Stiffed Upstate NY Tax Collectors, Indian Nations Continue Lower Court Litigation Over Unpaid Real Estate Taxes, Despite Pending Supreme Court Ruling

In Rochester, New York, The Syracuse Post Standard reports:

• The Cayuga Indian Nation has asked a federal court in Rochester to stop Seneca County from foreclosing on five nation properties for unpaid back taxes, a lawyer for the Cayugas said [last week].(1)

• The nation [last week] requested a temporary restraining order and preliminary injunction to halt the county’s foreclosure attempt, attorney Daniel French said. A date for arguments had yet to be scheduled. “This is all litigation folly, a waste of taxpayers’ money,’’ French said.

***

• The Cayugas claim they have sovereign nation rights to not have to pay taxes on any of the 1,100-plus acres they own in both counties. The counties disagree and the two sides have clashed over the tax issue in court many times.

***

• French said he does not understand why the counties are taking the foreclosure action now since the U.S. Supreme Court is expected to rule this summer on a similar case involving Madison County’s attempt to foreclose on Oneida Indian Nation properties that are in tax arrears. “This is all rather silly since the Supreme Court is going to decide on this in a couple months,’’ French said.(2)

For more, see Cayuga, Seneca counties start foreclosure action against Cayuga Nation; tribe seeks injunction.

See also The Oneida Daily Dispatch: Madison County, Oneida County, Oneida Indian Nation prepare for Supreme Court land foreclosure case.

(1) According to the story, the Cayugas owe $5,506.70 for unpaid 2008 taxes on the five properties, three of which are in the town of Seneca Falls and two in the town of Varick, county attorney Frank Fisher said. In addition, neighboring Cayuga County has started foreclosing on five nation properties where the nation owes $124,131.08 in back taxes on three properties in the village of Union Springs and two in the town of Springport, county attorney Fred Westphal said.

(2) The ruling currently on appeal to the U.S. Supreme Court is Oneida Indian Nation of N.Y. v. Madison County, 605 F.3d 149 (2d Cir. 2010). Noteworthy in the 2nd Circuit ruling are the words of Circuit Judge Jose A. Cabranes who, in a concurring opinion with whom Circuit Judge Peter W. Hall joined, stated (bold text is my emphasis, not in the original text):

• The holding in this case comes down to this: an Indian tribe can purchase land (including land that was never part of a reservation); refuse to pay lawfully-owed taxes; and suffer no consequences because the taxing authority cannot sue to collect the taxes owed.
  
  This rule of decision defies common sense. But absent action by our highest Court, or by Congress, it is the law. In the last twenty years, the Supreme Court has twice held that, although states may have a right to demand compliance with state laws by Indian tribes, they lack the legal means to enforce that right. See Kiowa Tribe of Okla. v. Mfg. Tech., Inc., 523 U.S. 751, 755 (1998) (“There is a difference between the right to demand compliance with state laws and the means available to enforce them.”); Okla. Tax Comm’n v. Citizen Band Potawatomi Indian Tribe of Okla., 498 U.S. 505, 514 (1991) (holding that states have a right to collect taxes on certain cigarette sales on an Indian reservation, but the tribe is immune from suit seeking to enforce that right). In light of this unambiguous guidance from the Supreme Court, I am bound to concur with the conclusion that, although the Counties may tax the property at issue here, see City of Sherrill, N.Y. v. Oneida Indian Nation of N.Y., 544 U.S. 197 (2005), they may not foreclose on those properties because the tribe is immune from suit.
  
  This result, however, is so anomalous that it calls out for the Supreme Court to revisit Kiowa and Potawatomi. I wish that we were empowered to revisit those decisions, but, alas, that is not a privilege extended to intermediate appellate courts. If law and logic are to be reunited in this area of the law, it will have to be done by our highest Court, or by Congress. Accordingly, I concur in the judgment of the Court and in the careful and comprehensive opinion of Judge Sack.

Ostensibly Time-Barred 'Fair Debt' Violations In Sewer Service Suit May Remain Viable Where 'Equitable Tolling' Suspends Running Of 1-Year Statute

In denying a motion to dismiss a lawsuit alleging, among other things, violations of the Federal Fair Debt Collection Practices Act ("FDCPA"), a Federal court in Brooklyn, New York ruled that consumer/plaintiffs may have viable claims under the ("FDCPA") against the defendants despite the expiration of the 1-year statute of limitations set forth in that statute, where the limitations period was 'equitably tolled' (where the existence of "extraordinary circumstances" require that the running of the statute of limitations be suspended; such a suspension will be made only in "rare and exceptional" circumstances(1)).

The FDCPA statute of limitations issue was one of several issues raised in the lawsuit, which involves allegations of a massive sewer service racket in connection with the obtaining of default judgments by the defendant, a nationwide 'zombie debt' buyer, and which also named a law firm, a process serving outfit, and others as defendants.

In making his ruling, United States Circuit Judge Denny Chin, sitting by designation in the U.S. District Court, addressed the issue of the statute of limitations in the following excerpt (at pages 10-13, court footnotes omitted; bold text is my emphasis, not in the original text):

• Defendants argue that some or all of the FDCPA claims are time-barred. To be timely, an FDCPA claim must be brought "within one year from the date on which the violation occurs." 15 U.S.C. 5 1692k(d). Plaintiffs counter that the equitable tolling doctrine preserves their claims.

• The first FDCPA violations allegedly occurred when the Leucadia and Mel Harris defendants filed the state debt collection actions. Defendants plausibly violated the FDCPA again when they subsequently applied for default judgments against plaintiffs. Even using the default judgment application dates, the claims of Sykes, Graham, and Perez would be time-barred because those dates were more than a year before December 28, 2009, when the class action allegations were asserted. Thus, it appears that absent equitable tolling, their claims would be untimely.

• The Complaint plausibly alleges that equitable tolling applies, as to most of the plaintiffs' FDCPA claims. A statute of limitations may be tolled in extraordinary circumstances, if a plaintiff establishes that: (1) the defendant concealed from him the existence of his cause of action; (2) he remained in ignorance of that cause of action until some length of time within the statutory period before commencement of his action; and (3) his continuing ignorance was not attributable to lack of diligence on his part. State of N.Y. v. Hendrickson Bros., Inc., 840 F.2d 1065, 1083 (2d Cir. 1988); see also Bailey v. Glover, 88 U.S. (21 Wall.) 342, 349-50 (1874). FDCPA claims are subject to equitable tolling. Somin v. Total Cmty. Mgmt. Corp., 494 F. Supp. 2d 153, 158 (E.D.N.Y. 2007) (citing Johnson v. Nyack Hosp., 86 F.3d 8, 12 (2d Cir. 1996)).

• Sykes and Perez have sufficiently alleged that defendants fraudulently deprived them of notice of their debt collection action. Because sewer service purposefully ensures that a party is never served, it is plausible that defendants' acts were "of such character as to conceal [themselves]" to warrant equitable tolling. Bailey, 88 U.S. at 349-50. The present class action commenced on December 28, 2009. Because Sykes and Perez allege that they discovered the default judgments entered against them after December 28, 2008, their claims would be timely under equitable tolling. The Complaint alleges, however, that Graham did receive a copy of the summons and complaint by mail from Mel Harris, LLC sometime before a default judgment was entered against her, and thus it fails to allege exercise of due diligence on her part. Thus, this prong of defendants' motion is granted with respect to Graham, but denied as to all other plaintiffs.

