The Law of Capitalism THE MASS MISS JOINDER

21 Oct

I attended the Attorney General and state Bar hearing as to the intervention of the state bar into the law practice of Mitchell Stein and the K2 mass Joinder cases in Los Angeles in front of Judge Johnson. The tentative was a scathing implication of Mitchell Stein and his purported involvement with the “marketing companies” and the allegations of unfair business practices all needed for the AG and the State Bar to step in and confiscate 1.6 million in various accounts.

I was there to opine the status of the case itself and the merits of the cases and as to the victims rights as against the banks. If the Bar took over the practice would they defend the cases would they protect the victims right. No they are not; right now they the State Bar are telling the victims they are on there own.

Once again these suits I have been following and hoping could get past the Demur stage the Banks would be forced to answer. Then there would be motions for Summary Judgement and if the Victims could survive the Summary Judgement and thousands of requests for admissions and interrogatories propounded on the thousands of plaintiffs. It could be done I would have to associate about 10 other lawyers and 30 paralegals but it could be done for about $700,000.00. Then I believe the Banks would enter settlement negotiations with the victims witch I calculate to be about 6500 victims to date.

Mandelman characterized the case as follows:

The case at the core of the Kramer and Kaslow mass joinder lawsuit is: Ronald vs. Bank of America. Basically, the case accuses Countrywide (subsequent cases being filed include Citibank, One West, GMAC/Ally Bank, and perhaps others) of perpetrating a massive fraud upon homeowners by knowingly inflating appraisals, creating a bubble the bank knew would pop and leave homeowner equity devastated, violate privacy statutes, and then Civil Code sections when they refused to modify… you get the idea.

The case says that Countrywide execs knew and did it anyway in order to make zillions of dollars securitizing the loans and therefore only others would incur the future losses.

Here’s an overview of what the third amended complaint says in its Introduction section:

2. This action seeks remedies for the foregoing improper activities, including a massive fraud perpetrated upon Plaintiffs and other borrowers by the Countrywide Defendants that devastated the values of their residences, in most cases resulting in Plaintiffs’ loss of all or substantially all of their net worths.

6. Hand-in-hand with its fraudulently-obtained mortgages, Mozilo and others at Countrywide hatched a plan to “pool” the foregoing mortgages and sell the pools for inflated value. Rapidly, these two intertwined schemes grew into a brazen plan to disregard underwriting standards and fraudulently inflate property values – county-by- county, city-by-city, person-by-person – in order to take business from legitimate mortgage-providers, and moved on to massive securities fraud hand-in-hand with concealment from, and deception of, Plaintiffs and other mortgagees on an unprecedented scale.

7. From as early as 2004, Countrywide’s senior management led by Mozilo knew the scheme would cause a liquidity crisis that would devastate Plaintiffs’ home values and net worths. But, they didn’t care, because their plan was based on insider trading – pumping for as long as they could and then dumping before the truth came out and Plaintiffs’ losses were locked in.

9. It is now all too clear that this was the ultimate high-stakes fraudulent investment scheme of the last decade. Couched in banking and securities jargon, the deceptive gamble with consumers’ primary assets – their homes – was nothing more than a financial fraud perpetrated by Defendants and others on a scale never before seen. This scheme led directly to a mortgage meltdown in California that was substantially worse than any economic problems facing the rest of the United States. From 2008 to the present, Californians’ home values decreased by considerably more than most other areas in the United States as a direct and proximate result of the Defendants’ scheme set forth herein.

This massive fraudulent scheme was a disaster both foreseen by Countrywide and waiting to happen. Defendants knew it, and yet Defendants still induced the Plaintiffs into their scheme without telling them.

10. As a result, Plaintiffs lost their equity in their homes, their credit ratings and histories were damaged or destroyed, and Plaintiffs incurred material other costs and expenses, described herein. At the same time, Defendants took from Plaintiffs and other borrowers billions of dollars in interest payments and fees and generated billions of dollars in profits by selling their loans at inflated values.

14. Since the time Plaintiffs filed the initial Complaint herein, Defendants’ improper acts have continued, including, inter alia: (i) issuing Notices of Default in violation of Cal. Civil Code §2923.5; (ii) misrepresenting their intention to arrange loan modifications for Plaintiffs, while in fact creating abusive roadblocks to deprive Plaintiffs of their legal rights; and (iii) engaging in intrinsic fraud in this Court and in Kentucky by stalling in addressing Plaintiffs’ legitimate requests to cancel notices of default and for loan modifications, and by refusing to respond, in any way, to Plaintiffs’ privacy causes of action.

Now, there’s no question… this is a real lawsuit. Some attorneys believe it will be a very difficult case to win, while others think it’s quite viable and likely to settle. I can see both sides of that argument.

On one hand, it would seem difficult to prove that Countrywide caused the housing bubble; there were certainly many parties involved and numerous other contributing factors as well. On the other hand, the case has numerous aspects that are unquestionably true and certainly wrong.

