Florida Attorney Mark Stopa: The party seeking foreclosure must demonstrate that it has standing to foreclose.


Editor’s Note:  Mark Stopa is an excellent foreclosure attorney located in Tampa, Florida.  We highly recommend his foreclosure blog a www.stayinmyhome.com.


Case No. 5D15-1898.District Court of Appeal of Florida, Fifth District.Opinion filed April 21, 2017.Appeal from the Circuit Court for Lake County, Carven D. Angel, Judge.

Mark P. Stopa, of Stopa Law Firm, Tampa, for Appellants.

Matthew A. Ciccio, of Aldridge/Pite, LLP, Delray Beach, for Appellee, Bank of New York Mellon Trust.

No appearance for other appellees.


Patrick and Catherine Walsh (borrowers) appeal the trial court’s final judgment of foreclosure entered in favor of Bank of New York Trust (the bank). Determining that the bank failed to prove standing, we reverse and remand for the entry of an involuntary dismissal.

“A crucial element in any mortgage foreclosure proceeding is that the party seeking foreclosure must demonstrate that it has standing to foreclose.” McLean v. JP Morgan Chase Bank Nat’l Ass’n, 79 So. 3d 170, 173 (Fla. 4th DCA 2012) (citations omitted). Additionally, a “party must have standing to file suit at its inception and may not remedy this defect by subsequently obtaining standing.” Venture Holdings & Acquisitions Grp., LLC v. A.I.M Funding Grp., LLC, 75 So. 3d 773, 776 (Fla. 4th DCA 2011). Thus, in order to prove standing, the bank was required to introduce admissible evidence that it (or its agent) possessed a properly-indorsed note at the inception of the case. Focht v. Wells Fargo Bank, N.A, 124 So. 3d 308, 310-11 (Fla. 2d DCA 2013).

Here, the copy of the note attached to the original complaint did not contain any indorsements, and the copy of the note attached to the amended complaint contained an undated blank indorsement. Such proof was insufficient to demonstrate standing because “standing cannot be established by simply filing a note with an undated indorsement or allonge months after the original complaint was filed.” Sorrell v. U.S. Bank Nat’l Ass’n, 198 So. 3d 845, 847 (Fla. 2d DCA 2016) (citing Focht, 124 So. 3d at 310; Cutler v. U.S. Bank Nat’l Ass’n, 109 So. 3d 224, 226 (Fla. 2d DCA 2012)). In addition to introducing the note, the bank presented a witness who testified that, based on his review of the business records, the bank had possession of the note at the time the bank filed its complaint. Yet, his testimony was not based on personal knowledge, but rather, on his review of a screenshot, which was not offered or admitted into evidence. Thus, that testimony was also insufficient to prove standing. Therefore, the trial court committed reversible error in entering final judgment of foreclosure in favor of the bank. See Gonzalez v. BAC Home Loans Servicing, L.P., 180 So. 3d 1106 (Fla. 5th DCA 2015) (holding that the testimony of a witness regarding business records that are not entered into evidence at trial is insufficient to prove standing in a foreclosure case).

Accordingly, we reverse and remand for the entry of an involuntary dismissal. REVERSED and REMANDED.

COHEN, C.J., and SAWAYA, J., concur.



Home Prices Continue To Surge Sparking Fears Of Bubble 2.0


With each passing day, and each new financial bubble, it becomes more and more difficult to figure out what exactly is “normal.”  That said, we can say with near certainty that home prices are not supposed to behave like this:



Home prices in markets that bubbled over back in 2006/2007, like Las Vegas and San Francisco, got cut in half in 2009 but have since doubled again of their lows.  Meanwhile, markets like Denver and Dallas that didn’t participate as much in the 2007 mania are now surging to all-time highs, with Dallas prices up 55% over the past 5 years.

Even the 20-City Composite Cash-Shiller Index shows that average prices have surged 44% off their lows and are nearly back to their 2007 peak.


