UPDATE: Northrop Team, Lakeview Title Accused of Kickback Scheme in Lawsuit

Creig Northrop’s Howard County powerhouse of a real estate firm is accused of engaging in an illegal kickback scheme with Lakeview Title in a federal lawsuit filed in March.

The lawsuit alleges Northrop’s real estate company received over $500,000 in kickbacks beginning in 2000.

Monty Crawford, an attorney for Creig Northrop, said this suit was filed by the same attorneys who had a different case against Norhtrop dismissed in Howard County in March of 2013.

"The first thing they did was rush out and file another lawsuit," said Crawford.

The lawsuit alleges a “sham employment arrangement” was set up between Northrop’s wife, Carla Northrop, and Lakeview Title, according to the plaintiffs, Patrick and Christine Baehr, of Glenwood. Northrop’s wife received payments from Lakeview, although she was an employee of the Northrop Team, and did not have an office, telephone number or email address at Lakeview, according to the lawsuit.

Carla Northrop is listed as vice president of the Northrop Team on the company’s website.

Then, in 2007, the arrangement changed to a “sham marketing agreement”, in which the Northrop Team would designate Lakeview as their exclusive settlement and title company, according to the lawsuit. The plaintiffs alleged as part of the marketing agreement Lakeview agreed to pay Northrop and the Northrop Team $6,000 per month, but some months Lakeview paid them as much as $12,000. 

The lawsuit alleges that due to the fluctuations in payments, that it’s likely the agreement was based on referrals rather than marketing services.

The Baehrs believe they and others who used The Northtrop Team to buy their home and Lakeview Settlement to settle on it were deprived of fair competition between settlement service providers, according to the lawsuit. 

The suit is proposed as a class action, where anyone who purchased a home from Northrop and settled with Lakeview after 2000 could sign on as a plaintiff.

Kickbacks between settlement companies and real estate firms are illegal under the federal Real Estate Settlement Procedures Act, first passed in 1974.

Crawford said the main difference between this suit and the previous one dismissed in March is that this one relies on RESPA, where the ohter one did not.

Much of the Howard County suit was dismissed in March because the plaintiffs failed to obtain the qualifications of a class action suit before the statute of limitations expired, according to Maryland court records.

The Northrop Team is a division of Long and Foster Real Estate. The company’s website lists it as the No. 1 seller of homes at Long and Foster.

The Northrop Team has offices in Clarksville, Columbia, Baltimore County, Rockville and Timonium.

Lin Eagan, the president of Lakeview Title, did not respond to a request for comment on Monday.