Ohio Appeals Court Affirms Dismissal Of City’s Public Nuisance Suit Against Banks

more+
less-

On March 21, the Court of Appeals of Ohio, Eighth Appellate District, affirmed a trial court’s dismissal of a suit by the city of Cleveland, which sought damages from several financial institutions involved in the creation of mortgage-backed securities using subprime mortgages from Cleveland, Ohio, real estate. Cleveland v. JP Morgan Chase Bank, N.A., No. 98656, 2013 WL 1183332 (Oh. Ct. App. Mar. 21, 2013). The City alleged that the institutions engaged in a practice of encouraging subprime lending in order to package mortgages together and sell the MBS to investors, and that these practices caused a foreclosure crisis in Cleveland that damaged the City and created a public nuisance. The City also brought an Ohio Corrupt Practices Act (OCPA) cause of action alleging that one institution systematically filed false or misleading paperwork in foreclosure cases. On appeal, the court held that the causal connection between the securitizing institutions and the foreclosure crisis is too far removed, and, even under the most lenient of pleading requirements, the City’s complaint fails to state a valid claim under public nuisance or the OCPA.

Topics:  Foreclosure, Mortgage-Backed Securities, Mortgages, Public Nuisance, Subprime Mortgages

Published In: Civil Procedure Updates, General Business Updates, Finance & Banking Updates, Personal Injury Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BuckleySandler LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »