Longbridge, Mutual of Omaha attempt to reach settlement over deceptive marketing accusations

An ongoing lawsuit between two major reverse mortgage lenders, Mutual of Omaha Mortgage and Longbridge Financial, over marketing practices could come to an end if both parties can reach a settlement agreement prior to going to trial.

But such an outcome isn’t guaranteed, and Mutual of Omaha has requested additional time to provide a response to the allegations Longbridge laid out in its complaint, according to a court filing reviewed by HousingWire’s Reverse Mortgage Daily (RMD).

Shortly after the lawsuit was announced in late September, Mutual of Omaha requested — and was granted — additional time to respond to the complaint, with a deadline of Dec. 17. But with that date fast approaching, Mutual of Omaha has submitted an additional extension request, this time to Jan. 16, 2025. Longbridge did not object to the motion.

“Since the Court granted [Mutual of Omaha]’s prior motions for extensions of time […], [the company has] been working diligently to respond to the complaint,” the filing stated. “However, the complaint spans nearly forty pages and includes complex allegations against entities in a highly regulated industry, requiring additional time for [Mutual of Omaha’s] counsel to investigate and confer with their respective principals.”

Mutual of Omaha noted that there have yet to be any scheduling orders put in place and that the delay would not “cause any undue delay or prejudice” to any involved party.

Crucially, the filing also explained that both companies are in the opening phases of negotiations for an end to the legal dispute that could happen prior to a jury trial — the remedy Longbridge demanded in the original complaint.

“The parties are also actively pursuing early mediation efforts aimed at narrowing the issues or achieving a resolution without further litigation or escalation,” the filing reads. “Extending the deadline will allow the parties to focus their resources on these efforts.”

Mutual of Omaha contends that the extension request is “not sought for delay” but is instead to allow for a substantive review of the complaint, preparation for a response and to “facilitate early resolution efforts, thereby conserving judicial and party resources.”

Chief District Judge Dana M. Sabraw of the U.S. District Court for the Southern District of California, where the case was filed, approved the request.

RMD reached out to both companies for comment on this development. Mutual of Omaha declined to offer one, while Longbridge did not immediately respond to the request.

The original legal complaint from Longbridge alleges that websites it says are operated by Mutual of Omaha are both deceptive and in violation of the Real Estate Settlement Procedures Act (RESPA) as well as guidance from the Federal Trade Commission (FTC).

The suit also names California-based Review Counsel LLC and Delaware-based Advisory Institute LLC as defendants. Both entities are either owned or controlled by Mutual of Omaha, but their respective websites feature ratings of reverse mortgage lenders that inaccurately suggest independence to readers, Longbridge claims.

Longbridge alleges that these sites present Mutual of Omaha more favorably than its competitors without disclosing the ownership relationships between the named companies.

The complaint goes on to say that one of the websites at hand is for Retirement Funding Solutions (RFS), the brand that Mutual of Omaha’s reverse mortgage arm previously operated under. In 2019, this division transitioned primarily to the Mutual of Omaha name.