Lawsuit claims trio conspired to push homeowners out the door and inflate profits.

SEATTLE, June 17 /PRNewswire/ -- Two California homeowners filed a class-action lawsuit against KB Home (NYSE: KBH), Countrywide Financial and LandSafe Appraisal Services, expanding cases previously filed in Arizona and Nevada claiming the companies conspired to systematically, artificially and illegally rig home appraisals and sale values in KB developments throughout the state.

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The lawsuit lists identical claims to the suit filed in Arizona last month. Homeowners claim KB Home and the other defendants inflated home prices by as much as $300 million in California alone.

Between 2006 and 2008, KB built more than 15,000 homes in California at an average selling price of $425,000 the complaint cites. Attorneys conservatively estimate that each home had an inflated appraised value of $20,000, the suit states.

'KB and Countrywide created an opportunity where the companies could control every aspect of a buyer's real estate transaction,' said Steve Berman, lead attorney and managing partner at HBSS. 'The defendants essentially created a black hole in the process, where they could rig and falsify appraisals and home sale values and customers had absolutely no idea.'

According to the 75-page complaint, Countrywide funneled all its KB customers' home appraisals to one person at LandSafe, an appraisal subsidiary of Countrywide who, in turn, would deliver an appraisal value at whatever KB and Countrywide ordered. These individuals were under direct instruction to value homes at or above the contract price, even if it meant violating regulatory guidelines and requirements.

In two KB Home developments cited in the complaint, sampled appraisals were inflated by $48,000 and $52,000 per property.