Judge Zloch Deals Blow to Wells Fargo and Ocwen on Trial by Jury

In a short written opinion Judge William J Zloch, formerly of Notre Dame football fame (quarterback and wide receiver) dealt a huge blow to bankers pretending to be lenders and servicers pretending to be bankers. For him the issue was simple. And he is right. His opinion contains irrefutable logic. Ocwen wanted to escape trial by jury because the mortgage documents contained a waiver. Wells Fargo also wanted to escape trial by jury, but they were being sued vicariously through the actions of Ocwen.

Zloch said no to Ocwen and seems to be saying the same thing to Wells Fargo. His reasoning is simple and bulletproof — the borrower sued Ocwen stating that it had committed various wrongdoing. Ocwen by all accounts is only a servicer and never has been a lender notwithstanding its prior assertions in court, which many judges have rubber stamped and now wish they didn’t.

This decision appears to be important for at least three reasons:

1. The Judge accepts the notion that Ocwen is a controlled entity of Wells Fargo.

2. The Judge rejects the idea that a party other than the owner of the mortgage can rely on the mortgage terms for any reason (except to show that they were servicing and processing in compliance with the terms of the note and potentially the mortgage). Thus the Judge underscores a central point on this blog — that the servicers, aggregators and broker dealers and trusts and trust beneficiaries are all independent entities and the servicers, among others, have inescapable conflicts of interests that results in action contrary to the expectations of both real parties in interest — i.e., the investors as lenders and the homeowners as borrowers.

3. Trial by jury is available as to all damage claims against any party who is not party to the mortgage contract; and for those banks that are using the servicers as a shield, they may be subject to claims that will be heard by a jury as well.

So in the end he says that the jury will render a verdict as to the claims against Ocwen and render an advisory verdict as to the claims against Wells Fargo. This is a potential nightmare for the banks. It is about time. And now it is time to get your claims heard by a jury.

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23 Responses

  1. @ P Nach

    Hamid v Ocwen Loan Servicing, LLC 13-62821-CIV-WJZ (2014)

  2. VERY IMPORTANT TO READ THIS NINTH CIRCUIT MEMORANDUM–MARCH 2014-REGARDING LIBOR

  3. ., and is offered for sale without any representation as to quality or quantity of title and without recourse to plaintiff.

    COUNTRYWIDE HOME LOANS, INC.

    PLAINTIFF

    BANK OF AMERICA, N.A. (USA);

    DEFENDANTS

    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

    Fuzzy Stuffs …
    Maybe I need a glass of Wine.
    Or maybe I need to get in a new line of business.

    BOA NA was not registered in IL until 2010.

  4. May 9, 2014, in COUNTY COURTHOUSE, JURY ASSEMBLY ROOM, MAIN STREET, at 9:00 AM, sell at public auction and sale to the highest bidder for cash, all and singular, the following described real estate mentioned in said Judgment, situated in the County of , State of Illinois, or so much thereof as shall be sufficient to satisfy said Judgment:

    Sale Terms: This is an “AS IS” sale for “CASH”. The successful bidder must deposit 25% down by certified funds; balance, by certified funds, within 24 hours. NO REFUNDS

    The subject property is subject to general real estate taxes, special assessments or special taxes levied against said real estate, water bills, etc., and is offered for sale without any representation as to quality or quantity of title and without recourse to plaintiff.

  5. Had to Share this from todays paper,
    Mind Boggling

    COUNTRYWIDE HOME LOANS, INC.

    PLAINTIFF

    VS

    XXXXXXXXXXXX XXXXXXXX

    COMMONS HOMEOWNER’S ASSOCIATION, INC.;
    BANK OF AMERICA, N.A. (USA);

    DEFENDANTS

    07 CH

    NOTICE OF SALE PURSUANT TO JUDGMENT OF FORECLOSURE UNDER ILLINOIS MORTGAGE FORECLOSURE ACT ***THIS DOCUMENT IS AN ATTEMPT TO COLLECT ON A DEBT. ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE*** PUBLIC NOTICE IS HEREBY GIVEN that pursuant to a Judgment of Foreclosure and Sale entered by said Court in the above entitled cause on February 25, 2008,

    Any Comments?

  6. http://dealbook.nytimes.com/2014/03/26/bank-of-america-to-pay-6-3-billion-to-settle-mortgage-securities-suit/?_php=true&_type=blogs&_php=true&_type=blogs&_r=1

    Bank of America to Pay $6.3 Billion to Settle Mortgage Securities Suit
    By MATTHEW GOLDSTEIN
    March 26, 2014, 5:34 pm

    Updated, 7:51 p.m.
    Bank of America is paying $6.3 billion to settle a lawsuit arising out of troubled mortgage-backed securities it cobbled together and sold to Fannie Mae and Freddie Mac in the run-up to the financial crisis.

