By Susan Chana Lask, Esq.

New York’s Attorney General Schneiderman and the Department of Justice went after Steven Baum after I blew the whistle on him with my August 2010 class action. By November, 2011 banks blew off Baum as their foreclosure attorney and he paid a slim Six Million Dollars to settle claims with the Attorney General and the Department of Justice. Unfortunately, Baum’s flopped foreclosure complaints live on in the courts and his files were simply transferred to new foreclosure firms to represent the banks statewide, such as Rosicki Rosicki & Associates P.C. and Frankel Lambert Weiss Weisman & Gordon LLP.  The new law firms are simply substituted in the case to continue where Baum left off by proceeding on the very foreclosure complaints Baum filed. The Attorney General refers to this continuation of Baum’s complaints by new law firms as the “shadow docket”.[1]  To combat the “shadow docket”, on May 29, 2013 Attorney General Schneiderman announced a “Certificate of Merit” bill (A. 5582) and the Foreclosure Fraud Prevention Act (A.7395) as “legislation to protect New York homeowners facing foreclosure” that “impose criminal penalties on residential mortgage lenders, servicers and their agents who intentionally engage in fraudulent or deceptive conduct in the preparation, execution or filing of false foreclosure documents”. 

Let’s get real here.  It took the Attorney General three years since 2010 when the media and Judge Schack publicly lambasted Baum’s floppy foreclosures leaving New Yorker’s homewrecked to now draft bills to hold the sloppy filings criminal?   And the Attorney General’s announcement may have good intentions but it fails to note that “bills” take years to pass through the senate before they become enforceable laws. Too much time will be wasted in court with homeowners battling the Baum complaints while waiting for this legislation to pass, so I propose this answer-the banks should do us all a favor and have their new law firms withdraw the faulty Baum filings from the court system. Period. Then the new law firms should review the files to insure everything is in order for a proper foreclosure complaint to be drafted, such as the original note, proper note endorsements for assigning the note, valid certificate of merits that the bank and/or it’s counsel have the original file and checking that the documents have proper notarizations and are not robo-signed.   Of course, we would have to be living in a parallel universe to have that dream come true.

So if the banks and their new firms won’t do what looks like the right thing, then let’s play hard ball. Here’s how to go after the bumbling Baum complaints.  Because the Baum firm was an “alleged” (yes, I said alleged) foreclosure mill then the way a mill operates is to mass produce its product. The Baum complaints were mass produced foreclosure complaints with boilerplate allegations. A quick review of any number of the Baum filings will show they are all the same bare bones complaint alleging at about the third paragraph that “the mortgage was assigned” to the plaintiff bank, but never alleging the note was assigned. The Baum complaints also conspicuosly never plead the banks own the note most likely because no one knows who owns the note with all of the slicing and dicing that occurred. 

Now here’s how to move to dismiss the Baum complaints that the new foreclosure firms represent in courts today. The law is that the plaintiff bank must plead and prove it owns the note and mortgage and that it has the right to foreclose. Wells Fargo Bank, N.A v. Erobobo et. al, 2013 N.Y Misc. LEXIS 1790,2013 NY Slip Op 50675(U) (Kings Sup. Ct, April 29, 2013);Wells Fargo Bank, N.A., 80 AD3d 753, 915 N.Y.S.2d 569 (2d Dept 2011); Argent Mtge. Co., LLC v. Mentesana, 79 AD3d 1079, 915 N.Y.S.2d 591 (2d Dept 2010); Campaign v Barba, 23 AD3d 327, 805 NYS2d 86 (2nd Dept 2005).  One, Baum’s complaints never plead the Bank owns the note, never pleads the note was assigned and only pleads there was an assignment of mortgage. Without pleading ownership of the note then the complaint fails. Remember when everyone relied on whether the bank had standing to bring the foreclosure?  Two, in addition to standing is whether the complaint pleads a cause of action. Do not confuse standing with ownership of the note as they are two distinct elements and both must be pled and proven in a foreclosure complaint. Erobobo.  “There is a difference between the capacity to sue which gives the right to come into court, and possession of a cause of action which gives the right to relief. Kittinger v Churchill Evangelistic Assn Inc., 239 AD 253, 267 NYS 719 (4th Dept 1933). Incapacity to sue is not the same as insufficiency of facts to sue upon. Ward v Petri, 157 NY3d 301 (1898).” Id. at 4. 

Baum’s bare bones foreclosure complaints dolled out to the new foreclosure law firms in courts today are ripe for motions to dismiss because they do not plead a cause of action that the bank owns the note.  Make the new foreclosure firms do their job because in my opinion they should be withdrawing the Baum complaints from the court system on their own and not putting the homeowners and the courts to task. Meanwhile, one day this will all become criminal under the Foreclosure Fraud Prevention Act (A.7395) so foreclosure firms will think twice before perpetuating another attorney’s suspect files subject to Attorney General and Department of Justice settlements as what the new attorneys are doing just diminishes the public’s confidence in the court system and attorneys at large.

Susan Chana Lask is an author, lecturer and accomplished attorney litigating in State and Federal Courts, including the United States Supreme Court for the past 25 years. She is named by the media as “New York’s High Profile Attorney” who consistently makes headlines worldwide and changes history with her controversial dogged lawsuits. Her 2010 lawsuit shut down the country’s most notorious Foreclosure Mill in New York State for the benefit of the public suffering from fraudulent foreclosure filings. In 2011 she appeared before the Supreme Court of the United States with the support of five Attorneys General where she obtained a historical decision that strip searching non-criminal offenders is unacceptable unless they are in the general population. Her 2006 lawsuit against the makers of Ambien resulted in the FDA complying with her demands to change prescription drug warnings to protect some 26 Million consumers. Her cases are monumental and have changed history.

Follow Ms. Lask on twitter @SusanChanaLask

This article is for informational purposes only. It is not legal advice. You should seek counsel from a licensed attorney if you have legal questions.

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