Press "Enter" to skip to content

Posts published by “Eric Tsai”

4th Cir. Holds Defendant Must Present Sufficient Evidence to ‘Determine – Not Speculate’ as to CAFA’s Requirements

The U.S. Court of Appeals for the Fourth Circuit recently held that a defendant invoking jurisdiction under the federal Class Action Fairness Act (CAFA), 28 U.S.C. § 1332(d), must provide sufficient evidence to allow the court to determine – not speculate – that it was more likely than not that there were at least 100 class members and the aggregate amount in controversy exceeded $5 million. A copy of the opinion in Scott v. Cricket Communications, LLC is available at:  Link to Opinion. Between July 2013 and March 2014, a consumer purchased two Samsung Galaxy S4 cell phones from the defendant…

6th Cir. Upholds Denial of Class Certification in TCPA ‘Junk Fax’ Case

The U.S. Court of Appeals for the Sixth Circuit recently held that a class could not be certified because the defendant’s alleged liability under the federal Telephone Consumer Protection Act (TCPA) for sending a “junk fax” without an opt-out notice required determination of two individualized issues, which rendered class certification impracticable. In so ruling, the Sixth Circuit concluded that with the absence of a fax log to identity each recipient, and without an alternative method of identifying class members who had provided consent to receive the fax, the plaintiff failed to prove that its proposed class satisfied Fed. R. Civ.…

Illinois Fed. Court Holds No ‘Bad Faith Denial Of Coverage’ Against Title Insurers in Illinois

The U.S. District Court for the Northern District of Illinois recently held that a title insurer may exclude coverage under the exception for defects “created, suffered, assumed, or agreed to by the insured claimant” without intentional or wrongful conduct by the insured. In so ruling, the Court also held that the Illinois statute for bad faith denial of coverage by insurers did not apply to title insurers. A copy of the opinion in Bank of America, NA v. Chicago Title Insurance Company is available at:  Link to Opinion. In 2007, a developer sought to purchase real estate in Yorkville, Illinois, to…

9th Cir. Holds ‘Free and Clear’ Bankruptcy Sale Was Not Rejection of Unexpired Leases, Did Not Implicate 11 U.S.C. § 365(h)

The U.S. Court of Appeals for the Ninth Circuit recently held that a bankruptcy trustee was authorized to sell real estate free and clear of unexpired leases under 11 U.S.C. § 363(f), and the sale was not a rejection of the unexpired leases and therefore did not implicate 11 U.S.C. § 365(h). In so ruling, the Ninth Circuit adopted the minority approach established in Precision Indus., Inc. v. Qualitech Steel SBQ, LLC, 327 F.3d 537 (7th Cir. 2003), which held that sections 363 and 365 may be given full effect without coming into conflict with one another. By allowing the…

6th Cir. BAP Holds BK Court Lacked Jurisdiction to Void Mortgage Lien Signed Before but Recorded During Bankruptcy

The Bankruptcy Appellate Panel of the U.S. Court of Appeals for the Sixth Circuit recently held that the bankruptcy court lacked subject matter jurisdiction under the Rooker-Feldman doctrine to void the foreclosure of a mortgage lien that was executed by the debtors before bankruptcy, but recorded while the automatic stay was in effect. In so ruling, the BAP held that the mortgage was effective upon signing, the pre-petition lien survived the bankruptcy, the creditor’s exercise of its in rem rights did not implicate the discharge order, and the bankruptcy court incorrectly applied the exception to the Rooker-Feldman doctrine recognized in…

9th Cir. Holds Bankruptcy Cram-Down Valuations to Use ‘Replacement Value’ Not ‘Foreclosure Value’

The U.S. Court of Appeals for the Ninth Circuit recently held that for cram-down valuations, 11 U.S.C. § 506(a)(1) requires the use of “replacement value” based upon the adoption of the replacement value standard in Associates Commercial Corp. v. Rash, 520 U.S. 953, 956 (1997). In so ruling, the Ninth Circuit interpreted Rash to instruct that valuation of collateral in a cram down must be based on the debtor’s desires (i.e., the proposed use of the collateral in the debtor’s plan of reorganization), and without consideration of the value that the secured creditor would realize in an immediate sale. Accordingly,…