As the Wall Street Journal points out today, some of the home buying behaviors of consumers, like paying prices well above appraisal values and waiving home inspections, are starting to be eerily reminiscent of 2006.

In some markets, bidding wars are breaking out. Agents said some buyers are kicking in extra cash when properties don’t appraise for the asking price, and some are waiving their right to home inspections.

“It can’t be sustained,” said David Berson, chief economist at Nationwide Insurance and a former chief economist at mortgage giant Fannie Mae, referring to the frenzied buying. “It can’t go on forever.”

Per the chart below, homes in a dozen major markets have increased over 50% off their 2012 lows while many have already exceeded their previous bubble peeks.


Meanwhile, there are other signs of overexuberance as well including surging levels of licensed Realtors all chasing a quick buck.

The number of licensed Realtors has jumped by nearly 25% since 2012, hitting a nine-year high in 2016 and sitting just 9% below the peak in 2006, according to real-estate consultant John Burns.

In Denver, homes are selling briskly. The median number of days that homes spent on the market declined to eight in the first three months of the year from 61 in 2012, according to Redfin. Home prices rose 8.5% in Denver over the year ended in February, according to Case-Shiller.

Nicki Thompson, an agent in Denver, said she recently had a listing that was on the market for two weekends at $1.2 million and she received multiple all-cash offers above the listing price.

“It’s just crazy,” she said.

Martin Mata, a Redfin agent in Denver, said his buyers often will commit to kicking in extra cash if the bank’s appraisal comes in lower than the purchase price. “We’ve got to be coming close to a plateau for prices,” he said.

But perhaps the scariest warning of all comes from the number of economists who were all too eager to reassure the WSJ that all is well.

With little risk of a supply glut in the near future, economists generally expect prices to continue rising quickly in most markets for a couple more years, if the economy keeps expanding.

They said it is more likely that overheated markets are headed for a long period of flat or slightly declining home prices, especially if mortgage rates rise or job growth slows, but not an outright crash.

The market “is not going to burst, it’s going to contract” with falling sales volume, said Nela Richardson, chief economist at Redfin, a real-estate firm. “You might still see what looks to be a robust market because prices are really strong, but that doesn’t mean it’s a broad market.”

Alas, we’re sure the economists are right this time around.

Live Now! The Neil Garfield Radio Show 6pm Eastern: Charles Marshall-the Decision to Appeal or not to Appeal

Thursdays LIVE! Click in to the The Neil Garfield Show

Or call in at (347) 850-1260, 6pm Eastern Thursdays

To Appeal or not to Appeal: That is the Question.

In this episode California Attorney Charles Marshall will discuss the pros and cons of filing an appeal.

Trial courts are not perfect institutions. They can and do make serious mistakes. And sometimes, trial courts are faced with unsettled areas of law, so that no matter what a judge decides, the losing side will have plausible grounds to appeal.

An appeal can be an opportunity to obtain justice when it was earlier denied. However, an appeal may not always make sense even if you believe that the trial court was in error. The first step in the appeals process is to decide what you hope to accomplish and whether the benefits justify possible drawbacks.

A successful appeal may not end your legal battle
Some successful appeals do provide the complete and final resolution of a dispute. However, this is by no means always true.

Many successful appeals result in the case being sent back for further proceedings in the trial court. This could result in a completely new trial. Although the Court of Appeal’s decision might result in that trial being conducted on ground rules more favorable than the first, there is no certainty that the bottom-line outcome will be any better. In fact, it could be even worse.

That said, a victory in the Court of Appeal could put you in a strong position to settle your case on favorable terms without having to go through a new trial. Often, the losing side in an appeal doesn’t have the stomach for a new trial and proves willing to compromise.

In fact, merely filing a notice of appeal can lead to a settlement that is better than the result obtained in the trial court. A significant number of civil cases settle during the course of an appeal — often, before the briefs are written. The other party may not want to go through the risk and expense of the appellate process and could be willing to give something up in order to achieve closure. If you hire an appellate specialist to handle an appeal, you send a strong signal that you are taking the process seriously — this increases the pressure on the other side.

