In the
United States Court of Appeals
For the Seventh Circuit
No. 09-2182
SAUL H. CATALAN and MIA MORRIS,
Plaintiffs-Appellants,
v. GMAC MORTGAGE CORP.,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 05 C 6920—George W. Lindberg, Judge.
ARGUED FEBRUARY 12, 2010—DECIDEDJANUARY 10, 2011
Before EASTERBROOK, Chief Judge, HAMILTON, Circuit
Judge, and SPRINGMANN, District Judge..
HAMILTON, Circuit Judge. Plaintiffs Saul H. Catalan and Mia Morris sued defendants RBC Mortgage Company and GMAC Mortgage Company under the federal RealEstate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2601, et seq., and under Illinois law for gross negligence, breach of contract, and willful and wanton negligence. The district court dismissed the plaintiffs’ gross negligence claim as merely duplicating the willful and wanton negligence claim. The court granted summary judgment to GMAC Mortgage on the plaintiffs’ RESPA, breach of contract, and remaining negligence claims. The plaintiffs appeal those decisions. We reverse the grant of summary judgment for GMAC Mortgage on the plaintiffs’ RESPA and breach of contract claims, and we affirm summary judgment on their negligence claims.1
That seems to be the approach that notorious robo-signing firm Nationwide Title Clearing has taken in responding to some of its critics.
If you are unfamiliar with their name, you might recall earlier this Fall when depositions of several Nationwide robo-signers employees went viral on YouTube (We mentioned these here and here).
This, amongst other perceived sleights has upset Nationwide Title, who has sued a St. Petersburg foreclosure defense lawyer, Matthew Weidner, for alleged libel and slander.
This is likely to be a terrible, terrible idea.
For those of you who are not attorneys, I need to point out a few things out about Libel and Slander laws in the United States. These are Constitutional issues, as the First Amendment protects speech, opinion, arguments, viewpoints, etc. In these cases, (capital “T”) Truth is an absolute defense. So if any defendant can demonstrate that the damaging statements were indeed, accurate, they win.
This case turns on the bizarre claim that the term robo-signer so libels the plaintiffs that they are entitled to damages. Given that Truth is a defense, the defendant will prevail if they can demonstrate Nationwide’s approach was robotic. Not literally machines doing the work, but any showing of assembly line manufacturing, for profit, of a streamlined document production that failed to review the documents, evaluate them, analyze the contents should qualify.
Here’s where things get very very interesting: In civil litigation, the discovery process provides lots of opportunities for a defendant to gather information related to the accusations to prove they are true. This is a very broad standard, and it means nearly anything relevant is fair game. Depositions of senior executives, the firm’s accounting and records, balance sheets, low level employees are all legitimate aspects of pre-trial discovery.
Why any private firm would subject themselves to this degree of scrutiny is quite baffling to me.
According to a Certification filed by NTC’s counsel, on November 17, 2010, the trial court contacted via e-mail and requested that a one-hour hearing be set on Friday, November 19th, to hear the pending motions. App. Tab 10. NTC’s counsel learned that Mr. Forrest was traveling outside of the country and would not return until the following Monday, November 22nd. Id. As NTC’s counsel explained: …
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