For the entire ruling (37 pages), see Sykes v. Mel Harris and Associates LLC.

(1) See Somin v. Total Cmty. Mgmt. Corp., 494 F. Supp. 2d 153, 158 (E.D.N.Y. 2007):

• As with any a statute of limitations, the FDCPA is subject to equitable tolling in appropriate circumstances. The doctrine of equitable tolling applies only in "rare and exceptional" circumstances. Bertin v. United States, 478 F.3d 489, 494 n. 3 (2d Cir.2007); Smith v. McGinnis, 208 F.3d 13, 17 (2d Cir.2000) (per curiam). To invoke this doctrine, a plaintiff must allege that extraordinary circumstances prevented him from acting in a timely manner. See Johnson v. Nyack Hosp., 86 F.3d 8, 12 (2d Cir.1996). Generally, equitable tolling applies only where defendant has engaged in conduct to conceal wrongdoing and, as a result, plaintiff fails to discover facts giving rise to the claim, despite the exercise of reasonable diligence. Coveal v. Consumer Home Mtge., Inc., 2005 WL 704835 *4 (E.D.N.Y.2005); see Chapman v. ChoiceCare Long Island Term Disability Plan, 288 F.3d 506, 512 (2d Cir.2002).

Federal Court: Servicer's Conduct Stiffing Homeowner Seeking Loan Modification May Be Unfair, Deceptive Practice; Allows Lawsuit To Continue

In San Francisco, California, Courthouse News Service reports:

• Homeowners who say Wells Fargo Bank duped them into loan-modification programs to stave off foreclosure survived a legal challenge to their case in San Francisco federal court.

• U.S. District Judge Joseph Spero pared the class's suit [last week], rejecting claims for breach of contract but upholding allegations that the bank's debt-collection practices were unfair, deceptive and fraudulent. He also permitted the plaintiffs to seek restitution for an installment payment they made in March 2010, since the bank had already foreclosed upon them by that point.

• Lead plaintiffs Gustavo Reyes and Maria Teresa Guerrero claimed that, after they defaulted on their mortgage payments, Wells Fargo offered to freeze foreclosure proceedings against them if they signed a modified loan agreement. But after they signed the loan and made payments over four consecutive months, the bank still foreclosed on their home.

***

• Spero [] found that the homeowners may be entitled to damages under California's Rosenthal Act, which protects consumers from improper debt-collection practices.(1)

For more, see Wells Fargo Loses Bid to Dismiss Fraud Claims.

For Judge Spero's ruling, see Reyes v. Wells Fargo Bank, N.A.

(1) In denying Wells Fargo's motion to dismiss the homeowner's claims that the bank used unfair and deceptive practices to dupe them into an allegedly phony loan modification arrangement, Judge Spero made this observation:

• The court cannot say, as a matter of law, that the statements made in the offer letter would not have been misleading to the least sophisticated buyer in light of: the words 'good news' at the beginning of the letter; the language in the letter indicating that the agreement was being offered based on a review of the recipient's financial information; the statement that foreclosure counsel would be instructed to delay foreclosure proceedings as long as the recipients made timely payments under the agreement; and the use of the words 'trial period' to describe the agreement.

Judge Spero also found that the homeowner had standing to bring an unfair competition claim under Cal. Bus. & Prof. Code §§17200 et seq., according to the ruling.

HAMP Suits Targeting BofA Roll On As SW Ohio Non-Profit Law Firm Files Action On Behalf Of Local Homeowner

In Cincinnati, Ohio, The Enquirer reports:

• A West Price Hill man on Wednesday filed a federal lawsuit against Bank of America and the U.S. Department of Housing and Urban Development alleging that his home was unlawfully forced into foreclosure.

• The Legal Aid Society of Southwest Ohio(1) filed the suit in U.S. District Court for the Southern District of Ohio on behalf of John Sinclair, who purchase his home in the 4000 block of Fawnhill Lane in 2000 using a Federal Housing Administration loan.

• In 2008, Sinclair fell behind on his mortgage, but attempted to work out a plan with BofA to avoid foreclosure, according to court papers. The suit claims that Bank of America ignored his request - a direct violation of federal law considering the FHA program requires lenders to take steps to avoid unnecessary foreclosures.

For more, see BofA, FHA sued over W. Price Hill foreclosure.

For the lawsuit, see Sinclair v. Donovan, et al.

(1) Legal Aid Society of Southwest Ohio provides legal representation, information, advice and referral for lower-income residents of Brown, Butler, Clermont, Clinton, Hamilton, Highland, and Warren Counties. It is affiliated with the Legal Aid Society of Greater Cincinnati and also coordinates services with the Volunteer Lawyers Project (VLP).

Mass. High Court Ruling "A Train Wreck For F'closure Industry" As Banks Slammed In Bay State Beat Down; 'Clouds' Over Title To Homes Darken Statewide

In Boston Massachusetts, The Boston Globe reports:

• The state’s highest court [Friday] upheld a controversial Land Court ruling that calls into question the ownership of hundreds, possibly thousands, of foreclosed properties in Massachusetts and could affect how foreclosures nationwide are conducted.

• In a 6-to-0 decision, the Massachusetts Supreme Judicial Court rebuffed the way lenders in recent years have conducted foreclosures — without having all the documentation in place at the time a property is seized. The justices affirmed a 2009 ruling that invalidated foreclosure proceedings involving two Springfield houses because the lenders did not hold clear titles to the properties.(1)

• “We agree with the [Land Court] judge that the plaintiffs . . . failed to make the required showing that they were the holders of the mortgages at the time of foreclosure,’’ Justice Ralph Gants wrote in the decision.

• Housing attorneys and state officials said the SJC’s ruling will increase pressure on major US lenders to prove they own mortgages before foreclosing, give homeowners seeking to fight foreclosures additional fodder for legal action, and further stall foreclosures in other states where similar litigation is pending. In cases where there is doubt about whether property was improperly taken, banks might even have to return homes to former owners.

***

• Boston lawyer Gary Klein, who represents many clients dealing with home foreclosure, called the ruling “a train wreck for the foreclosure industry.’’ [...] The court said yesterday that its ruling applies to all foreclosures in Massachusetts — no matter when they took place — because laws governing proper foreclosure procedures have remained constant over time. “All that has changed is the plaintiffs’ apparent failure to abide by those principles and requirements in the rush to sell mortgage-backed securities,’’ Gants wrote in the decision.(2)

***

• Officials from the Real Estate Bar Association for Massachusetts said that by not placing a time limit on its ruling, the court has guaranteed a legal traffic jam. “There is a mess of titles out there,’’ said Edward Bloom, president of the association. “There will be a lot more litigation which could have been avoided.’’

For the story, see SJC upends rules on foreclosed properties (Ruling against lenders may have US impact).

See also:

• Massachusetts Lawyers Weekly: SJC rules against banks on mortgage assignments,
• Bloomberg: Banks Lose Pivotal Massachusetts Foreclosure Case,
• Reuters: The Ibanez case and housing-market catastrophe risk.

For the ruling of the Massachusetts Supreme Judicial Court, see U.S. Bank Nat’l Ass’n v. Ibanez, No. SJC-10694 (January 7, 2011).