The costs of continuing to litigate
Entering the appeals process means prolonging the emotional stress of litigation. The average civil appeal can last over a year. Federal appeals are especially slow — often taking about two years.

In addition, of course, there is the cost. Appeals can be one of the less expensive parts of the overall litigation process. Nonetheless, the appeal will add to your legal bills and, if the case then goes back to the trial court, the costs will increase further. This has to be weighed against what you stand to gain by appealing.

In addition, civil litigants will have to post a bond or other security if they want to stay the enforcement of many types of trial court judgment while an appeal is ongoing, including those involving money damages. And a defendant that loses an appeal will also have to pay interest on money that is at issue. The judicial interest rate is steep, 10 percent.

It may be beneficial to weigh the cost-benefit decision easier by having an attorney quote flat rates to handle appeals. While there is never any certainty about the outcome of an appeal, some certainty about the cost is helpful.

Evidence and appeals
Perhaps the most fundamental question to ask is how strong a chance you have of obtaining a reversal. As is shown elsewhere on this Web site, most appeals do not succeed.

One of the reasons is that the Court of Appeal does not reweigh the evidence heard by the trial court or — with very rare exceptions — consider new evidence. If the trial judge or jury believed evidence that “the light was red,” the Court of Appeal will not listen to an argument that “it was really green” — even if there was a lot more evidence pointing to that conclusion. Its job is solely to review whether the law was correctly applied to what the trier of fact in the trial court considered to be the facts and whether proper procedures were followed. An appeal is not a second trial.

That is not to say that an appeal does not provide any type of chance to challenge the evidence that was considered at trial. The Court of Appeal can decide whether certain evidence that was excluded should have been admitted, and whether evidence that was admitted should have been excluded.

In addition, the Court of Appeal can determine whether the evidence was sufficient to support a trial court outcome. But that can be a tall order on appeal — in general, an appeals court will uphold a decision based on facts if there is any evidence in the record that supports it.

The need to show “prejudice”
Even if you can point to legal error by the trial court, that does not of itself mean that you will succeed on appeal. The error must be “prejudicial.” The meaning of that term is itself a subject for argument, but one interpretation is that an error is prejudicial if there is a “real chance” that it made a difference to the outcome.

The need for prior objections
Another obstacle is that the Court of Appeal will not generally consider issues that were not initially raised in the trial court. If a trial lawyer did not object to a particular ruling or piece of evidence, for example, that issue most likely cannot be raised on appeal. It will generally have been waived. That said, an appellate lawyer may be able to introduce new arguments concerning an issue — although there can be gray areas between raising a “new issue” and merely improving upon the presentation of an issue already raised.

There are some ways around the waiver rule. For example, an often-overlooked exception is that a litigant may raise for the first time on appeal a pure question of law that that is presented by undisputed facts. In addition, litigants are not required to “preserve” an issue at trial if it would severely compromise their interests to do so — for example, a defendant at trial does not need to point out required evidence that the other side has omitted.

The risk of creating a bad precedent
Some litigants — particularly businesses — should consider whether or not they want to create a binding precedent in the disputed area of the law. Trial court decisions are not binding on other courts. Once a case goes to appeal, however, a legal precedent may be set that will be binding on trial courts faced with the same issue in the future. (Not all appeals do result in binding precedents — this depends on whether the Court of Appeal decides to “publish” its decision. A large majority are not “published.”)

In some situations, therefore, a party that loses at trial may be better off swallowing the result rather than risking an unsuccessful appeal that will have precedential effect. In other cases, however, a litigant may be eager to get the law settled once and for all.

The risk of cross-appeals
Keep in mind that if you appeal, the other side might “cross-appeal” — in other words, your opponent may try to reverse aspects of the trial court proceeding that were favorable to you. Therefore, even if you succeed in reversing one aspect of the trial court proceeding, the benefit could be offset by a less welcome reversal of another.

