Court finds literal falsity where two supposedly distinct, rated reverse mortgage sellers are actually one

Longbridge Financial, LLC v. Mutual of Omaha Mortgage, Inc., No. 24-cv-1730-DMS-VET, 2025 WL 1382866 (S.D. Cal. May 13, 2025)

Mutual owns defendant Review Counsel and is the first and only advertising partner of defendant Advisory; those two have similar websites. Review Counsel’s disclosure banner at the top of its webpages, which previously stated that Review Counsel was “affiliated with” Mutual of Omaha, now states that it is “owned and operated by Mutual.” Likewise, Advisory updated its “Disclaimers” page with a “[l]ist of [a]dvertising [p]artners” that “have paid to advertise with [Defendant Advisory]”; a list that includes only Mutual of Omaha. Advisory also added a disclosure to its landing page and “changed some references on its site [previously] describing it as ‘independent,’ to ‘objective.’ ” Both websites now omit any reference to Retirement Funding Solutions (RFS), which was previously listed as Defendants’ number two recommended reverse mortgage provider, but which is also Mutual of Omaha in a different hat.

Longbridge argued that both websites still: (1) falsely represent those defendants as independent organizations using objective ratings despite their financial relationship with Mutual of Omaha; (2) use “arbitrary and statistically unsound criteria” that artificially boost Mutual of Omaha’s rating as a reverse mortgage provider while deflating other providers’ scores; and (3) use false and misleading Google ads and landing pages that promise consumers information about “Top 3” reverse mortgage providers while actually only promoting Mutual of Omaha.

Longbridge sought an injunction requiring removal of various webpages and reviews/review metrics, including a review of Longbridge that falsely listed it as not being licensed in Hawaii. After Longbridge moved for injunctive relief, Review Counsel stopped using the phrase “Top 3 Reverse Mortgages” in its sponsored Google ads and instead used “2025’s Best Reverse Mortgages” and “Top U.S. Reverse Mortgage Companies Reviewed & Ranked.” It also removed the false statement that Longbridge was not licensed in Hawaii.

The court found that the Hawaii statement was literally false. And ads promising information about “Top 3” reverse mortgage providers were literally false “because those ads redirected consumers to landing pages that highlighted Mutual of Omaha and RFS—which the parties agree are the same company—as two of the three ‘top’ providers.”

Likewise, “spotlighting and recommending of Mutual of Omaha and RFS as two separate reverse mortgage providers was literally false by necessary implication.” Listing them side by side, describing them as “some of our notable reverse mortgage loan partners” and “industry leaders,” describing both as having “[e]xcellent customer service” and “[g]reat borrower reviews from independent sites,” and listing a different phone number for each necessarily implied that the two were separate and independent entities.

In addition, Longbridge showed that other past statements, while not literally false, would likely mislead or confuse consumers. Review Counsel’s previous banner disclosure, stating that Review Counsel was “affiliated with” Mutual of Omaha and RFS, was “literally true but obfuscated Mutual of Omaha’s actual control and ownership of Review Counsel.” (The court didn’t identify extrinsic evidence of deception, though I don’t think it should have to.)

What about the current websites, highlighting Mutual of Omaha as their “Featured” or “Top” reverse mortgage company? Longbridge argued that their disclosures were insufficient and too far removed to reveal the true nature of Mutual of Omaha’s ownership and control of Review Counsel and Advisory, and that the sites’ ratings and criteria were “unsound, arbitrary, deceptive and misleading.”

But the court found the current disclosures sufficient, again without any consumer reception evidence.  At the top of every Review Counsel webpage is an evergreen banner stating that “Review Counsel is owned and operated by Mutual of Omaha Mortgage,” and a bolded “Disclosure” link at the top of the landing page that repeats the same disclosure.

Review Counsel page with disclosure at top

Advisory with much less impressive disclosure that "the companies" on the page compensate it

Advisory’s current disclosures include a paragraph on the landing page stating that “[t]he companies listed on this page compensate us as advertising partners.” And, at the very bottom of Advisory’s full-form disclaimer page, Advisory added a “[l]ist of [a]dvertising [p]artners” denoting Mutual of Omaha as the only company to “have paid to advertise with [Advisory].” Longbridge didn’t meet its burden to show misleadingness: “While a consumer would have to read Advisory’s long-form disclosure to understand the true nature of Mutual of Omaha’s advertising relationship with Advisory, the other two disclosures on the landing page—albeit less informative—should spur a reasonable consumer to further inquire about Advisory’s advertising partnerships. Advisory’s long-form disclosure page ultimately provides that information.” However, without that specific information, the previous disclosures were misleading, since they only referred to paid partnerships. “That Mutual of Omaha is Advisory’s only advertising partner is a vital piece of information consumers should know to avoid being misled or confused. The information is particularly salient because Mutual of Omaha is featured on Advisory’s landing page and Advisory makes vague references to ‘[c]ompanies’ who pay Advisory to be promoted or featured on its website without identifying those companies.