(1) For the 2009 rulings of Massachusetts Land Court Judge Keith C. Long in this matter, see:

• U.S. Bank Nat’l Ass’n v. Ibanez (Ibanez #1), 17 Mass. Land Court Rptr. 202 (Mar. 26, 2009),
• U.S. Bank Nat’l Ass’n v. Ibanez (Ibanez #2), 17 Mass. Land Court Rptr. 679 (Oct. 14, 2009).

(2) Justice Gants' full statement on the retroactive application of this ruling follows:

• Finally, we reject the plaintiffs' request that our ruling be prospective in its application. A prospective ruling is only appropriate, in limited circumstances, when we make a significant change in the common law. See Papadopoulos v. Target Corp., 457 Mass. 368, 384 (2010) (noting "normal rule of retroactivity"); Payton v. Abbott Labs, 386 Mass. 540, 565 (1982). We have not done so here. The legal principles and requirements we set forth are well established in our case law and our statutes. All that has changed is the plaintiffs' apparent failure to abide by those principles and requirements in the rush to sell mortgage-backed securities.

Banks Want Court To Scrap Proposal To Halt NJ Foreclosures; Ask Judge To Believe Screw-Ups In Process Can Be Fixed Without Stalling Court Proceedings

In Trenton, New Jersey, Bloomberg reports:

• Bank of America Corp., JPMorgan Chase & Co. and other U.S. banks told a New Jersey court that defects in their processes for seizing homes in the state can be remedied without halting foreclosures.

• The banks have taken steps to improve their procedures, making a suspension unnecessary, they said in documents filed [last week] in state court in Trenton, New Jersey, and made public [Thursday].(1) The filings came in response to a proposal to freeze foreclosures in the state by six U.S. banks while their procedures are reviewed. The banks’ practices came under scrutiny after bank employees signed court documents in foreclosure cases without verifying their accuracy, according to court papers.

***

• Judge Mary Jacobson scheduled a Jan. 19 hearing to consider suspending uncontested foreclosure cases and staying foreclosure sales by the banks: Ally Financial Inc., Bank of America, JPMorgan, Wells Fargo & Co., Citigroup Inc. and OneWest Bank, according to a Dec. 20 order. The move “is necessary to protect the integrity of the judicial foreclosure process in New Jersey and to assure the public that the process going forward will be reliable,” Jacobson said in the order.

For more, see JPMorgan, GMAC Urge New Jersey Court Not to Suspend Home Foreclosures.

(1) For the documents, see:

• December 20, 2010 - Order to Show Cause Issued by Judge Mary Jacobson - Residential Mortgage Foreclosures - Robosigning,
• January 5, 2011 BOA-BAC Home Response,
• January 5, 2011 GMAC-Ally Responsive Pleading,
• January 5, 2011 JPMorgan Chase Response,
• January 5, 2011 Wells Fargo Response,
• January 5, 2011 Citibank-Citi Res Notice of Appearance,
• January 5, 2011 Citibank-Citi Residential Response,
• January 5, 2011 MTN AD PR HC VC - Brooks-OneWest,
• January 5, 2011 MTN AD PR HC VC - McKeen-OneWest,
• January 5, 2011 MTN AD PR HC VC - McKeon-JP Morgan,
• January 5, 2011 OneWest Bank Response.

Iowa AG Pulls U-Turn, Reneges On Vow To "Put People In Jail!" In 50-State AG Robosigner Scandal Probe; Now Calls Matter "Inherently Civil"

Blogger David Dayen writes in Firedoglake:

• Iowa AG Miller Breaks Promise, Calls AG Investigation “Inherently Civil” and Not Criminal.

• This is a very disappointing and two-faced statement from Iowa Attorney General Tom Miller. It wasn’t even a month ago that he met with foreclosure victims and homeowner advocates and pronounced, "We will put people in jail." Now, according to this article, no, we won’t.

For more, see Iowa AG Miller Breaks Promise, Calls AG Investigation “Inherently Civil” and Not Criminal.

See also Attorney General Tom Miller Reneges on Promise to Prosecute Mortgage Fraud.

Judge Gives Go-Ahead To Civil Suit Alleging RICO Claims, Massive Sewer Service & Robosigner Racket Against Zombie Debt Buyer/Law Firm/Process Server

In Brooklyn, New York, AOL Daily Finance columnist Abigail Field reports:

• Federal Circuit Court Judge Denny Chin just issued an opinion in a consumer class action case that should send chills down the spines of debt collectors, perhaps including foreclosure-mill law firms and their process servers, nationwide.(1)

• Judge Chin decided that plaintiffs alleged enough information about the debt collectors in this case -- a law firm, a process-serving company and a debt-buying company -- to sue them for being a criminal enterprise under the Racketeer Influenced Corrupt Organization (RICO) law. Judge Chin also allowed claims under the Fair Debt Collection Practices Act.

• Why should other companies in and related to the debt-collection business be so nervous?

For more, see A Lawsuit That Dirty Debt Collectors Should Be Worried About.

(1) For the court ruling, see Opinion - Sykes v. Mel Harris and Associates LLC (denying in part and granting in part defendants motion to dismiss) (the following excerpt appears at pages 5-7 of Judge Chin's ruling; for purposes of ruling on the defendants' motion to dismiss, the following allegations in the lawsuit are assumed to be true; bold text is my emphasis, not in the original text):

• Plaintiffs allege that the Leucadia and Mel Harris defendants entered into joint ventures to purchase debt portfolios, pursued debt collection litigation en masse against the alleged debtors, and sought to collect millions of dollars in fraudulently obtained default judgments. In 2006, 2007, and 2008, they filed a total of 104,341 debt collection actions in New York City Civil Court. Assuming 260 business days a year, they filed an average of 133 debt collection actions per day.

• The Leucadia and Mel Harris defendants regularly hired Samserv to serve process. They paid Samserv only for service attempts that were reported as completed and paid nothing for service attempts that were not reported as completed. More than 90% of the individuals they sued did not appear in court; most defaulted because they were not actually served.

• Sewer service was integral to this scheme. After a consumer failed to appear in court, the Leucadia and Mel Harris defendants applied for a default judgment by providing the court with proof of service; proof of additional mailed notice to the consumer; an affidavit attesting to whether the consumer was in the military; and an "affidavit of merit" attesting to their personal knowledge of facts substantiating their legal claims to the court.

• Leucadia had limited proof to substantiate its claims because it typically did not purchase documentation of the consumers' indebtedness to the original creditors. Nonetheless, the Mel Harris defendants' "designated custodian of records," Todd Fabacher, signed the vast majority of the approximately 40,000 affidavits of merit they filed each year. Fabacher averred to having personal knowledge of the key facts establishing that the debt in each collection action was due and owing. Assuming 260 business days a year, Fabacher had to have personally (and purportedly knowledgeably) issued an average of twenty affidavits of merit per hour, i.e., one every three minutes, over a continuous eight-hour day.

• After obtaining the default judgments, the Leucadia and Mel Harris defendants proceeded to restrain plaintiffs' bank accounts, threatened to garnish their wages or seize their property, caused them to incur litigation costs, and impaired their credit, making it difficult for plaintiffs to obtain housing, employment, and loans.

For the first amended complaint filed in this lawsuit, see Complaint - Sykes v. Mel S. Harris and Associates LLC.