11th Cir. Adopts ‘Claim Splitting’ Doctrine, Upholds Dismissal of Duplicative Litigation

The U.S. Court of Appeals for the Eleventh Circuit recently affirmed the dismissal of a complaint alleging violations of the federal Telephone Consumer Protection Act, the federal Fair Debt Collection Practices Act (FDCPA) and its analogue under Florida state law, because the plaintiff previously filed a separate lawsuit against the same defendant alleging violations of the TCPA based on the same conduct. Because the Eleventh Circuit concluded that the claims asserted in the second action were based on the same nucleus of operative facts, the plaintiff was barred from splitting her claims among the lawsuits. A copy of the opinion…

MD Ala. Holds Servicer Did Not Violate Discharge By Sending Periodic Statements, NOI, Delinquency Notices, Hazard Insurance Notices

The U.S. Bankruptcy Court for the Middle District of Alabama recently held that a mortgage servicer did not violate the discharge injunction in 11 U.S.C. § 524 by sending the discharged borrowers monthly mortgage statements, delinquency notices, notices concerning hazard insurance, and a notice of intent to foreclose. Moreover, because the borrowers based their claims for violation of the federal Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., on the violation of the discharge injunction, the Court also dismissed their FDCPA claims with prejudice. A copy of the opinion in Golden et al v. Carrington Mortgage Services,…

Calif. App. Court (3rd Dist) Holds Loan Mod Denial Letter Allowing Only 15 Days to Appeal Was ‘Material Violation’ of HBOR

The Court of Appeal of the State of California, Third Appellate District, recently held that a mortgage servicer violated California’s Homeowner Bill of Rights (HBOR), Civ. Code § 2923.6(d), when it sent a borrower a loan modification denial letter stating that the homeowner had only 15 days to appeal the denial. In so ruling, the Appellate Court held that the servicer’s denial letter was a material violation of section 2923.6, and therefore the homeowner alleged a valid cause of action for injunctive relief under section 2924.12. A copy of the opinion in Berman v. HSBC Bank USA, N.A is available…

SCOTUS Rules State Credit Card Anti-Surcharge Law Regulates Speech, Not Conduct

The Supreme Court of the United States recently held that a state law penalizing merchants for charging a surcharge for credit card payments did not restrict the amount that a store could collect when a buyer paid by credit card (i.e., a regulation on conduct). Instead, the Court held that the state statute regulated how sellers may communicate their prices, and was therefore a regulation on speech subject to First Amendment scrutiny. As you may recall, in Dana’s R.R. Supply v. AG, 807 F.3d 1235 (11th Cir. 2015), the U.S. Court of Appeals for the Eleventh Circuit held that a…

9th Cir. Holds Mortgagee’s ‘Sold Out Second’ Claim Not Barred by California’s 4-Year Statute of Limitations

The U.S. Court of Appeals for the Ninth Circuit recently reversed a ruling that disallowed an unsecured creditor’s claim filed in a California bankruptcy court based on the forum state’s statute of limitations. In so ruling, the Ninth Circuit held that, although courts typically apply the forum state’s statute of limitations if the contract is silent on the issue, exceptional circumstances warranted the application of a longer statute of limitations here, because the creditor had no option but to enforce its claim in the forum based on where the bankruptcy petition was filed. A copy of the opinion in PNC…

2nd Cir. Holds Payoff Statement Stating ‘Amount Due May Include’ Estimated Fees, Costs Violates FDCPA

The U.S. Court of Appeals for the Second Circuit recently reinstated a complaint alleging a debt collector violated the federal Fair Debt Collection Practices Act when it sent a payoff statement containing unaccrued fees and costs without providing any information as to how those fees were calculated or any basis for those fees and costs. In so ruling, the Second Circuit was careful to note that a payoff statement may contain estimated fees and costs if the information in the statement would allow the least sophisticated consumer to determine the minimum amount she owed at the time of the notice,…