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Consumer Financial Services

Representative Matters

In a 15-year long “late fee” class action brought in the Southern District of New York involving  a class of approximately 300,000 borrowers, we persuaded the  District Court to overturn a $54 million jury verdict against our client and decertify the class. Decertification was affirmed on appeal. The Opinion by the Second Circuit explores the intersect between the Seventh Amendment and the power of a federal judge to amend a class certification order right up until entry of judgment, an issue of first impression.
We defended a claim brought in the Southern District of New York under the Fair Debt Collection Practices Act and Truth-in-Lending Act which contended that our client used a “false name” in attempting to collect debts  owed by delinquent borrowers. The District Court, on motion, drastically reduced the potential  size of the class and the case settled for minimal damages.
On behalf of a national mortgage servicer, McCarter lawyers defended a putative class action asserting claims under the Telephone Consumer Protection Act and the state’s unfair and deceptive trade practices statute.
McCarter lawyers defended a putative class action filed against a mortgage loan servicer by a residential mortgagor seeking equitable relief and damages as a result of the allegedly improper inclusion of a “late fee” in a payoff statement. We disposed of the case on a motion to dismiss.
McCarter lawyers represented four national loan servicers in over 40 cases involving challenges to the mortgagee’s standing to foreclosure, part of a consolidated docket of mortgage foreclosure cases. Our appeal overturned an injunction issued by the District of Rhode Island preventing foreclosures in hundreds of cases.
On behalf of the trustee of a securitized trust, our attorneys obtained dismissal of claims brought in the District of Massachusetts for wrongful foreclosure and violation of the state’s consumer protection statute, then secured an appellate decision affirming the judgment.
We obtained dismissal of a claim against a current holder of a mortgage loan based on allegedly inadequate disclosures. This case was the first decision concerning allegations of missing dates on a Notice of Right to Cancel and held that national banking institutions and loan servicers are not subject to private causes of action under the state’s Consumer Protection Act.
We defended a government-sponsored enterprise and a national loan servicer in an action where the issue, one of first impression, was whether the holder of a mortgage is required under state law also to hold the underlying promissory note in order to conduct a valid foreclosure.
Our client commenced a foreclosure action involving the residence of a sophisticated businessman. He used New Jersey’s Consumer Fraud Act to challenge the foreclosure, arguing that the $3.5 million loan was predatory. Before the Appellate Division, we successfully demonstrated that the businessman was abusing the CFA and there was no merit to his defenses. The businessman petitioned the New Jersey Supreme Court, which declined to grant certiorari.
After two foreclosure actions and a bankruptcy filing, we successfully defended the bank before the Appellate Division in a matter where the original promissory note was lost. The borrower thereafter claimed he owed nothing on an $870,000 loan obligation. We secured a favorable outcome which will benefit lenders in the future when negotiable instruments are lost.
We defended a national loan servicer against claims by the borrowers for violation of a state-mandated foreclosure mediation program.
McCarter won an appellate decision in a case arising out of a judicial foreclosure in which the defendant claims that the mortgage is void due to duress.
After selling a property that had been in foreclosure, the borrower commenced suit against the lender, claiming the bank misapplied the mortgage payments, causing the default, and the borrower lost money on the sale. We noticed the deposition of the borrower, which included a document demand. It was our position that the borrower submitted fraudulent checks to make some mortgage payments. Upon seeing the document demand, the borrower dismissed the suit.
We successfully proved claims at trial for equitable estoppel and equitable subrogation to establish a first lien position, which entitled our client to the proceeds of a foreclosure sale of the subject property. Affirmed on appeal.
McCarter is defending claims brought under the Fair Debt Collection Practices Act, Truth-in-Lending Act and the state’s consumer protection laws as well as allegations of negligence and fraud.
We have handled a series of lawsuits asserting claims of forgery, indemnification and notary misconduct.