November 30, 2007, 9:10 am
Law Blog Lexpionage: “Foreclosure Mills”
Posted by Peter Lattman
Are you hip to the Web site Word Spy? It’s a fun one for all you language lovers out there. Its founder describes its mission as “lexpionage” — sleuthing out new words and phrases. Recent entries include “stroller envy,” feelings of envy directed at high-end baby strollers owned by other parents; and “tattoo regret,” feelings of embarassment or remorse caused by having one or more tattoos.
What fun! Well we hope that Word Spy reads the WSJ because it might want to introduce its readers to “foreclosure mills,” or law firms that are handling thousands of foreclosure cases on behalf of mortgage lenders and servicers. The firms are often paid based on volume — in Ohio, for example, they get around $1,000 a case.
Some of these “foreclosure mills” are drawing criticism from judges for aggressive tactics and cutting corners. Here’s the WSJ story from the Law Blog’s very own Amir Efrati.
This month a state judge in Cincinnati dismissed a foreclosure suit brought by Wells Fargo because it filed the suit before it acquired the mortgage. The judge sent a warning letter to the bank’s law firm, John D. Clunk Co. LPA, in Hudson, Ohio. Judge Steven Martin — we hear he’s a wild and crazy judge — wrote it was “troubling” that the plaintiff “and its counsel filed the lawsuit with no basis whatsoever” and that firm must not do so again. (The law firm didn’t respond to requests for comment. Wells Fargo declined to comment.)
Judges are also fining firms for filing shoddy motions in bankruptcy court on behalf of creditors. In Houston, three judges have sanctioned or considered sanctions against Barrett Burke, a Texas size foreclosure firm. In June, Judge Wesley Steen imposed a $75,000 fine on Barrett Burke for filing computer-generated pleadings that were “grossly erroneous” and “gibberish.” The judge wrote that the firm has “become over reliant” on the software and its attorneys are “allowing their signatures to become affixed to pleadings that they have not adequately reviewed.” Said partner Michael Barrett: “We have taken many steps to eliminate the problems that we had in the past.”
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Filed under: CDO, currency, Eviction, foreclosure, GTC | Honor, Mortgage | Tagged: foreclosure defense, foreclosure offense |
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