    The bank agreed on Wednesday to pay that sum to settle a lawsuit filed on behalf of the two government-sponsored mortgage finance firms by their regulator, the Federal Housing Finance Agency. As part of the settlement, Bank of America will also repurchase mortgage securities from Fannie and Freddie that are valued at about $3.2 billion.

  7. Wells Fargo is in trouble as this case show there motive of operation with Ocwen is the same as they were only the servicer for the WaMu loans and never the lender as they claimed in the assignment forgeries they created with MERS!

    The end is near! You got too have about 52,000 forgeries in all the foreclosed WaMu loan that Wells should have conducted in 2009-2010 along that went through the HAMP programs!

  8. And Gene,

    What were the allegations against the broker?

  9. Gene,

    I can see that happening. In fact, it makes a lot of sense.

    Which state?

  10. I’ve been saying it for a very long time. Things are moving. They have been for a while.There have been shake ups pretty much everywhere for at least 3 or 4 years.

    A Likely Heir is Leaving JP Morgan

    http://dealbook.nytimes.com/2014/03/25/jpmorgan-co-head-of-investment-banking-to-leave/

    “The surprise departure of a top JP Morgan Chase executive for a giant private equity firm underscores how financial regulations are forcing a shift in the balance of power on Wall Street”

    “Considered a likely heir to Jamie Dimon, the bank’s 58-year-old chief executive, Michael J. Cavanagh announced on Tuesday that he would resign as JPMorgan’s co-head of investment banking…”

  11. Sounds like none of you have ever been on a jury or really seen the results.

    Juries do funny things. I testified in one case for a homeowner going after the mortgage broker. It was an open and shut case, or so we thought.

    Never did we imagine that the jury would find the broker guilty, but in the damages determination, decide that the borrower was 25% responsible for what happened, so they reduced the damages available by 25%.

  12. I am suing Ocwen and WFB. WFB never answered, and I sued them through the S. Dakota Sheriff’s department. Should be interesting.

  13. And once again, here is the decision. Do you people read?

    http://www.cfjblaw.com/files/uploads/realprop/mar-7-14/hamid-v-ocwen-loan-servicing-llc.pdf

  14. UNITED STATES DISTRICT COURT
    SOUTHERN DISTRICT OF FLORIDA
    CASE NO. 13-62821-CIV-ZLOCH

  15. WHAT IS THE CASE NUMBER FOR THE WELLSFARGO-JUDGE ZLOCH CASE YOU ARE TALKING ABOUT?

  16. Then there are the people offered a $300 “we made a mistake check”.

    PNC is in this mess too.

    All that got the cease and desist have unclean hands and AG sold out for pennies for theft of estate property and illegal/unlawful/invalid/voidable property transfers.

    $300

    Only military got the better offer albeit that doesn’t mean it was equitable.

    Glad people realize we didn’t ” lose ” our home. We know where it is. We were forced out and robbed under threat, duress, and coercion.

    Trespass Unwanted, Creator, Corporeal, Life, People, State, Independent, In Jure Proprio, Jure Divino

  17. Would love to be on that Jury……$100 million for the homeowner.

  18. When Catherine Austin Fitts starts talking about “The UFO Economy”, I sure as hell listen. When she states that over 100 trillions have been funneled into it by all kinds of financial manipulations for decades, I listen even more intently. When she declares that one cannot analyze economy and industrial output without including it in the figures, I know she’s right.

    Off topic? Hell no! Foreclosures were one more means of funneling money to the military industrial complex and the secret space program.

    Nothing happens in a vacuum.

  19. It was JPMorgan turn and now its Wells Fargo turn in the frying pan. Wells Fargo is taking on a lot of water here, and along with the Fed Gove case against them over the 100,000 loans the Gov is saying Wells Fargo approved ala BOA and JPM, Wells Fargo going to get caught for the WaMu foreclosures they illegally performed.

    I figure with just normal default rate of government insured loan of 2% and knowing the quality of WaMu loan which as they are defunct and had the same abilities to approve loans, that at a minimum during 2009-2010 there should be 52,000 foreclosures with forgeries in the files. Wells Fargo needed MERS to illegally assign the security instrument to them as if Wells purchase these loans. We are talking about the servicing of 1.3 million FHA & VA loans that Wells have “No standing” at all!