Then there’s what’s known as “the banker factor.” Actually, I’m making that up, but you know what I mean. The banks aren’t going to lay down for this as it would open an enormous can of litigating worms… so they have to fight… or is there no percentage in that either? Well, now you’ve seen first hand why I chose not to go to law school.

I really haven’t the foggiest idea what’s going to happen… and neither does anyone else.

But then, Columbus couldn’t exactly stop and ask for directions either, which, it’s worth noting is why, when sailing for The New World, he landed in the Bahamas and named them San Salvador, but assumed he had found the Indies so he named the native people Indians (leading me to always wonder what he would have named them had he not gotten so hopelessly lost.)

(What if his favorite word was “Jujubees,” and he had named the natives “Jujubees?” Then I would have grown up playing Cowboys & Jujubees?)

So, since no one can know what’s going to happen in the future of this case, I thought I’d take a look at where it is today. From a review of the Los Angeles Superior Court’s online records database we find these events have transpired to-date or are set for the near future…
1. Original complaint was filed in March 2009.
2. First amended complaint was in June of 2009.
3. Second amended complaint March 2010.
4. August 2010: the banks try to remove the case to federal court, but fail.
5. Third amended complaint was filed July 7, 2010.
6. The defendant banksters have demurred again, but it doesn’t appear that the demurs filed in December have been heard.
7. Status conference set for Thursday, February 3rd, 2011.
8. There is a hearing date scheduled for March 29, 2011, but it’s not clear to me what will be happening at that hearing.

So, this is their third “amended complaint.” That means the defendants… the banks… have demurred twice. That means that the banks have come to court claiming that the mass joinder plaintiffs don’t state a cause of action… or in other words saying the plaintiffs have no case… and the court has allowed the plaintiffs to amend the complaint three times so far.

Like almost everything in the law, I guess you could read that a couple of different ways. On one hand it seems positive… the case brought by the mass joinder plaintiffs has not been tossed out by the judge yet. That’s good, right?
On the other hand… the court could “sustain the demur without leave to amend,” in which case the mass joinder suit would be over and done.

And that’s why litigating is always a gamble, and by no means a sure thing.
Here’s an oversimplified look at the mass joinder’s causes of action.

First Cause of Action… Fraudulent Concealment – This is saying that the bank was hiding things from the borrowers.

Second Cause of Action… Intentional Misrepresentation – This is lying when you knew you were lying. In other words, you knew an appraisal was wrong… it came in at $500,000, but you knew it was worth $400,000 and you passed it off anyway.

Third Cause of Action… Negligent Misrepresentation – This is like saying that you’re lying but it wasn’t intentional. Let’s say that you ordered an appraisal but never really looked at the appraisal to make sure it was done correctly. You include this cause of action in case the conduct doesn’t rise to the level of intentional misrepresentation, and perhaps because some insurance policies don’t cover intentional acts.

Fourth Cause if Action… Invasion of Constitutional Right to Privacy – This is saying that the banks disclosed personal information… perhaps when selling the loans to another investor.

Fifth Cause of Action… Violation of California Financial Information Privacy Act – See above or read the actual complaint.

Sixth Cause of Action… Civil Code 2923.5 – Defendants are prohibited by statute from recording a Notice of Default against the primary residential property of any Californian without first making contact with that person as required under § 2923.5 and then interacting with that person in the manner set forth in detail under § 2923.5. Nothing special here, but its been upheld by other courts in California.

Seventh Cause of Action… Civil Code 1798 – When they gave away your private information, they didn’t tell you they did it? Defendants failed to timely disclose to Plaintiffs the disclosure of their personal information as required under California Civil Code § 1798.82

Eighth Cause of Action… Unfair Competition Against All Defendants – Defendants’ actions in implementing and perpetrating their fraudulent scheme of inducing Plaintiffs to accept mortgages for which they were not qualified based on inflated property valuations and undisclosed disregard of their own underwriting standards and the sale of overpriced collateralized mortgage pools, all the while knowing that the plan would crash and burn, taking the Plaintiffs down and costing them the equity in their homes and other damages, violates numerous federal and state statutes and common law protections enacted for consumer protection, privacy, trade disclosure, and fair trade and commerce.

In Conclusion…

Attorney Phillip Kramer, in his own words, made it quite clear that his firm was not responsible for the mailer I received or the telemarketing about which I’ve been notified. Once again, he says…

“I know of no outbound calling. If asked, I would not approve of that. I knew that some law firms wanted to send out mailers. I have insisted that everyone comply with State Bar rules and that anything with my name must be pre-approved. As of this date, no one has submitted any proposed marketing for my review. That piece was done without my knowledge.

I am happy to pay a referral fee to other law firms. I do not split fees, pay commissions, nor do I pay referral fees to non-lawyers. I do not use cappers, and have never authorized anyone to robocall, telemarket, spam email, or undertake any mass marketing on my behalf.”

