Almanzar et al v. Select Portfolio Servicing, Inc. et al

Filing 70

ORDER denying 37 , 38 , 39 Motions to Dismiss. Signed by Judge Federico A. Moreno on 3/24/2015. (whl)

UNI
TED STAT ES D I
STR I C O U R T FO R TH E
CT
SO U TH ER N D I
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N o.1 CI 4- V 22586- OREN O
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J
UAN ALM ANZAR a J
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SELECT POR TFO LI SERV I N G,I C.
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Com pa Am e i a Se iy l ur nce Com pa a Sel c Porf i Se ci I ' m otons
ny,
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t dim i s a num ber of cl i s r l t t alega i t t t D e e
o s s
a m e a ed o l tons ha he f ndant pai a r ce ve
s d nd e i d

une m e kikba i conne ton wih af ce pl e i ur nc s he e.l TheDe e
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pai t a a fla e oft lnde f br r ge s vies but a e i f tcyced
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Dee nt Seec Porf i Sevi ng (
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t r ns a
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l
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e
xcha , A SI a SG I a e gi n t e us ve r g t f ce i ur e on
nge
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pr ry s urng a l n w ihi t porf i when t bor ow e ' i ur nce
ope t ec i
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r r s ns a
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na ua e.
C nd
C
t
S ntr oa
tolo or a e n
bor o er 'i ur nce c r . Onc a l ps i i ntf e A SI a SG I s nd
r w s ns a
ove age
e a e s de ii d, C nd
C e
no i t t bo r e t ti ur nce w ilbe S c e 'a f ce pl e i t
tce o he r ow r ha ns a
l
l has d' nd or - ac d f he
pur
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unt r over ge i notc i d. I a l ps contnue ,t i ur r no ii s t
a s
ontnue f a e
i s he ns e t fe he
bor o ert ti ur nc i be ng f c pl ce a hi orhe expe e.
r w ha ns a e s i or e- a d t s
r
ns

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hages r r
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tt
a t lypa )f f c - a e c a ,a t c ge borowesmor t n
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e ha
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he m
ce s r o ver t
nt r s n he ola e a or r w r '
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t
oa .
har s s e
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t De e n st i udet cos ofb i sa unea ne kikbac pad by ASI
he f nda t o ncl he t rbe nd
r d c
ks i
C
a SG I t SPS t m a n a n a e us ve r l tons p. SPS a s pa s s on
nd
C o
o i t i n xcl i e a i hi
lo s e
c r s t t hom e ne sf unnec s a y and duplc tve c r notr qui e
ha ge o he
ow r or
esr
i a i ove age
e rd
by 1 w ort t r soft m orgage t t diec bene i oft D ef nda s
a
he e m
he
t
o he r t
ft he
e nt .
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he pos
he ns a
t o , he
t c e s hes le tons s r
nd

c tue t aleg tons i t lg mos f vor e t t Pli if t dee ne t whehe
onsr s he l a i
n he i ht
t a abl o he antf s o tnni he
t r
Pl i if pl enough f c s t sa e pl i e cli f r i . See Bel Atantc Cor v
antfs ed
a t o tt ausbl a ms or elef
l l i
p. .

