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Federal Judges

Selective Justice: Law Firm Assistant Criminally Charged with $3M IOLTA Theft But Lawyers Who Steal Millions Are Not.

This is exactly the type of case where it’s one law for lawyers and another law for citizens. When a law firm complaints about embezzlement, criminal charges always follow.

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It is appalling how many recent cases in Florida confirm lawyers are not being criminally charged with theft of millions of dollars, yet citizens are hauled into criminal court quickly. It confirms once again, the judiciary is an institution which is out of control and needs independent oversight and prosecutors are not excused for their roles in blanking criminal charges against those who work for the legal profession and regulated by the State Bar(s).

Former Bookkeeper Charged with Embezzling over $3 Million from Law Firm Former Employer

MAY 25, 2022 | REPUBLISHED BY LIT: MAY 26, 2022

NEWARK, N.J. – A Florida woman was charged with wire fraud after she stole over $3 million from the law firm where she worked as a bookkeeper, U.S. Attorney Philip R. Sellinger announced today.

Janet Lee Blissitt, 66, of Margate, Florida, is charged by complaint with one count of wire fraud. Blissitt was arrested earlier this morning and made her initial appearance before U.S. Magistrate Judge Patrick M. Hunt in Fort Lauderdale, Florida, federal court. She was released on $150,000 bond.

According to documents filed in this case and statements made in court:

Blissitt worked as a bookkeeper and assistant at a law firm in Boca Raton, Florida. She had access to several of the firm’s business bank accounts, including the firm’s client trust accounts. Starting in October 2021 and continuing through March 2022, Blissitt transferred money from several of the law firm’s business accounts to her personal account and other business bank accounts in New Jersey and Ohio. Blissitt would sometimes falsely note that the purpose of the transfers was to pay fees. Blissitt embezzled an estimated $3 million from the law firm.

The wire fraud charge has a maximum term of 20 years, and a maximum fine of $250,000 or twice the pecuniary gain to the defendant or loss to the victim, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Acting Special Agent in Charge Michael Messenger in Newark and Special Agent in Charge Eric B. Smith in Cleveland, Ohio, with the investigation leading to the charges. He also thanked the Boca Raton Police Services Department for their assistance.

The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Cybercrime Unit in Newark.

The charge and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 USA v.Janet Lee Blissitt

(0:22-mj-06257)

District Court, S.D. Florida

MAY 24, 2022 | REPUBLISHED BY LIT: MAY 26, 2022

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Appellate Judges

The Eleventh Circuit Issues Another Glossed Opinion to Dismiss a Pro Se Lawyer’s Appeal

All motions under Rule 60(b) OTHER THAN those based on Rule 60(b)(4) must be made within a reasonable time.

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Henry v. City of Mount Dora, No. 21-14120 (11th Cir. Sep. 16, 2022)

REPUBLISHED BY LIT: SEP 17, 2022

Before LUCK, LAGOA, and ANDERSON, Circuit Judges. PER CURIAM:

Marie Henry, proceeding pro se, appeals the district court’s denial of her Federal Rule of Civil Procedure 60(b)(4), (d)(3) motion seeking relief from the court’s order dismissing her federal claims raised pursuant to several federal statutes, and remanding to state court her state law claims raised pursuant to Florida state law.

After filing an ethics complaint against one of the defendants and a pro se motion to disqualify a judge in a predatory lending case, Henry was referred to a Florida Bar grievance committee on two counts of misconduct and, after disciplinary proceedings that she challenged as defective, she was suspended for 6 months.

She originally filed her complaint in Florida state court, but the Florida Bar removed her case to the United States District Court for the Middle District of Florida.

On appeal, she argues, first, that the district court erred by denying her Rule 60 motion as untimely.

Second, she contends that the court abridged her due process right to an impartial tribunal, notice, and an opportunity to be heard by dismissing her federal claims where the defendants did not unanimously consent to removal, the court judicially noticed facts without a hearing, and the judge was a member of an adverse party.

Third, she asserts that the court erred by failing to analyze fraud on the court.

Finally, she argues that the court’s denial of an extension to file objections to a magistrate judge’s report and recommendation violated 28 U.S.C. § 2072.

I.

LIT OBJECTS TO THE PANEL SUMMARY, WHICH DOES NOT PROVIDE DATES FOR THE FLORIDA BAR SUSPENSION, WHICH WAS IN MARCH 2015 , AND GLOSSES OVER THE FACT IT TOOK THE BAR YEARS TO PROSECUTE AND REACH ITS FINAL DISPOSITION.

We review de novo the denial of a motion to set aside a judg-ment for voidness under Rule 60(b)(4).

Stansell v. Revolutionary Armed Forces of Colom., 771 F.3d 713, 736 (11th Cir. 2014).

Motions pursuant to Rule 60(b)(4) are not subject to a reasonable timeliness requirement or a typical laches analysis.

Id. at 737-38.

But “Rule 60(b)(4) does not provide a license for litigants to sleep on their rights.”

United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 275 (2010).

When considering whether a movant slept on her rights, we have noted that subject matter jurisdiction cannot be waived and have addressed the merits of the movant’s jurisdictional argument.

See Stansell, 771 F.3d at 737

(holding that movant waived “his right to object to any defects in the service of process or to any denial of his right to be heard” because he “sat on his rights for nine months” but addressing alleged jurisdiction issues).

We may affirm for any reason supported by the record.

Bircoll v. Miami-Dade Cnty., 480 F.3d 1072, 1088 n.21 (11th Cir. 2007).

Here, the district court applied a reasonable time requirement to Henry’s Rule 60(b)(4) motion, but that requirement was inappropriate.

See Stansell, 771 F.3d at 737.

However, Henry sat on her rights by waiting more than 2 years to file her Rule 60(b)(4) motion.

See id. at 737-38.

Thus, we affirm the district court as to any issues raised by Henry that do not relate to subject matter jurisdiction because she slept on her rights for over two years.

Bircoll, 480 F.3d at 1088 n.21.

Like in Stansell, however, we next consider Henry’s arguments that the district court lacked subject matter jurisdiction.

See Stansell, 771 F.3d at 737.