Clerical Error On Deed Of Trust Leaves Innocent Homeowner Facing F'closure, Despite Never Missing A Payment; Lacks Cash To Cough Up $5K For TRO Bond

In Boise, Idaho, KBOI-TV Channel 2 reports:

• The American dream has turned into a nightmare for Donna Lee of West Boise. She pays her mortgage each month but is facing foreclosure anyway. When she bought her home from a developer, there was a clerical error on the deed of trust that shows she should be living in a different unit. The developer has filed for bankruptcy and the bank wants the property.

***

• Lee lives in the home with her son. Life was good until a year ago, when she found out someone messed up the paperwork in the process of buying the home. "I just can't believe that no one is willing to change the clerical error on the deed of trust. Someone couldn’t read the platt correctly and record it correctly. My big thing here is I want justice, I want it corrected", Lee said.

• Lee's lawyer, Michael Christian met with the bank the week of December 27, 2010, to try and work out a deal. Christian came out of the meeting with another disappointing decision. In an email, Christian told the Truth Squad: "Our discussion with the developer's lender's attorney was unsuccessful, and the developer's lender (Intermountain Community Bank, which is a DBA of Panhandle State Bank), has indicated it is unwilling to postpone its foreclosure sale to work out a solution to the mistakes that were made."

• Christian filed a [request for a] restraining order afterward to try and stop the foreclosure process. The judge granted the request but also asked for a 5 thousand dollar bond to enforce it. Lee doesn't have the money and she's running out of time.

***

• Christian told the Truth Squad the developer’s bank might be interested in swapping units so Lee can stay in her home, but she might have to come up with some money to pay for any differences in the values of the properties.(1)

For more, see Boise woman facing foreclosure: 'It’s a nightmare'.

(1) I wonder if the homeowner or her attorney (or the bank currently holding her mortgage loan used to finance the home purchase) has been in touch with the title insurance company that (presumably) insured the title to the property to submit a claim on the title policy. See generally, Title Insurance: What Risks Does It Protect A Property Owner Against?

Squatting 'Gang' Of 30 Snatches Vacant 10-Bedroom, £10M London Mansion; Pending Eviction Action Of No Concern As Group Has Sights On 'Roomier' Abode

In London, England, the Daily Express reports:

• A LATVIAN squatter living in a £10 million mansion has offered to “open” houses for others to take over – and is planning to move into a bigger home himself. Jason Ruddick, 21, moved into a four-storey Victorian mansion with a 30-strong gang, many of whom are also from eastern Europe. It is believed he entered the house in Highgate, north London, on Boxing Day.

• Ruddick, who came to the UK after hearing it was a “soft touch” for squatters, said: “I like it around here and there are empty houses. We are going to keep going.” The house, which belongs to Lebanese businessman Albert Abela, was empty because it was to be renovated. Mr Abela is said to be furious at having to pay for gas, water and electricity as he cannot legally disconnect supplies while the house is occupied.

• A court hearing to evict the squatters is set for January 19 but the gang has already set its sights on a new home. Yesterday Ruddick – an anglicised version of his Latvian name – said: “We will move to a bigger place. I have found somewhere only 15 minutes away and we want more people to join us.”

• And, in a post on the Advisory Service for Squatters website, he offers to “open” empty houses for others to live in. He writes: “I have many empty houses… I can open them for anybody who’s interested – but not for free.”

For more, see I Want An Even Bigger House Says Latvian In £10M Squat.

See also BBC News: Squatting in 10-bed Highgate home was 'easy': squatter:

• [Ruddick] said squatters rights in England means "this is one of the few countries (where) it is so easy to do it". "I would probably get arrested (in Latvia), that would be the end of it", Mr Ruddick added.

• Occupation of empty properties is a civil, not a criminal, matter in England and Wales, unless entry is forced. Police can act only if the squatters commit offences such as theft or criminal damage.

Orange County DA: Squatting Couple Hired PI To Locate Vacant Foreclosed Homes, Then Drafted Fake Lease To Obtain Utility Service For $2.6M House

In Newport Beach, California, The Associated Press reports:

• Prosecutors say an Orange County couple squatted in a foreclosed home in a ritzy Newport Beach neighborhood more than three months before they were discovered and arrested. The district attorney's office said Thursday that 42-year-old Chris Wayne Duncan and 36-year-old Robin Ann Duncan face charges of second-degree burglary and other charges.

• Authorities allege the Duncans hired a private investigator to locate foreclosed and vacant homes in Orange County and then drafted a fake lease so utility companies would put bills in their name as renters. They are also accused of changing the locks after an appraiser tried to enter the property.

Source: DA: Couple squatted in Newport Beach foreclosure.

See also:

• The Orange County Register: Couple accused of squatting in vacant Newport homes,
• OC Weekly: Newport Coast Squatters Featured in OC Weekly Get Arrested (Newport Beach Police Department detectives slapped handcuffs on the couple and hauled them to jail after the Orange County district attorney's office filed criminal charges against them for illegally squatting in a $2.6 million, ocean-view Newport Coast home).

MERS Continues Efforts To Allegedly 'Buy Off' Congress By Beefing Up Its Gang Of Lobbyists

The Center for Responsive Politics' OpenSecrets Blog reports:

• One company embroiled in the nation's property foreclosure crisis is not unprepared for a fight. In Washington, D.C., Merscorp Inc. has retained several well-heeled lobbyists and invested hundreds of thousands of dollars in lobbying efforts since the start of the mortgage crisis and economic meltdown.Merscorp Inc. is the parent company of Virginia-based Mortgage Electronic Registration Systems (MERS), which serves as an electronic registry for 67 million U.S. mortgages -- more than 60 percent of the country's total.

***

• Rolling Stone reporter Matt Taibbi recently summed up the company's status this way: "In short, the mortgage industry considers MERS owner enough to foreclose on you, but not owner enough to be sued, or reasoned with, or even to provide basic customer service."

***

• The company has retained several lobbyists with powerful pedigrees. Among them?
  
  (1) Former House Appropriations Committee Chairman Robert Livingston (R-La.),
  (2) J. Allen Martin, Livingston's former chief of staff,
  (3) Arnold Havens, who formerly served as general counsel at the U.S. Treasury,
  (4) John M. Duncan, who formerly worked in the Treasury Department under President George W. Bush and served as the chief of staff for Sen. William Roth (R-Del.) -- the former Senate Finance Committee Chairman who is the namesake of the Roth IRA investment vehicle.

• Merscorp has also utilized the lobbying services of two other men who have passed through the "revolving door" between public service and the private sector: William D. Crosby Jr., a long-time lawyer for the House Rules Committee, and Steve Kreseski, the former chief of staff for Rep. Bob Ehrlich (R-Md.).

For more, see Embattled Virtual Mortgage Registry MERS Retains Top Lobbying Talent.

Beware Of Sovereign Citizen Movement Peddling Worthless Service To Homeowners Facing Foreclosure

In Orlando, Florida, WKMG-TV Channel 6 reports:

• The words are stamped in red across every page of the bank foreclosure notice. Statements such as "United States is a for-profit corporation and is bankrupt," or, "No consent to forced seizure by sale or takings," cover the foreclosure papers without any apparent purpose.

• Yet, over the past nine months, court clerks in Lake County report they have received a handful of foreclosure documents covered in the same random words and statements.

