Class-action suit continues against Citicorp unit.

While the plaintiffs in the NationsBank Corp. case (above) are seeking status as a class-action suit, a Chicago-area case involving a unit of Citicorp has already been granted class-action status. The class-action designation, subject to some limits, was made in late June by a federal judge. The

In Buycks-Roberson, Roberson, and Brooks v. Citibank Federal Savings Bank, three African-American applicants who were turned down for refinancing loans claim that the thrift discriminated against them on the basis of race. According to court papers, they claim that Citi discriminated by "subjective application of facially neutral underwriting criteria." Citing Home Mortgage Disclosure Act figures, they claim such discrimination was widespread and that their complaints represent part of a broad class grievance.

According to court papers, Citi disputed both the individual claims and the call for classification as a class-action. On the latter point, Citi lawyers argued that credit, being a matter of evaluation of individual credit factors, could not be turned into a class-action matter. The plaintiffs argued that the matter could indeed be a class-action because they believe Citi redlined predominantly black neighborhoods.

In a 35-page opinion, Judge Ruben Castillo of the Eastern Division of the U.S. District Court for the Northern District of Illinois granted class-action status in a June 29 order. The class he certified consists of: "All African-Americans who filed applications for home loans to Citibank [Federal Savings Bank] on or after July 6, 1992, and whose applications were rejected because they were African-American and/or the racial composition of the neighborhoods in which their properties were located was predominantly African-American."

The judge's opinion did note, in granting class-action status, that the merits of the case remained to be decided. The judge also held that members of the affected class would not be eligible for any relief unless the three plaintiffs pressing the suit offer sufficient evidence that they were financially qualified for home loans and that statistics bear out broad discrimination. Further, the judge noted that statistics alone will not prove the plaintiffs' case--they must successfully challenge the lender's claim that rejections were based on inadequate financial qualifications.

In a related opinion, the judge ordered Citi to turn over thousands of loan files and related materials. The plaintiffs' law firms have been poring over these files since.

Jeffrey Cummings, an associate at Davis, Miner, Barnhill and Galland P.C., which is one of two firms representing the plaintiffs, said it was possible a settlement could be developed at the Oct. 30 hearing. A call to Citi's counsel at the Chicago office of Mayer, Brown & Platt was not returned.