Justia Banking Opinion Summaries

Amzak appealed the district court's summary judgment on its loan loss claims against its title insurance policy provider and related entities. The court concluded that Amzak failed to show that it suffered actual loss because of a failure of title and STL could not be held responsible for any harm suffered by Amzak. The court formalized the holding in First State Bank v. American Title and likewise rejected the guarantee rationale of Citicorp Savings of Illinois v. Stewart Title Guaranty Co., and agreed with the district court's rejection of Amzak's argument that STL breached the title policy at the time of the loan because its mortgage was voidable at that time. The court also disposed of Amzak's negligence claim where STL's delay in making a complete filing of Amzak's mortgage was not a legal cause of Amzak's loss. Accordingly, the court affirmed the judgment of the district court. View "Amzak Capital Mgmt. v. Stewart Title" on Justia Law

Plaintiff filed suit alleging that the mortgage trust that claimed to hold his mortgage was not validly assigned the mortgage, and therefore, his mortgage could not be foreclosed by the trust. The district court granted summary judgment in favor of the trustee, Wells Fargo. The court affirmed, concluding that the assignment to the mortgage trust was valid. Given the record, including the custodian's initial certification failing to list the promissory note as missing - which provided a strong inference that the note was not missing - and given the lack of any other reason to believe the note was or is missing, the court agreed with the district court that no reasonable jury could find that the original promissory note was not in the Trust's possession on the startup date of the Trust. View "Johnson, Jr. v. Wells Fargo Bank, N.A." on Justia Law

In 1989, Seamans received a Federal Perkins Loan of $1,180.00 from Temple University. The first payment was due in 1992. The loan was declared delinquent the following month. Nonths later, Temple notified Seamans that the account had been placed for collection. In 2010, Seamans enrolled at Drexel University. He sought a Pell Grant, but Drexel refused to provide with financial assistance until Seamans repaid the Temple Loan. In 2011, Seamans repaid that loan in full. Seamans then noticed a “trade line” on his credit report. The trade line may or may not have appeared on his credit report when the account was in default. Seamans formally disputed some of the information by contacting the credit reporting agency. Temple, had its loan servicer investigate, but resubmitted information virtually unchanged. Seamans again contacted Temple and credit agencies, to dispute the trade line. After a second investigation, Temple modified certain elements, but still did not report various details. There was evidence that Temple treated other disputes in a similar manner. Seamans sued, alleging that Temple negligently or willfully violated the Fair Credit Reporting Act, 15 U.S.C. 1681–1681x. The district court granted Temple summary judgment, finding that the Higher Education Act, 20 U.S.C. 1001–1155, exempted Temple from FCRA compliance because the credit instrument was a Perkins Loan. The Third Circuit vacated, stating that Seamans’s dispute appears to have merit and that failure to report the dispute may constitute a material inaccuracy on his credit report. View "Seamans v. Temple University" on Justia Law

Deutsche Bank filed its 1999 Form 1120F (U.S. Income Tax Return of a Foreign Corporation), reporting total tax of $105,725,463, total payment of $188,256,721, including credit for taxes withheld at the source ($13,256,721), and a resulting overpayment of $82.5 million. Form 1120F does not itemize withholding credits, which were derived from Forms 8805 (Foreign Partner’s Information Statement of Section 1446 Withholding Tax) and 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding) received from withholding agents. Deutsche Bank did not attach those forms . The IRS returned the filing, unprocessed, requesting documentation of the withholding credit. In its amended return, Deutsche Bank stated that it discovered an overstatement of the withholding credit by $11,240 and that the correct amount was $13,245,481. The IRS processed the resubmitted return without correcting the error and credited the overpayment to the 2000 tax year. Later, Deutsche Bank filed an amended 1999 return claiming an additional refund of $59 million based on a valuation adjustment. The IRS issued the refund and $5 million in overpayment interest for January 1, 2001 to November 14, 2002. The IRS denied its request for additional interest for March 15 to December 31, 2000. The Claims Court agreed. The Federal Circuit affirmed, stating that the return was not filed by the extended return filing due date in processible form to commence the accrual of overpayment interest. View "Deutsche Bank AG v. United States" on Justia Law

Plaintiffs granted a mortgage on their property in Massachusetts to Ameriquest Mortgage Company, which assigned its interest in the mortgage to Mortgage Electronic Registration System, Inc. (MERS). MERS later purported to assign Plaintiffs’ interest to HSBC Mortgage Services, Inc. (HSBC). HSBC subsequently began foreclosure proceedings on Plaintiffs’ property. Plaintiffs filed an eight-count complaint against HSBC, claiming the assignment was void, and therefore, HSBC never acquired the mortgage to their property and had no right to initiate foreclosure proceedings. The district court dismissed Plaintiffs’ complaint for failure to state a claim, concluding that Plaintiffs did not have standing to challenge the assignment because they were not a party to the assignment, nor were they third-party beneficiaries of the assignment. The First Circuit Court of Appeals affirmed, holding (1) under Massachusetts law, homeowners in Plaintiffs’ position have standing to challenge a prior assignment of their mortgage on the grounds that the assignment was void, but because Plaintiffs did not set forth a colorable claim that the mortgage assignment in question was void, Plaintiffs lacked standing to raise certain claims; and (2) Plaintiffs failed to state a claim for promissory estoppel with respect to a loan modification. View "Wilson v. HSBC Mortgage Servs., Inc." on Justia Law

