Illusion of Confusion: Dealing with Unresponsive “Responses” in Discovery

The bank playbook is very simple: keep it as complicated as possible. That way the court and even the homeowner will come to rely on what the banks and so-called servicer say about names, places, documents and money. That’s how they sold the initial fraudulent MBS and around 10 million foreclosures.

If you had a high success rate and you succeeded in scaring most homeowners off from contesting fraudulent foreclosures, what would you do? You would keep going based upon a strategy of creating the illusion of complexity. The only really complex thing is the fact that the foreclosing parties make inconsistent assertions not only from case to case but from one pleading to another in one case.

What is simple? That the only two real parties in interest in this whole affair have been investors on one side and homeowners on the other side. Everyone else is an intermediary with little or no authority to do anything — a fact that has not stopped them from nearly destroying our financial system.

For reasons that have been discussed elsewhere on this blog, the acceptance of the illusion of confusion by the courts is NOT rooted in law, as it is required to be, but rather in politics. This isn’t the first time the courts made political decisions and it won’t be the last. But through persistence and good litigation techniques homeowners who went all the way to the end have often prevailed — probably because the judge was too uncomfortable once the real nature of the asserted transactions was revealed.

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I was writing an article on discovery when by coincidence Dan Edstrom who has been our senior most forensic analyst since 2008 forwarded some questions and comments about the discovery process. He understands full well that the discovery process does NOT consist of just asking a question or asking for a document and the other side then gives you all you need to win.

No, the response will be framed to confuse, which is generally enough to make the homeowner or the foreclosure defense walk away. The foreclosure goes though even though it is most likely completely fraudulent.

And the message that goes out to the world is the banks are winning a huge percentage of foreclosures when in fact they pretty much don’t win when the foreclosure is ably contested.  The issue is obvious — not enough people are ably contesting foreclosures.

In discovery it usually starts with interrogatories. And the first question is who is answering the interrogatories. So in one example, the answer was Sally Torres. The response was that Torres was “from” Ocwen Financial Corporation (OFC). She is described as a “representative” of OFC, which leaves open the question of the identity of her employer.

Back to basics — A corporation is a legal person. And THAT means it is not the same as another legal person, as for example Ocwen Loan Servicing (OLS).

So you need to read carefully and not skip the parts that nobody pays attention to — like the answer to the question and the verification where Torres signs the response. There she signs as a “representative” of OLS not OFC. That ,eaves open the same question but also adds another — is she a representative of both legal persons (OFC and OLS)? If so what is the nature of her “agency” for either legal person? If she is not an employee is there a contract?

The answers further state that she is a “Senior Loan Analyst” for OFC and a “Senior Loan Analyst” for OLS. Is it both? How does that work? And of course that gives rise to yet another question — What is a Senior Loan Analyst? Google it.

Job Summary. Responsible for analyzing financial and supporting documents on incoming applications consistent with internal and insurer policies. Evaluate property values based on appraised market prices and recommend or deny mortgages to clients after examining financial status.

Hmmmm. This sounds like a made-up title to impress a judge. The industry definition of a loan analyst describes a job that ends with the approval of a loan. What would a loan analyst know about foreclosure — years after the alleged origination of the alleged loan? More specifically, what did Torres actually know or do with regard to the subject loan? It doesn’t take a genius to speculate about a number of questions:

  • Did Torres actually sign the verification?
  • Why was a loan analyst necessary in the litigation of a foreclosure?
  • Is Ocwen a lender? Why need a loan analyst?
  • What as it that Torres analyzed?
  • Did she review the work of a “Junior” Analyst ?
  • Did someone else draft the answers?
  • Was there anyone who had personal knowledge of the loan history involved with answering the interrogatories?

The kicker in the case I reviewed, was that the notice letters were sent not by any Ocwen entity but by Wells Fargo. The problem here is that most lawyers do not wish to confess their ignorance and therefore don’t follow through with obvious questions. Everything they are seeing is incomprehensible and confusing.

Here is another example right out of a hearsay treatise: The “Plaintiff” in an unlawful detainer (eviction) action makes the assertion that the rental value of the subject property is $1,800 per month and that the only way they know that is from a website called “Rentometer.” How this number is calculated by the website is unknown. Nor do we know if any person was involved. But Judges regularly take this representation to be true, even though it comes from a declarant not present in court.

