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Case Summaries

Banking Law

[09/11] Branch Banking and Trust Company v. DMSI LLC
Affirming summary judgments against debtors who failed to repay loans held by a bank because arguments about breaches of good faith and fair dealing were predicated on oral promises that do not constitute a contract, the bank had standing to sue, there was no detrimental reliance to support an estoppel defense, and summary judgment did not violate the Seventh Amendment because the claim was predominantly equitable.

[08/02] US v. Stone
Affirming the district court's rulings in the case of a mortgage fraud scheme where the defendant alleged a conflict of interest but the court found that the interest was not significant and the court's judgment would not substantially affect the companies involved and because the sentence and restitution order were not an abuse of discretion.

[05/22] Hardwick v. Wilcox
In an action arising out of a series of loans defendant made to plaintiff, to recover usurious interest and prevent defendant from foreclosing on property securing his loans, the trial court's judgment -- that plaintiff's usurious interest payments made over the course of the relationship offset the principal debt, and that plaintiff could recover interest payments he made during the two years prior to the filing of this lawsuit -- is affirmed where: 1) plaintiff did not waive his usury claim; and 2) the statute of limitations does not bar plaintiff's claim with respect to any loan that was paid off more than two years before this lawsuit was filed.

[05/09] Starr Int'l Co., Inc. v. US
In a suit arising out of a loan from the Federal Reserve Bank of New York under which the federal Government acquired a majority stake in American International Group, Inc. (AIG)'s equity, which the Government eventually converted into common stock and sold, brought by an AIG shareholder alleging that the Government's acquisition of AIG equity and subsequent actions relating to a reverse stock split were unlawful, the Claims Court's judgment that the Government committed an illegal exaction and remand with instructions to dismiss the equity-acquisition claims that seek direct relief is: 1) vacated in part where plaintiffs lack standing to pursue the equity-acquisition claims directly, as those claims belong exclusively to AIG; and 2) affirmed in part as to the denial of direct relief for the reverse-stock-split claims.

[05/03] Berman v. HSBC Bank
In an action brought by a plaintiff who was denied a loan modification by defendant bank, seeking injunctive relief under Civil Code section 2924.12 on the theory that the bank's denial letter was a material violation of section 2923.6(d) in that the letter only provided fifteen days for appeal instead of the thirty days as provided under that statute, the trial court's judgment sustaining the demurrer to plaintiff's complaint without leave to amend based on the conclusion that he had not alleged a violation of section 2923.6, is reversed where the denial letter constituted a material violation of section 2923.6 because it substantially misstated the time plaintiff was allowed by the law to appeal defendant's denial of his application for a loan modification.

[05/01] Bank of America Corp. v. Miami
In a City's suit against two national Banks, alleging violations of the Fair Housing Act (FHA), which prohibits racial discrimination in connection with real-estate transactions, 42 U.S.C. sections 3604(b) and 3605(a), alleging that the Banks' discriminatory conduct led to a disproportionate number of foreclosures and vacancies in majority-minority neighborhoods, which impaired the City's effort to assure racial integration, diminished the City's property-tax revenue, and increased demand for police, fire, and other municipal services, the Eleventh Circuit Court of Appeals' decision vacating the District Court's dismissal of the complaint is vacated where: 1) the City is an 'aggrieved person' authorized to bring suit under the FHA; but 2) the Eleventh Circuit erred in concluding that the complaints met the FHA's proximate-cause requirement based solely on the finding that the City's alleged financial injuries were foreseeable results of the Banks' misconduct.

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Tax Law

[08/31] In Re DBSI, Inc.
Affirming decisions by the bankruptcy court and district court that the Congress had unambiguously abrogated sovereign immunity as it relates to actions associated with bankruptcy, an abrogation that extends to derivative 'applicable laws' such as Idaho's Uniform Fraudulent Transfer Act and the government could not rely on sovereign immunity to prevent the avoidance of the tax payments at issue.

[08/28] California Cannabis Coalition v. City of Upland
Affirming a Court of Appeals judgment that article XIII C of the California Constitution, limiting the ability of local governments to tax, does not constrain voter constitutional powers to propose and adopt initiatives or raise taxes by such initiatives in the case of a city ordinance banning medical marijuana dispensaries and requiring an annual licensing and inspection fee of $75,000.

[08/07] Russell City Energy Company, LLC v. City of Hayward
Reversing an order sustaining a city's demurrer without leave to amend and dismissing a complaint to the extent that the order denied the plaintiff leave to amend in an action relating to an agreement between an energy company and a city whose terms may have violated the California Constitution because a quasi-contractual restitution claim would be permitted even if the Payments Clause at issue is unconstitutional.

[07/18] The Container Store v. US
Reversing and remanding the final judgment of the United States Court of International Trade case granting summary judgment to the government because the subject modular storage unit imports were improperly classified as mountings and fittings rather than as parts of unit furniture.

[07/05] Matuszak v. Commissioner of Internal Revenue
Affirming that the issue of the failure to file a petition for innocent spouse relief from IRS actions during the statutorily provided period deprives the Tax Court of jurisdiction to review such a claim.

[06/29] 926 North Ardmore v. County of L.A.
Affirming the appellate court's denial of the plaintiff's refund claim in a case where Los Angeles imposed a documentary transfer tax on a written instrument transferring beneficial ownership among parties and holding that such a tax can be imposed where there is a transfer of legal beneficial ownership made for consideration.