Twombl 550 U. 54 555 (
y,
S. 4,
2007) Beng f l a sd i t pr miesoft Dee nt'
. i uly dvie n he e s
he fnda s
m otons i i
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A DJU DG ED t t Def
hat he
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bas ofcl i s r l t t a f a e f c pl ce i ur nc s he e The Cour now a e s
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t
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The De e nt be i ve t tt Pl i if f ce s ver lpr lm i r ba r e s t s t Fi s ,
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t t De e
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t Cour ca
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he w e s y pa t nt
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ti
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r t of t f c - a ed i ur nce t Pl i if a e not cha l ngi t r t t m s l s
a es
he or e pl c ns a , he a ntf s r
le ng he a es he e ve .
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t r he ai t f s r halengi he r udul nts he e be nd t r t ,by whi h SG I a
e c m
hi he a es
c
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A SI of e e l t a ng a i ur nc pl ce e s r i s t SPS and pa d SPS une m e
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ki kba ks i e hange f a exc us ve c r t lr a i hi l kee ng wih pr e ntf om
c c n xc
or n l i ontac ua el tons p. n pi
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hi
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U S.Bank N A.No.1 c 21 2,201 W L 41
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Fi ly,t Def nda sar t tt Pl i if 'c ai sf lasa m a t rof1 w be a e t
na l he
e nt gue ha he a ntf s l m ai
te
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Dee da t ds l e t a b ro r mih be s b e tt d c h g r'c ssi t e dd n t
fn ns icosd h t o r wes g t u j c o t h ihe' o t f h y i o
mu
o an ha a d i ur nc on t i o
bt i z r ns a e
her wn. The De e nt ' dicl u e ar
f nda s s os r gume r t on t
nt ess
he
a s pton t tt f es pa d t SPS we e c m i s ons r t r t n il lki kba ,w hi h i
s um i ha he e
i o
r om s i , a he ha lega c cks
c s
a is t t goe t t c e of t s c e. The C ou tr c ze t tm e e y l lng pay e s
n s ue ha
s o he or
hi as
r e ogni s ha
r l abe i
m nt
asil li c cks'i i ufi i ntt a m a e t Pl ntf s cl i s f r le . See Fea v Wels
lega i kba ' s ns tc e o ni t he ai i f ' a m or e i f
ki
z . l

Fa goBank NA.745F. 1 1111( 1h Ci.201 ;Cohe v Amerc Se rt I ur
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n .
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y

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.7 5 3 01 61 7h r 201 ) nse d,h u to k o h a t s e o eemi
whehe t qui pr quo ara m e be we n t De e nt m o s i o t r a m ofil al
t r he d o
r nge nt t e he f nda s ve nt he e l
leg
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ym nt or e v ce , . , i s he m opr e y
c nnno be a e i a ed by di c os es
t
m lor t
s l ur
t t bor ow er
o he r
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I t rcompl nt t Pli if de ala s r ts he e by whi h SGI a ASI pad
n hei
ai , he antfs t i ec e c m
c
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C i
w holy une m e ki kbac t SPS i e ha f a e us ve c r c ua r l i ns p t f r e
l
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ks o
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pl c i ur nce upon t Pl i if . The cos sas oci t w ih t D e e
a e ns a
he a ntf s
t s a ed t he f ndant 'f a
s r udul nts he e
e c m
w e e pa s on o t bor ow e s gi ng r s t t cl i s i t s c e. I ,as alege t f ce
r s ed t he r r , vi i e o he a m n hi as f
l d, he or pl c d i ur nc s he e w a drve by il galki kbac ,t n di cl i t e c t of f ce
a e ns a e c m
s i n
le
c
ks he s os ng he nd os
or pl i t i ur nc ca m oti ul t t D e e nt f om cl i s perai ng t t D ef nda t '
ac ng he ns a e r
ns a e he f nda s r
am
t ni o he
e ns
be nd t s e a tvii s t tdr up t r t sbor by uns pec i bor ow e s
hi he c ne c i te ha ove he a e
ne
us tng r r .
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R ACKETEER I LUENCED AND C ORRUPT O RGANI
NF
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Def nt' Ra kete I l nc d a Cor pt Or ni ton Ac ( CO) agume t
enda s c e r nfue e nd
nl
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t RI
r
ns
a n t n on t t i bl i s of whe he t c t buiti o D e e nt 'f c - a ed i ur nc
gai ur
he r a e s ue
t r he os s l nt
f nda s or e pl c ns a e
s he e c tt e co m i s onsor il alki kba ks I t f c - a ed i ur nc s m e w a
c m ons iut d m s i
leg
c c . f he or e pl c ns a e che
s

4-

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drve by ilgalac i te ,t t Pl n if have s ts id t e e nt of a cli f RI
i n
le
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am or CO

v oain u d r1 U. C. 1 6 ()
ilto s n e 8 S. j 9 2 c .
ThePl i if a lge t tt De e nt m al l te st borowe st tm ir pr s nt
antfs le ha he f nda s ied et r o r r ha s e e e ed
t na ur of t n oun s t tt w oul be bil d,s a ed t tt a ount r pr s nt d t c t
he t e he m
t ha hey
d
le t t ha he m
s e e e e he os
of i ur nce a f ie t di c os t t a pori of t c t r e e ed unea ne ki kbac
ns a , nd a l d o s l e ha
ton
he os s epr s nt
r d c
ks
t tw e e pa d t SPS i e ha f a exc usve c r t r l tons p w ih SGI a A SI .
ha r i o
n xc nge or n l i ontac ual e a i hi t
C nd
C

