People ex rel. Madigan v. Wildermuth

This case presents question as to whether trial court properly denied defendants’ motion to dismiss claim under section 3-102(B) of Human Right Act (HRA), where defendants were accused of targeting distressed African-American and Latinos homeowners in home loan modification scheme under circumstances where defendants accepted large fees to obtain loan modifications of mortgages for said individuals with knowledge that said individuals were not eligible for such modifications. Defendants argued that their alleged actions were not covered under HRA because they were essentially rendering legal services and were not engaging in real estate transactions as contemplated under HRA, and trial court certified question as to whether State may assert violation of HRA pursuant to reverse redlining theory, where complaint did not allege that defendants acted as mortgage lenders. Appellate Court, in answering certified question in affirmative, found that: (1) reverse redline theory is viable even though no new credit was extended to homeowners; and (2) concept of reverse redlining theory is not strictly limited to situations involving mortgage lending and included instant loan modification services offered by defendants.