Articles Posted in US Court of Appeals for the First Circuit

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In this diversity case, the First Circuit affirmed the district court’s conclusion that Deutsche Bank National Trust Company’s mortgage interest in a property in New Hampshire was subject to a homestead right of Jennifer Pike, the property’s resident, and the district court’s denial of Pike’s request for attorney’s fees, holding that the district court did not err. After consolidating Pike’s appeal from the denial of her request for attorney’s fees with Deutsche Bank’s appeal, the First Circuit held (1) the district court correctly determined that Pike retained her homestead right under the plain language of a divorce decree; (2) the district court correctly declined to apply equitable subrogation to defeat Pike’s homestead right; and (3) the district court correctly concluded that Pike was not entitled to attorney’s fees under a New Hampshire state statute and the mortgage because she was not the “borrower” for purposes of the mortgage. View "Deutsche Bank National Trust Co. v. Pike" on Justia Law

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The First Circuit reversed the judgment of the district court granting Bank’s motion to dismiss this case alleging that Bank failed to comply with the notice requirements in Plaintiffs’ mortgage before foreclosing on their property, holding that Bank’s failure to strictly comply with paragraph 22 of the mortgage invalidated the foreclosure. Paragraph 22 required that prior to accelerating payment by Plaintiffs, the mortgagee had to provide Plaintiffs with notice specifying certain elements. After Bank sent default and acceleration notices to Plaintiffs Plaintiff failed to cure the default, and Bank conducted a foreclosure sale. Plaintiffs then filed a complaint alleging that Bank failed to comply with the paragraph 22 notice requirements prior to foreclosing on their property. The district court granted Bank’s motion to dismiss for failure to state a claim, concluding that Bank’s default and acceleration notice strictly complied with paragraph 22. The First Circuit disagreed, holding (1) the mortgage terms for which Massachusetts courts demand strict compliance include the provisions in paragraph 22 requiring and prescribing the preforeclosure default notice; and (2) because the default letter omitted certain information that rendered the notice potentially deceptive the Bank violated the strict compliance requirement, thus invalidating the foreclosure. View "Thompson v. JPMorgan Chase Bank, N.A." on Justia Law

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The First Circuit affirmed the district court’s order dismissing the case brought by Plaintiff seeking to have the district court address the same grievances she brought without success in the Massachusetts state courts, holding that Supreme Court case law divests federal courts of subject-matter jurisdiction in such cases. A bank commenced a summary process action in the Worcester Housing Court seeking to evict Plaintiff. Plaintiff counterclaimed. The Housing Court eventually entered final judgment awarding possession of the property to the bank. Plaintiff’s appeal was unsuccessful. Thereafter, Plaintiff filed a civil action against the bank in the United States District Court for the District of Massachusetts, alleging wrongful foreclosure and other claims relating to the same issues she addressed in the summary process action. The district court granted the bank’s motion to dismiss, concluding that the doctrine set forth in D.C. Court of Appeals v. Feldman, 460 U.S. 462, 482 (1983) and Rooker v. Fidelity Trust Co., 263 U.S. 413, 415-16 (1923), deprived the federal courts of subject-matter jurisdiction. The First Circuit affirmed, holding that under the Rooker-Feldman doctrine, the district court lacked jurisdiction where Plaintiff’s federal suit sought to invalidate the antecedent state courts’ judgments. View "Klimowicz v. Deutsche Bank National Trust Co." on Justia Law

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In this action filed by Plaintiffs seeking to enjoin their property’s foreclosure sale, the First Circuit affirmed the district court’s dismissal of Plaintiffs’ complaint under Fed. R. Civ. P. 12(b)(6) and the denial of Plaintiffs’ request for injunctive relief, holding that the district court did not abuse its discretion in concluding that the statute of limitations applied to the bulk of Plaintiffs' claims. Plaintiffs obtained a loan from Countrywide Home Loans, Inc. to refinance their Massachusetts property. After Plaintiffs defaulted on their loan they initiated this action to void their transaction and enjoin their property’s foreclosure sale. The district court granted Defendants’ motion to dismiss the bulk of Plaintiffs’ claims as time-barred and denied Plaintiffs’ request for injunctive relief. The First Circuit affirmed, holding (1) the district court properly found that the statute of limitations applied to the majority of Plaintiffs’ claims; and (2) the remainder of Plaintiffs’ arguments were meritless. View "Harry v. Countrywide Home Loans, Inc." on Justia Law

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The First Circuit affirmed in substantial part the district court’s judgment dismissing US Bank’s complaint against HLC Escrow, Inc. and First American Title Insurance Company, vacating only its dismissal of US Bank’s claim against First American alleging violation of Maine’s Unfair Claims Settlement Practices Act (USCPA), which the First Circuit concluded was timely filed. US Bank, the current holder of a 2007 mortgage that incorrectly identified a parcel of unimproved land rather than the correct parcel of improved land that encompassed the mortgagors’ residence, sued the closing agent and the title insurer in 2016. The complaint included causes of action for negligence and “duty of care” against HLC Escrow, and negligence, unilateral mistake, and violation of USCPA against First American. The district court dismissed the complaint in its entirety, concluding that Maine’s six-year statute of limitations for civil actions barred US Bank’s claims. The First Circuit vacated the dismissal with respect to US Bank’s USCPA claim against First American and otherwise affirmed, holding that the USCPA claim was timely for statute of limitations purposes but that the remainder of US Bank’s claims were untimely filed. View "US Bank, N.A. v. HLC Escrow, Inc." on Justia Law