Pli if f t ra lge t tt s notc c us d borower t f e obt i ng haz r i ur nc
antfs urhe le ha he e i es a e
r
s o or go a ni
a d ns a e
be a e t Pl ntf s woul ha obt i d i ur e on t row n i t y w e e i or ed t tt
c us he ai if
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hei
f he
r nf m
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f nt' or e pl c ns a e nc ude he oss
a ned c c
A c or ng t t Pl ntf s t s a tvii s t pl c w ihi a e e prs c pr s of
c di o he ai i f , he e c i te ook a e t n n nt r i e om i ed
SG I A SI and SPS. The m e be s of t e e prs s r d t c m on goa of i r asng
C, C,
m r
he nt r i e ha e he om
l nc e i
r ve s by f c ng t Pl i if t pa i l ed r t s ba e o t il ga ki kba t f l d
e nue
or i he a ntf s o y ntat a e s d n he le l c cks hat ue e

t e eprs ,a asde a ld a
he nt l ie nd,
t ie bove ea h m e rpl d a i s a e r e i t ope aton
, c
mbe aye n ndipens bl ol n he r i
oft en e pr s I pr n,t e a l ga i f m t ba i of RI vi a i ns s e m i f om
he t r i e. f ove hes le tons or he s s
CO ol t o t m ng r
t D e e nt 's he e t de r ud bor ow e s by m a lf a
he f nda s c m o f a
r r
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T RUTH I LENDI A CT CLAI S A GAI D EFENDANT SPS
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uh n ndi
t 5 S.
601 t e , otct ns r
l ng hem
m a i onne c e t de s ons See For M ot Cr di Co. v M iholi 444 U . 555,559
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( 980)(1 Tnlh i Le ng Ac hast br d pur e ofpr tng t i onne us of
1
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The t n ndi
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umes'
)
antfs leg
t t t Def nda s vi a e t Tr h i Le ng A c by c ngi t t r s of t Pl ntf s
ha he
e nt ol t d he ut n ndi
t
ha ng he e m
he ai if '
l ns a c ea i new o i tons when t D e e nt f ce duplc tve a r toac i
oa
nd r tng
blga i
he f nda s or d
i a i nd e r tve

i ur ncec r geon t Pl ntfs pr ri . ThePl i if f t ral get tt sduplc tve
ns a
ove a
he ai if ' ope tes
antfs urhe le ha hi
ia i
c r ge e e
ove a
xc eds t t r uie by 1 w and t Pa tes m o t ge a ee e s a t t t
ha eq r d
a
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atndan hi n coss f m t ba i ofTr t i Le ng Ac vi a i be a e SPS di no
te
t dde
t or he ss
u h n ndi
t oltons c us
d t
ade t y dicos t e cosst borowe sbef r i
quael s l e hes
t o r r
o e mposng t c nges SPS r s ndst ti
i he ha
.
e po
ha t
di notne d t di c os t c t bec us t y c tt e tpr m i s f r i u a e ag ns l s
d
e o s l e he os s a e he ons iut d s e um o ns r nc ai t os
of orda a t pr pe t ' a SPS i onued bor ow e s t tt ca ob ai t s cove a f om
m ge o o ry, nd
'
nf
r r ha hey n t n hi
r ge r

ot rs c i a cor nc wih 1 C. R.j226.
he oures n c da e t 2 F.
The Cour cons r t pr s ons of t Tr t i Le ng A c lber ly t a f d r le
t
t ues he ovi i
he u h n ndi
t i a l o f or e i f

f borower. SeeBr gg v BilHe d Che r et I . 374 F. l
or r s
a . l ar
v ol , nc,
3d 060,1 ( lh Ci.2004)
065 1 t r
.
l c t i t Pl i i f ' Tr t i Le ng A c alega i , t Cour ag n t ns t t
n ons nlng he a ntf s u h n ndi
t l tons he
t ai ur o he

