Title insurer Fidelity National Financial Inc. has agreed to sell several title plants and related assets in Oregon and Michigan to settle charges by the Federal Trade Commission that its acquisition of bankrupt LandAmerica Financial’s underwriting subsidiaries reduced competition in those markets.
The proposed settlement also requires Fidelity to notify the FTC before acquiring 50 percent or more of any joint title plant in California, Colorado, Nevada, New Mexico, Oregon, and Texas, where the FTC said Fidelity’s acquisitions increased Fidelity’s ownership interest in title plants, which are databases used by title insurers and others to determine ownership of real property in connection with underwriting and issuance of title insurance polices.
In a complaint, the FTC said Fidelity’s 2008 acquisition of former LandAmerica underwriters Lawyers Title Insurance Corp., Commonwealth Land Title Insurance Co. and United Capital Title Insurance Co. reduced competition in six geographic areas including the Detroit, Mich., and Portland, Ore., metro areas, and an additional four counties in Oregon (Benton, Jackson, Marion, and Linn).
The U.S. Justice Department allowed the acquisition to proceed, despite worries that it would lead to further market concentration of the title insurance business in the hands of a handful of national underwriters.
The acquisition made Fidelity the nation’s largest title insurer, together with with rival First American Corp. controlling a combined market share of 70 percent or more in 11 of the 12 states with the biggest gross title insurance premiums, opponents said at the time.
In Portland, the FTC says the acquisition left Fidelity with a controlling interest in the lone title plant providing title insurance information services for the area. In the three other counties, the acquisition reduced the number of independent title plants from four to three.
In Detroit, the FTC charged that the acquisition might give Fidelity the power to affect the competitive significance of an independent title services provider, Data Trace. Data Trace is the only company besides Fidelity with a "complete and up-to-date title plant" in Michigan’s Oakland, Macomb and Wayne counties, the FTC said.
The proposed settlement requires Fidelity to sell part of its ownership in the joint title plant in Portland, Ore., to Northwest Title, and to sell a copy of the data from each of the title plants serving Oregon’s Benton, Jackson, Linn, and Marion counties to Northwest.
The proposed settlement also requires Fidelity to sell a copy of the title data in the three Detroit-area counties where Data Trace acquired information from LandAmerica to an "FTC-approved buyer."
The proposed settlement is subject to public comment for 30 days. The FTC will decide whether to make it final after the public comment period closes on Aug. 16.
A Fidelity spokesman did not respond immediately to a request for comment.