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In this appeal from a forfeiture order, the First Circuit held that the district court did not abridge Defendant’s procedural rights and that the district court applied an appropriate yardstick in measuring the proceeds of Defendant’s criminal activity to be forfeited. Defendant, a corrupt politician, was convicted of embezzlement from an organization receiving federal funds. The First Circuit affirmed the conviction and sentence but vacated the district court’s forfeiture order. On remand, the district court ordered Defendant to forfeit the “proceeds” of his criminal activity in the amount of $1,382,214. On appeal, Defendant argued, in part, that he had a right to allocate before the district court upon remand and a right to be present when the district court reentered the forfeiture order. The First Circuit affirmed, holding (1) Defendant’s right to allocate was satisfied at the initial sentencing hearing, and Defendant waived any right to be present that may have existed when the district court re-entered the forfeiture order; and (2) the management fees that formed the basis for the forfeiture award constituted “proceeds” of the offenses of conviction. View "United States v. George" on Justia Law

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The First Circuit affirmed the district court’s order dismissing a suit that challenged the lawfulness of a 2012 foreclosure sale of a Massachusetts home. In their complaint, Plaintiffs, who formerly owned the property at issue, alleged that Defendants - OneWest Bank, Indymac Mortgage Services, Ocwen Servicing, and the Federal National Mortgage Association - had engaged in unfair and predatory mortgage lending and loan servicing practices. The complaint set forth nine claims. The district court granted Defendants’ motion to dismiss all of the claims. The First Circuit affirmed, holding that the district court did not err in (1) dismissing three claims for which Plaintiffs sought a judgment declaring that the foreclosure sale was void; (2) dismissing for lack of standing the claim in which Plaintiffs sought to quiet title; (3) dismissing the claim for breach of the duty of good faith and reasonable diligence on the basis that there was no such duty; and (4) dismissing Plaintiffs’ remaining claims. View "Flores v. OneWest Bank, F.S.B." on Justia Law

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The First Circuit reversed the denial of Plaintiff’s motion to vacate and order dismissing his lawsuit against Defendants in which Plaintiff alleged a variety of state law violations in connection with a foreclosure action against a property he owned in Nantucket, Massachusetts. The district court, sua sponte, dismissed Plaintiff’s suit for failure to prosecute after Plaintiff’s counsel failed to appear at a motion hearing. Plaintiff’s counsel subsequently filed a motion for relief from the district court order dismissing the case, citing Fed. R. Civ. P. 60(b) and claiming “mistake, inadvertence, carelessness or excusable neglect.” The district court denied the motion without prejudice. Plaintiff then refiled the motion, but the district court denied it without any further explanation. The First Circuit reversed the district court’s denial of Plaintiff’s motion to vacate the prior order dismissing his case and vacated the order dismissing his case, holding that, where Plaintiff provided the district court with an innocent and undisputed reason for counsel’s absence, dismissal with prejudice was too harsh given the circumstances. View "Keane v. HSBC Bank USA, N.A." on Justia Law

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The First Circuit affirmed the district judge’s dismissal of Plaintiff’s eight-count complaint. Plaintiff filed his complaint in state court against the servicers, holders, and assignees of his mortgage loan. Relevant to this appeal was count one, a claim predicated on the Massachusetts Predatory Home Loan Practices Act, Mass. Gen. Laws ch. 183C. The matter was removed to federal court, which dismissed the complaint in its entirety. The First Circuit held (1) Plaintiff’s chapter 183C was time-barred, and Plaintiff presented no reason to toll the applicable statute of limitations; and (2) the trial justice did not err in denying Plaintiff leave to amend his complaint because the amended complaint would fail to state a claim upon which relief could be granted. View "Rife v. One West Bank, F.S.B." on Justia Law

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In this action seeking to, among other things, quiet title to certain property, the district court did not err in granting judgment on the pleadings in favor of Defendants. After he was informed that his loan secured by a mortgage on his Massachusetts property was in default, Plaintiff sued Ocwen Loan Servicing, LLC and US Bank, N.A. (collectively, Defendants), seeking unclouded title to the property, an injunction against foreclosure, and damages. The district court granted Defendants’ motion for judgment on the pleadings and dismissed all counts of Plaintiff’s complaint. The First Circuit affirmed, holding that Defendants were entitled to judgment on the pleadings because Defendant failed to plead any set of facts that would entitle him to relief. View "Rezende v. Ocwen Loan Servicing, LLC" on Justia Law