• Paul Urmson had some of those statements stamped on his foreclosure notice. He is about to lose his Lake County home to foreclosure. [...] Urmson said a friend guaranteed he would save his home. He claimed the government already had $800,000 set aside in his name. [...] He was told to pay $1,000 for the service and mail the documents to the Lake County Court. He never did.

***

• Matt Englett, managing partner of the KEL law firm, said his staff has seen a few of those stamped documents from clients who had turned to his firm for help. KEL specializes in mortgage foreclosure cases. "Courts do not recognize this, and any court that sees this will not give it any credibility," Englett said.

• The veteran attorney said the bigger issue is the sovereign movement's sales pitch. "I don't think the courts waste a lot of time on these things, but I'm more concerned about people spending $1,000, which is probably all the money they have on something that will not work," he said.

For the story, see Lawyers Warn Against Foreclosure Quick Fix (Anti-Tax Group's Propaganda Shows Up In Local Foreclosure Courts).

Go here for other posts on the sovereign citizens racket.

Massachusetts AG: Landlord's Craigslist Ads Discriminating Against Families w/ Young Kids Due To Lead Contamination In Apartments Violates Law

From the Office of the Massachusetts Attorney General:

• A Melrose-based realty trust and its manager violated Massachusetts law by allegedly posting a discriminatory rental advertisement on the popular classified advertising website Craigslist.org (“Craigslist”), according to a lawsuit filed by AG Coakley’s Office. The complaint, filed in Suffolk Superior Court against Mt. V.M. Realty Trust (“Mt. V.M.”) and Nicholas Keramaris, alleges that they violated state anti-discrimination, lead paint, and consumer protection laws by placing an advertisement on Craigslist which referred to the lead status of an apartment and refused to rent it to families with young children.

***

• According to the complaint, Keramaris, on behalf of Mt. V.M., posted an advertisement on Craigslist in June 2010 that discriminated against families with young children. The advertisement, for an apartment building in Melrose that Keramaris managed, stated that the unit could not be rented to families with children under six years old as it was not deleaded. Under Massachusetts law, it is illegal to refuse to rent or steer families away from rental properties because they have young children whose presence triggers an owner’s duty to eliminate lead hazards that pose serious health risks.

***

• Since taking office in January 2007, Attorney General Coakley’s office has obtained judgments in 91 housing discrimination cases brought against landlords, property managers, and/or real estate companies.

For the Massachusetts AG press release, see AG Coakley Sues Melrose Realty Trust And Manager For Posting Discriminatory Housing Ad On Craigslist.

Illinois Law Allowing Active-Duty Servicemembers To Apply For 90-Day Foreclosure Delay Goes Into Effect

The Huffington Post reports:

• The state of Illinois has faced an especially grim foreclosure picture in the last several years, and the outlook is likely to get bleaker in the first quarter of 2011. [...] But thanks to a new law that went into effect on New Year's Day, one especially vulnerable group of Illinoisans will be allowed a temporary reprieve.

• House Bill 3762, which passed the House and Senate unanimously in the spring and was signed into law over Memorial Day 2010, will allow active-duty service members to apply for a 90-day delay if facing foreclosure.

For more, see Illinois Foreclosures Law Helps Military Service Members Get Reprieve.

Acquitted Cop Killer Vows "We Will Defend Ourselves!" If Crim'l Defense Lawyer Attempts Eviction After F'closing On Family Farm Over Unpaid Legal Fees

In Kingston, Tennessee, the Knoxville News Sentinel reports:

• The lawyer who won Leon Houston's freedom holds a prize he can't cash. Not a single bidder showed up Tuesday when former defense lawyer Jim Logan stood on the Roane County courthouse steps and auctioned a little less than 100 acres of the Houston family farm for unpaid legal fees. Logan ended up buying the land back himself. The winning bid came in at $150,000 - far less than the quarter-million-plus Logan said the family still owes him.

***

• "This is going to get interesting when they come try to evict me by way of fraud," Leon Houston said. "We will defend ourselves."

***

• Logan sat beside Leon Houston through two double-murder trials over three years in the deaths of Roane County Deputy Bill Jones and ride-along Mike Brown. Jones and Brown died in a shootout with the Houston brothers May 11, 2006, in front of the family farmhouse on Barnard Narrows Road south of the Tennessee River.

• The brothers argued self-defense, and prosecutors couldn't prove who shot first. Leon Houston's first trial ended in a mistrial, the second in acquittal on all charges in November 2009. [Brother] Rocky Houston's only trial in December 2008 ended in a split verdict, and an appeals court threw out the case last year.

For the story, see No bids made on Houston land (Lawyer buys back farm he owns in lieu of fees).

Massachusetts High Court Ready To Rule On 'Ibanez/LaRace' Case; Validity Of Thousands Of Bay State Foreclosures Hang In Balance

In Boston, Massachusetts, Bloomberg reports:

• Massachusetts’s highest court is poised to rule on whether foreclosures in the state should be undone because securitization-industry practices violate real estate law governing how mortgages may be transferred.

• The fight between homeowners and banks before the Supreme Judicial Court in Boston turns on whether a mortgage can be transferred without naming the recipient, a common securitization practice. Also at issue is whether the right to a mortgage follows the promissory note it secures when the note is sold, as the industry argues.

• A victory for the homeowners may invalidate some foreclosures and force loan originators to buy back mortgages wrongly transferred into loan pools.(1) Such a ruling may also be cited in other state courts handling litigation related to the foreclosure crisis.

***

• The case is U.S. Bank v. Ibanez, 10694, Supreme Judicial Court of Massachusetts (Boston). The lower-court cases are U.S. Bank National Association v. Ibanez, 08-Misc-384283, and Wells Fargo Bank NA v. LaRace, 08-Misc-386755, Commonwealth of Massachusetts, Trial Court, Land Court Department (Boston).(2)

For the story, see Foreclosures May Be Undone by Massachusetts Ruling on Mortgage Transfers.

For a related post, with links to relevant court documents, see Massachusetts High Court Hears Arguments In 'Ibanez' Case That Threatens To Open The Door To Voiding Thousands Of State Foreclosures.

(1) A homeowner victory could also trigger an additional slew of lawsuits (ie. alleging violations of the Federal Fair Debt Collection Practices Act, state law prohibiting unfair and deceptive acts or practices in violation of G.L. c. 93A, § 2, etc.) against the foreclosure mill law firms who have brought foreclosure actions tainted with flaws similar to those at the center of this case.

(2) For Massachusetts Land Court Judge Keith C. Long's two rulings in this matter, see:

• U.S. Bank Nat’l Ass’n v. Ibanez (Ibanez #1), 17 Mass. Land Court Rptr. 202 (Mar. 26, 2009),
• U.S. Bank Nat’l Ass’n v. Ibanez (Ibanez #2), 17 Mass. Land Court Rptr. 679 (Oct. 14, 2009).

For related earlier posts on this story, see:

• Lenders' Problem "Entirely Of Their Own Making" Says Judge In Affirming Earlier Ruling That Puts Title To Foreclosed Massachusetts Homes Into Question,
• Court Says Foreclosure Sales Were Invalid As Banks Didn't Acquire Interest In Delinquent Loans Until After Legal Action Was Completed.

