Justia Military Law Opinion SummariesArticles Posted in Banking
Phx. Light SF Ltd. v. Bank of N.Y. Mellon; Phx. Light SF DAC v. Bank of N.
Plaintiffs – issuers of collateralized debt obligations secured by certificates in residential-mortgage-backed securities trusts – appealed from three separate judgments dismissing actions brought against The Bank of New York Mellon, Deutsche Bank National Trust Company, and Deutsche Bank Trust Company Americas. In each case, the district courts assumed that Plaintiffs had Article III standing but found that Plaintiffs were precluded from relitigating the issue of prudential standing due to a prior case Plaintiffs had brought against U.S. Bank National Association. The Second Circuit affirmed the district court’s orders. The court explained that it joined the Ninth Circuit in concluding that the district courts permissibly bypassed the question of Article III standing to address issue preclusion, which offered a threshold, non-merits basis for dismissal. The court also concluded that the district courts’ application of issue preclusion was correct. The court wrote that it fully agreed with the district courts that Plaintiffs were not entitled to a second bite at the prudential-standing apple after the U.S. Bank Action. The district courts, therefore, did not err in taking this straightforward, if not “textbook,” path to dismissal. View "Phx. Light SF Ltd. v. Bank of N.Y. Mellon; Phx. Light SF DAC v. Bank of N." on Justia Law
Sibert v. Wells Fargo Bank, N.A.
Plaintiff filed suit against Wells Fargo, alleging that the foreclosure sale of his house was invalid under the Servicemembers Civil Relief Act (SCRA), 50 U.S.C. 3953(a), 3953(c), which requires a lender to obtain a court order before foreclosing on or selling property owned by a current or recent servicemember where the mortgage obligation "originated before the period of the servicemember's military service." The Fourth Circuit affirmed the district court's grant of summary judgment to Wells Fargo, holding that plaintiff's mortgage obligation originated when he was in the Navy, it was not a protected obligation under section 3953(a), and his later enlistment in the Army did not change that status to afford protection retroactively. View "Sibert v. Wells Fargo Bank, N.A." on Justia Law
Brewster v. Sun Trust Mortgage
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
Posted in: Banking, Military Law