Winning on appeal is not easy. And a good appellate lawyer will always counsel a client about the pros and cons. But despite all the hurdles, many litigants do file appeals — and a significant number do go on to succeed. With civil appeals in the state courts, roughly one in five results in a complete reversal — and that doesn’t include appeals that result in some modification short of a reversal.

It is important that every potential litigant does consider the possible drawbacks of appealing. But if you have a good case, the battle can be well worth fighting — providing it is fought well.

For more information on California foreclosure litigation please contact:
Charles Marshall, Esq.
Law Office of Charles T. Marshall
415 Laurel St., #405
San Diego, CA 92101

Pending Home Sales Drop In March – Stagnant For 2 Years

Contracts to buy previously owned U.S. homes declined in March after rising a month earlier by the most since 2010, as perhaps the seasonal exuberance gives way to affordability constraints. Despite NAR’s comments that “home shoppers are coming out in droves this spring,” it is evident from the chart below that pending home sales have been stagnant for almost two years.

2013 deja vua ll over again?

Regionally, only The South saw a sales increase:

  • In the Midwest the index declined 1.2 percent to 109.6 in March, and is now 2.4 percent lower than March 2016.
  • Pending home sales in the South rose 1.2 percent to an index of 129.4 in March and are now 3.9 percent above last March.
  • The index in the West fell 2.9 percent in March to 94.5, and is now 2.7 percent below a year ago.

Lawrence Yun, NAR chief economist, says sparse inventory levels caused a pullback in pending sales in March, but activity was still strong enough to be the third best in the past year.

“Home shoppers are coming out in droves this spring and competing with each other for the meager amount of listings in the affordable price range,” he said.

“In most areas, the lower the price of a home for sale, the more competition there is for it. That’s the reason why first-time buyers have yet to make up a larger share of the market this year, despite there being more sales overall.

Yun worries that the painfully low supply levels this spring could heighten price growth — at 6.8 percent last month — even more in the months ahead. Homes in March came off the market at a near-record pace 1, and indicating an increase in the likelihood of listings receiving multiple offers, 42 percent of homes sold at or above list price (the second highest amount since NAR began tracking in December 2012).


Richard Bowen: Is the Fed Really Interested In Protecting Consumers or Is It just Lip Service?

By Richard Bowen, CitiBank Whistleblower


Eric Ben Artzi … is a former risk officer at Deutsche Bank. Mr. Ben-Artzi was one of three former Deutsche Bank employees turned whistleblowers who in 2010-2011 notified regulators of improper accounting at Deutsche. What was discovered resulted in a five-year investigation and a $55 million settlement between Deutsche Bank and the SEC. While Mr. Ben-Artzi was entitled to 15 percent of the award, he publicly rejected the multimillion dollar award. He shines as an example of a whistleblower who truly wants to change the system without any personal monetary or other gratification.

In his most recent post, he reminds us to not let the political upheaval in the U.S. and abroad cloud our judgements and common sense and hide what is still not happening to correct the situation. Government continues to exhibit an abject failure to correct the underlying causes of the “culture that wreaked havoc on the financial system.”

He says, “Fortunately, every now and then a tone-deaf bureaucrat inadvertently reminds us of how far our institutions have strayed from their obligation to serve the public.” His example,  

“William C. Dudley, President and CEO of the Federal Reserve Bank of New York, recently addressed the UK’s Banking Standards Board in London (BSB). Mr. Dudley’s speech capped several years of joint work by the New York Fed and the BSB on the issue of reforming the culture of banking.”

In that speech, Mr. Dudley pointed out a benchmarking survey conducted by the BSB which stated that of the 28,000 or so responders in banking, nearly 30 percent of them were worried about negative consequences if they raised concerns at work. Supposedly this culture of fear is what Mr. Dudley’s Fed and the BSB are attempting to change.

In a previous post, I pointed out how banks retaliate against brokers, employees and others for blowing the whistle, definitely a fixation with me as you might imagine. In that post, we talked about the culture of winks and nods and jobs for the boys, where too many people making bad decisions have gotten where they are for reasons other than excellence.