LIT DISAGREES WITH THE PANEL OPINION WHICH CONTRADICTS ITSELF AND THIS COURT’s OWN RULINGS TO RELY UPON A SCOTUS BANKRUPTCY CASE, WHICH IS INAPPOSITE TO THE FACTS HERE.

FURTHERMORE, THE CITE, WHEN READ FULLY, IS NOT ABOUT DELAY IN APPEALING AT ALL:

“United had actual notice of the filing of Espinosa’s plan, its contents, and the Bankruptcy Court’s subsequent confirmation of the plan. In addition, United filed a proof of claim regarding Espinosa’s student loan debt, thereby submitting itself to the Bankruptcy Court’s jurisdiction with respect to that claim…. United therefore forfeited its arguments regarding the validity of service or the adequacy of the Bankruptcy Court’s procedures by failing to raise a timely objection in that court.

United Student Aid Funds v. Espinosa, 559 U.S. 260, 275 (2010)

—————

Before HULL, MARCUS and WILSON, Circuit Judges.:

“All motions under Rule 60(b) other than those based on Rule 60(b)(4) must be made within a reasonable time. See Fed. R. Civ. P. 60(c). ” Sec. & Exch. Comm’n v. J&J Mgmt. Consulting, No. 15-14628, at *4 (11th Cir. Oct. 3, 2016)

II.

Federal Rule of Civil Procedure 60(b)(4) provides relief from a final judgment or order if the judgment is void.

Fed. R. Civ. P. 60(b)(4).

A judgment is not void under Rule 60(b)(4) merely because it was erroneous.

Espinosa, 559 U.S. at 270.

Generally, it is void solely if it is premised on a jurisdictional error depriving the court of even arguable jurisdiction or on a due process violation that deprived a party of notice or the opportunity to be heard.

See id. at 271.

Federal courts always have jurisdiction to determine their own jurisdiction.

In re Nica Holdings, Inc., 810 F.3d 781, 789 (11th Cir. 2015).

The Rooker-Feldman1 doctrine is a narrow jurisdictional doctrine concerning a court’s subject matter jurisdiction that bars parties who lose a case in state court from appealing their loss in a federal district court.

Behr v. Campbell, 8 F.4th 1206, 1208 (11th Cir. 2021);

Alvarez v. Att’y Gen for Fla., 679 F.3d 1257, 1264 (11th Cir. 2012).

Neither res judicata nor the requirement that all defendants consent to removal is jurisdictional.

See Narey v. Dean, 32 F.3d 1521, 1524-25 (11th Cir. 1994);

In re Bethesda Mem’l Hosp., Inc., 123 F.3d 1407, 1410 n.2 (11th Cir. 1997).

An appellant abandons any argument not briefed before us, made in passing, or raised briefly without supporting arguments or authority.

Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324, 1330 (11th Cir. 2004);

Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678, 681 (11th Cir. 2014).

We can consider sua sponte an abandoned issue if a forfeiture exception applies and extraordinary circumstances warrant review.

United States v. Campbell, 26 F.4th 860, 873 (11th Cir. 2022) (en banc), petition for cert. filed (U.S. May 17, 2022) (No. 21-1468).

Here, Henry was not entitled to relief pursuant to her Rule 60(b)(4) motion because she did not identify any jurisdictional defect depriving the district court of arguable jurisdiction.

See Espinosa, 559 U.S. at 271.

The requirement that all defendants consent to removal is not jurisdictional.

See In re Bethesda Mem’l Hosp., Inc., 123 F.3d at 1410 n.2.

Res judicata is not jurisdictional either.

Narey, 32 F.3d at 1524–25.

Moreover, to the extent Henry argues that the district court erred by concluding the Rooker-Feldman doctrine applied, that is an argument over which the court had jurisdiction because a court always has jurisdiction to determine its own jurisdiction.

See In re Nica Holdings, Inc., 810 F.3d at 789.

Moreover, Henry points to no error in the district court’s application of the doctrine, nor to any other possible jurisdictional problem that might have deprived the district court of arguable jurisdiction.

Thus, we affirm the district court’s denial of Henry’s Rule 60(b)(4) motion.

1 Rooker v. Fid. Tr. Co., 263 U.S. 413 (1923); D.C. Court of Appeals v. Feld- man, 460 U.S. 462 (1983).

III.

We review a district court’s denial of a Rule 60(d)(3) motion for relief from a judgment due to the opposing party’s fraud on the court for abuse of discretion.

See Cox Nuclear Pharm., Inc. v. CTI, Inc., 478 F.3d 1303, 1314 (11th Cir. 2007) (Rule 60(b)(3) motion).

Rule 60 does not limit a court’s power to set aside a judgment for fraud on the court.

Fed. R. Civ. P 60(d)(3).

A movant must prove fraud on the court with clear and convincing evidence.

See Booker v. Dugger, 825 F.2d 281, 283-84 (11th Cir. 1987)

(appealing denial of Rule 60(b) motion after denial of § 2254 petition).

Fraud on the court is limited to exceptional conduct like bribery or evidence falsification involving an attorney.

Rozier v. Ford Motor Co., 573 F.2d 1332, 1338 (5th Cir. 1978) (prior version of Rule 60).

We have held that, in independent actions challenging a judgment for fraud on the court, the alleged fraud must not have been raised in the original litigation, and it must not have been possible for the complaining party to raise the issue through reasonable diligence.

See Travelers Indem. Co. v. Gore, 761 F.2d 1549, 1552 (11th Cir. 1985).

Here, the district court addressed fraud on the court, and it correctly found that Henry failed to show sufficiently egregious conduct.

The conduct Henry points to on appeal, even if true, does not fall within the category of egregious conduct that can constitute fraud on the court, but instead amounts to, at most, arguably erroneous legal arguments, or conduct that occurred before she filed her complaint, neither of which come close to the necessary showing of fraud on the court.

See Rozier, 573 F.2d at 1338.

Furthermore, she does not challenge any conduct that was not raised before her Rule 60 motion or that she could not have raised through reasonable diligence.

See Travelers Indem. Co., 761 F.2d at 1552;

Bircoll, 480 F.3d at 1088 n.21.

Thus, we affirm the denial of her Rule 60(d)(3) motion.