Here is the rub. If the attorney for the homeowner fails to raise an objection and motion to strike that assertion or representation the objection is waived. But on cross examination of the robo-witness it is fairly easy to show that there is no appraisal or opinion rendered by the witness, nor could there be. It is also fairly easy to establish that the witness has no idea who runs, operates, owns or is otherwise involved with Rentometer.

Like Zillow and other sites, Rentometer does not employ people. It employs computer algorithms that may or may not work in any given situation.

For all we know it is a site set up by the banks that looks professional but is used specifically to extract outsize rents from people defending their property. (thus cutting off income that could be used for an attorney).  It looks like it might be useful but no presumption should arise from the projection by Rentometer unless someone from Rentometer can lay the foundation for the estimate. But that would mean putting a person on the witness stand who is not a robo-witness so the foreclosing party is going to fight against that tooth and nail.

And of course any site that leis exclusively on algorithms could not possibly take into consideration whether the subject property is habitable, the school district, and other factors that apply to both marketability and price. In the case presented it appears that the rental value is zero or in fact negative. That is because the property’s condition is such that nobody would move into it without extensive major repairs and because taxes and maintenance of the exterior would still need to be paid.

And then there is this example: You ask for the documents that support the authority of the alleged new beneficiary to substitute the trustee on the deed of trust. You get back an assignment. But it turns out later, in court, that they are relying upon some additional unrecorded assignments. So you ask for the additional unrecorded assignments and the response is essentially “We already gave you the assignments.” In  this case with 1 recorded assignment and 2 unrecorded assignments their answer is exactly 1/3 true and 2/3 untrue. And THAT is why you need to be prepared to compel their response by a specific court order pointing to those documents and any others that pertain the request for production.

The most challenging thing after the foreclosure sale is to prove it should never have taken place. But it is possible and necessary to do that if you want the property or you want leverage for a settlement. You are challenging circular reasoning.

Their argument is that they followed the rules and appointed a substitute trustee who sold the property. Your answer is that the new ‘Beneficiary” was not a beneficiary, had no right to substitute the trustee and thus no right to file a notice of sale (nonjudicial states).

Here is where legal presumptions point the court in the wrong direction. Because the sale took place and it was “facially” valid, the presumption adopted by the court is usually that there was a sale even though you are contesting that narrative. You say that a sale didn’t take place, particularly where there was “credit bid” on behalf of an entity that had no interest in the debt and therefore could not possibly submit a credit bid.

Lastly the sleight of hand trick that is so successful for the banks is the assertion or inference that there is a trust. In this case US Bank is asserted, probably without tis knowledge, as the trustee of certificates which is no trusteeship at all. Even if you slip in “the holders of certificates” they still have not named a beneficiary.

So the common error being made out there is to ask for answers and documents and so forth and accepting the response from the servicer or alleged servicer. Back to basics: the  first question should be “please identify the person or entity that is the [Plaintiff (judicial state or any eviction action) / beneficiary on the deed of trust (nonjudicial states)].

Then the next question should be “Is the party executing the verification of these interrogatories an employee, officer of said Plaintiff/Beneficiary? They will respond with gibberish because the real party in interest is a remote “Master Servicer” of a trust that doesn’t exist.

And of course “Where are the records of the Plaintiff/Beneficiary that relate to the subject alleged loan?” Once again they will respond with gibberish because they want the court to accept the fabricated records of Ocwen as though they were the records of the Plaintiff/Beneficiary whose books and records do not exist. The closer you get the more likely they are to walk away or offer a settlement that includes a seal of confidentiality. And yes I have seen this scenario thousands of times.










10 Responses

  1. PD….glad to help out.
    From Steve at Consumer Rights Defenders reachable at 818.453.3585

  2. Thank you and I am going to start reading these cases right now😊

  3. Here is a few apparently federal filings, all BONY Mellon as defendant:
    Courtesy of Consumer Rights Defenders at 818.453.3585.

    P.S. we hammered BONYM a couple of years back….. they had lousey records and incompetent experts who know little of securitization. They dismissed a judicial foreclosure case in Calif.