Federal Reserve To Support Tougher Rules Regulating Mortgage Servicing Rackets; Reverses Earlier Stance

The Huffington Post reports:

• The Federal Reserve has reversed its opposition to new rules reining in foreclosure abuses, and will support stronger regulations on the nation's largest banks, according to a source familiar with the matter.

***

• Problems in the packaging and sale of mortgage bonds helped inflate the housing bubble and facilitated the sale of predatory loans nationwide. Since banks could push mortgages on borrowers and then sell them to investors, critics say that banks lacked serious incentives to ensure those loans could be repaid.

• The FDIC has been pushing hard to ensure that new regulations on the mortgage bond market include clear instructions for how banks handle mortgages-- and under what circumstances they can evict delinquent borrowers. The bank divisions that collect payments from borrowers and implement the foreclosure process-- known as "mortgage servicers"-- have been plagued by rampant problems with fraudulent documentation. This fraud has resulted in everything from illegal fees charged to borrowers to improper evictions.

For more, see Fed To Back New Rules To Rein In Home Foreclosure Abuses.

BofA's "Pennies On The Dollar" Settlement With Fannie, Freddie Over Sale Of Crappy Mortgages A "Backdoor Bailout" Of Bank By Federal Government?

The New York Post reports:

• Bank of America is getting blasted with accusations of a "backdoor bailout" for its $2.8 billion settlement with Fannie Mae and Freddie Mac over billions of bad mortgages. Fannie and Freddie, which are wards of the government, accepted pennies on the dollar to settle a dispute over billions of faulty mortgages the bank sold to the pair during the housing bubble.

• Bank of America breathed a sigh of relief on Monday after the cost was far less than investors feared, sending its shares up as much as 6.4 percent. But detractors on Wall Street and in Washington denounced the deal as another taxpayer buyout for a bank that weathered the financial crisis only with the help of a $45 billion government lifeline.

***

• Analysts estimate the taxpayer bill for propping up troubled institutions Fannie and Freddie could hit a whopping $150 billion, while the entities' recent settlements with banks over bad mortgages represent a drop in the bucket.

• "If Fannie and Freddie had really pushed hard on this settlement, it would have really caused problems for BofA," Edward Pinto, resident fellow at conservative Washington think tank American Enterprise Institute, told The Post.

• The outrage stems from BofA's agreement to pay just $1.28 billion to Fannie and $1.52 billion to Freddie to resolve a dispute over loans purchased between 2005 and 2007 that the pair claims were improperly created. According to critics, the BofA settlement was struck for a mere fraction of the amount the bank should be forking over to Fannie and Freddie.

• "This [settlement] is a standing subsidy that has to be worth $10 billion or $15 billion for [BofA]," Christopher Whalen, the founder of Institutional Risk Analytics, told The Post.

For more, see Furor over BofA's $2.8B mortgage settlement.

Colorado AG Scores $181K+ Judgment Against Foreclosure Rescue Operator For Clogging Courts With Frivilous Filings, Clipping Homeowners w/ Upfront Fees

In Denver, Colorado, The Denver Post reports:

• A man accused of running a company called "America's Foreclosure Defense" and preying on elderly and vulnerable people has been ordered to pay $181,266 in restitution and fines to the state, Colorado Attorney General John Suthers announced Tuesday.

• Sherron L. Lewis Jr., 54, has been barred from providing foreclosure-relief services. Lewis was accused in a suit filed by the attorney general of filing frivolous lawsuits that clogged the courts. Suthers alleged that Lewis used deceptive and misleading schemes that Lewis claimed would stop the foreclosure process.

• Suthers said Lewis had no legal experience, had improperly raked in thousands of dollars of upfront fees and had "grossly misused and abused the judicial system." The $181,266 judgment against Lewis was ordered after he failed to respond to the state's lawsuit over his activities.

• A Jefferson County district court judge ordered Lewis in August to pay more than $76,000 in restitution to victims, including an elderly Illinois woman, Suthers said. The fines ordered against Lewis in August stemmed from his alleged practice of collecting upfront fees and acquiring an interest in his victims' properties as part of his services, both of which violated Colorado law, according to the attorney general.(1)

Source: Man pays fines, restitution to state in case alleging frivolous lawsuits.

(1) For the Colorado AG press release, see Attorney General announces $181,266 judgment against Denver man who provided fraudulent foreclosure-relief services.

For the relevant court documents, see:

• Sherron Lewis final judgment release,
• Sherron Lewis default judgment and permanent injunction,
• Sherron Lewis judgment,
• Sherron Lewis complaint.

Ex-Ohio AG Files Class Action Suit Alleging Lenders' Law Firm Files Frivilous Foreclosures

In Cleveland, Ohio, WKYC-TV Channel 3 reports:

• Ohio's former embattled attorney general Marc Dann is taking on his first high-profile lawsuit since a sexual harassment scandal forced him to resign from the job in 2008. Dann and co-counsel James Douglass Tuesday filed a class-action lawsuit against a law firm he says files frivolous foreclosures.

• The lawsuit filed in Cuyahoga County Common Pleas Court claims the debt collection firm-- Lerner, Sampson and Rothfuss -- doesn't have the right to file foreclosures and has created incorrect documentation.(1)

For more, see Ex-AG Dann sues law firm regarding their foreclosure process.

For the lawsuit, see Turner, et al. v. Lerner, Sampson & Rothfuss.

See also attorney Marc Dann's press release: Lawyers for Foreclosing Banks Should be Held Accountable for Telling the Truth:

• The suit alleges that filing lawsuits on behalf of banks and investors who do not actually hold the notes or mortgages that are the subject of the lawsuit is a violation of the Fair Debt Collection Practices Act, Ohio Consumer Sales Practices Act and constitutes abuse of process. We have also alleged that Lerner Sampson and its staff members created and signed assignments, endorsements and affidavits without having actual knowledge of the facts contained in those documents.

Thanks to deontos.is for the heads up on the story.

(1) According to Dann's press release, the Cuyahoga County County Common Pleas Judges have recently enacted much stricter requirements for proof when lawyers like Lerner Sampson are seeking a judgment in a foreclosure case (Cuyahoga County Affidavit Policy, Attorney Affidavit Forms).

Big Bear Homeowner Scores Small Claims Win Over BofA In Alleged Fraudulent Bait & Switch Loan Modification Scam

In Big Bear City, California, BigBearGrizzly.net reports:

• Dave Graham got fighting mad. The Big Bear City resident took Bank of America’s mortgage division, BAC Home Loans Servicing LP, to small claims court claiming fraud. Graham won his case Dec. 17. And he doesn’t feel apprehensive about gloating one bit.“I feel real good about this,” Graham says. He sued the mega bank for fraud because he was put into a loan modification program by Bank of America when the bank knew from the start he did not qualify.

***

• The judge awarded Graham $7,595. This is the first known case where Bank of America has been found guilty by reason of fraud.

For more, see Big Bear bank shot (Local man wins lawsuit against Bank of America).

See also The Huffington Post: Homeowner Beats Bank Of America In Small Claims Court:

• Graham, who faces reduced income after retiring from his job as a shift foreman at a grocery distribution center, said he never would have bothered with HAMP had the bank not sent him a packet saying he should apply. "I would have found some way to [make my payments] if I had to," he said. "It may even been that we'd have fallen behind a month or two. I certainly wouldn't have been in this sort of shape."

• It's the classic HAMP bait-and-switch: Homeowners are told they're eligible for the program but eventually discover the foreclosure process, triggered by the reduced payments, moved faster than the modification process.