LIT OBJECTS TO THE PANEL SUMMARY, WHICH DOES NOT PROVIDE THE ‘CONDUCT’ AT ISSUE, AND BLANKS HENRY’S ARGUMENTS.

IV.

We review a district court’s denial of a motion for extension of time for abuse of discretion.

See Lizarazo v. Miami-Dade Corr. & Rehab. Dep’t, 878 F.3d 1008, 1010-11 (11th Cir. 2017)

(extension of time to file motion for substitution).

A request for an extension should be granted if good cause is shown. Fed. R. Civ. P. 6(b).

Here, Henry arguably has shown good cause for an extension in her motion for an extension to file objections to the magistrate judge’s report and recommendation concerning her Rule 60 motion because she asserted that she did not receive the report and recommendation until after the time for her to file objections had passed and she had been occupied caring for a family member.

We assume arguendo that she showed good cause for an extension.

However, the consequence for failing to object to the magistrate’s report and recommendation is waiver of the right to challenge those issues on appeal.

11th Cir. R. 3-1.

Because we have reviewed Henry’s arguments as if she had not waived them for failing to object, we affirm the denial of her motion for the reasons discussed above.

See R. 3-1; Fed. R. Civ. P. 6(b).

AFFIRMED.

LIT OBJECTS TO THE SCANT LEGAL ANALYSIS OF THE ‘CONSEQUENCE FOR  FAILING TO OBJECT TO THE MAGISTRATE REPORT’.

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Federal Judges

Lawyer Calvin Curtis Stole Over $13M Sentenced to 8 Years in Jail. He Wants a Favor from The Florida Bar.

Attorney Calvin Carl Curtis submitted a request for disciplinary revocation, with the caveat he can reapply in 5 years.

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LIF Commentary

“It is unbelievable and painful that Mr. Curtis continues to spend potential restitution to support a lavish lifestyle for his girlfriend in Orlando while his disabled victims are unable to pay rent on their mobile homes or afford basic necessities.

Apparently stealing more than $12,700,000 [corrected sum by LIF] isn’t shameful enough,”

said Kelly White, an attorney who is representing several of Curtis’ victims.

On May 24, Despicable Utah Attorney Calvin Carl Curtis, who is also a member of the Florida Bar, submitted a request for disciplinary revocation, with the caveat he can reapply in 5 years.

Salt Lake City Estate Planning Attorney Sentenced to 97 Months in Prison and Ordered to Pay over $12.7 Million Dollars to 26 Victims

MAY 6, 2022 | REPUBLISHED BY LIT: JUN 1, 2022

FBI agents went to Curtis’ office late last month and found a $2,000 check for legal work he provided, according to the report.

Prosecutors also asked a judge to clarify that Curtis’ restriction on performing legal work is already in effect and he should cease any work as a lawyer.

Prosecutors asked a judge to require Curtis to get a full-time job immediately.”

SALT LAKE CITY – Attorney Calvin Curtis, 61, of Salt Lake City, was sentenced to serve 97 months in federal prison by a U.S. District Court Judge today. Curtis was ordered to pay $12,779,496 in restitution to the 26 victims of his crimes and sentenced to an additional three years of supervised release upon his release from federal prison.

Curtis previously pleaded guilty in November of 2021, to embezzling millions of dollars from clients of his estate planning law firm based in Salt Lake City, known as Calvin Curtis Attorney at Law PLLC, and Curtiselderlaw.com.

By the time of his sentencing, it had been discovered that Curtis had embezzled over $12 million dollars from his former clients who prosecutors say are elderly, incapacitated, or disabled individuals.

In the plea agreement, Curtis admitted that he is an attorney who specialized in special needs trusts and that beginning in January 2008, he began a fraudulent scheme to defraud a client known as “G.M.” out of money. Curtis admitted that due to his role, he had access to millions of dollars in two different trust accounts belonging to victim G.M., and that he transferred at least $9,500,000 intended for the care of G.M. into his own accounts, and then used this money for his own personal use. Curtis admitted that he also created fake financial statements and submitted these to the court ordered conservator of G.M. to conceal the fraud.

In pleading guilty to the wire fraud charge, Curtis admitted that on January 25, 2018, that he caused a wire communication from a Schwab Investment Account to his own Wells Fargo account, resulting in a transfer of $1,485,000.

Curtis admitted that he used the money for his own personal benefit to make mortgage payments on his combined home and office located on South Temple Street in Salt Lake City, Utah; to support a lavish lifestyle with frequent travel; to purchase tickets to basketball and football games; to give lavish gifts to others; and to support the operations of his law firm.

In pleading guilty to the money laundering count, Curtis admitted that he fraudulently caused $135,000 to be transferred online from G.M. to his own Wells Fargo account, and that he used these funds to wire $95,000 to The Fechtel Company for the remodel of his home in Tampa, Florida.

Curtis admitted that he knew these transactions were illegal at the time they occurred, and that the money was not used for the benefit of G.M.

Assistant United States Attorneys prosecuted the cases against Curtis and Special Agents from the FBI and IRS Criminal Investigation conducted the investigation.

Topic(s):
Financial Fraud
Component(s):
USAO – Utah

United States v. Curtis

(2:21-cr-00464)

District Court, D. Utah

NOV 8, 2021 | REPUBLISHED BY LIT: JUN 1, 2022

Curtis’ South Temple mansion has been sold to House of Hope, which provides services to women with substance abuse disorders.

1135 E South Temple Salt Lake City, UT 84102 (Office Property)

JUDGMENT as to Calvin Curtis (1), Count(s) 1, BOP 97 months.

36 months probation with standard and special conditions as stated on the record.

No fine.

SPA $200.

Restitution of $12,779,496.51 as stated on the record.

Forfeiture of real property located at 1135 East South Temple Street in Salt Lake City, Utah;

a money judgment equal to the value of any property, real or personal, constituting or derived from proceeds traceable to the scheme to defraud and not available for forfeiture as a result of any act or omission of the defendant(s) for one or more of the reasons listed in 21 U.S.C. 853(p);

substitute property as allowed by 28 U.S.C. 2461(c) and 21 U.S.C. 853(p);

funds in the amount of $384,919.04 seized from Wells Fargo Bank account ending in 3424;

jewelry purchased at Summit Diamond for $73,935.;

Count(s) 2, BOP 97 months.

