Providence Hall Assoc. v. Wells Fargo Bank, N.A.

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PHA filed suit against Wells Fargo, alleging that Wells Fargo falsely represented that it would forbear collection of the principal balance of a line of credit, ultimately causing PHA to default and enter bankruptcy. PHA subsequently filed suit in Virginia state court, which Wells Fargo removed to federal court. Along with repeating the claims made in the bankruptcy adversary complaint, PHA alleged new theories of lender liability. The district court dismissed the suit. The court rejected PHA's contention that the district court erroneously gave res judicata effect to various sale orders issued during PHA’s Chapter 11 bankruptcy, concluding that the elements of res judicata are satisfied. Accordingly, the court affirmed the judgment. View "Providence Hall Assoc. v. Wells Fargo Bank, N.A." on Justia Law