***

• Lots of people have sued big banks for their bad faith HAMP efforts, but Graham may be the first to try it in small claims court. It won't save his home, but it gives him some dignity. "Both small claims courts judges and juries often have a refreshing sense of justice that allows these sorts of bellwether decisions," HAMP expert Alan White told HuffPost. "Judges are also less reticent to denounce unfair practices in small stakes individual cases than in government enforcement or class actions."

• The National Consumer Law Center is involved in several class-action lawsuits against banks and others over broken HAMP promises.(1) (Those lawsuits, if successful, will prevent foreclosures.) The NCLC's Charles Delbaum told HuffPost that Judge John Pacheco's "terrific decision" in Graham's case picked up on the same theme of more than a dozen actions against the likes of Bank of America, JPMorgan Chase, Wells Fargo, and CitiMortgage.

• "[I]t is unconscionable to string homeowners along far beyond the three month trial periods they and their banks have agreed to," Delbaum emailed, "allowing them to become more and more behind on the payments due under their original loan, making the hole they are in ever deeper and harder to dig out of, and then to tell them they weren't eligibile for the program in the first place -- something the banks are required to determine within the three month trial period."

(1) For some of those lawsuits, see:

• Bosque v. Wells Fargo, Class Action Amended Complaint (Exhibits: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, and 11 - eight-page demand letter (offering Wells Fargo opportunity to settle HAMP claims)),
• Johnson v. Bank of America Home Loans Servicing, Class Action Amended Complaint,
• Durmic v. J.P. Morgan Chase, Class Action Complaint,
• Reyes v. OneWest, Class Action Amended Complaint.

Rubber Stamping Florida Judge Changes Public Position On Exempting F'closing Banks From Complying w/ Procedural Rules, Then Lets 'Em Break Them Anyway

AOL Daily Finance columnist Abigail Field writes:

• Over the holidays, I wrote about judges in Lee County, Fla., and how they appear to prioritize completing foreclosures over the rule of law. The most extreme example was an order in one case by Judge James R. Thompson that specifically exempted banks from a rule on affidavits that all other Florida litigants must follow -- specifically, part (e), which requires claimants to provide legally valid documents to back up their claims.

• Now, Judge Thompson has disowned the original order, replacing it with an order that claims banks do have to follow the rules. The problem? Even though he says the rules of evidence do apply to banks, the judge allowed the bank in that case to use an affidavit that obviously breaks the rule.

• Apparently, the judge merely changed his public position: Rather than admit the fact that foreclosing banks don't have to follow the rules on affidavits and loan documentation, he'll say they do, then fail to make them comply. That smells like a cover-up, not a correction.

• Indeed, the clerk of the court told a Florida TV station that the court never makes the banks comply with the rules on documentation.

***

• To its credit, the Florida Supreme Court, like its counterparts in New York and New Jersey, has been trying to defend the rule of law. Sadly, a more robust action seems necessary.(1)

For more, see Florida Is Still Letting Banks Break the Rules in Foreclosure Cases.

(1) See Florida Trial Judges Continue Sloppy Work In Foreclosure Actions; Rubber-Stamped Judgments Tainted By Sewer Service Reversed By State Appellate Courts for more on the apparent crappy attitude of some Florida judges presiding over foreclosure proceedings.

Florida AG Outlines Its Evidence Of Fraudulent Court Filings In Foreclosure Cases With 98-Page Presentation

The Palm Beach Post reports:

• Sweeping evidence of the case the state attorney general's office has built in its pursuit of foreclosure justice for Florida homeowners is outlined in a 98-page presentation complete with copies of allegedly forged signatures, false notarizations, bogus witnesses and improper mortgage assignments.

• The presentation, titled "Unfair, Deceptive and Unconscionable Acts in Foreclosure Cases," was given during an early December conference of the Florida Association of Court Clerks and Comptrollers by the attorney general's economic crimes division.

• It is one of the first examples of what the state has compiled in its exploration of foreclosure malpractice, condemning banks, mortgage servicers and law firms for contributing to the crisis by cutting corners. "What we got from this is the state has had the opportunity to see where the laws have been broken, and frankly, it is in large part thanks to the work of the defense attorneys," said Palm Beach County Clerk and Comptroller Sharon Bock. "They've been bringing these defenses up in foreclosure cases for years now."

For more, see State details foreclosure chaos: Evidence of forgeries, bogus witnesses and illegal shortcuts.

For the Florida AG Economic Crime division's 98-page presentation, see Unfair, Deceptive and Unconscionable Acts in Foreclosure Cases (whoever illustrated this presentation had a good sense of humor).

A Mortgage-Backed Security Map: The Fantastic Fate of One Man's Loan

A recent story from PBS Newshour featured the case of homeowner Daniel Edstrom, who is employed by a company who happens to perform securitization audits, who decided he'd look into the history of his own mortgage.

He reportedly spent a year mapping his mortgage, came up with this flowchart showing how his mortgage was ripped apart during the securitization process, and observed:

• "If someone steals a car, they can make much more money if they break the car up into pieces and sell the pieces individually. That's exactly what happened here [to my mortgage]."

The story concludes with this excerpt:

• [I]ncreasingly, those who engineered these deals are looking suspect, as Brooklyn Supreme Court Judge Arthur Schack recently explained to us. If a judge were to study Daniel Edstrom's chart of his own wayward mortgage, might his or her honor have even more reason to slow the foreclosure process? Take a close look yourself and see how you might rule.

For the PBS' story, see A Mortgage-Backed Security Map: The Fantastic Fate of One Man's Loan.

Michigan Couple Victimized By Illegal Trashout Linked To Wrongful Bank Foreclosure Of 'Mortgage-Free' Home Settle Lawsuit

In Grand Rapids, Michigan, The Grand Rapids Press reports:

• A couple who said a bank wrongly foreclosed on their $14,000 fixer-upper have settled their lawsuit. Rick and Sherry Rought of Gowen bought the house near Big Rapids in 2009 for their daughter, Hannah, while she attended Ferris State University. Seven months later, a company allegedly hired to “trash out” the house changed locks and turned off utilities, the couple said in a lawsuit filed last year in U.S. District Court.(1)

• Their house, bought with cash, was not subject to foreclosure. They sued Deutsche Bank National Trust Co., Field Asset Services and American Home Mortgage Servicing. The companies denied any wrongdoing, and said a contractor, Out in the Woods, “may be wholly or partially at fault.” Out in the Woods was not named as a defendant in the lawsuit.

• The parties reached a settlement that was not disclosed in court records. The agreement, which results in the lawsuit being dismissed, was signed Monday by District Judge Janet Neff.

For the story, see Grand Rapids homeowners end lawsuit against bank in foreclosure case.

(1) For the lawsuit, see Rought v Deutsche National Trust Company, Trustee, et al.

(2) For examples of other lawsuits involving these illegal lockout cases, see:

• Bank admits mistake on Willcox home foreclosure (involving an Arizona homeowner) (for a copy of the resulting federal lawsuit, see Newman v. Bank of America, N.A. and go here for the attached Exhibits),

• Couple: Bank Foreclosed On Wrong House (New Bedford Couple Suing Bank Of America) (involving a Massachusetts resident with a home in Florida) (for a copy of the resulting federal lawsuit, see Cardoso v. Bank of America, et al.),

• In a Sign of Foreclosure Flaws, Suits Claim Break-Ins by Banks (involving a California homeowner) (for a copy of the resulting federal lawsuit, see Ash v. Bank of America).

