Justia Banking Opinion Summaries

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The case involved an appeal by two brothers, Jonathan and Daniel Markovich, who were convicted for operating fraudulent drug rehabilitation clinics in Florida. They were found guilty of various charges, including health-care fraud, wire fraud, kickbacks, money laundering, and bank fraud, resulting in fraudulent claims of over $100 million.The brothers appealed their convictions on several grounds. They argued that the district court violated their constitutional rights by denying their motion to compel the prosecution to obtain and disclose confidential medical records possessed by third parties. They also claimed that the court violated Federal Rules of Evidence by admitting unreliable and confusing expert testimony about the clinics' medical and billing practices. Additionally, they argued that the court abused its discretion by admitting lay summary testimony about medical and billing records.The United States Court of Appeals for the Eleventh Circuit affirmed the convictions. The court ruled that the prosecution had no duty to seek out potentially exculpatory evidence not in its possession. It also determined that the expert testimony was clear and reliable, and the summary testimony was proper. The court found that any challenge to bank-fraud counts was forfeited due to a lack of explanation or supporting legal authority. Finally, the court ruled that the district court did not abuse its discretion by denying the brothers' motion for a new trial based on newly discovered evidence. View "United States v. Markovich" on Justia Law

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Creditors obtained a $1.6 million default judgment against Rodney Dorand and sought to satisfy the judgment with funds from Dorand's individual retirement account, held by Morgan Stanley. An Alabama court approved the transfer of funds, but before the transfer occurred, Dorand filed for Chapter 7 bankruptcy, asserting that the retirement account was exempt property of his bankruptcy estate. The bankruptcy court agreed with Dorand. The United States Court of Appeals for the Eleventh Circuit affirmed this decision, stating that the Alabama judgment did not extinguish Dorand’s interest in his account before he filed his bankruptcy petition.Rodney Dorand had been sued by creditors for damages arising from a failed condominium development. After the state court issued a writ of garnishment to Morgan Stanley, Dorand argued that the retirement account was exempt from garnishment, but the state court rejected this argument. However, before the funds were transferred, Dorand filed for bankruptcy. The bankruptcy court determined that the retirement account was Dorand’s exempt property and that the Alabama judgment against garnishee Morgan Stanley “does not affect the [retirement account’s] exempt status.”The Alabama judgment did not terminate all of Dorand's interests in his property. While the judgment had given Morgan Stanley a limited right to transfer Dorand’s funds, it had not exercised that right before Dorand filed for bankruptcy. The Court of Appeals affirmed that the retirement account was part of Dorand’s bankruptcy estate, as Dorand had an interest in the retirement account when he filed for bankruptcy. View "The Alabama Creditors v. Dorand" on Justia Law

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The Maine Supreme Judicial Court addressed an appeal from Citibank, N.A., challenging a District Court judgment in favor of the defendant, Ashley Moser, in a case related to the collection of credit card debt. The bank argued that the judgment violated its procedural due process rights due to insufficient notice about a hearing scheduled on April 12, 2023.The court had issued notices for both a 'first mediation' and a 'debt collection hearing' on the same day, at the same time, and in the same room. On the hearing day, Citibank's counsel attended without a representative from the bank, assuming that the case was scheduled for mediation and not a final hearing. The court proceeded with the hearing and entered a judgment in favor of Moser, as Citibank failed to satisfy its burden of proof.Citibank appealed, claiming the notices were ambiguous and violated its right to procedural due process. The Supreme Judicial Court agreed with Citibank, noting that the competing notices created an impossibility of both a mediation and a hearing taking place simultaneously. It ruled that the ambiguity in the notices and the court's subsequent judgment denied Citibank the required notice and meaningful opportunity to be heard. The court vacated the judgment and remanded the case for further proceedings. View "Citibank, N.A. v. Moser" on Justia Law

