Justia Banking Opinion Summaries

The Simons filed for Chapter 7 bankruptcy protection, identifying a nonpriority credit-card debt to FIA. FIA retained Weinstein, which sent the Simons a letter and notice through their bankruptcy counsel, stating that FIA was an adversary proceeding under 11 U.S.C. 523 to challenge dischargeability, but offering to forego the proceeding if the Simons stipulated that the debt was nondischargeable or agreed to a reduced amount. The letter stated that a Rule 2004 examination had been scheduled, but that Weinstein was open to settlement; it mentioned the possibility of rescheduling and set out information about challenging the debt. The subpoena certificate, signed by a Weinstein attorney, stated that a copy was mailed to the Simons’ home and their attorney’s office. The Simons allege that Weinstein did not actually send it to their home. Their counsel received copies. The Simons moved to quash, alleging violations of Bankruptcy Rule 9016 and Civil Rule 45 subpoena requirements, and filed an adversary proceeding asserting Fair Debt Collection Practices Act claims based on the letter. The Bankruptcy Court quashed the notices, but ruled that it lacked jurisdiction over the FDCPA claims. The Simons then sued FIA and Weinstein in the district court, which dismissed. The Third Circuit affirmed dismissal of 15 U.S.C 1692e(5) and (13) claims for allegedly failing to identify the recording method in the Rule 2004 examination and by issuing the subpoenas from a district other than where the examinations were to be held. The court also affirmed dismissal of a 1692e(11) claim because its mini-Miranda requirement conflicts with the Bankruptcy Code automatic stay. The court reversed dismissal of claims based failing to serve the subpoenas directly on the individuals and failing to include the text of Civil Rule 45(c)–(d) in the subpoenas. View "Simon v. FIA Card Servs., NA" on Justia Law

At a foreclosure mediation, Homeowners and representatives of Lender agreed that foreclosure proceedings would be halted while Homeowners were being considered for a loan modification. Several months later, Homeowners petitioned for judicial review, asserting that Lender breached the parties' agreement. The district court granted the petition, finding Lender had violated the agreement and directing Lender to participate in and pay for further mediation. The Supreme Court dismissed Lender's appeal, holding (1) to preserve and promote the interests of judicial economy and efficiency, an order remanding for further mediation generally is not final and appealable; and (2) the Court lacked jurisdiction to hear this appeal because, given the remand for additional mediation, the district court's order was not final and appealable. View " Wells Fargo Bank, N.A. v. O'Brien" on Justia Law

Plaintiff refinanced his home mortgage and entered into a refinancing loan and mortgage agreement with IndyMac Bank, which assigned the mortgage to OneWest Bank. The mortgage was serviced by IndyMac Mortgage Services (all three services are referred to as "OneWest"). After Plaintiff fell behind on his payments, Harmon Law Offices, counsel to OneWest, informed Plaintiff that his home would be foreclosed. Fannie Mae purchased Plaintiff's house at a subsequent foreclosure sale. Eleven days later, Harmon served Plaintiff with an eviction notice. Plaintiff sued OneWest, Fannie Mae, and Harmon, asserting negligence and negligent misrepresentation and seeking an injunction against the pending eviction, an order nullifying the foreclosure, and monetary damages. The district court dismissed the complaint, concluding that the economic loss doctrine barred Plaintiff's tort claims and that the tort claims failed because Defendants had not breached any duties owed to Plaintiff. The First Circuit Court of Appeals affirmed, holding that the district court did not err in dismissing Plaintiff's claims. View "Schaefer v. IndyMac Mort. Servs." on Justia Law

Todd alleges that in 2012 he received a recorded telephone message from Collecto asking him to call and help the company locate his mother, Terry. He called; a Collecto representative told him that Terry owed AT&T money for cell phone service. Todd stated that he is not Terry, but the representative continued to discuss the alleged debt without asking how to reach Terry or asking Todd to pay the bill. Todd claimed that this interaction harmed him emotionally and violated the Fair Debt Collection Practices Act, 15 U.S.C. 1692b, which permits a debt collector to call a third party for help in locating a “consumer” but prohibits revealing the existence of the consumer’s debt to the third party. Section 1692f prohibits “unfair or unconscionable means to collect or attempt to collect any debt.” The district court concluded that Todd lacked standing under the Act. The Seventh Circuit affirmed, finding that Todd lacked standing under 1692b and failed to state a claim under 1692f. View "Todd v. Collecto, Inc." on Justia Law

Plaintiff sued the servicer of his loan (Bank) in a putative class action, asserting that the Bank's requirement that he maintain flood insurance coverage in an amount sufficient to cover the replacement value of his home breached the terms of his mortgage contract. The mortgage was insured by the Federal Housing Administration (FHA). Specifically, Defendant contended that the Bank, under a covenant of the mortgage contract, could not require more than the federally mandated minimum flood insurance. The covenant was a standard uniform covenant prescribed by the FHA pursuant to federal law. The district court dismissed the complaint for failure to state a claim. The judgment of dismissal was affirmed by an equally divided en banc First Circuit Court of Appeals, holding that Plaintiff failed to state a claim for breach of contract, as (1) the Bank's reading of the contract was correct and Plaintiff's was incorrect; (2) Plaintiff could not avoid dismissal on the grounds that his specific understanding or the actions of the parties created an ambiguity; and (3) the United States' position articulated in its amicus brief, which stated that Plaintiff's interpretation of the contract was incorrect, reinforced the Court's conclusion. View "Kolbe v. BAC Home Loans Servicing, LP" on Justia Law