36 months probation with standard and special conditions as stated on the record.

No fine. SPA $200.

Restitution of $12,779,496.51 as stated on the record.

Forfeiture of real property located at 1135 East South Temple Street in Salt Lake City, Utah;

a money judgment equal to the value of any property, real or personal, constituting or derived from proceeds traceable to the scheme to defraud and not available for forfeiture as a result of any act or omission of the defendant(s) for one or more of the reasons listed in 21 U.S.C. 853(p);

substitute property as allowed by 28 U.S.C. 2461(c) and 21 U.S.C. 853(p);

funds in the amount of $384,919.04 seized from Wells Fargo Bank account ending in 3424;

jewelry purchased at Summit Diamond for $73,935.

Defendant Termed.

Case Closed.

Signed by Judge David Barlow on 05/06/2022.(jl)

(Entered: 05/09/2022)

1305 Bayshore Blvd, Tampa, FL 33606

Sold for $1.75M in April 2021

Sold to Doctor Rose (Where'd the Dosh Go?)

Judge rejects plea deal for Utah attorney charged with embezzling millions

APR 19, 2022 | REPUBLISHED BY LIT: JUN 1, 2022

Judge David Barlow and Calvin Curtis

A prominent Salt Lake City attorney thought he would be spending just over six years in prison after embezzling more than $12 million from dozens of clients over a span of 13 years.

Instead, a federal judge refused to accept the 73-month plea deal — indicating the punishment was not harsh enough and that he doesn’t believe Calvin Curtis is fully remorseful.

Curtis was a special needs trust attorney, representing some of the most vulnerable clients in Utah — many of whom suffer from severe mental or physical disabilities.

Prior to the ruling, Curtis cried and apologized to the victims.

Cameras were not allowed in the courtroom.

Kris Sanford, who has been paralyzed since 2009, addressed Curtis directly during the hearing.

“Your moral compass is not there,”

Sanford said.

“It’s disgusting… I guess on the advice of my attorney, I’m going to stop there.”

Sanford, who said he “only” lost about $40,000, asked the judge to ignore the recommended 73-month sentence that prosecutors reached with Curtis.

Aaron Hall, who is legally blind, also asked the judge to ignore the plea deal. He said he lost about half a million dollars.

“This brought me almost to suicide,”

Hall said.

“He gave fraudulent accounts to family members who were questioning me and drove me to the point where I was questioning my own sanity and whether I did something wrong… It’s really embarrassing being a father not being able to take care of your children. Your children shouldn’t have to pay all your bills.”

Sherry McConkey was in court representing her mother-in-law. Glenn McConkey has severe Alzheimer’s and dementia.

In that case, Curtis admitted he stole approximately $12 million.

“I just kept on staring at him going, ‘Wow, how can you be so evil?’”

Sherry McConkey said.

“I don’t believe his apology, so therefore I don’t accept it.”

While addressing the court, Curtis agreed that his actions were “evil.”

He addressed some of the victims by name, referring to them as “dear friends” that he took advantage of.

“Unfortunately, most of everything they’ve said is true, and I’m very sorry about that,”

Curtis said.

“I accept responsibility. It’s my fault. I pray for them. I hope they pray for me.”

“If that man never speaks my name again, it would be too soon,”

Hall responded.

Curtis withdrew his guilty plea after learning the judge found the plea deal “unreasonable.”

Some victims, like Matt Hess, said they were not sure how to feel, worried the case could now drag on or go to trial. Hess’ disabled daughter is one of the victims.

A prominent Salt Lake City attorney thought he would be spending just over six years in prison after embezzling more than $12 million from dozens of clients over a span of 13 years.

Instead, a federal judge refused to accept the 73-month plea deal — indicating the punishment was not harsh enough and that he doesn’t believe Calvin Curtis is fully remorseful.

Curtis was a special needs trust attorney, representing some of the most vulnerable clients in Utah — many of whom suffer from severe mental or physical disabilities.

Prior to the ruling, Curtis cried and apologized to the victims. Cameras were not allowed in the courtroom.

Kris Sanford, who has been paralyzed since 2009, addressed Curtis directly during the hearing.

“Your moral compass is not there,” Sanford said. “It’s disgusting… I guess on the advice of my attorney, I’m going to stop there.”

Sanford, who said he “only” lost about $40,000, asked the judge to ignore the recommended 73-month sentence that prosecutors reached with Curtis.

Aaron Hall, who is legally blind, also asked the judge to ignore the plea deal. He said he lost about half a million dollars.

“This brought me almost to suicide,” Hall said. “He gave fraudulent accounts to family members who were questioning me and drove me to the point where I was questioning my own sanity and whether I did something wrong… It’s really embarrassing being a father not being able to take care of your children. Your children shouldn’t have to pay all your bills.”

Sherry McConkey was in court representing her mother-in-law. Glenn McConkey has severe Alzheimer’s and dementia.

In that case, Curtis admitted he stole approximately $12 million.

“I just kept on staring at him going, ‘Wow, how can you be so evil?’” Sherry McConkey said. “I don’t believe his apology, so therefore I don’t accept it.”

While addressing the court, Curtis agreed that his actions were “evil.” He addressed some of the victims by name, referring to them as “dear friends” that he took advantage of.

“Unfortunately, most of everything they’ve said is true, and I’m very sorry about that,” Curtis said. “I accept responsibility. It’s my fault. I pray for them. I hope they pray for me.”

“If that man never speaks my name again, it would be too soon,” Hall responded.

Curtis withdrew his guilty plea after learning the judge found the plea deal “unreasonable.”

Some victims, like Matt Hess, said they were not sure how to feel, worried the case could now drag on or go to trial. Hess’ disabled daughter is one of the victims.

“It’s good and bad I guess,” Hess said. “It’s good in the sense that we might get something a little more out of this. He might get a few more years. I don’t think we’re going to find any more money.”

Judge David Barlow said he believed a more appropriate sentence would be somewhere between 8-10 years in prison, or 97 to 121 months.

He referred to Curtis’ actions as “unspeakable,” “calculated,” and “cold blooded.”