ditnci bewe n l l co mi so a une r
si ton t e ega m s i ns nd
a ned ki c , t l te of whi h ca t
ckba ks he at r
c
nno
c tt e a va i t e i f i ur nce '
onsiut
ld d m um or ns a ' unde t sa ut See Jac s 201 W L 41
pr
r he t t e.
k on, 4
79867 a
t
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6. t r he c ptve t e he ar d c c c m
e udes t a i to of
he pplca i n
t Tr t i Le ng A c ' one ye r sa ut of lm ia i aga ns Pl i if ' c ai s 1 Thus
he u h n ndi
ts - a tt e
i t tons i t a ntf s l m . d.
,
t Pl i if have s a e a cl i f vi a i nsoft Tr t i Le ng A c .
he a ntf s
t t d a m or ol to
he u h n ndi
t
l .
V

N Ew JERS C ONS ER FRAUD A CT CLAI A GAI T DEF
EY
UM
MS
NS
ENDANTS SG I AND A SI
C
C
The N e J s Cons e Fr ud A c pr de r le i o cons e s w ho a e vi tm i d
w er ey
um r a
t ovi s e i f t
t
um r
r c i ze

by fa e pr c i s i t mar t a e. See Gonz e v W is r Cr di Co p. 25 A .
r udulnt a tce n he
kepl c '
'
alz . lhie e t r ,
3d

11 111 ( J 2011 .Tosaeacai f aCons rFr Ac vi ain,hePli if mus
03, 4 N.. )
tt l m or
ume aud t olto t antfs t
alege iany ascert nabl l ofm oneys or pr
l s
ai e oss
opert r or pers ,as a r t of t us or
y, eal
onal
esul
he e

e pl ym e by ano he per o ofa m e hod,a t orpr ctce dec ar d unl w f .... N . S a .
m o nt
t r sn
ny t
c,
a i
l e
a ul
' J. t t
'

j 56:- 9. Thedei ton oft c t na e l s'i l sc t a s ae by i operf c
81
fnii
s erai bl os' ncude oss socitd mpr
as
ore-

-

6-

pl c d i ur nc Gonz e 25 A.d a 111 i a ulpr c i s'unde t Cons rFr ud
a e ns a e.
alz,
3 t 6. f wf a tce '
unl
r he
ume a
Ac i l
t nc ude:
a unc c ona e c m e c a pr tc dec pton,f a f l e pr t ns f l e
ny
ons i bl om r i l ac i e, e i
r ud, a s e e e, a s
pr i e, m i r pr e a i
om s
s e es nt ton, or t know i
he
ng, c ea m e , s es i
onc l nt uppr s on, or
omison ofa m ae ilf twih i e t tot r r l upon s c eam e ,
si
ny t ra ac t nt nt ha he s ey
uch onc l nt
s es i or omison ...whe he or no a pe s has i f c bee m ild,
uppr son
si
t r
t ny r on
n a t n se
de ei d orda a d t r
c ve
m ge he eby.

N. Stt j56:- SGI a ASI movet dimist Pl ntfs Cons rFr Ac cai
J. a. 82. C nd C
o s s he ai if'
ume aud t l ms
be us no hi w a t a ke e 't t Pl i if t t c d f
ca e t ng s s r t d' o he a ntf s ha oul onn t bas s of t i c a m s a
m
he i
he r l i , nd
be us t Pl n if di not aleg t t y w er ti ed or l ed' i o us ng f c pl c
ca e he ai t f s d
l e hat he
e dnduc
ur ' nt i or e- a ed
i ur
ns ance.

l vi oft c es r a ng c lctng out es on t s i s t Cour r t ns t t
n ew
he as e chi onfi i
com
hi s ue, he
t e ur o he
l ng e ofN e J s s Cons e Fr ud A c t de e m i w he he t Pl i if s a e a cl i
a uag
w er ey'
um r a
t o t r ne
t r he a ntf s t t d a m
unde t s a ut . The Pl i if a l ge t t t D e e nt us a f a
r he t t e
a ntf s le ha he f nda s ed r udul nt s he e t s c e
e c m o e ur

une r d kikbac fom f c plc i ur nce whi h consiut s an unl ulpr ctce unde
a ne c
ks r
or e- a ed ns a , c
tt e
awf a i
r