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Banking Law

[09/11] Branch Banking and Trust Company v. DMSI LLC
Affirming summary judgments against debtors who failed to repay loans held by a bank because arguments about breaches of good faith and fair dealing were predicated on oral promises that do not constitute a contract, the bank had standing to sue, there was no detrimental reliance to support an estoppel defense, and summary judgment did not violate the Seventh Amendment because the claim was predominantly equitable.

[08/02] US v. Stone
Affirming the district court's rulings in the case of a mortgage fraud scheme where the defendant alleged a conflict of interest but the court found that the interest was not significant and the court's judgment would not substantially affect the companies involved and because the sentence and restitution order were not an abuse of discretion.

[05/22] Hardwick v. Wilcox
In an action arising out of a series of loans defendant made to plaintiff, to recover usurious interest and prevent defendant from foreclosing on property securing his loans, the trial court's judgment -- that plaintiff's usurious interest payments made over the course of the relationship offset the principal debt, and that plaintiff could recover interest payments he made during the two years prior to the filing of this lawsuit -- is affirmed where: 1) plaintiff did not waive his usury claim; and 2) the statute of limitations does not bar plaintiff's claim with respect to any loan that was paid off more than two years before this lawsuit was filed.

[05/09] Starr Int'l Co., Inc. v. US
In a suit arising out of a loan from the Federal Reserve Bank of New York under which the federal Government acquired a majority stake in American International Group, Inc. (AIG)'s equity, which the Government eventually converted into common stock and sold, brought by an AIG shareholder alleging that the Government's acquisition of AIG equity and subsequent actions relating to a reverse stock split were unlawful, the Claims Court's judgment that the Government committed an illegal exaction and remand with instructions to dismiss the equity-acquisition claims that seek direct relief is: 1) vacated in part where plaintiffs lack standing to pursue the equity-acquisition claims directly, as those claims belong exclusively to AIG; and 2) affirmed in part as to the denial of direct relief for the reverse-stock-split claims.

[05/03] Berman v. HSBC Bank
In an action brought by a plaintiff who was denied a loan modification by defendant bank, seeking injunctive relief under Civil Code section 2924.12 on the theory that the bank's denial letter was a material violation of section 2923.6(d) in that the letter only provided fifteen days for appeal instead of the thirty days as provided under that statute, the trial court's judgment sustaining the demurrer to plaintiff's complaint without leave to amend based on the conclusion that he had not alleged a violation of section 2923.6, is reversed where the denial letter constituted a material violation of section 2923.6 because it substantially misstated the time plaintiff was allowed by the law to appeal defendant's denial of his application for a loan modification.

[05/01] Bank of America Corp. v. Miami
In a City's suit against two national Banks, alleging violations of the Fair Housing Act (FHA), which prohibits racial discrimination in connection with real-estate transactions, 42 U.S.C. sections 3604(b) and 3605(a), alleging that the Banks' discriminatory conduct led to a disproportionate number of foreclosures and vacancies in majority-minority neighborhoods, which impaired the City's effort to assure racial integration, diminished the City's property-tax revenue, and increased demand for police, fire, and other municipal services, the Eleventh Circuit Court of Appeals' decision vacating the District Court's dismissal of the complaint is vacated where: 1) the City is an 'aggrieved person' authorized to bring suit under the FHA; but 2) the Eleventh Circuit erred in concluding that the complaints met the FHA's proximate-cause requirement based solely on the finding that the City's alleged financial injuries were foreseeable results of the Banks' misconduct.

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Property Law & Real Estate

[08/30] Direct Capital Corporation v. Brooks
Affirming that debt incurred by an attorney-spouse is considered to be among the necessaries of life in the context of their marriage, in part because the spouse's law practice generated community property income.

[08/29] Attard v. Board of Supervisors of Contra Costa County
Affirming a trial court denial of a petition for writ of mandate challenging the revocation of permits issued in error by the county for the development of property because whatever rights they might have had on their projects had not vested and sovereign immunity and due process arguments also failed.

[08/29] Save Laurel Way v. City of Redwood City
Reversing a court decision setting aside a planned development permit (PDP) issued by the city that would not include any development on individual lots owned by a group of property owners hoping to build homes in that space because although the lower court felt the city had abused its discretion in failing to evaluate the legal status of the lots under the Subdivision Map Act the Court of Appeal felt that issues regarding the legal status of the individual lots were not ripe for review since the PDP did not address the development of the lands at issue, but only the infrastructure surrounding them.

[08/29] BRE DDR BR Whittwood CA LLC v. Farmers and Merchants Bank of Long Beach
Reversing a trial court summary judgement for the landlord in an action to recover rents from a lender that had received the interest in property held by a tenant in foreclosure that argued it should only pay the amount owed for the period in which they were in possession and the court agreed that the purchase of the leasehold in the case, identified in a deed of trust by reference to a lease, did not constitute an express agreement to assume the obligations of the lease.

[08/29] Norfolk Southern Railway Company v. Pittsburgh and West Virginia Railroad
Affirming district court's use of course-of-performance evidence to bolster its conclusions regarding lease provisions and its finding that the appellants engaged in fraud to obtain the consent to transactions otherwise prohibited in the lease.

[08/25] Berezovsky v. Moniz
Affirming the district court's summary judgment in favor of the Federal Home Loan Mortgage Company, or Freddie Mac, in a quiet title action brought by a plaintiff who purchased real property at a homeowners association foreclosure sale because the Federal Foreclosure Bar preempted Nevada's superpriority lien provision, entitling Freddie Mac to a summary judgment even though the recording document listed the deed-of-trust beneficiary but not the note owner.

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