The culture of fear seems to permeate the financial services industry. Regardless of what steps Mr. Dudley may point out to “fix” the situation, the Fed, the SEC and other regulators and key officials still look the other way. Whom do we, should we believe? The facts frankly say not the Fed and other regulatory agencies.

A prime example of the out of control behavior by our regulatory agencies is the Wells Fargo situation. Comptroller of the Currency Thomas Curry said during a congressional hearing in September, soon after the bank’s $185-million settlement with the OCC and other regulators, that he had ordered a review of the OCC’s supervision of Wells Fargo. Wednesday’s report is the product of that review.

In a recent report, the Office of the Controller of the Currency (OCC) admitted to lax oversight on its part toward Wells Fargo, missing many opportunities to address its wrongdoing. The report goes on to say, “The OCC did not take timely and effective supervisory actions after the bank and the OCC together identified significant issues with complaint management and sales practices.”

This lack of oversight has to date resulted in significant lawsuits and settlements. The report points out that in 2010 the bank examiners met with Carrie Tolstedt,  the former Wells Fargo executive, then in charge of the community banking division which was at the center of the unauthorized accounts scandal.  While the examiners asked about the 700 whistle-blower complaints of workers “gaming” the bank’s sales goal system so they could receive more compensation, after that initial meeting the investigation was dropped. The OCC looked the other way and the fraud continued.

Some lawmakers, including  Rep. Jeb Hensarling (R-Texas), the chairman of the House Financial Services Committee have also asked why the  OCC and the Consumer Financial Protection Bureau had not identified  problems at the bank earlier. A spokesman said Wednesday that it seems clear the agency failed in this case; in just this case!! Really??

“If there was ever a case where consumers needed regulators to protect them, this was it, ”said Jeff Emerson, a spokesperson commenting on the report. “Yet obviously Washington regulators, including the OCC, failed to do their jobs and let the American people down.”

The OCC did confront Carrie Tolstedt, then head of Wells Fargo’s community bank, about the stunning number of whistleblower claims. However, there are no records that show that federal inspectors “investigated the root cause,” or force Wells Fargo to probe it. And the OCC report also says that the Wells Fargo’s board of directors received “regular” reports going back to 2005 indicating that most ethics line complaints and firings were related to sales violations.

Our regulators and that includes the Fed do not have a culture which permits dissent.

In fact, their own retaliation against Fed whistleblower Carmen Segarra, for not going easy on the banks is another example.

The Fed’s actions during and after the financial crisis have raised serious concerns about its leadership’s priorities. It seems that it prefers the financial interests of America’s banking elite over those of the general public. Numerous examples of revolving doors (Mr. Dudley himself is a former Goldman Sachs chief economist) and conflicts of interest have been exposed in the Fed since the financial crisis.

The Fed needs to also be accountable. It has too much of its own dirty laundry; so how can it “fix” others issues?

Bankruptcy concerns or suggestions? Join the ABI Consumer Commission

The  American Bankruptcy Institute (ABI) has formed a Commission on Consumer Bankruptcy. More information about the Commission is available on its web site . the committee is requesting input and suggestions about the Commission’s work.

The ABI has asked the Commission to assist with “researching and recommending improvements to the consumer bankruptcy system that can be implemented within its existing structure. These changes might include amendments to the Bankruptcy Code, changes to the Federal Rules of Bankruptcy Procedure, administrative rules or actions, recommendations on proper interpretations of existing law and other best practices that judges, trustees and lawyers can implement.”

The first public meeting is during the 2017 annual meeting for the National Association of Consumer Bankruptcy Attorneys (NACBA) in Orlando, Florida. Anyone is invited to make a a request to make a statement during the meeting, which will be held on Saturday, May 6 8:00 and 10:30 a.m. in Oceanic Room 1 of the Walt Disney Dolphin Hotel. To make a request, you can email the Commission at ConsumerCommission@abiworld.org. They request that you submit a written statement. More information about making a public statement to the Commission is available here.