With that said I was going to apply to the Bar to take over the cases if they would relinquish the 1.6 to pay for the work to be done for the victims. Before making such a wild leap into this caos I called my State bar lawyer. He informed me that I should not even go close to these cases that all lawyers involved will be DISBARRED. I said wow but what about the merits of the cases the judge in the case had already overruled the demur as to some of the causes of action. The State Bar (by their actions in not finding a lawyer to protect the victims) is recommending that case be dismissed the Attorney General IS NOT PURSUING THE RIGHTS OF THE VICTIMS . I persisted with my lawyer. To which he exclaimed ” DON’T YOU GET IT MCCANDLESS THE AG AND THE BAR ARE WORKING FOR THE BANKS”.

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4 Responses to “The Law of Capitalism THE MASS MISS JOINDER”

  1. VICTOR October 21, 2011 at 8:50 am #

    CALIFORNIA BAR ASSOCIATION IS ACTING AGAINST ATTORNEYS WITHOUT PAYING ATTENTION, THAT THEY ARE NO MORE THAN A PRINCIPAL OFFICE IN THE SCHOOL, THE PRINCIPAL CAN CALL THE ATTENTION TO THE TEACHER BUT THE PRINCIPAL IS NOT GOING TO GIVE CLASES TO EACH ROOM IF THE TEACHERS GOES AWAY.

    THE ATTORNEY BAR ASSOCIATION MUST RESPECT EACH AND EVERY ONE OF THE ATTORNEYS IN THEIR ASSOCIATION

  2. briankkorteesq October 23, 2011 at 7:04 am #

    If I were these litigants I would feel that I had no choice that my case was stuck, I spoke to my lawyer about this and some of his suggestions I am re-quoting here , he suggested that the AG be litigated, AG personally, He suggested that a lawsuit against the AG and with criminal charges, may have an effect.

    This is totally unfair when we know that the banks did commit these crimes we should occupy the Atty. Gen. of California that’s what I would do if my house was in that pileup.
    What would happen if every homeowner in that case file litigates the AG to the fullest extent of the law?

    If people do this In any and every court in which ever city or court the case can be fought. The people have to do this on their own as the lawyers will get dis barred, as the article suggests, therefore the people have no choice but to stand up for their own rights.
    The AG is not above the law.

    This is why I support occupy wall street, I am hoping that in some time in the future we can work to change these injustices and stop anyone from violating our constitutional rights.

    • MARIO KENNY October 23, 2011 at 7:08 am #

      I AM SORRY I WAS LOGGED IN AS MY LAWYERS ACCOUNT

      If I were these litigants I would feel that I had no choice that my case was stuck, I spoke to my lawyer about this and some of his suggestions I am re-quoting here , he suggested that the AG be litigated, AG personally, He suggested that a lawsuit against the AG and with criminal charges, may have an effect.

      This is totally unfair when we know that the banks did commit these crimes we should occupy the Atty. Gen. of California that’s what I would do if my house was in that pileup.
      What would happen if every homeowner in that case file litigates the AG to the fullest extent of the law?

      If people do this In any and every court in which ever city or court the case can be fought. The people have to do this on their own as the lawyers will get dis barred, as the article suggests, therefore the people have no choice but to stand up for their own rights.
      The AG is not above the law.

      This is why I support occupy wall street, I am hoping that in some time in the future we can work to change these injustices and stop anyone from violating our constitutional rights.

  3. Vickie Barker October 29, 2011 at 10:11 pm #

    In reference to: Civil Code 2923.5 – Defendants are prohibited by statute from recording a Notice of Default against the primary residential property of any Californian without first making contact with that person as required under § 2923.5 and then interacting with that person in the manner set forth in detail under § 2923.5. Nothing special here, but its been upheld by other courts in California.

    Appears that Senate Bill 1137 has even more requirements placed upon the banks too, they are to be sure to give 30 days in between their contact (offer to help, what a joke) and the filing of the default. This was an Urgency bill passed in 2008. In my sisters case there had been only 7 days passed, and a transfer of deed in that time as well. (this is only ONE of the illegal acts of MANY in this case)

    My sister if facing sheriff’s lockout this next Thursday morning. We have been in the court now for almost 2 years this Dec…wow, how can that be? anyway, she had filed a complaint against Deutsche Bank and 25 Does, the court in April set the case management hearing for Oct 14. We go into court only to find the judge had dismissed the case in Sept., no notice to my sister, and no reason given at the hearing (of which there was no hearing, the judge called her to the table and ask what she was doing there because “I already dismissed this case”. well, now we face the eviction AGAIN. Too tired and beat up to keep going on our own.

    She needs an attorney that will file the appeal. My question is: If the Judge dismissed the complaint against Deutsche (this effected the stay of execution that another judge had given until the outcome of the case management hearing) He dismissed it “with prejudice” so does that mean that she can not appeal the decision?

    We don’t know where to turn. Trying to get the facts on our page, please read:

    http://www.glenncountyforeclosure.com

    Vickie Nelson (Barker)
    abfoundation@gmail.com

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