Plaintiff and other checking account customers filed suit against the Bank for allegedly charging excessive overdraft fees in breach of their account agreement. The district court denied the Bank's renewed motion to compel arbitration. The court concluded that state law applied when courts determined whether a valid arbitration agreement is in effect, and the Federal Arbitration Act's, 9 U.S.C. 1 et seq., presumption did not; under North Carolina law, the Bank Agreement was entirely superseded, and the arbitration agreement in that agreement therefore became ineffective; the district court properly looked to the PNC Agreement to determine whether the parties agreed to arbitrate their disputes; under North Carolina law, the PNC Agreement's silence was insufficient to form such an agreement; based on the terms of the agreement, the PNC Agreement applied retroactively; and because the agreement governing the dispute at hand did not permit the Bank to compel arbitration, the district court properly denied the motion. Accordingly, the court affirmed the judgment of the district court. View "Dasher v. RBC Bank (USA)" on Justia Law

Plaintiff filed suit against her mortgage lender, Wells Fargo, alleging that Wells Fargo breached the mortgage-loan contract and violated extracontractual duties by requiring her to have more flood insurance than the amount set by federal law. At issue was whether a covenant included in all contracts for home mortgage loans guaranteed by the FHA unambiguously permitted mortgage lenders to require their borrowers to obtain flood insurance beyond the amount the agency required. The court concluded that the covenant unambiguously made the federally required flood-insurance amount the minimum, not the maximum, the borrower must have. Accordingly, plaintiff could not prevail on her claims against Wells Fargo and the court affirmed the district court's dismissal of the complaint for failure to state a claim. View "Feaz v. Wells Fargo Bank, N.A., et al." on Justia Law

The Bank filed this interpleader action to determine ownership of funds held on deposit in an account in the name of the Federal Directorate of Supply and Procurement (FDSP), an entity organized under the former Socialist Federal Republic of Yugoslavia (SFRY). The account was frozen pursuant to an executive order during the Bosnian War. Yugoimport, a Serbian entity, claimed full ownership of the funds as successor-in-interest to the FDSP. The Republics of Croatia and Slovenia contend that the funds should be divided among the states succeeding the SFRY under a multilateral treaty, the Succession Agreement. The court held that interpretation of the Succession Agreement was governed by the Vienna Convention and that the FSPA was an agency of the SFRY. Therefore, the court affirmed the district court's grant of summary judgment to the Republics. View "Yugoimport v. Republic of Croatia, Republic of Slovenia" on Justia Law

Plaintiff appealed the district court's dismissal of his claim under Rule 12(b)(6), alleging that Nationstar violated section 533 of the Servicemembers Civil Relief Act (SCRA), 50 U.S.C. app. 533, when it maintained certain fees related to a rescinded Notice of Default on his account while he was on active duty. Because the state-law statutory definition of foreclosure contemplates the inclusion of specified fees as part of the foreclosure proceeding, and because the Supreme Court has unambiguously required courts to give a broad construction to the statutory language of the SCRA to effectuate the Congressional purpose of granting active-duty members of the armed forces repose from some of the trials and tribulations of civilian life, the court held that the attempted collection of fees related to a Notice of Default on a California property constituted a violation of section 533. In this case, plaintiff has pled sufficient facts to allege that Nationstar's continuing failure to remove the fees incidental to the Notice of Default was a continuation of that foreclosure proceeding while plaintiff was on active duty service in violation of section 533. Accordingly, the court reversed and remanded. View "Brewster v. Sun Trust Mortgage" on Justia Law

This litigation arose out of the failure of WaMu and the assumption of WaMu's assets and liabilities by Chase from the FDIC, acting in its capacity as WaMu's receiver. On appeal, the FDIC and Chase challenged the district court's grant of summary judgment in favor of Hillside. The district court concluded that Hillside, which owned premises leased by WaMu before the financial crisis, had third-party standing to enforce the alleged assignment of WaMu's real estate lease to Chase under a purchase agreement between the FDIC and Chase, even though the FDIC validly repudiated the lease under section 212(e) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, 12 U.S.C. 1821(e), and the parties to the purchase agreement asserted that it did not in fact assign the lease. The court held that Hillside lacked prudential standing to litigate whether WaMu's liabilities were assigned to Chase under the agreement because it was neither a contracting party nor a third-party beneficiary under the agreement. Accordingly, the court vacated and remanded with instructions to dismiss the complaint. View "Hillside Metro Associates, LLC v. JPMorgan Chase Bank, N.A." on Justia Law