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In this case, the appellant, Savanna Jennings, was convicted of malice murder and related charges in relation to the shooting death of her grandfather, Otha Perrin Sr. The jury found her guilty on all counts, and she was sentenced to life in prison without the possibility of parole, plus fifteen years in confinement. On appeal, Jennings argued that the trial court abused its discretion by admitting other-acts evidence, admitting certain business records, and that her trial counsel provided constitutionally ineffective assistance.The Supreme Court of Georgia concluded that the trial court did not abuse its discretion in admitting evidence of Jennings' financial activities pertaining to her grandfather's bank account, as it formed part of the financial motive for the crime. The court also found no plain error in the admission of Facebook messages between Jennings and another individual, which were arguably hearsay but did not likely affect the outcome of the trial.In terms of ineffective counsel, the court found that Jennings' lawyer did preserve her objections to the admission of the bank records. As for the failure to preserve an objection to the Facebook records and to timely disclose an expert witness, the court concluded that Jennings failed to establish that there was a reasonable probability that these actions affected the outcome of her trial. Therefore, the court affirmed Jennings' convictions. View "JENNINGS v. THE STATE" on Justia Law

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The case originates from an Application for Judicial Assistance under 28 U.S.C. § 1782 by Frasers Group PLC ("Frasers"), a British retailer group. Frasers requested to obtain documentary and testimonial evidence from James Patrick Gorman, the former CEO of Morgan Stanley, for use in a lawsuit started in the UK. The district court denied the application, and Frasers appealed this decision.The dispute revolves around a series of transactions Frasers entered into with Saxo Bank A/S related to shares of the fashion company Hugo Boss. Concurrently, Saxo Bank engaged in trades with Morgan Stanley & Co. International PLC, a subsidiary of Morgan Stanley. A margin call was issued by Morgan Stanley, leading to a dispute and the commencement of the lawsuit in the UK.On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court's decision, finding no abuse of discretion. The court considered the factors established by the Supreme Court in Intel Corp. v. Advanced Micro Devices, Inc., which guide district courts when determining whether to grant domestic discovery for use in foreign proceedings under 28 U.S.C. § 1782(a). The court found that the first factor—whether “the person from whom discovery is sought is a participant in the foreign proceeding”— and the fourth factor—whether the discovery request is “unduly intrusive or burdensome”— weighed against granting the Application. Consequently, the court upheld the denial of the Application. View "FRASERS GROUP PLC v. MORGAN STANLEY" on Justia Law

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In this case, the United States Court of Appeals for the District of Columbia Circuit was asked to consider an appeal brought by BuzzFeed, Inc. and one of its journalists, Jason Leopold, against a decision of the District Court granting summary judgment to the Department of Justice (DOJ). The appellants sought the release of a partially redacted report on HSBC Bank's conduct under the Freedom of Information Act (FOIA). The District Court had ruled that the report was entirely exempt from disclosure under FOIA Exemption 8 which protects reports related to the regulation or supervision of financial institutions.The Court of Appeals held that the case must be remanded to the District Court to determine whether the DOJ can demonstrate that the release of any part of the report could foreseeably harm an interest protected by Exemption 8. The Court stressed the requirement for a sequential inquiry: first, whether an exemption applies to a document; and second, whether releasing the information would foreseeably harm an interest protected by the exemption. The Court found that the District Court had not sufficiently conducted this sequential inquiry, and the DOJ had not adequately demonstrated how the release of the report would cause foreseeable harm to an interest protected by Exemption 8.The Court noted that the FOIA requires agencies to release any reasonably segregable portion of a record, even if an exemption covers an entire agency record. The Court determined that the DOJ had not satisfactorily explained why the release of a redacted version of the report would cause foreseeable harm to an interest protected by Exemption 8. Therefore, the Court vacated the District Court's grant of summary judgment to the DOJ and remanded the case for further consideration. View "Leopold v. DOJ" on Justia Law

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In this case, Michael Bordick and Monica Bordick defaulted on a loan from Franklin Savings Bank, which was secured with a hunting cabin they owned on property they leased. The Bank filed a complaint for recovery of the cabin, and the Business and Consumer Docket ruled in favor of the Bank. The Bordicks appealed, arguing that the Bank did not make disclosures required by the Federal Truth in Lending Act (TILA). The Bank argued that the credit transaction was not subject to TILA.The Maine Supreme Judicial Court held that a credit transaction secured by real property in the form of a lease is not exempt from TILA under 15 U.S.C.A. § 1603(3). However, the court also found that the lower court applied an incorrect test to determine whether the loan was for commercial purposes and therefore exempt under § 1603(1). The court vacated the judgment in favor of the Bank and remanded the case for the lower court to determine the nature of the loan, looking at the totality of the circumstances.The court also clarified that although the leased land where the cabin was located was not the Bordicks' principal dwelling, the credit transaction is not exempt from TILA under § 1603(3) because it was secured with real property. View "Franklin Savings Bank v. Bordick" on Justia Law