For those homeowners who've been screwed over by wrongful lockouts by foreclosing lenders (and their confederates) and seek some possible guidance on how much their cases might be worth if they seek to sue, see:

• Nevada High Court OKs $1M+ Damage Award To Homeowner Due To Mortgage Company Misidentification Of Home In Foreclosure (for the court ruling, see Countrywide Home Loans v. Thitchener, 192 P.3d 243; 2008 Nev. LEXIS 79; 124 Nev. Adv. Rep. 64 (September 11, 2008)),

• Long Island Judge Hammers Wells w/ $155K Tab For Oppressive, Heavy Handed, Egregious Conduct For Pre-Sale Lockout Of Homeowner In Foreclosure (for the court ruling, see Wells Fargo v. Tyson, 2010 NY Slip Op 20079 (Sup. Ct., Suffolk County, March 5, 2010)).

Change In Judicial Mood On New Jersey Robosigning Scandal Reflected In Recent Rulings

The Metropolitan Corporate Counsel reports:

• New Jersey courts have started clamping down on lenders' ability to enforce mortgage documents by raising concerns when the lender cannot establish that it possesses the original note at the time a foreclosure action is commenced or that it is a holder in due course under the Uniform Commercial Code ("UCC").

• Two recent decisions, one from the New Jersey Superior Court, Chancery Division, General Equity Part, Atlantic County, and a second from the United States Bankruptcy Court for the District of New Jersey, elucidate this change in judicial mood. The teachings of these decisions, which are discussed herein, are that lenders and their counsel need to determine and be sure of certain facts before they start an action to enforce mortgage documents. The failure to take the simple steps discussed in this article could result in such action being substantially delayed or never getting off the ground.

• In Bank of New York v. Raftogianis, ___ N.J. Super. ___, 2010 N.J. Super. Unpub LEXIS 2316 (N.J. Super. Ct. Ch. Div. June 29, 2010), the Hon. W.C. Todd, P.J. Ch., issued a lengthy and scholarly opinion addressing many issues relating to foreclosure litigation, including the applicability of the UCC, how the Mortgage Electronic Registration System ("MERS") operates, and the impact on foreclosures of the securitization or pooling of mortgages. In fact, the opinion could be viewed as a treatise on these subjects.

***

• In Kemp v. Countrywide Home Loans, Inc. (In re Kemp) , 2010 Bankr. LEXIS 4085 (Bankr. D.N.J. Nov. 17, 2010), the debtor filed an adversary complaint seeking to expunge the proof of claim filed on behalf of Bank of New York by Countrywide Home Loans, Inc. as servicer.

For more, see New Jersey Courts Place Roadblocks On Lenders' Ability To Enforce Mortgage Documents (for print version, TRY HERE).

Indiana AG Asks State High Court To Implement Procedural Rules To Address Robosigner Scandal

In Indianapolis, Indiana, WRTV-TV Channel 6 reports:

• The Indiana attorney general on Monday asked the Indiana Supreme Court to implement new regulations regarding the handling of foreclosures in the state. The proposed changes, which would not require legislative action, are in response to mortgage companies that admitted they improperly filed documents with courts to process foreclosures.

For more, see Court Asked To Toughen Foreclosure Lender Regulations (AG Says New Proposal Will Protect Homeowners).

Fannie, Freddie Score $2.5B+ From BofA To Settle Crappy Loan Buyback Demands; Requests For $10B+ From Other Banks Still Outstanding

The New York Times reports:

• Bank of America announced Monday that it had paid more than $2.5 billion to buy back troubled mortgages and resolve related claims from Fannie Mae and Freddie Mac — deals that may prompt a wave of such settlements by big banks.

• The agreements center on home loans that Countrywide Financial sold to Fannie and Freddie at the height of the mortgage bubble. The government-controlled housing giants, which have suffered billions of dollars in losses in recent years, have said that the lender misrepresented the quality of the loans. Bank of America bought Countrywide in 2008.

• Fannie and Freddie also are looking to collect from other large lenders, including Wells Fargo, Citigroup and Washington Mutual, now owned by JPMorgan Chase.

• Before the Bank of America payments, Fannie and Freddie received about $9 billion from repurchase claims, according to their financial statements. The two firms still have more than $10 billion of requests outstanding. Banks have a major incentive to cut deals with Fannie and Freddie. The two firms currently own or guarantee roughly two-thirds of all new mortgages in the United States.

For more, see Bank of America Buys Back $2.5 Billion in Mortgage Debt.

MD Appeals Court: State Foreclosure Rescue Law Applies To Transaction Where Law Took Effect After Contract But Before Closing Of Sale Leaseback Ripoff

In a recent ruling by the Maryland Court of Special Appeals, the court rejected an accused sale leaseback peddler's attempt to dodge the application of the state's Protection of Homeowners in Foreclosure Act by claiming that the contract for the transaction pre-dated the effective date of the statute, in a deal that didn't actually close until after the law took effect.

In reversing a lower court ruling, the appeals court said that applying the law to this case did not operate as an impermissable retroactive application of the statute to deprive the sale leaseback peddler of vested rights, and found that the trial court erred in concluding that the law was inapplicable to the transaction.

For the ruling, see Kargbo v. Gaston, 195 Md. App. 222; 5 A.3d 1231 (September 30, 2010).

Fed-Up Judge Refuses Further Trial Delays For Ex-Closing Attorney Accused Of Ripping Off Real Estate Escrow Funds In 4-Year Old Case

In Pittsburgh, Pennsylvania, the Pittsburgh Tribune Review reports:

• The only way a former Fayette County attorney accused of stealing about $99,000 in mortgage-settlement claims from two elderly couples can avoid going to trial on Jan. 3 is if he is hospitalized, according to the trial judge.

• Judge Steve Leskinen [] told Mark Morrison's attorney that if Morrison fails to appear for trial in the four-year-old criminal case, a bench warrant will be issued for his arrest unless Morrison is "confined to a hospital." Morrison, 53, of Hopwood was charged in 2006 with two counts each of theft by failure to make required disposition of funds, forgery, tampering with records or identification, and misapplication of entrusted property. The state Attorney General's Office alleges Morrison failed to use the money to settle outstanding mortgages on two properties.

• Citing numerous health problems and questions over competency, Morrison has successfully petitioned the courts to postpone his trial. The case was put back on the trial list [...] when Leskinen, after a 4 1/2-hour long hearing in November, declared Morrison competent for trial.

***

• "This case has been pending for four years," Leskinen said. "It needs to be resolved."

For the story, see Enough delays, exclaims judge in alleged mortgage scam case.

For a couple of follow-up stories, see

• Ex-lawyer from Hopwood gets one more day to appear in court ("A Fayette County judge yesterday said he was unconvinced a former attorney couldn't secure an ambulance ride to the courthouse in time for the start of his trial yesterday on theft charges, but he gave the Hopwood man another day to appear."),

• Broker: Lawyer withheld payment ("A former Fayette County attorney's reputation persuaded a mortgage broker to let him represent two clients at closings, according to a former loan officer who testified Tuesday in the Hopwood man's theft case.").