Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

Plaintiffs appealed the district court's grant of summary judgment for Wells Fargo in a suit stemming from plaintiffs' default on a home mortgage. Plaintiff asserted claims for common-law fraud and fraudulent inducement. The court concluded that plaintiffs' claimed damages are either categorically not damages, too speculative, or unsubstantiated assertions. Because plaintiffs failed to give proof to support an element of their fraud claims, the district court committed no error in granting summary judgment. The district court did not commit error, let alone plain error, in denying a continuance where plaintiffs filed only a one-line request for a continuance without any supporting evidence regarding the need for additional discovery or why existing discovery had been incomplete. Accordingly, the court affirmed the judgment. View "Lawrence v. FHLMC" on Justia Law

Plaintiff filed suit against BOA and Wells Fargo alleging, among other claims, that BOA had violated Section 51.002(d) of the Texas Property Code and the Texas Debt Collection Act (TDCA), Tex. Fin. Code Ann. 392.301(a)(8), 392.303(a)(2), and 392.304(a)(8). On appeal, plaintiff challenged the district court's grant of summary judgment for BOA. The court concluded that, even if section 51.002(d) authorizes a private cause of action, plaintiff fails to state a claim because she did not allege that BOA attempted to send her a timely notice of sale or to initiate foreclosure. Further, the court concluded that, irrespective of any statutory notice requirements, BOA did not violate section 392.301(a)(8) of the TDCA by threatening to foreclose; plaintiff failed to allege a violation of section 392.303(a)(2); and plaintiff failed to establish any of the elements required by section 392.304(a)(8). Accordingly, the court affirmed the judgment. View "Rucker v. Bank of America" on Justia Law

After plaintiffs defaulted on their residential mortgage loan, they sought to enjoin BNY from foreclosing by claiming that the assignment of the deed of trust (DOT) to BNY was void. Plaintiffs also filed a false-lien claim under Texas Civil Practice and Remedies Code 12.002 against BNY and MERS. The district court granted BNY's motion to dismiss. The court concluded that plaintiffs lack standing to challenge BNY’s efforts to foreclose on the ground that MERS’s assignment to BNY was void for violating the PSA. Because plaintiffs have failed to plead facts showing BNY’s lien was in fact fraudulent, plaintiffs have failed to state a false lien claim under Texas Civil Practice and Remedies Code 12.002. Accordingly, the court affirmed the district court's judgment. View "Ferguson v. Bank of New York Mellon" on Justia Law

The Committee appealed a consolidated district court judgment affirming several bankruptcy court judgments. The court held that the bankruptcy court did not abuse its discretion in approving the Settlement Agreement - a compromise the Trustee made in discharge of his fiduciary duty. The court affirmed the Trustee’s conclusion that the estate’s best interests were better served by the Settlement Agreement than by continued litigation to determine the absolute value of Chase’s secured collateral; for purposes of 11 U.S.C. 502(b), although the bankruptcy court did not adequately determine the amount of Chase’s allowed claim, its error was harmless; the bankruptcy court did not abuse the discretion afforded it by Rule 3012 in declining the Committee’s request to undertake a “more precise determination of value;” and the bankruptcy court did not err in denying the Motion to Value simultaneously with its approval of the Settlement Agreement. Accordingly, the court affirmed the district court’s consolidated judgment affirming the bankruptcy court’s orders approving the Settlement Agreement, denying the Claim Objection, and denying the Motion to Value. View "Official Comm. of Unsecured Creditors v. Chase Capital Corp." on Justia Law

Comar filed suit against vessel-owning LLCs after the LLCs decided to terminate an agreement with Comar in which Comar would manage the vessels on behalf of the LLCs. JPMorgan and Allegiance provided the financing for the vessel purchases and intervened to defend their preferred ship mortgages. The district court granted summary judgment in favor of JPMorgan and Allegiance. The court concluded that the district court correctly concluded that breach of the management agreements did not give rise to maritime liens; the court affirmed the district court’s grant of summary judgment in favor of Allegiance and JPMorgan; and the court did not reach whether the district court’s alternate holding that Comar was a joint venturer and therefore foreclosed from asserting a maritime lien was erroneous. The court also concluded that the district court did not commit reversible error in concluding that the termination-fee provision is unenforceable; the district court’s award to Comar is plausible in light of the record and not clearly erroneous; the district court did not clearly err in finding that Comar acted in bad faith when arresting the vessels and did not rely on legal advice in good faith; the district court did not clearly err in denying lost-profit and lost-equity damages; and the court concluded that the district court did not commit any other errors. Accordingly, the court affirmed the judgment. View "Comar Marine, Corp. v. Raider Marine Logistics" on Justia Law