“It’s just about as terrible as a thing can be,” Barlow said. “So heinous and so devastating… Im not convinced he’s taken full accountability.”

Barlow gave credit to Curtis for cooperating with the investigation and forfeiting approximately $1.4 million. He said that he hopes both sides come together to reach a more reasonable plea deal in order to avoid trial.

The likelihood of the remaining $11 million being returned is “failingly small” if not “impossible.”

Utah attorney pleads guilty to embezzling $9.5M from his clients

Prosecutors had said Calvin Curtis used the money to fund a “lavish lifestyle.”

NOV 18, 2021 | REPUBLISHED BY LIT: JUN 1, 2022

SALT LAKE CITY – Attorney Calvin Curtis, 61, of Salt Lake City, pleaded guilty in federal court today to two counts involving wire fraud and money laundering for his role in embezzling at least $9.5 million dollars from clients of his estate planning law firm based in Salt Lake City, known as Calvin Curtis Attorney at Law PLLC, and Curtiselderlaw.com.

Prosecutors and defense attorneys have agreed to recommend a sentence of 73 months in federal prison during Curtis’s sentencing which is scheduled to occur on March 15, 2022.

In the plea agreement, Curtis admitted that he is an attorney who specializes in special needs trusts and that beginning in January 2008, he began a fraudulent scheme to defraud a client known as “G.M.” out of money.

Curtis admitted that due to his role, he had access to millions of dollars in two different trust accounts belonging to victim G.M. and that he transferred at least $9,500,000 intended for the care of G.M. into his own accounts and then used this money for his own personal use.

Curtis admitted that he also created fake financial statements and submitted these to the court ordered conservator of G.M. to conceal the fraud.

In pleading guilty to the wire fraud charge, Curtis admitted that on January 25, 2018, that he caused a wire communication from a Schwab Investment Account to his own Wells Fargo account, resulting in a transfer of $1,485,000.

Curtis admitted that he used the money for his own personal benefit to make mortgage payments on his combined home and office located on South Temple Street in Salt Lake City, Utah; to support a lavish lifestyle with frequent travel; to purchase tickets to basketball and football games; to give lavish gifts to others; and to support the operations of his law firm.

In pleading guilty to the money laundering count, Curtis admitted that he fraudulently caused $135,000 to be transferred online from G.M. to his own Wells Fargo account, and that he used these funds to wire $95,000 to The Fechtel Company for the remodel of his home in Tampa, Florida.

Curtis admitted that he knew these transactions were illegal at the time they occurred, and that the money was not used for the benefit of G.M

At this time, it is alleged that Curtis embezzled funds from at least 22 additional trusts in amounts more than $9,500,000.

Anyone who believes they may be a victim of this crime is encouraged to call the FBI at (801) 579-1400 to file a report.

“Defrauding vulnerable and elderly adults is a reprehensible and greedy act that is deserving of federal prison time,” said Acting United States Attorney Andrea T. Martinez. “The United States Attorney’s Office is committed to prosecuting and holding those accountable who defraud elderly and vulnerable clients. Our concern is with the victims of these crimes and their ability to obtain basic needs moving forward.”

“Calvin Curtis’ greed had devastating consequences for his clients, who placed their trust and money in his hands,” said Special Agent in Charge Dennis Rice of the Salt Lake City FBI. “Sadly, financial fraud cases like this are not limited to a few victims. We hope this case sends a strong message that the FBI will do what it takes to make sure such crimes don’t go unpunished.”

“The IRS is proud to collaborate with our law enforcement partners to combat the seemingly ever present fraud in Utah,”¬ stated IRS Phoenix Field Office Special Agent in Charge Darren Lian. “This plea brings the United States one step closer to justice for the many victims who have serious losses in this unfortunate case.”

Assistant United States Attorneys are prosecuting the cases against Curtis and Special Agents from the FBI and IRS Criminal Investigations are conducting the investigation.

Topic(s):
Elder Justice
Financial Fraud
Component(s):
USAO – Utah

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Appellate Circuit

Constance Daniels, Student of Hard Knocks, Admonished Florida Lawyer and Friend of The Eleventh Circuit

LIF cannot comprehend how the People of Florida and the United States of America are so accepting of Brazen Corruption.

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LIF UPDATE

OCT 26, 2022

Five months after the 11th Circuit saved a colleague and lawyer from foreclosure, the mandate issued (without en banc hearing) and as instructed (reversed and remanded) the lower court has reopened the case.

LIT will be tracking this case closely, stay tuned.

LIF COMMENTARY

The article below starts with Constance Daniels failure to pay for her law school tuition loan issued in 2003. She defaulted in 2005 per the complaint. The USA won a judgment of $164k+ in 2011.

In 2010, Wells Fargo commenced foreclosure proceedings in state court, Hillsborough County.

While all this was going on, Ms Daniels, a Republican, was attempting to become a State judge in 2014, which failed.

In late November of 2017 a settlement was reached, dismissing the Wells Fargo foreclosure complaint.

In 2017-2018, lawyer Daniels was failing to look after her client(s). Many moons later, in 2021, that would result in a slap on the wrist by the referee, Hon. Daniel D. Diskey for Fl. Bar.

Then we move onto the June 2018 complaint, filed by Daniels against the mortgage servicer. It was removed to the lower court in Middle District  of Florida Federal Court.

The court, via one of the Moody clan of judges, sided with Select Portfolio Servicing, LLC and this formed the appeal which was decided this week by the 11th Circuit.

In Nov. 2020, Wells Fargo filed a renewed foreclosure complaint against Daniels and her homestead in State court. In Sept 2021, Wells Fargo voluntarily dismissed the case and terminated the lis pendens ‘due to loan modification’.

The issue for LIF in this case is quite clear. Who the 11th Circuit has chosen to upend it’s prior stance that mortgage servicers can do no wrong under the FDCPA, despite irrefutable facts confirming otherwise.

For example, LIF refers to the case we highlighted regarding a deficiency judgment (State case, March 2022):

Florida Lawyer Stephanie Schneider Appeals a Mortgage Foreclosure Deficiency Judgment

In that case, LIF investigated beyond the court opinions to discover the wife is a Florida Lawyer and her husband, Laurence Schneider is owner of S&A Capital, Inc., a mortgage investment company, has built a national portfolio of performing mortgages that have been written off by other financial institutions.