    Filed Parties Court Judge Type of Lawsuit Cause of Action

    Bashen et al v. Ditech Financial LLC fdba Green Tree Servicing, LLC, as servicer and attorney in fact for the Bank of New York Mellon fka the Bank of New York as Trustee for the Certificateholders of CWABS, Inc. Asse
    Defendant: Ditech Financial LLC fdba Green Tree Servicing, LLC, as servicer and attorney in fact for the Bank of New York Mellon fka the Bank of New York as Trustee for the Certificateholders of CWABS, Inc. Asse
    Plaintiff: George Steven Bashen , Janet Emerson Bashen
    TXSD All Other Real Property Diversity-(Citizenship)

    Hunter v. The Bank of New York Mellon fka The Bank of New York, as Trustee for the Certificate-Holders of the CWABS, Inc. Asset-Backed Certificates Series 2007-12 et al
    Plaintiff: Tisha Nicole Hunter
    Defendant: The Bank of New York Mellon fka The Bank of New York, as Trustee for the Certificate-Holders of the CWABS, Inc. Asset-Backed Certificates Series 2007-12 , Ditech Financial, LLC , Johnson & Silver LLP
    TXSD All Other Real Property Diversity-Notice of Removal

    The Bank of New York Mellon fka The Bank of New York, As Trustee for the Certificate Holders of the CWABS, Inc., Asset-Backed Certificate Series 2007-1 v. Warren et al
    Defendant: Jennifer D. Warren, CFNA Receivables (MD), Inc., Home Capital, Inc.
    Plaintiff: The Bank of New York Mellon fka The Bank of New York, As Trustee for the Certificate Holders of the CWABS, Inc., Asset-Backed Certificate Series 2007-1
    MDD All Other Real Property Diversity-Declaratory Judgement

    Buddy Humphries, et al v. Bank of New York Mellon
    Defendant – Appellee: BANK OF NEW YORK MELLON, formerly known as Bank of New York as Trustee for the certificateholders of CWABS, Inc., Asset-Backed Certificates, Series 2005-17
    CA5 Other Property Actions false

    Jean Lombardi v. Bank of America, N.A., et al
    Plaintiff – Appellant: JEAN LOMBARDI
    Defendant – Appellee: BANK OF AMERICA, N.A., BANK OF NEW YORK MELLON, formerly known as Bank of New York as Trustee for the Certificate holders of CWABS, Inc., Asset-Backed Certificates, Series 2004-12
    CA5 Other Property Actions false

    Simon et al v. Mitchell Mortgage Company, LLC et al
    Plaintiff: Yushema Simon , Lemroy Simon
    Defendant: Mitchell Mortgage Company, LLC, The Bank of New York Mellon, As Trustee for the Certificateholders of the CWABS, Inc., Asset-Backed Certificates, Series 2004-6 , Countrywide Home Loans, Inc. k/n/a Bankof America, N.A.
    TXSD All Other Real Property Diversity-Notice of Removal

    NJD All Other Real Property Diversity-Contract Dispute

    Harry, Jr., et al v. Countrywide Home Loans., Inc., et al
    Plaintiff – Appellant: THOMAS HARRY, JR., GRETCHEN HARRY
    CA1 All Other Real Property false

    Rickey Lyons v. Bank of America National Assn, et al
    Plaintiff – Appellant: RICKEY A. LYONS
    CA5 Other Property Actions false

    McPherson v. Bank of America, N.A. et al
    Defendant: Bank of America, N.A. , The Bank of New York Mellon as Trustee for the CWABS, Inc., Asset-Backed Certificates Series 2006-24 Trust , CWABS, Inc.
    Plaintiff: Lester Anthony McPherson
    TXSD All Other Real Property Diversity-(Citizenship)

  4. No class action vs. this entity we know of. Who is the defendant?

  5. Anyone knows a pending class action law suit against CWABS, INC., Asset-Backed Certificates, series 2007-4 ?

  6. Attorneys General don’t litigate private foreclosure matters ordinarily.

  7. I wrote to my attorney general here in PA and US Bank sent out a new brochure tailored to my situation. This brochure says that it is common to see US Bank as the plaintiff even though they have nothing to do with the foreclosure process. It is so pathetic that it is laughable. I am not going to back down MR Cooper and I have been winning for 10 years.

