Dan Gilbert Pretends He Is The Little Engine That Could By Repeating “I think I can! I Think I can!” In FHA Lawsuit

Dan Gilbert And Quicken
Dan Gilbert leads Quicken Loans executives in a chorus of, “I think I can! I think I can!” 

Dan Gilbert and Quicken Loans filed a preemptive lawsuit against FHA in April of last year. The strategy of this was to thwart the DOJ from filing a False Claims Act lawsuit against Quicken Loans. The strategy was also intended to get the court to combine the two cases in Detroit. Gilbert hoped he would get a Quicken Loans friendly federal judge in Detroit. Dan Gilbert assumed his odds were better than an impartial federal judge in Washington, D.C.

The strategy was based on Gilbert’s ego and his reputation of bullying people he knows he bully. This is the opposite of what Dan Gilbert’s executives were telling Detroit media. Gilbert was spinning the story claiming he wanted it moved out of “fairness.”

The strategy blew up in Dan Gilbert’s face on New Year’s Eve. The federal judge hearing the case tossed the preemptive lawsuit. He also chastised Quicken Loans for filing the suit.

The U.S. DOJ’s The False Claims Act Lawsuit

The DOJ sued Quicken Loans under the False Claims Act alleging that the company’s executives bullied appraisers. They wanted the appraisers to give higher values for applicants and that underwriting managers encouraged underwriters to “fudge” the incomes of hundreds of applicants.

The DOJ complaint states Quicken Loans approved loans for FHA insurance based on what Quicken Loans VP Mike Lyons’ department called “bastard income,” which he explained was income that was “plausible to the investor even though we know its creation comes from something evil and horrible.”

The complaint also states that Gilbert’s executives pressured underwriters to move things quickly and improperly incentivized volume over quality and by paying underwriters prohibited commissions, including “speed bonuses.” and disciplined underwriters who were not reviewing loans fast enough by threatening them with termination.

Like the Little Engine That Could, who repeats, “I think I can! I think I can!”, Gilbert and his lawyers are going to attempt to convince a federal judge in Washington, D.C. to move the case to Detroit. Attorneys will also be filing motions in the case to renew the call to have to suit moved from Washington, D.C. to Detroit. Gilbert hopes of getting Quicken Loans friendly Detroit-based federal judge. 

Cleveland.com reports:

The company’s lead counsel, Jeff Morganroth, said it makes much more sense to have the case heard by a jury in Michigan because all of the witnesses are in Michigan, as are all of the records and company officials. The court has requested that Quicken Loans file papers to renew the motion; that’s expected later this week. The company expects a ruling on the motion in the next couple of months, Morganroth said in an interview.

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