At issue in this case was Ind. Code 6-1.1-24-3(b), which provides that a mortgagee annually request by certified mail a copy of notice that a parcel of real property is eligible for sale under the tax sale statutes. Here a bank, which held a mortgage on certain property, failed to submit a form affirmatively requesting from the county auditor to mail notice of a pending sale of the real property. Therefore, the bank was not notified that its mortgaged property was tax delinquent until after the property had been sold and the buyer requested a tax deed. The buyer filed a petition to direct the county auditor to issue a tax deed for the property, and the bank filed a response challenging the tax sale notice statutes as unconstitutional under the Fourteenth Amendment. The trial court issued an order holding that the statute was unconstitutional and denying the buyer's petition. The court of appeals affirmed. The Supreme Court reversed, holding that section 6-1.1-24-3(b) was constitutional under the due process clause of the Fourteenth Amendment. Remanded. View "M & M Inv. Group, LLC v. Ahlemeyer Farms, Inc." on Justia Law

Appellee Pamela Vukman appealed a superior court order that affirmed the Allegheny County Court of Common Pleas. That order granted appellees motion to set aside judgment and sheriff's sale, and dismissed appellant Beneficial Consumer Discount Company's praecipe without prejudice. Beneficial moved to foreclose appellee for being in default of her mortgage. The parties agreed to a settlement whereby Beneficial received judgment for the accelerated amount due on the mortgage as long as appellee made regular payments. Appellee eventually defaulted according to the terms of the settlement; Beneficial filed for a writ of execution. The property was sold at a sheriff's sale, and Beneficial was the successful bidder. Appellee then moved to set aside the sale, arguing Beneficial failed to comply with the requirements under the Homeowner's Emergency Mortgage Act. The court concluded that Beneficial did not follow the Act's requirements, and as a result, it id not have jurisdiction. Therefore the court set aside the sale and dismissed Beneficial's original complaint. Beneficial appealed; the superior court affirmed. Upon review, the Supreme Court concluded that the Act's notice requirement did not implicate subject matter jurisdiction of the trial court, it reversed and remanded the case for further proceedings. View "Beneficial Consumer Discount Company v. Vukman" on Justia Law

Two petitions for a writ of mandamus came before the Supreme Court. Both sought review of orders that found plaintiffs lacked of standing and, in turn, found the trial courts lacked subject-matter jurisdiction. In case no. 1111567, U.S. Bank National Association ("U.S. Bank"), sought a writ to require the Walker Circuit Court to dismiss an action filed by Walker County. In case no. 1111370, MERSCORP, Inc. ("MERSCORP"), and Mortgage Electronic Registration Systems, Inc. ("MERS") sought a writ to require the Barbour Circuit Court to dismiss an action filed by Barbour Probate Judge Nancy Robertson. Upon careful consideration of the underlying trial court cases, the Supreme Court concluded that these cases did not fall within the subject-matter-jurisdiction exception to the general rule that the Supreme Court would not engage in mandamus review of a trial court's denial of a motion to dismiss. The Court therefore denied the request for mandamus relief in both of the cases. View "Robertson v. MERSCORP, Inc." on Justia Law

Mortgage-backed securities, known as the MASTR Pass-Through Certificates, Series 2007-3, were offered to the public in 2007. UBS, the sponsor of the Certificates, purchased the underlying loans from originators, including Countrywide Home Loans and IndyMac Bank, then sold the loans to MASTR, which placed the loans into the MASTR Adjustable Rate Mortgages Trust, the issuer of the Certificates. UBS Securities, the underwriter, sold the Certificates to investors. The Certificates were issued pursuant to a Securities and Exchange Commission (SEC) Form S-3 Registration Statement filed in 2005 and an SEC Form 424B5 Prospectus Supplement filed in 2007. Those documents assured investors that the underlying loans were originated pursuant to particular underwriting policies and in compliance with federal and state laws and regulations. The district court dismissed a purported class action by investors, alleging violations of the Securities Act of 1933, 15 U.S.C. 77, for failure to plead compliance with the one-year statute of limitations and dismissed an amended complaint as untimely under an inquiry notice standard. The Third Circuit affirmed, holding that a Securities Act plaintiff need not plead compliance with Section 13 and that Section 13 establishes a discovery standard for evaluating the timeliness of Securities Act claims, but the claims were, nonetheless, untimely. View "Pension Trust Fund for Operating Eng'rs v. Mortg. Asset Securitization Transactions, Inc." on Justia Law

AmEx is the world’s largest issuer of traveler’s checks, which never expire. AmEx and third-party vendors sell the checks at face value, and AmEx profits by investing the funds until the TC is redeemed. Although most are cashed within a year, AmEx uses the remaining uncashed checks for long-term, high-yield investments. Until recently, every state’s abandoned property laws presumed abandonment of uncashed traveler’s checks 15 years after issuance. This presumption requires the issuer to transfer possession of the funds to the state. In 2008 Kentucky amended KRS 393.060(2) to change thes abandonment period from to seven years. AmEx claims violation of the Due Process Clause, the Contract Clause, and the Takings Clause. Following a remand and amendment of the complaint to add a dormant Commerce Clause argument and a claim that the legislation did not apply retroactively to checks that were issued and outstanding prior to the effective date, the district court granted the state summary judgment. The Sixth Circuit affirmed, holding that the amendment applies only prospectively and does not violate the Commerce Clause. View "Am. Express Travel Related Servs. Co., Inc. v. Hollenbach" on Justia Law