The Avakians purchased a house with a loan secured by a properly executed deed of trust. The property was their homestead, where they lived together. Citibank refinanced the loan. Unlike the original loan, the refinancing note only listed Norair as the debtor. Citibank required that the Avakians execute another deed of trust. Norair signed the Citibank deed of trust. The next day, Burnette signed an identical deed of trust. The deeds of trust did not mention each other, and did not refer to signature of counterpart documents. Citibank recorded them as separate instruments. The Avakians received a loan modification. Around the time of Norair’s death, Burnette received notice that Citibank was taking steps to foreclose. After Norair’s death, Burnette sought a declaratory judgment. The district court granted summary judgment to Burnette, finding that, because the two were living together when they signed the Citibank deeds of trust, the instruments were invalid. The Fifth Circuit reversed. Under Mississippi law, a deed of trust on a homestead is void if it is not signed by both spouses, but the Mississippi Supreme Court would likely hold that a valid deed of trust is created when husband and wife contemporaneously sign separate, identical instruments. View "Avakian v. Citibank, N.A." on Justia Law

Plaintiff filed a class action alleging that the Bank violated the Electronic Funds Transfer Act (EFTA), 15 U.S.C. 1963 et seq., by failing to post an external notice of fees on its ATMs. While the suit was pending but before class certification, Congress amended the EFTA to eliminate the external notice requirement. The district court dismissed plaintiff's claim and denied class certification. The court concluded that plaintiff has standing to bring her claim where Congress's determination that consumers were entitled to the fee information they need to decline a transaction before investing the time needed to initiate it protects a substantive, if small, right, and its deprivation is an injury-in-fact that allows plaintiff to pursue her claim; the Bank's attempt to "pick off" plaintiff's claim before the court could decide the issue of class certification fits squarely within the "relation back" doctrine, which saves her claim from mootness at this stage; the EFTA amendment eliminating the "two notice" provision does not apply retroactively to plaintiff's claim; and the EFTA amendment poses no more a barrier for putative class members than it does for plaintiff, for claims alleging violations before the amendment was enacted. Accordingly, the court vacated the district court's denial of class certification and remanded for further considerations. View "Mabary v. Home Town Bank, N.A." on Justia Law

Plaintiff appealed the dismissal of his wrongful foreclosure suit involving a promissory note and an associated Deed of Trust on property in Fort Worth, Texas. The district court granted U.S. Bank's motion to dismiss after determining that all of plaintiff's claims relating to U.S. Bank's standing to foreclose failed as a matter of law, and plaintiff failed to allege any actionable misrepresentation on the part of U.S. Bank. The court concluded that the district court properly granted U.S. Bank's motion to dismiss because plaintiff failed to assert a claim for common-law fraud under Texas law and section 12.002 of the Texas Civil Practice & Remedies Code.View "Reece v. U.S. Bank Nat'l Assoc., et al." on Justia Law

Coastal filed suit against Chase Bank, asserting claims of conversion and negligence under the Texas Uniform Commercial Code (UCC) and money had and received under the common law. At issue on interlocutory appeal was whether section 3.405 of the UCC can serve as an affirmative defense to a common law "money and received" claim and whether settlement credits in Texas reduce the nonsettling defendant's liability rather than the plaintiff's total loss. The court concluded that the money had and received claim as applied in this situation must simply incorporate the affirmative defense provided by section 3.405. Therefore, the district court did not err in its determination that section 3.405 could so be applied. Further, the district court was correct in holding that the settlement credit should be applied to reduce the nonsettling defendant's liability, not the plaintiff's total loss. On remand, however, the district court must give Coastal an opportunity to demonstrate that allocation of the settlement amount is appropriate. Accordingly, the court affirmed and remanded for further proceedings.View "Coastal Agricultural Supply v. JP Morgan Chase Bank, N.A." on Justia Law

Plaintiff briefly had a checking account with Union Planters Bank and had signed a signature card binding her to arbitration. Union Planters merged with Regions Bank. Years after closing her account, plaintiff was injured in an automobile accident. The lawyer she retained allegedly embezzled plaintiff's portion of the settlement and she sued Trustmark Bank, where the lawyer maintained his accounts, for negligence and conversion. Regions moved to compel arbitration based on the arbitration agreement. Because the events leading to plaintiff's claim - a car accident, a settlement, and embezzlement of the funds through an account that a third party held with the bank - have nothing to do with her checking account opened years earlier for only a brief time, the notion that her claim falls within the scope of the arbitration agreement is "wholly groundless." Accordingly, the court affirmed the district court's denial of the motion to compel arbitration.View "Douglas v. Trustmark National Bank" on Justia Law