predatory lending action filed in Shelby County in recent memory, offers a large-scale glimpse at the work Brewer and Barlow have busied themselves with for years.

Their usual targets are similar. Barlow most often takes aim at the out-of-town or neglectful owners of blighted homes and duplexes. And he was one of the first lawyers in the city to use a relatively obscure state statute to do that.

That statute is the Neighborhood Preservation Act, a Tennessee law that makes it possible to force a property owner to clean up a public nuisance. It also allows for the appointment of a third-party receiver to oversee that effort.

Brewer tends to concentrate on borrowers trapped in abusive loans.

For example, Brewer was involved in a settlement MALS put together over several months in 2007 covering a series of companion lawsuits MALS brought against a group of defendants. They included appraisers, brokers and closing agents.

The plaintiffs were homeowners trapped in mortgages they couldn’t afford. Brewer said the settlement on behalf of 17 plaintiffs in the various cases was cumulatively worth $3 million.

“This will be an ongoing thing, a small partnership that’s focused on lending and other kinds of social issues,” Brewer said of his work with Barlow. “There was a decision made sometime last year by the leadership of (MALS) that this (city-county) lawsuit was a little bit outside of what the board chairman perceived as MALS’ mission. At the same time, I had invested a lot into it and wanted to be involved, and the local governments wanted me to be involved. So there was an agreement that I would work on it apart from MALS.”

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 78 215 4,981
MORTGAGES 96 322 6,548
FORECLOSURE NOTICES 0 25 1,504
BUILDING PERMITS 0 318 11,577
BANKRUPTCIES 79 198 5,157
BUSINESS LICENSES 19 65 2,001
UTILITY CONNECTIONS 124 351 6,815
MARRIAGE LICENSES 0 44 1,385

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