The Commission also welcomes written statements. You can submit suggestions for topics the Commission should study by going to the Commission web site. In the upper-right, click on the link that says “Submit Topic” and, well . . . submit a topic. The link will take you to a page where you can suggest a topic and elaborate on why it is important. Any topic suggestions submitted there will be forward along to the relevant committees of the Commission.

Issues of concern include servicers filing fraudulent Proof of Claims, servicers who prevent homeowners from modifying loans while in bankruptcy, and the difficulty in filing an Adversary proceeding in order to have a creditor prove standing. Other bankruptcy issues include servicers tacking on unapproved fees and inaccurate credit reporting.

Foreclosure hell: Sacramento judge says Bank of America stalked and bullied family into losing home

‘Blockbuster’ ruling hits lending giant with $46 million for Kafkaesque tactics


The young boy playing piano inside his house suddenly looked up. A man he’d never seen before was peering at him through a sliding glass door. The man began pounding on the glass, yelling at the boy to let him inside. The 10-year-old raced down the hall in a fit of tears.

For the boy’s parents, Erik and Renee Sundquist, this encounter with a stranger was about to morph into an ongoing nightmare. According to a federal bankruptcy judge’s ruling last month, the Sundquist family was “stalked” throughout the summer of 2010, with people watching them from parked cars for hours at a time, tailgating them through their neighborhood before speeding off, peering through their windows and sometimes lurking around their house to the point the Sundquists called personal security.

But even more startling is who was employing these shadowy figures.

According to the 109-page ruling from U.S. bankruptcy Judge Christopher Klein, it was one of the nation’s largest financial institutions, Bank of America. And the bank’s tactics were part of an extraordinary, years-long effort to bully the Placer County couple into foreclosure during the height of the economic recession, the judge asserted in a ruling that has dropped jaws around Sacramento’s legal community.

Terence Kilpatrick, a local attorney who works in bankruptcy and foreclosure law, called Klein’s opinion “truly a blockbuster.”

“[T]his is just one example of what the big banks did to people during the economic downturn,” Kilpatrick, who wasn’t associated with the case, wrote in an email. “The Sundquists are the only ones to my knowledge who have succeeded in taking their case to trial and to a judgment that exposes such actions.”

But the couple’s travails aren’t over. And the financial regulations that are meant to protect people like the Sundquists are starting to erode under the Trump administration.

Following a lengthy civil trial, Judge Klein assailed Bank of America for hounding the Sundquists to the point that Erik considered suicide and Renee suffered a stress-induced heart attack. The judge awarded the family more than $1 million in damages, then tagged Bank of America for another $45 million in punitive fines—decisions that the bank is appealing.

When Klein tried to encapsulate the existential “nightmare” he believed the Sundquists experienced, he reached for a specific literary allusion, one where average people are crushed by faceless, nameless forces that strike from an absurdist labyrinth with dizzying traps of deceit.

“Franz Kafka lives,” Klein wrote. “[H]e works at Bank of America.”

The Castle

The Sundquists were raising their young twins in Loomis in 2008 when the economy tanked. Erik owned a construction business and tried to stay ahead of the building industry’s collapse by downsizing. He and Renee set their sights on a more modest dwelling in Lincoln. They had a $125,000 down payment, but the monthly mortgage rate was still out of their price range. There was also an all-cash offer from another buyer. A broker working for the Sundquists assured them that they could refinance or modify the loan immediately.

Erik and Renee took out the loan on the new property while its note and deed came under the ownership of Bank of America. The Sundquists never missed a payment, though they were barely keeping up. Later, according to the judge’s findings, when the Sundquists contacted BofA for their loan modification, they were given startling news: Bank officials said they’d consider changing the loan only if the Sundquists defaulted on three months of payment in a row. For the couple, who had a credit score above 800 at the time, the demand made no sense.

