Lower says team issued high-risk loans before AmCap poaching

Lower is accusing a former branch manager and his team of filing over a dozen lucrative, bad loans before departing to a rival and taking confidential information with them.

The lender is suing four of its former workers and their new employer, AmCap Mortgage, asking a court to halt their use of Lower's trade secrets including customer data. The high-risk mortgages the team originated at Lower before their exit cost Lower $4 million, it claims. 

"These conspirators left Lower holding the bag, which is quite heavy and has caused Lower to incur millions of dollars in damages," wrote attorneys for Lower. 

The lawsuit, filed last July in the U.S. District Court for the Eastern District of Texas, names former Plano branch manager Jason Ozment and three members of his Oz Lending team as defendants. It's the most recent poaching lawsuit between lenders, this time over activity which allegedly continued well after the origination boom of 2020 and 2021.

Representatives for both AmCap and Lower declined to comment this week, while Ozment and attorneys for Lower didn't respond to requests for comment. Summons were issued earlier this month, and a lawyer was not yet listed for AmCap.

Lower hired Ozment as a branch manager and vice president in April 2021 in the Dallas area, and renovated a Plano office for his team to work out of, the complaint said. At the time of his onboarding, he also signed agreements dictating non-disclosure of confidential information and non-solicitation of employees for a 16-month period following an exit.

In mid-to-late 2022, Lower claims Ozment secretly entered into agreements with AmCap to leave Lower and for the competitor to offer jobs to the Plano employees if they also quit. He departed in early November, although it's unclear if he was terminated or resigned. Ozment's former employer claims he damaged office space, trespassed following his exit and took physical property, without elaborating in the complaint.

The lender further alleges the Oz Lending team including an underwriter and loan processor issued high-risk loans to at least 13 customers who didn't meet eligibility criteria. Lower claims the employees originated the loans to earn more money than they would have otherwise. The complaint doesn't contain details of the loans, but counsel for Lower suggested they could provide the information with the court privately. 

Oz Lending, which still operates today in a Dallas office just south of Plano, is also allegedly displaying customer reviews on its website procured during the team's time under Lower. 

The aggrieved lender said it will pursue its employment-related claims through arbitration, while asking a court to order permanent injunctive relief from Oz Lending using Lower's customer information, property and client testimonials. 

Lower, based in Columbia, Maryland, originated $3.37 billion in mortgage volume last year, according to S&P Global data, and $465 million through April of this year. Its numbers in S&P data are slightly larger than Houston-based AmCap, which generated $1.88 billion in mortgage volume in 2023 and $350 million through April.