  8. Consumer Rights Defenders litigation department reachable at 818.453.3585, adds to this excellent article that homeowner’s propounded written [interrogatories, etc.] discovery to the bank 95% of the time will be purely objected to. Its what is done in foreclosure cases to keep the facts from being unearthed. It’s indeed, frustrating. Then, to further challenge these “objections,” the borrower needs to usually “meet and confer” to try to work out the objections. That is usually a futile exercise requiring letter writing and arguing your reasons for the discovery with opposing counsel, but in most state courts must be attempted. Here is one approach that seems to work…..

    Start your discovery with a Notice for the Taking of the Deposition of the Person most Qualified and for Document Production concerning the borrower’s “loan file.” Then use a well-crafted cheat sheet of questions to that person. The bank lawyers have much more difficulty protecting the bank’s interest when the questions are orally presented in a deposition setting. BUT, try to get the loan file documents in possession of the note holder or servicer first so you have some fodder to grill the banker/deponent with. Also, if you can hire a ad hoc counsel skilled in taking depositions, it’s far preferred than going it alone unless you have some established questioning skills.
    SO, in order….
    1. Get the documents in the loan file by Request for Production and then,
    2. Notice the Depo of the PMQ [who usually can’t answer the questions in a forthright manner re: signature authenticity, assignments, laws required to be followed, second hand-hearsay information, etc.].
    3. Once you successfully obtain some responses, prepare your case for a summary judgment motion against the bank. Just one discovery response showing the bank/servicer has no proof it owns that note rights in your MSJ could successfully win such a motion and defeat the foreclosure case.

    Call us if you need assistance at 818.453.3585 asking for Sara or Steve when you call.

  9. Urgent Creditor Alert: Significant Changes to Bankruptcy Rule 3002 Effective December 1, 2017 By Michael L. Moskowitz and Melissa A. Guseynov

    Creditors beware: changes are afoot and attention must be paid to these changes or your rights in bankruptcy may be prejudiced. We have previously written about the practices and procedures required under Rule 3002 of the Federal Rules of Bankruptcy Procedure (“Bankruptcy Rules”). However, as of December 1, 2017, certain revisions to Bankruptcy Rule 3002 will both require secured creditors to file proofs of claim and substantially reduce the amount of time provided to creditors to file a proof of claim in Chapters 7, 12 and 13 bankruptcy cases.

    It has long been recognized that for a secured claim to be “allowed” in bankruptcy, a creditor must file a proof of claim. In its current form, Bankruptcy Rule 3002(a) merely states that an “unsecured creditor or an equity security holder must file a proof of claim or interest …” The fact that Bankruptcy Rule 3002 does not specifically mention secured claims has resulted in conflicting case law as to whether a secured creditor must file proof of claim. As a result, the revised text of Bankruptcy Rule 3002 clarifies that a secured creditor must file a proof of claim in order for the claim to be “allowed.” However, the amended Bankruptcy Rule also provides that a secured creditor’s failure to file a proof of claim does not affect the underlying lien.

    In addition, revised Bankruptcy Rule 3002 requires proofs of claim to be filed in a substantially shorter period of time than the current Rule. Under current Rule 3002, creditors have up to 90 days after the first date scheduled for the section 341(a) meeting of creditors to file their claims. Since such meetings are generally scheduled between 20 and 40 days after the petition date, creditors currently have between 110 and 130 days after the petition date to file claims. New Rule 3002 will mandate that creditors file proofs of claim within 70 days of the petition date. Thus, as of December 1, 2017, a creditor’s time to file a proof of claim will be reduced by almost half.

    Although the new Rule provides that a creditor can move for an additional 60 days to file its claim, such an extension may only be granted upon establishing that: (i) notice was insufficient to give the creditor a reasonable time to file a proof of claim because the debtor failed to timely file a creditor matrix; or (ii) notice was insufficient to give the creditor a reasonable time to file a proof of claim, and the notice was mailed to the creditor at a foreign address.  

    In view of the above, it is essential for all creditors to act promptly when a borrower files for bankruptcy protection. The filing of a bankruptcy petition under chapters 7, 12, and 13 triggers certain limitation periods which can significantly affect a creditors rights and claims. Thus, secured and unsecured creditors alike should immediately consult with experienced bankruptcy counsel to ensure they comply with the requirements of the Bankruptcy Rules.    

    Ronald J O’Donnell, J.D. (909) 862-5789   Email:,,  Candidate US Congressional District 08 2018               .                                                                                                        

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