“They’d never paid a bill late,” said Denise Henderson, the Sundquists’ attorney. “It was astonishing to them when they were told to stop paying. That sounded insane and, as it turned out, it was insane.”

The Sundquists followed the bank’s advice and stopped paying. Henderson’s case files lay out what happened next: UPS receipts, tax records and third-party letters show some 20 successive attempts by the increasingly desperate Sundquists to comply with BofA’s loan modification process. The applications they sent, starting in 2009, were repeatedly lost by the bank or sent back with confusing notes or deemed stale by the time bankers got around to looking at them.

Meanwhile, BofA started a foreclosure process on the family—even as other bank employees were allegedly informing Erik and Renee that they could still modify their loan. A series of vacate notices eventually forced the couple to file for bankruptcy. By law, that filing should have put the foreclosure process on hold. But bank officials admitted seizing the Sundquist house on June 15, 2010, one day after they received notice of the Chapter 13 filing, Judge Klein wrote in his ruling.

“[It was] apparent to anyone at Bank of America who cared to look,” Klein wrote of the company’s violation of bankruptcy law. “Nobody at Bank of America cared to look.”

For the Sundquists, the real nightmare hadn’t started yet. Over the summer of 2010, strangers began following them and constantly attempting to serve them with illegal eviction notices. When, on August 19, 2010, a BofA representative brought the Sundquists a three-day notice to leave the property, he reportedly did so by throwing the papers so hard against the door “they ricocheted some three feet.”

“It was such a loud bang I could hear it in my kitchen,” Renee wrote in a journal entry that was admitted into evidence at trial. “I just stood shaking and could barely call Erik. … BOA steals another night from my family.”

At this point, Henderson’s law firm intervened.

“Every time they got served, it was another stick hitting them,” the former public defender said of her clients. “They stopped having friends over. They were very isolated. It was very much like being in an abusive relationship.”

Henderson confronted BofA officials about the unlawful foreclosure. Their response, according to both Henderson and Klein’s ruling, defied belief.

The bank returned the ownership of the house to the Sundquists without telling them or their attorney. The Sundquists had already moved out due to the threat of being removed by law enforcement. It wasn’t until seven months later that Erik discovered, by checking county records, that he indeed owned the house again. And he also owed BofA money again.

The bewildered couple returned to the premises of their abandoned home to discover their cook-top oven, built-in refrigerator, washer and dryer had all been stolen. Their landscaping was long dead. Even worse, they now had a $20,000 bill for nonpayment and fines from their homeowners association, after Bank of America employees neglected to keep up those obligations.

“All that sadness came back,” Renee wrote in her journal, “all that pain of leaving, losing, sickness.”

SN&R contacted Bank of America about the host of accusations against its employees and representatives, all of which Klein legally determined had happened. BofA spokesman Rick Simon responded in an email, saying, “The loan in question goes back nearly a decade, and the foreclosure at the center of the claim to 2010, at the earliest stages of the economic crisis. The processes in place at the time were subsequently modified; regrettably our performance in this particular case was unsatisfactory.”

Simon’s only comment about the findings related to deception, harassment and stalking was, “We believe some of the court’s rulings are unprecedented and unsupported.”

The Metamorphosis

A day after her mother died, in 2012, Renee found another eviction letter. Bank of America’s enveloping tactics were overwhelming the family. Erik fell into a suicidal depression. Renee suffered nonstop headaches and, according to evidence presented at trial, a stress-induced heart attack. The fear in their kids’ eyes, the pity and resentment from neighbors, the bizarre monitoring from strangers, were all taking a toll.

Henderson filed a lawsuit against the bank on behalf of the Sundquists that ultimately landed in federal bankruptcy court that same year. That made it Henderson’s turn to experience the Kafkaesque ordeal. She told SN&R that BofA’s attorneys engaged in “a pattern of defense and coverup,” including failing to provide discovery evidence and the names of employees she wanted to depose until the court compelled them. Henderson said what was handed over tended to be the same over-redacted documents as before, just filed in a different order. Henderson even wanted one BofA official fined for perjury and contempt of court. That didn’t happen.