N. Stt j 56: 2. The Pl ntfs as ale a a c rana e l s of mone i t c t
J. a.
8ai if lo lge n s e ti bl os
y n he oss
a s itd wihf ndi t Defnda s uneane kikba .Se N. Stt j56: 1 l notfr
socae t u ng he e nt' r d c cks e J. a. 8- 9. f o
t c t c ea ed i t Def nda s r udul nt s m e,t n t t a c t of f c pl c d
he os s onc l n he
e nt 'f a
e che
he he ot l os
or e- a e
i ur e w o d ha be l e f t Pl i if . Ba e on t l nguage oft s a ut t e
ns anc
ul ve en ow r or he a ntf s
sd
he a
he t t e, hes
a l to f m t ba i ofCons e Fr ud A c c a m sunde N ew J r e l w .
lega i ns or he s s
um r a
t li
r
e sy a
V.

MI
SCELLANEOUS COM MON LAW C LAI S
M

The Pl i if brng a num be of c m on l w cl i s r l t t t haz d i ur nc
a ntf s i
r
om
a
a m e a ed o he
ar ns a e
pr s o i t i m orga ag ee e s The Pl ntf s f r t alege a si pl br
ovi i ns n he r
t ge r m nt .
ai if i s l
m e each of t
he
m ort
gage agr ent based on t unr s na e plc nt of ha ar i ur e ( c
eem s
he ea o bl a eme
z d ns anc whih,

ac or ngt t Pl nif,i ve up-ha gi borowesf une r dkikba ) Thoug t
c di o he aitfs nvol d c r ng r r or ane c cks.
h he
exp es l ngua of t con r c s alow e SPS t f c pl c i u a e upon t Pl i if ,SPS
r sa
ge he t a t l d
o or e- a e ns r nc
he a ntf s

wa i idl oblg t d t do s i a i ea o bl a appr it m a .' Se LJ t v
s mple y i a e o
o n s s na e nd
r
opra e nner '
e .#' .
z
n

Sant rBank N A.No.CI A.1 40 201 W L 2693158,a * ( D.Pa.J 1 201 .
ande
, ,
V. 3- 40, 4
t 4 E.
une 2, 4)
The Co tc l o dimi st Pl n if 'br c ofcon r c cli s be us whehe SPS f ce
ur am t s s he aitf s ea h
ta t am
ca e
t r
or pl e i ur nc i ar s bl a a oprae mn
ac d ns a e n ea ona e nd ppr i t nneri ac e t is i t sc s
s ont sed s ue n hi a e.
The Pl i if buid t tousi e f r nc c a m s upon t i br ac ofcon r c cl i s A s
a ntf s l ori
nt r e e e l i
he r e h
ta t a m .
t Pl i if s a e pl usbl c ai s f r le on t r br a h of c r t alega i , t r
he a ntfs t t d a i e l m or e i f
hei e c
ontac l tons hei

d ti d alg t nsa o th w SGI a d ASI itnin l a d u j si a l c u e S t
eal le ai b u o
e
o
C n
C ne to al n n u tt by a s d PS o
y
i
br a h ismorga agee nswiht Pl ntfs( i e i t cos ofha a di urncet
ec t
t ge r me t t he ai if by ncrasng he t
z r ns a o

c runea d kikbac )ae s fce t sae cli f t tous i e frnce wih SPS'
ove
me c ks r ufiint o tt ams or ori ntree
t
S
morga conta swih t Pli tfs
t ge
r ct t he a n if .
The Pl i if f ce a hi he ba t s a e c ai s f br ac of t d i y dut as i i t
a ntf s' a
g r r o t t l m or e h
i uc ar
y, t s he
t ul e ep i
r y xc tonalc e w he e a l nder a t a a fduci r t a bor ow e . Unied Je s y Bank v
as
r e
cs s i ay o
r r
t
re
.