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The Supreme Court of Texas examined whether a lender could rescind a loan acceleration and reaccelerate the loan simultaneously, thereby resetting the foreclosure statute of limitations under the Texas Civil Practice and Remedies Code Section 16.038. The plaintiffs, Linda and Thomas Moore, defaulted on their home loan, leading to an acceleration of the loan by the lenders, Wells Fargo Bank and PHH Mortgage Corporation. The lenders subsequently issued notices rescinding the acceleration and then reaccelerating the loan. The Moores sued, arguing that the foreclosure statute of limitations had run out because the lenders' rescission notices also included notices of reacceleration. The federal district court ruled against the Moores, leading to their appeal and the subsequent certification of questions to the Supreme Court of Texas by the Fifth Circuit. The key question was whether simultaneous rescission and reacceleration could reset the limitations period under Section 16.038.The Supreme Court of Texas held that a rescission that complies with the statute resets the limitations period, even if it is combined with a notice of reacceleration. The court reasoned that the statute doesn't require the rescission notice to be separate from other notices, nor does it impose a waiting period between rescission and reacceleration. The court's ruling means that lenders can rescind and reaccelerate a loan simultaneously, thereby resetting the foreclosure statute of limitations. View "MOORE v. WELLS FARGO BANK, N.A." on Justia Law

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In this case, the Supreme Court of North Dakota affirmed the lower court's ruling in favor of the North Dakota Industrial Commission (NDIC), acting through the North Dakota Housing Finance Agency (NDHFA), in a dispute over a lien on a property. The property in question was part of a housing development built by the Fendee Group, and was purchased by Carinne Gould, who obtained a mortgage through Guaranteed Rate, Inc., which was later assigned to the NDIC. After Gould defaulted on her payments, both the NDIC and Fendee filed liens on the property. Fendee argued that its liens were superior to the NDHFA's mortgage, but the court ruled that since the NDHFA's lien was perfected (or legally finalized) before Fendee's liens, the NDHFA held the superior lien. The court also rejected Fendee's claim of a "super lien," which would have given it priority over all other liens, and denied Fendee's request for attorney's fees. The court found that the dispute over the super lien was a question of first impression, meaning it was the first time such a question had come before the court, and therefore the appeal was not frivolous and did not warrant attorney’s fees. View "NDIC v. Gould" on Justia Law

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In this case, the United States Court of Appeals for the Seventh Circuit addressed a dispute involving the owners of two parcels of real estate in Chicago who contended that banks tried to collect notes and mortgages that belonged to different financial institutions. The state judiciary had ruled that the banks were entitled to foreclose on both parcels, but the properties had not yet been sold and no final judgments defining the debt were in place. The plaintiffs attempted to initiate federal litigation under the holding of Exxon Mobil Corp. v. Saudi Basic Industries Corp., arguing that their case was still pending. However, the district court dismissed the case, citing the Rooker-Feldman doctrine, which states that only the Supreme Court of the United States can review the judgments of state courts in civil suits.The Appeals court held that the application of the Rooker-Feldman doctrine was incorrect in this case because the foreclosure litigation in Illinois was not yet "final". According to the court, the foreclosure process in Illinois continues until the property is sold, the sale is confirmed, and the court either enters a deficiency judgment or distributes the surplus. Since these steps had not occurred, the plaintiffs had not yet "lost the war", and thus parallel state and federal litigation could be pursued as per Exxon Mobil Corp. v. Saudi Basic Industries Corp.However, by the time the district court dismissed this suit, the state litigation about one parcel was over because a sale had occurred and been confirmed, and by the time the Appeals court heard oral argument that was true for the second parcel as well. The Appeals court stated that Illinois law forbids sequential litigation about the same claim even when the plaintiff in the second case offers novel arguments. The court found that the plaintiffs could have presented their constitutional arguments in the state court system and were not free to shift what is effectively an appellate argument to a different judicial system.The court also noted that Joel Chupack, the lead defendant, was the trial judge in the state case and was not a party to either state case. He did not claim the benefit of preclusion. Judge Chupack was found to be entitled to absolute immunity from damages, as he acted in a judicial capacity.The judgment of the district court was modified to reflect a dismissal with prejudice rather than a dismissal for lack of jurisdiction, and as so modified it was affirmed. View "Bryant v. Chupack" on Justia Law