Our angst is clear. Lawyers are being treated preferentially by the courts over regular citizens and homeowners.

In the case of Daniels, whilst she may have legitimate arguments, there have been many citizens who have failed before her by the wordsmithing by the Federal and Appellate Court(s), which has refused to apply the correct legal interpretation of the FDCPA, or clarify the question(s) with the federal consumer agency, the CFPB.

Whilst LIF is unhappy with the anti-consumer watchdog, the Consumer Financial Protection Bureau (CFPB) which is a revolving door for staff to leave the Bureau and go work for a creditor rights law firm without any restriction or time limit (non-compete), the Daniels case should have been referred to the CFPB for interpretation about the matters of ‘first impression’.

The Second Circuit recently did so for a RESPA question in Naimoli v Ocwen and we highlighted the case on our sister website, LawsInTexas.com (Laws In Texas). Instead of doing so in Daniels, there is a dissenting opinion by Judge Lagoa, who’s father in law is a  senior judge in SD Florida (Paul C. Huck) and her hubby is a Jones Day Partner and apparently the leader of the Miami Chapter of the Federalist Society. Lagoa herself is a former Florida Supreme Court justice appointed by Gov DeSantis who ‘ensured he puts conservatives on the bench so that anyone coming to court knows how the court will rule’.

LIF anticipates the Daniels case will be subject to a rehearing petition and presented to the full en banc court for reconsideration. The opinion here is similar to the recent Newsom FDCPA opinion, which was too negative towards Wall St and the financial banking services community. As such, it was vacated by the en banc panel while they reconsider. The courts’ decision is currently pending.

In this case, there is still time for the 11th Circuit to correctly ask the CFPB to provide its opinion on the underlying facts raised on appeal and decided by the 3-panel.

However, what the judiciary won’t do is apply this retroactively to the thousands of cases which have been incorrectly tossed in the last 14 years, resulting in homeowners losing their homes to wrongful foreclosures.

United States v. Daniels (2011)

(8:11-cv-01058)

District Court, M.D. Florida

MAY 13, 2011 | REPUBLISHED BY LIT: MAY 26, 2022

USA Motion for Summary Judgment with Exhibits, Doc. 13, Aug 17, 2011

ORDER granting  Motion for summary judgment in favor of the Plaintiff and against the defendant in the amount of $109,813.74,

together with accrued interest in the amount of $54,097.10 as of February 28, 2011,

plus interested at the rate of 8.25 percent per annum and a daily rate of $24.80, until the date of judgment;

for post-judgment interest, at the legal rate, from the entry of final judgment until the date of payment;

and for such other costs of litigation otherwise allowed by law.

The Clerk of Court is directed to close the case.

Signed by Judge Elizabeth A. Kovachevich on 9/22/2011.

(SN) (Entered: 09/22/2011)

U.S. District Court
Middle District of Florida (Tampa)
CIVIL DOCKET FOR CASE #: 8:11-cv-01058-EAK-AEP

USA v. Daniels
Assigned to: Judge Elizabeth A. Kovachevich
Referred to: Magistrate Judge Anthony E. Porcelli
Demand: $164,000
Cause: 28:1345 Default of Student Loan
Date Filed: 05/13/2011
Date Terminated: 09/22/2011
Jury Demand: None
Nature of Suit: 152 Contract: Recovery Student Loan
Jurisdiction: U.S. Government Plaintiff
Plaintiff
USArepresented byI. Randall Gold
US Attorney’s Office – FLM
Suite 3200
400 N Tampa St
Tampa, FL 33602-4798
813/274-6026
Fax: 813/274-6247
Email: FLUDocket.Mailbox@usdoj.gov
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
V.
Defendant
Constance Danielsrepresented byConstance Daniels
PO Box 6219
Brandon, FL 33608
PRO SE

 

Date Filed#Docket Text
05/13/20111COMPLAINT against Constance Daniels filed by USA. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Civil Cover Sheet)(MRH) (Entered: 05/13/2011)
05/13/20112Summons issued as to Constance Daniels. (MRH) (Entered: 05/13/2011)
05/13/20113ORDER regulating the processing of civil recovery actions. Service must be perfected by 09/10/2011. Signed by Deputy Clerk on 5/13/2011. (MRH) (Entered: 05/13/2011)
05/13/20114STANDING ORDER: Filing of documents that exceed twenty-five pages. Signed by Judge Elizabeth A. Kovachevich on 7/15/08. (MRH) (Entered: 05/13/2011)
05/19/20115NOTICE of designation under Local Rule 3.05 – track 1 (CLM) (Entered: 05/19/2011)
05/20/20116CERTIFICATE OF SERVICE re 3 ORDER regulating the processing of civil recovery actions by USA (Gold, I.) Modified on 5/20/2011 (MRH). (Entered: 05/20/2011)
05/25/20117CERTIFICATE OF SERVICE by USA (Notice of Designation Under Local Rule 3.05) (Gold, I.) (Entered: 05/25/2011)
07/06/20118RETURN of service executed on 7/5/11 (Marshal 285) by USA as to Constance Daniels. (MRH) (Entered: 07/06/2011)
07/27/20119MOTION for default judgment against Constance Daniels by USA. (Gold, I.) Modified on 7/27/2011 (MRH). NOTE: TERMINATED. INCORRECT MOTION RELIEF. ATTORNEY NOTIFIED. ATTORNEY TO REFILE. (Entered: 07/27/2011)
07/27/201110MOTION for entry of clerk’s default against Constance Daniels by USA. (Gold, I.) Motions referred to Magistrate Judge Anthony E. Porcelli. (Entered: 07/27/2011)
07/28/201111CLERK’S ENTRY OF DEFAULT as to Constance Daniels. (MRH) (Entered: 07/28/2011)
07/29/201112ANSWER to 1 Complaint by Constance Daniels.(BES) (Entered: 07/29/2011)
08/17/201113MOTION for summary judgment by USA. (Attachments: # 1 Exhibit A, # 2 Exhibit B)(Gold, I.) (Entered: 08/17/2011)
09/09/201114ENDORSED ORDER TO SHOW CAUSE as to Constance Daniels.. The plaintiff filed a motion for summary judgment on 8/17/11. The defendant had up to and including 9/3/11 to respond to the motion. To date no response has been filed. Therefore, it is ORDERED that the defendant has up to and including 9/19/11 in which to show cause why the pending motion should not be granted. Signed by Judge Elizabeth A. Kovachevich on 9/9/2011. (SN) (Entered: 09/09/2011)
09/22/201115ORDER granting 13 Motion for summary judgment in favor of the Plaintiff and against the defendant in the amount of $109,813.74, together with accrued interest in the amount of $54,097.10 as of February 28, 2011, plus interested at the rate of 8.25 percent per annum and a daily rate of $24.80, until the date of judgment; for post-judgment interest, at the legal rate, from the entry of final judgment until the date of payment; and for such other costs of litigation otherwise allowed by law. The Clerk of Court is directed to close the case.. Signed by Judge Elizabeth A. Kovachevich on 9/22/2011. (SN) (Entered: 09/22/2011)
10/12/201116ABSTRACT of judgment as to Constance Daniels. (DMS) (Entered: 10/12/2011)

