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Judge: Will Not Vacate Foreclosure Ruling Against Bank of America

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A federal bankruptcy judge who took Bank of America to task for its treatment of homeowners in a foreclosure case refused to rescind his scathing opinion in which he called the bank “heartless” for its conduct, despite the bank’s agreement to settle if the judge did so.

In Sundquist v. Bank of America, the judge awarded nearly $6 million in damages to the couple ($5 million of that in punitive damages and attorney’s fees), as well as $40 million to the intervenors in the case for the bank’s actions. The bank has offered to set aside its appeals and settle the case for several million dollars in excess of that $6 million, if only the judge will expunge his opinion and vacate the $40 million in damages to the intervenors. The couple has offered to donate $300,000 to the intervenors. However the judge, who has been labeled a hero in some circles, while agreeing to vacate the intervenors’ damage award, has refused to rescind his opinion. In a new recently-released response opinion, the judge stated the bank’s settlement offer was a coercive effort to erase the record. He frankly stated, “No chance. No dice.”

The intervenors in this case include a number of law schools and non-profit consumer advocacy organizations intervened on behalf of the public. The judge noted that the points made by these entities were valid, and the bank has thus far issued no apology and offered no remorse or made offers to change the corporate practices that led to the foreclosure abuses this couple suffered – which were not isolated incidents.

There was nothing the bank or its executives had done, the judge explained, that shows a willingness to address the issues that led to this case. Absent that, there is no assurance it won’t happen again.

This case started like so many others amid the foreclosure crisis. At the height of the recession, the California-based couple was told by the bank they needed to allow their 6 percent mortgage to slide into default if they wanted to have it modified. They followed the bank’s directives on this, despite the fact that they could still afford their payments. However, the bank reneged on its offer and never gave them a modification. The result was the home went into foreclosure and the couple landed in bankruptcy court. From there, the judge ruled the bank violated federal bankruptcy law that requires foreclosures to be put off while bankruptcy is pending.

When the bank finally allowed the couple to return, all major appliances had been heisted from the dwelling. The emotional distress on the couple was enormous, with the husband attempting suicide and his wife suffering symptoms of a heart attack that required hospitalization.

It should be noted that while the parties could have reached a settlement on the financial issues on their own, without requiring approval from the judge, they did need the judge to sign off to vacate his opinion. On that, he stood firm. He said that his opinion will serve as a record available for citation of other bankruptcy judges – no doubt the outcome Bank of America was hoping to avoid.

Our Miami foreclosure lawyers know many banks have been caught using underhanded tactics that disadvantage homeowners. The best way to fight back is by securing knowledgeable, experienced legal representatives with a track record of proven results.

If you’re battling debt collection in Miami or the surrounding areas contact Jacobs Legal for a confidential appointment to discuss your rights. Call 305-358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday at 5 p.m. on “Debt Warriors with Bruce Jacobs,” discussing foreclosure topics that matter to YOU.

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