Ken e 704 A. 38,45 ( J App.Di 1 . The exit e ofa fducay rlto hi
sy,
2d
N..
v. 997)
senc
i ir eains p,
howe r i af ts cii i r a t r a ei t esi whih gr sac sofmic
ve , s ac- pe fc nquiy, nd he e r nsanc n c os t
s onduc a
t nd
dec i c n gi r s t c a m s f br a h of a l nder s f d i r du y. I
e t a ve i e o l i
or e c
e
' i uc a y t
d

Ac e i t
c ptng he

Pl n if a l ga i as t ue t Cour c nnot di m i s t Pl ntf s c ai s a t s tm e. The
ai tf s' le tons
r , he
ta
s s he ai if ' l m t hi i
Pl n if pl d t e s enc ofa fduci r r l i hi bas d on SPS' di c e i y a hort t
ai tf s e he xi t e
i a y e atons p e
S s r tonar ut iy o

de o f c pl c i ur nce and ba e on SPS' poston a a e c ow ag nt be wee
velp or e- a ed ns a ,
sd
S
ii s n s r
e
t n
SGI A SI a t Pl i i f . The Pl ntf s f t a l ge t t SPS s c e l ex oie is
C/ C nd he a ntf s
ai i f urher le ha
e r ty pl t d t
r l i hi w ih SG I A SI i or r t e r c unea ne ki kbac a t e
e atons p t
C/ C n de o xt a t
r d c
ks t he xpens of t
e
he
Pl i if . I pr n,t e a l ga i m a f
a ntf s f ove hes le tons y onu t ba i of c a m s f br ac off d i r d y
he s s
l i or e h
i uc a y ut
agai tSPS.
ns

-

8-

Li t rbr ac offduci r du y cl i s t Pl i i f pr di t t r br a h ofi ple
ke hei e h
i a y t a m , he a ntf s e ca e hei e c
m id
c na c a m s on t D e e nt ' bad f t e r i e of di cr ton w he i i pos d ha r
ove nt l i
he f nda s
aih xe c s
s ei
n tm e
za d
i ur nc upon t Pl ntf s The Cour s s no r as t de r f om t pr e nt i t s
ns a e
he ai i f .
t ee
e on o pa t r
he ec de n hi

Dititt ta l br a ofi id c na cli st pr e on ne ry i i la lga i .
src ha lows e ch mple ove nt am o oc ed
a l dentca le tons

Se Car nv I Bank FSB, 9:3-ve de . NG
,
No. 1 c 80659- ( D. a. ach20,201 .
KLR S. Fl M r
4)

Fial te P an if pld camsf runu te rcun n i t eatr aiet t i b e c
n l h litfs e li o j s n il e t n h l n tv o her ra h
y,
e
of c t a t c a m s The Pl n if a l ge t t SG I a A SI w er e i hed by t i e l i
on r c l i .
ai t f s le ha
C nd
C
e nr c
he r xc usve
de lng a r nge e w ih SPS. The Pl i if f t r a l t t SGI and A SI ' e i e
a i r a m nt t
a ntf s ur he lege ha
C
C S nrchm nt

t plc a t e
ook a e t he xpens oft Pl ntfsby vit oft c t as ocit d wih SPS' unea e
e he ai if
rue he oss s a e t
S
m d
ki kba t tw e e pas e on t t Pl ntf s A c di t t Pl i if ,SG I and A SI '
c cks ha r
sd
o he ai i f . cor ng o he a ntf s
C
CS

e c me twa u j tb c u e i wa g n rtd b te Dee d n s fa d e tf re pa e
mi h n s nus e a s t s e e ae y h
fn a t' ru uln o c - lc d
i ur nc s he e. The Cour fnds t t t e a l ga i a e s t c e t s a e c m on l w
ns a e c m
ti
ha hes le tons r ufi i nt o t t om
a

camsf ru j s e c me t
li o nu t mi h n .
For t s r as , t Defnda s m otons t dimi s t c am s pr e e i t
he e e ons he
e nt '
i
o s s he l i
es nt d n he
Pl i if 'cons i t d c pl i a e de ed.
a ntf s
olda e om a nt r ni
D ON E A N D OR DER ED i Cha be s a M i m i Fl i ,t s
n
m r t a , or da hi

da ofM a c 201
y
r h, 5.

FED
A .M OREN O
UNI
TED STA TES DI
STR I J D GE
CT U

Copi pr ded t
es ovi
o:

Couns ofRe or
el
c d
-

9-