Order GRANTING Summary Judgment for $164k Student Loan Debt, Doc. 15, Sep 22, 2011

Daniels v. Select Portfolio Servicing, Inc.

(2018-Present)

(8:18-cv-01652)

District Court, M.D. Florida

ORDER

THIS CAUSE comes before the Court upon Defendant’s Motion to Dismiss Plaintiff’s Second Amended Complaint (Dkt. 24) and Plaintiff’s Response in Opposition (Dkt. 27).

The Court, having reviewed the motion, response, and being otherwise advised in the premises, concludes that Defendant’s motion should be granted.

Specifically, Plaintiff’s second amended complaint will be dismissed with prejudice because any further amendment is futile.

BACKGROUND

As the Court explained in its prior Order granting Defendant’s motion to dismiss, (see Dkt. 22), Plaintiff Constance Daniels initially filed suit in Florida state court against Defendant Select Portfolio Servicing, Inc. (“SPS”) alleging three Florida claims, which included a claim under Florida’s civil Racketeer Influenced and Corrupt Organizations (“RICO”) Act.

On July 10, 2018, SPS removed the case to this Court based on diversity jurisdiction.

On August 6, 2018, SPS moved to dismiss the entire complaint.

In relevant part, SPS argued that the complaint failed to allege any of the elements of a RICO claim.

On August 27, 2018, Daniels filed an amended complaint, which mooted SPS’s motion to dismiss.

Daniels’ amended complaint alleged two claims: a claim under the Fair Debt Collection Practices Act (“FDCPA”) and a claim under the Florida Consumer Collections Practices Act (“FCCPA”).

Both claims relied on the same allegations.

To summarize, Daniels alleged that SPS had “improperly servic[ed]” her mortgage loan “in reckless disregard” of her consumer rights. (Dkt. 12).

The amended complaint did not attach any mortgage statements.

SPS moved to dismiss Daniels’ amended complaint based on her failure to allege that SPS ever attempted to collect the mortgage balance.

The Court granted SPS’s motion.

The Court noted that the amended complaint did not identify or attach any communication from SPS to Daniels.

The Court also surmised that the dispute was more akin to a dispute about an improper accounting of Daniels’ mortgage.

The Court dismissed the FDCPA and FCCPA claims and provided Daniels a final opportunity to amend her complaint.

Daniels filed a second amended complaint.

The allegations are largely unchanged.

But, significantly, Daniels attaches multiple monthly mortgage statements that SPS sent to her.

She now claims that these mortgage statements constitute debt collection activity under the FDCPA and FCCPA.

SPS’s motion to dismiss argues that the monthly mortgage statements comply with Regulation Z of the Truth in Lending Act (the “TILA”)—they were not communications in connection with the collection of a debt—and therefore do not constitute debt collection activity under the FDCPA and FCCPA.

As explained further below, the Court agrees with SPS’s position based on the Court’s detailed review of the monthly mortgage statements.

Therefore, the second amended complaint will be dismissed with prejudice.

STANDARD OF REVIEW

Federal Rule of Civil Procedure 12(b)(6) allows a court to dismiss a complaint when it fails to state a claim upon which relief can be granted.

When reviewing a motion to dismiss, a court must accept all factual allegations contained in the complaint as true.

Erickson v. Pardus, 551 U.S. 89, 94 (2007) (internal citation omitted).

It must also construe those factual allegations in the light most favorable to the plaintiff.

Hunt v. Aimco Properties, L.P., 814 F.3d 1213, 1221 (11th Cir. 2016) (internal citation omitted).

To withstand a motion to dismiss, the complaint must include “enough facts to state a claim to relief that is plausible on its face.”

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

A claim has facial plausibility “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

Pleadings that offer only “labels and conclusions,” or a “formulaic recitation of the elements of a cause of action,” will not do.

Twombly, 550 U.S. at 555.

DISCUSSION

The FDCPA and FCCPA prohibit debt collectors from using a “false, deceptive, or misleading representation or means in connection with the collection of any debt.”

See e.g. 15 U.S.C. § 1692e (emphasis added);

Fla. Stat. § 559.72 (“In collecting debts, no person shall . . .”) (emphasis added).

It is axiomatic then that the “challenged conduct is related to debt collection” to state a claim under either statute.

Reese v. Ellis, Painter, Ratterree & Adams, LLP, 678 F.3d 1211, 1216 (11th Cir. 2012);

see also Garrison v. Caliber Home Loans, Inc., 233 F. Supp. 3d 1282, 1286 (M.D. Fla. 2017) (“the FCCPA is a Florida state analogue to the federal FDCPA.”) (internal citations omitted).

“[T]he Eleventh Circuit has not established a bright-line rule” as to what qualifies as “in connection with the collection of any debt.”

Dyer v. Select Portfolio Servicing, Inc., 108 F. Supp. 3d 1278, 1280 (M.D. Fla. 2015).

“As a general principle, the absence of a demand for payment is not dispositive,” and courts should “instead consider whether the overall communication was intended to induce the debtor to settle the debt.”

