Justia Banking Opinion Summaries

In 2014, the trustee under a deed of trust conveyed the Parrish property to the Federal National Mortgage Association (Fannie Mae), which sent the Parrishes a notice to vacate and filed a summons for unlawful detainer in the general district court. The Parrishes alleged that the foreclosure was invalid because their deed of trust incorporated 12 C.F.R. 1024.41(g), which, they asserted, prohibits foreclosure if a borrower submitted a completed loss mitigation application more than 37 days before the foreclosure sale. They alleged that they had submitted such an application. The court awarded Fannie Mae possession. On appeal, Fannie Mae argued that the court should exclude any defense contesting the foreclosure’s validity because the lower court lacked subject matter jurisdiction to try title in a proceeding on unlawful detainer. Fannie Mae contended that because the circuit court’s subject matter jurisdiction on appeal from the general district court was derivative of the general district court’s jurisdiction, the circuit court also lacked jurisdiction. The court awarded Fannie Mae possession. The Supreme Court of Virginia vacated, restoring the parties to their status quo before the unlawful detainer proceeding. Courts not of record lack power to try title unless expressly conferred by the General Assembly. The court cited Code sections 16.1-77(3) and 8.01-126 and acknowledged the practical implications of its holding. View "Parrish v. Fed. Nat'l Mortgage Ass'n" on Justia Law

This appeal arose out of a $17 million verdict rendered in favor of Francis Maybank for claims sounding in contract, tort, and the South Carolina Unfair Trade Practices Act (UTPA). Maybank brought this action alleging he received faulty investment advice from Branch Banking and Trust (BB&T - the Bank) through BB&T Wealth Management (Wealth Management) and BB&T Asset Management (Asset Management), all operating under the corporate umbrella of BB&T Corporation (collectively, Appellants). Appellants appealed on numerous grounds, and Maybank appealed the trial court's denial of prejudgment interest. After review, the Supreme Court reversed as to an award of punitive damages based on a limitation of liability clause. The Court affirmed on all other grounds. View "Maybank v. BB&T" on Justia Law

Plaintiff filed a qui tam action under the New York False Claims Act (NYFCA), N.Y. Stat Fin. Law 187 et seq., on behalf of the State and the City against Wells Fargo for fraudulent avoidance of New York tax obligations. The district court dismissed for failure to state a claim. The court concluded that, with no special state interest, and with no indication of congressional preference for state-court adjudication, the exercise of federal jurisdiction in this case is fully consistent with the ordinary division of labor between federal and state courts. The court also concluded that the complaint did not plausibly allege that the Wells Fargo trusts were not qualified to be treated as Real Estate Mortgage Investment Conduits (REMICs). Therefore, the complaint failed to state a claim on which relief could be granted under the NYFCA for any false statement or record affecting the trusts' entitlement to exemption from income tax under the New York tax laws. Accordingly, the court affirmed the judgment. View "State of New York ex rel. Jacobson v. Wells Fargo" on Justia Law

222 plaintiffs, homeowners, in 22 related mass actions against various financial institutions and mortgage loan servicers, appeal from an order dismissing those actions after the trial court sustained without leave to amend defendants' demurrers to an “omnibus” third amended complaint. Each mass action involves numerous plaintiffs whose loans originated with and/or were serviced by a single defendant or related affiliates. The omnibus complaint asserted seven causes of action. On appeal, plaintiffs challenge only the trial court's denial of their request for leave to amend their unfair business practices cause of action (the UCL claim) to add factual allegations to support an entirely different theory that was suggested in seven sentences of the 29-page complaint. The court concluded that the trial court did not abuse its discretion by denying plaintiffs leave to amend their complaint because they failed to show that their proposed additional facts are sufficient to state a UCL claim. Moreover, even if their proposed additional facts were sufficient, they clearly demonstrate that the claim could not be prosecuted as a mass action because the 222 plaintiffs' claims do not arise out of the same transaction or occurrence, as required by Code of Civil Procedure section 378. Accordingly, the court affirmed the judgment. View "Aghaji v. Bank of America" on Justia Law

After a foreclosure case, Davis filed various claims against an entity that he calls “Wells Fargo U.S. Bank National Association as Trustee for the Structured Asset Investment Loan Trust, 2005-11” as the purported holder of Davis’s mortgage. Davis also sued Assurant, believing it to be the provider of insurance on his home. His claims arise from damage that occurred to his house after Wells Fargo locked him out of it, which went unrepaired and worsened into severe structural problems. The district court dismissed Davis’s claims against Wells Fargo, on the grounds that claim preclusion and a statute of limitations barred recovery, and claims against Assurant for lack of subject matter jurisdiction. The Court reasoned that Davis lacked standing to bring those claims because he sued the wrong corporate entity, namely Assurant, when he should have sued Assurant’s wholly-owned subsidiary, ASIC. The Third Circuit affirmed dismissal of Wells Fargo, but vacated as to Assurant. Standing is a jurisdictional predicate, but generally focuses on whether the plaintiff is the right party to bring particular claims, not on whether the plaintiff has sued the right party. View "Davis v. Wells Fargo" on Justia Law