The court rejected Longbridge’s argument that defendants’ “.org” domain names were misleading and confusing because they are primarily used for “nonprofit websites such as non-governmental organizations (NGOs), open-source projects, charitable organizations, and educational platforms.” “To the extent Defendants’ ‘.org’ usage engenders a false sense of trust and objectivity, Defendants’ current disclosures likely counteract it.”

What about the ratings criteria and ratings? Longbridge argued that defendants’ criteria were neither relevant nor meaningful to reverse mortgage consumers and instead were pretextually selected to make Mutual of Omaha Defendants’ top rated reverse mortgage provider. But the court found that ratings with this much judgment involved were likely not factual claims. “[C]hallenges to the selection of purportedly objective criteria which are summarized by a five-star rating are not actionable under the Lanham Act.”

Likewise, the individual review pages for Longbridge were not actionable. Review Counsel’s own “3.7” rating for Longbridge showed alongside another four-star rating and a button to “Read Reviews.” Clicking that button brings a consumer to Review Counsel’s consumer review section for Longbridge, a consumer would see that Longbridge’s four-star rating is based entirely on a single consumer review stating “Yes. I understand.”

A reasonable consumer should notice that the 3.7 score [that is, nonactionable opinion] and the four-star score are distinct since they are side-by-side and numerically different. Additionally, if a reasonable consumer were to click on “Read Reviews” to read the four-star consumer review, they would likely conclude it was not relevant to evaluating Longbridge’s services since the consumer review is nonsensical—stating, “Yes, I understand.”

As for Longbridge’s complaints about Mutual of Omaha’s individual consumer ratings, there was no suggestion that Review Counsel authored or influenced them.

However, Advisory’s prior statements that its reviews and scores “are based upon Advisory’s own independent propriety scoring system” and that advertisement compensation does not influence Advisory’s reviews, scores, or ratings of providers, were falsifiable. A claim of independence “is a statement of fact that can be proven true or false.” Given that Advisory was founded and owned by Mutual of Omaha’s former General Counsel, the Advisory website was designed using a “templated design footprint” provided by Review Counsel, and Advisory’s sole advertising partner is Mutual of Omaha, that was dubious, but the record didn’t support a preliminary injunction.

Materiality: disclosure of the Mutual of Omaha connection was material “because it misrepresents an inherent quality or characteristic of Review Counsel’s services—whether a consumer can trust Review Counsel’s reviews and recommendations.” Even if reverse mortgage consumers were “savvy” and needed mandatory counseling from a government-approved agency before they could take out a reverse mortgage, that evidence was too generalized. “Further, the mandatory counseling occurs well after consumers are exposed to and potentially influenced by Defendants’ false and misleading statements. It is also contested whether these counselors are allowed to redirect consumers from their chosen reverse mortgage provider.” The same was true for Advisory’s disclosures. “Consumers are more likely to use Advisory’s website if they can trust and rely on the information Advisory chooses to present. Failing to disclose the sole source of income for Advisory, when that source is a reverse mortgage provider highlighted on Advisory’s website, could certainly influence consumers’ decisions to use Advisory’s website and choose a reverse mortgage provider.”

The court presumed irreparable harm, which defendants didn’t rebut. It didn’t matter that Longbridge had no evidence of harm or that defendants voluntarily changed their websites. Even if Longbridge’s business was growing, that could happen anyway, and its greater growth might have been stymied by the false advertising. Review Counsel argued that Longbridge itself paid for favorable placement and ratings on competing comparison/review websites, but it didn’t Longbridge own and operate any advertising website or serve as the sole advertiser of a review website that was founded by a former Longbridge employee. Anyway, “[e]vidence of threatened loss of prospective customers or goodwill certainly supports a finding of the possibility of irreparable harm.”

The court also rejected arguments based on Longbridge’s delay of more than sixteen months in seeking preliminary injunction rebuts the presumption of irreparable harm.  “ ‘[D]elay is but a single factor to consider in evaluating irreparable injury’; indeed, ‘courts are loath to withhold relief solely on that ground.’ ” Longbridge discovered Review Counsel’s false advertising in April 2023, then raised formal complaints to relevant trade associations and state banking regulators between July 2023 and January 2024 before eventually suing in September 2024. The magnitude of Longbridge’s “potential harm [became] apparent gradually, undermining any inference that [Longbridge] was ‘sleeping on its rights.’ ” Longbridge attempted to resolve its claims extrajudicially during the delay period, and then the potential for harm increased with Advisory’s founding in January 2024. An additional eight months delay wasn’t dispositive under these circumstances.

The good news for defendants: the injunction didn’t require discontinuing current practices, only that they couldn’t (1) advertise that Longbridge is not licensed to issue loans in any state or territory where Longbridge is licensed; (2) advertise to consumers on sponsored Google-search links that they provide information relating to “Top 3” reverse mortgage providers when their landing pages advertise fewer than three independent reverse mortgage providers; (3) advertise RFS on their websites as if RFS were an independent reverse mortgage provider originating its own loans, including by representing that RFS has customer support phone lines, reviews, and ratings that are distinct from Mutual of Omaha; or (4) “diminish” their existing disclosures.