LAS VEGAS (AP) -- A Nevada judge has ordered the state to pay legal costs that could amount to hundreds of thousands of dollars to a mortgage-services company that state Attorney General Catherine Cortez Masto accused of consumer fraud and engaging in an illegal "robosigning" scheme.
Attorneys for the former Lender Processing Services Inc. won sanctions Thursday from Clark County District Judge Elizabeth Gonzalez after arguing the attorney general's office failed to back up claims Masto made in December 2011 after filing criminal charges against two employees and a civil lawsuit against the company.
Masto on Friday afternoon issued a long statement declaring that she was fighting for the people of Nevada against a company she accused of deceptive trade practices and "widespread problems in the execution and notarization of mortgage documents."
"Nevada has borne the costs and continues to bear the scars from the reckless conduct of too many unscrupulous players in the mortgage market," the statement said.
Masto also acknowledged that her office was using a New York-based law firm to represent the state, and she said the amount that will be paid to Lender Processing Services will be up to the judge.
The Las Vegas Review-Journal reported the amount could be in the hundreds of thousands of dollars.
Jacksonville, Fla.-based Lender Processing Services is now called Black Knight Financial Services, a subsidiary of Fidelity National Financial Inc.
Company attorney Mitchell Berger said Friday that the case was still open and he declined to comment to The Associated Press.
In court documents, prosecutors argued the state complied with "both the letter and the spirit" of evidentiary rules requiring them to turn over materials to the defense. They objected to turning over other materials they described as "premature, unduly burdensome or irrelevant."
Company lawyers derided the attorney general's court filings as lacking specifics and "replete with overstatements, misstatements, inconsistencies (and) mischaracterizations."
They claimed they were hamstrung in their preparation for trial, scheduled for September, because they don't know details of the state's accusations.
"The attorney general is pursuing a case of 'categories' or 'types' of violations," company attorneys said in court filings. "One cannot defend himself against innuendo, supposition or types and categories. One can only defend himself against facts."
Trouble in Masto's prosecution of the company billing itself as the nation's largest loan processor followed the February 2013 collapse of a criminal case against two Southern California-based loan agents affiliated with the company.
Masto accused the two of filing hundreds of mortgage documents without proper certification and signatures.
Defense attorneys in that case noted that Masto's lead prosecutor was facing a foreclosure himself at the time, and a key witness — a notary public who claimed to have witnessed thousands of robosigning improprieties — committed suicide in 2011.
After Clark County District Judge Carolyn Ellsworth dismissed all 204 felony and 102 misdemeanor charges, Masto characterized the dismissals as a pretrial setback and said she might ask another grand jury to refile criminal charges.
Instead, the case was closed in April.
Attention to the practice dubbed robosigning grew from reports that tens of thousands of fraudulent foreclosure documents had been processed in Nevada and the Las Vegas area during the hectic months before the Great Recession began in December 2007.
As foreclosures piled up in the months that followed, banks nationwide backtracked to make sure paperwork was properly filed.
In Nevada, Masto vowed to hold lenders accountable.
The first sentence of her Dec. 15, 2011, complaint alleging Lender Processing Services violated state deceptive-practices laws noted that Nevada led the nation in foreclosures every month for more than four years.
The next morning, Masto issued a statement declaring that former employees and "industry players" described the company as "an assembly-line sweatshop, churning out documents and foreclosures as fast as new requests came in and punishing network attorneys who failed to keep up the pace."
Berger told the judge on Thursday that prosecutors haven't backed up claims that Lender Processing Services paid kickbacks to other attorneys to pursue foreclosures, that it committed forgery when signing documents, or that it targeted the elderly, the Review-Journal reported.
He said people who signed documents on the company's behalf had all been granted signatory power — a common business practice.
Berger also acknowledged that Nevada wasn't alone in accusing the company of wrongdoing, but he said the company reached settlements with every other state and the federal government.