The Lindsays were minority shareholders of the 304 Corporation; its principal asset was Mid City Bank. In 2010, the Nebraska Department of Banking and Finance and the FDIC began an examination of the bank. In 2011, the Department appointed the FDIC as the bank's receiver, stating that “‘large commercial real estate loan and poor management practices . . . led to a deterioration of the bank’s capital’” so that there was “‘no option but to declare the insolvent institution receivership.’” The bank reopened and regained good standing. In 2014, the FDIC filed suit, alleging that Fitl “was grossly negligent and breached his fiduciary duties,” 12 U.S.C. 1821(d)(2)(A)(i). The Lindsays also filed suit, alleging breach of fiduciary duties. The court dismissed. The Nebraska Supreme Court affirmed. The Lindsays’ claims are similar to all other shareholders’ claims and did not arise from a special duty, since the injury was not “separate and distinct.” The district court correctly concluded that the Lindsays’ claims were derivative in nature and that as a result of the FDIC lawsuit, the Lindsays had no standing to bring a derivative action on behalf of the corporation. View "Lindsay v. Fitl" on Justia Law

After the Borrower defaulted on a loan, the Guarantor (the petitioner) allegedly breached the guaranty. Omni (the real party in interest) filed a complaint against the Guarantor for the alleged default on the guaranty. At issue on appeal is whether a creditor's amended complaint seeking a deficiency judgment against petitioner may relate back to a timely complaint against a different party pursuant to NRCP 15(c), so as to satisfy NRS 40.455(1)'s six-month deadline for an application for a deficiency judgment against petitioner. The court concluded that the district court erred in permitting the real party in interest's amended complaint to relate back to the timely original complaint pursuant to NRCP 15(c), so as to satisfy the six-month deadline for an application for a deficiency judgment against petitioner, as required by NRS 40.455(1); the timely complaint against the borrowers does not constitute a valid application for deficiency judgment against the unnamed petitioner; and petitioner did not waive his right to object under NRS 40.455(1). Accordingly, the court concluded that the district court erred in denying petitioner's motion for summary judgment in the guaranty action and motion to dismiss in the borrower action, and the court granted the petition for writ of mandamus. View "Badger v. Eighth Jud. Dist. Ct." on Justia Law

The Federal National Mortgage Association (Fannie Mae) filed a complaint for summary process in the Housing Court to establish its right to possession of the Rego house, which Fannie Mae purchased at a foreclosure sale. The Regos argued that the foreclosure sale conducted by GMAC, which held the mortgage, was void because GMAC's attorneys had not been authorized by a prior writing to undertake the actions set forth in G. L. 244, 14. They also asserted an equitable defense and counterclaims. The judge granted Fannie Mae summary judgment "as to possession only," and scheduled a bench trial on the counterclaims, but later dismissed the counterclaims for lack of subject matter jurisdiction. The Massachusetts Supreme Judicial Court vacated. The foreclosure suffered no defect on the asserted ground that GMAC failed to provide such authorization to its attorneys, but the Housing Court has limited authorization to entertain counterclaims and an equitable defense to the foreclosure sale in the summary process action. View "Fed. Nat'l Mortgage Ass'n v. Rego" on Justia Law

Plaintiffs filed numerous antitrust suits alleging that the Banks colluded to depress LIBOR by violating the rate‐setting rules, and that the payout associated with the various financial instruments was thus below what it would have been if the rate had been unmolested. After consolidation into a multi-district litigation (MDL), the district court dismissed the litigation in its entirety based on failure to plead antitrust injury. The court vacated the judgment on the ground that: (1) horizontal price‐fixing constitutes a per se antitrust violation; (2) a plaintiff alleging a per se antitrust violation need not separately plead harm to competition; and (3) a consumer who pays a higher price on account of horizontal price‐fixing suffers antitrust injury. The court remanded for further proceedings on the question of antitrust standing. Finally, the court rejected the Bank's alternative argument that no conspiracy has been adequately alleged. View "In re: LIBOR-Based Financial Instruments Antitrust Litig." on Justia Law

In 2004, the Woods obtained a $76,000 home-equity loan secured by their homestead. Nearly eight years later, the Woods notified the note holder, HSBC, and loan servicer, Ocwen that the loan did not comply with the Texas Constitution because the closing fees exceeded 3% of the loan amount. Neither of the lenders attempted to cure the alleged defects. In 2012, the Woods sued, seeking to quiet title and asserting claims for constitutional violations, breach of contract, fraud, and a declaratory judgment that the lien securing the home-equity loan is void, that all principal and interest paid must be forfeited, and that the Woods have no further obligation to pay. The trial court granted the lenders summary judgment and the court of appeals affirmed, citing the statute of limitations. The Texas Supreme Court reversed in part.“No . . . lien on the homestead shall ever be valid unless it secures a debt described by this section[.]” TEX. CONST. art. XVI, § 50(c). This language is clear, unequivocal, and binding. Liens securing constitutionally noncompliant home-equity loans are invalid until cured and thus not subject to any statute of limitations. The Woods do not, however, have a cognizable claim for forfeiture. View "Wood v. HSBC Bank USA, N.A." on Justia Law