Judge combines lawsuits against Mr. Cooper over data breach

A district judge in Texas approved a request to consolidate all of the outstanding class action litigation pegged against Mr. Cooper, stemming from a cyber attack that exposed the personal identifiable information of its customers.

Twenty class action suits pending against the lender and servicer will be combined into a single case under plaintiff Jennifer Cabezas, who was the first to bring a motion against the company after it was hit by the data breach in October. 

The leak compromised the Social Security numbers of 14.7 million customers. 

In December, plaintiffs argued joining the suits is appropriate because it will "streamline the litigations and save both party and judicial resources.

"There is also "little to no risk of prejudice or confusion from consolidation as each of the plaintiffs consented to this motion, and their counsel are collectively and cooperatively working together and agree consolidation is in the best interest of plaintiffs," court documents said. None of the 20 suits have been officially certified as class actions.

Mr. Cooper declined to comment on pending litigation.

Cabezas' suit accuses Mr. Cooper of failing to implement the security safeguards necessary to protect customer information, as well as not being timely and transparent in communicating with customers.

The exposure of data "disturbs customers, as they no longer control their highly sensitive and confidential personal information, cannot stop others from viewing it, cannot prevent criminals from misusing it, and crucially cannot control where and to whom that personal information is sold and subsequently used," Cabezas' suit said.

The aggregate amount of damages stemming from the data breach exceeds $5 million, documents filed by the plaintiff show.

Mr. Cooper has moved to rectify the situation by offering to compensate current and former borrowers for the breach by footing the bill for two years of complimentary identity-protection services, including credit monitoring. 

Covering these costs will notably impact Mr. Cooper's bottom line, pushing vendor related expenses in the fourth quarter to $25 million, from $5 to $10 million, the servicer said in a filing with the Securities and Exchange Commission in mid- December.