But what did happen is that, after five years of delays, the Sundquists got their day in court.

“They did everything they could to try to stop this case from being heard,” Henderson said of BofA’s lawyers. “And trials are about someone finally being heard.”

Renee allowed her personal life to be laid bare by admitting her journal into evidence. Erik broke down on the witness stand. Later, throughout his written opinion, Klein noted that he found both plaintiffs highly credible, while also referencing myriad documentation that backed up their accounts. Klein wrote that BofA’s misconduct, at one point, “strayed across the civil-criminal frontier,” adding that, “in contrast, the Sundquists have clean hands.”

The Sundquists are one family in a pool of thousands that saw their financial lives evaporate under the practices of Bank of America during the recession.

In 2014, President Barack Obama’s Justice Department compelled the lending giant into a $16.65 billion settlement with federal and state officials for the mass selling of toxic mortgages on the eve of the recession. The settlement against BofA was for actions it engaged in, along with those of its subsidiaries, Countrywide Financial Corporation and Merrill Lynch.

What a difference three years makes. In February, President Donald Trump announced his intention to roll back the Dodd-Frank Wall Street Reform and Consumer Protection Act, which lawmakers crafted to rein in threats to the financial system, especially the practices that obliterated middle-class savings, retirement accounts and equity during the meltdown. Trump also sent an official memorandum to the U.S. Labor Department ordering it to consider repealing the Fiduciary Rule, which requires stock brokers to act in their clients’ best interests over the brokers’ own personal gains.

“It’s a signaling issue,” said Justin King of New America, a Washington, D.C., think tank that advocates for low-income and middle-class families. “If these rules are rolled back, it sends a sign to the business and financial sector that says, ’We’re going to be taking the cop off the beat and trusting you to treat your customers fairly.’”

Klein’s $46 million judgment against Bank of America is one of the largest affirmations that the Wall Street powerhouse hasn’t always treated its customers fairly. However, the judgment is also an outlier, according to Renata Pumarol of the Committee for Better Banks.

“Unfortunately, these victories do not happen often,” Pumarol told SN&R in an email.

The Judgment

In an over-lit, sixth-floor courtroom in Sacramento, Judge Klein swivels behind the bench with his chin resting on his palm. Sitting below him, on one side, are the Sundquists. On the other, two BofA lawyers. Today, April 18, is the moment the lending titan officially begins to appeal the penalties Klein handed down. The judgment stipulates that the bank pay $1,074,581 in damages directly to the Sundquists and more than $40 million in punitive damages into legal education and consumer rights organizations, including the National Consumer Law Center, the National Consumer Bankruptcy Rights Center and five public law schools operated by University of California.

In April, BofA filed papers to have Klein’s ruling reviewed by an outside court. The bank also defended its reputation in its correspondence with SN&R, saying, “Bank of America helped more than 2 million homeowners avoid foreclosure through industry-leading modification and refinancing processes.”

The statement made no reference to its 2014 settlement with the Justice Department on behalf of thousands of consumers.

Yet, it’s only the Sundquist family Judge Klein has to consider. He looks down at Erik and Renee, then reminds the bank’s attorneys that—should their attempt to upend his ruling fail—BofA will have to cover the Sundquists’ additional legal costs.

Preparing to move the case to a new judge, Klein explains in his breezy voice, “If the judgment stands, even in the amount of one dollar, Bank of America is going to pay their attorneys fees.”

BofA attorney Jonathan Doolittle gives a quick acknowledgment. Henderson, who so far has handled the Sundquists’ case on contingency, quietly digests how long it will take to get five years of legal bills paid. Klein says little else. He summed up his take when he typed the ruling.

“Bank of America’s actions tell a story that smacks of cynical disregard for the law,” the judge wrote. “In the calculus of reprehensibility, Bank of America’s intentional conduct adds up to reckless and callous disregard for the rights of others.”

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