  20. $100 Million Malpractice Action Filed By EBG On Behalf Of Bankruptcy Trustee Against International Law Firm Bryan Cave, LLP Reinstated By Ninth Circuit

    LOS ANGELES, March 25, 2014 /PRNewswire/ — On Monday, March 24, 2014, the United States Court of Appeals for the Ninth Circuit issued its decision reversing the District Court’s dismissal of a $100 million lawsuit against the international law firm Bryan Cave, LLP.

    Trustees for the bankruptcy estate of two real estate mortgage companies, Estate Financial Inc. and its funding company Estate Financial Mortgage Fund LLC, brought the lawsuits. The suits allege that Bryan Cave committed malpractice and breached its fiduciary duty in advising the debtors on how to conduct their business operations in light of allegations of violations of complex real estate and securities laws. The unpublished decision reversed the District Court’s determination that the doctrine of “in pari delicto” (“in equal fault”) precluded the trustees from pursuing their claims against Bryan Cave on the merits.

    Larry W. Gabriel and Corey R. Weber of Ezra Brutzkus Gubner LLP (Los Angeles, CA), lawyers for Estate Financial Inc.’s chapter 11 trustee, Thomas P. Jeremiassen, noted that in reinstating the suits, the Ninth Circuit did not address whether the equitable doctrine of in pari delicto applies to state law claims brought by bankruptcy trustees. The issue has been the subject of much legal debate.

    “We are very pleased with the decision by the Ninth Circuit today reinstating the trustees’ claims against Bryan Cave. Although briefed and argued, the Ninth Circuit did not address whether the doctrine of in pari delicto applies to bankruptcy trustees. That issue will apparently be left for another day,” says Corey R. Weber, Partner at Ezra Brutzkus Gubner LLP.

    Based upon this decision by the Ninth Circuit, Jeremiassen v. Bryan Cave LLP and Sharp v. Bryan Cave LLP will return to the trial court for further proceedings.

    http://www.foxcarolina.com/story/25069841/100-million-malpractice-action-filed-by-ebg-on-behalf-of-bankruptcy-trustee-against-international-law-firm-bryan-cave-llp-reinstated-by-nin

  21. $100 Million Malpractice Action Filed By EBG On Behalf Of Bankruptcy Trustee Against International Law Firm Bryan Cave, LLP Reinstated By Ninth Circuit

    Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact pressreleases@worldnow.com.

    SOURCE Ezra Brutzkus Gubner LLP

    LOS ANGELES, March 25, 2014 /PRNewswire/ — On Monday, March 24, 2014, the United States Court of Appeals for the Ninth Circuit issued its decision reversing the District Court’s dismissal of a $100 million lawsuit against the international law firm Bryan Cave, LLP.

    Trustees for the bankruptcy estate of two real estate mortgage companies, Estate Financial Inc. and its funding company Estate Financial Mortgage Fund LLC, brought the lawsuits. The suits allege that Bryan Cave committed malpractice and breached its fiduciary duty in advising the debtors on how to conduct their business operations in light of allegations of violations of complex real estate and securities laws. The unpublished decision reversed the District Court’s determination that the doctrine of “in pari delicto” (“in equal fault”) precluded the trustees from pursuing their claims against Bryan Cave on the merits.

    Larry W. Gabriel and Corey R. Weber of Ezra Brutzkus Gubner LLP (Los Angeles, CA), lawyers for Estate Financial Inc.’s chapter 11 trustee, Thomas P. Jeremiassen, noted that in reinstating the suits, the Ninth Circuit did not address whether the equitable doctrine of in pari delicto applies to state law claims brought by bankruptcy trustees. The issue has been the subject of much legal debate.

    “We are very pleased with the decision by the Ninth Circuit today reinstating the trustees’ claims against Bryan Cave. Although briefed and argued, the Ninth Circuit did not address whether the doctrine of in pari delicto applies to bankruptcy trustees. That issue will apparently be left for another day,” says Corey R. Weber, Partner at Ezra Brutzkus Gubner LLP.

    Based upon this decision by the Ninth Circuit, Jeremiassen v. Bryan Cave LLP and Sharp v. Bryan Cave LLP will return to the trial court for further proceedings.

    http://www.foxcarolina.com/story/25069841/100-million-malpractice-action-filed-by-ebg-on-behalf-of-bankruptcy-trustee-against-international-law-firm-bryan-cave-llp-reinstated-by-nin

  22. It is one of my pet peeves with NG. He has, forever, been referring to cases he doesn’t cite. Irritating for an information website!

    http://www.cfjblaw.com/files/uploads/realprop/mar-7-14/hamid-v-ocwen-loan-servicing-llc.pdf

  23. Please attach the opinion. The link 201403241440 takes us nowhere….

    Thanks,

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