SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
--------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
-------------------
Date of report (Date of earliest event reported) May 19, 1999
------------------------------
THE FIRST AMERICAN FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of the Registrant as Specified in Charter)
California 0-3658 95-1068610
- --------------------------------------------------------------------------------
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
114 East Fifth Street, Santa Ana, California 92701-4642
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrants telephone number, including area code (714) 558-3211
------------------------------
Not Applicable
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
On May 19, 1999, The People of the State of California, Kathleen Connell,
Controller of the State of California, and Chuck Quackenbush, Insurance
Commissioner of the State of California, filed a class action suit in the
Sacramento Superior Court.
The suit seeks to certify as a class of defendants all "title insurers", all
"underwritten title companies" and all "controlled escrow companies" (as those
terms are defined in the California Insurance Code) and all "independent escrow
companies" (as that term is defined in the California Financial Code) doing
business in the State of California from 1970 to the present who (i) hold or
held dormant, unclaimed escrow funds; (ii) charged California home buyers and
other escrow customers $10.00 or more for delivery services or administrative
fees; (iii) charged California home buyers and other escrow customers
reconveyance fees and/or (iv) earned interest (or its equivalent) from financial
institutions on customers' deposited escrow funds. Although the following
defendants have been named in the suit, they have not yet been served: Fidelity
National Title Insurance Company, Spring Mountain Escrow Corporation and West
Coast Escrow Company. Spring Mountain Escrow was acquired by First American from
Norwest Mortgage, Inc. on January 1, 1999.
The plaintiffs allege that the defendants unlawfully (i) failed to escheat
unclaimed property to the Controller of the State of California on a timely
basis; (ii) charged California home buyers and other escrow customers fees for
services which were never performed, or which cost less than the amount charged;
and (iii) devised and carried out schemes with financial institutions to receive
interest, or monies in lieu of interest, on escrow funds deposited by defendants
with financial institutions in demand deposits.
Based upon public comments made by the Controller of the State of California,
the plaintiffs intend to pursue this action against the title insurance and
escrow industries operating in the State of California. First American, which
has its headquarters located in Santa Ana, California, has title insurance and
escrow operations throughout California.
At this time, First American plans to closely monitor this action.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE FIRST AMERICAN FINANCIAL
CORPORATION
Date: May 27, 1999 By: /s/Thomas A. Klemens
-----------------------
Name: Thomas A. Klemens
Title: Executive Vice President
and Chief Financial Officer