Wood v. Citibank, N.A., No. 8:14-cv-2819-T-27EAJ, 2015 WL 3561494, at *3 (M.D. Fla. June 5, 2015) (citations omitted).

The second amended complaint attaches multiple monthly mortgage statements.1

Because the communications at issue here are all monthly mortgage statements, a discussion of the TILA is necessary.

The TILA requires SPS, a servicer, to send monthly mortgage statements.

12 C.F.R. § 1026.41. Specifically, 12 C.F.R. § 1026.41(d) requires that servicers provide debtors with detailed monthly mortgage statements containing, among other things: the “amounts due;” the “payment due date;” “the amount of any late payment fee, and the date that fee will be imposed if payment has not been received;” “an explanation of amount due, including a breakdown showing how much, if any, will be applied to principal, interest, and escrow and, if a mortgage loan has multiple payment options, a breakdown of each of the payment options;” “any payment amount past due;” a breakdown of “the total of all payments received since the last statement” and “since the beginning of the current calendar year;” “a list of all transaction activity that occurred since the last statement;” “partial payment information;” “contact information;” and detailed “account information” and “delinquency information.”

The Consumer Financial Protection Bureau (the “CFPB”) has issued a bulletin providing that a

“servicer acting as a debt collector would not be liable under the FDCPA for complying with [monthly mortgage statement] requirements.”

Implementation Guidance for Certain Mortgage Servicing Rules, 10152013 CFPB GUIDANCE, 2013 WL 9001249 (C.F.P.B. Oct. 15, 2013).

Courts have largely followed this guidance.

See, e.g., Jones v. Select Portfolio Servicing, Inc., No. 18-cv-20389, 2018 WL 2316636, at *3 (S.D. Fla. May 2, 2018) (citing 12 C.F.R. § 1026.41(d));

Brown v. Select Portfolio Servicing, Inc., No. 16-62999-CIV, 2017 WL 1157253 (S.D. Fla. Mar. 24, 2017) (noting the guidance and finding that monthly mortgage statements in compliance with the TILA were not debt collection).

The monthly mortgage statements at issue here were in conformity with the TILA requirements.

Moreover, the subject statements were substantially similar to model form H-30(B) provided by Appendix X to Part 1026 of TILA Regulation Z.

See also Jones, 2018 WL 2316636, at *4 (noting the similarities between a monthly mortgage statement and the model form in concluding no debt collection).

Although the monthly mortgage statements may not be identical to model form H-30(B), the differences are not significant deviations.

Notably, the plaintiff in Brown brought a nearly identical lawsuit against SPS.

The court explained in detail why the plaintiff was unable to state a claim under the FDCPA and FCCPA because the monthly mortgage statement was required to be sent pursuant to the TILA.

The complaint in Brown was dismissed with prejudice because “amendment would be futile” given that the basis for the claims was a monthly mortgage statement that was not actionable as a matter of law.

See 2017 WL 1157253, at *2-*4.

Also, the Jones court discussed in detail the numerous prior decisions addressing this issue, including multiple cases from this district that have held that monthly mortgage statements

“are almost categorically not debt collection communications under the FDCPA.”

2018 WL 2316636, at *5 (citing cases).

The particular monthly mortgage statements before the court in Jones were also sent by SPS and were substantively identical to the statements at issue in this case and in Brown.

Most recently, in Mills v. Select Portfolio Servicing, Inc., No. 18-cv-61012- BLOOM/Valle, 2018 WL 5113001 (S.D. Fla. Oct. 19, 2018), the court “agree[d] with the reasoning in Jones and [concluded] that the Mortgage Statements at issue [were] not communications in connection with a collection of a debt.” Id. at *2.

In conclusion, the substance of the monthly mortgage statements at issue in this case is substantially similar to model form H-30(B).

Any minor discrepancies in the language—when taken in the context of the document as an otherwise carbon copy of form H-30(B)—do not take the statements out of the realm of a monthly mortgage statement and into the realm of debt collection communications.

It is therefore ORDERED AND ADJUDGED that:

1. Defendant’s Motion to Dismiss Plaintiff’s Second Amended Complaint (Dkt.

24) is granted.

2. Plaintiff’s Second Amended Complaint is dismissed with prejudice.

3. The Clerk of Court is directed to close this case and terminate any pending motions as moot.

DONE and ORDERED in Tampa, Florida on December 18, 2018.

 

 

 

 

Copies furnished to: Counsel/Parties of Record

Judge Bert Jordan’s “Reputation” Warning to New Florida Lawyers

Constance Daniels Admonished by the Florida Bar (2021)

Constance Daniels, P.O. Box 6219, Brandon, admonishment in writing and directed to attend Ethics School effective immediately following a November 24 court order.

(Admitted to practice: 1995)

Daniels failed to act with reasonable diligence and failed to communicate with her client in connection with a dissolution of marriage action.

Daniels also failed to timely respond to the Bar’s formal complaint.

(Case No: SC21-683)

Constance Daniels v. Select Portfolio Servicing, Inc. (2022)

11th Cir., Published Opinion

(19-10204, May 24, 2022)

“A matter of first impression” 14 Years after the great recession and greatest theft of citizens homes in the history of the United States.

It’s quite incredulous how the 11th Circuit selects a Sanctioned Fl. Republican Lawyer, a failed judicial candidate and one who is facing foreclosure, for this ‘landmark’ published opinion in 2022.

Panel Author, Judge Bert Jordan, joined by Judge Brasher with a dissenting opinion by Judge Babs Lagoa

11th Circuit revives FDCPA lawsuit over mortgage statement language

How Westlaw is Summarizing the Latest Eleventh Circuit Opinion

(May 26, 2022)

Resolving an issue of first impression, a divided federal appeals panel has held that mortgage servicers can be liable under the Fair Debt Collection Practices Act for inaccuracies in monthly mortgage statements that contain additional debt-collection language.

Daniels v. Select Portfolio Servicing Inc., No. 19-10204, (11th Cir. May 24, 2022).

In a 2-1 decision, the 11th U.S. Circuit Court of Appeals on May 24 reinstated Constance Daniels’ lawsuit against Select Portfolio Servicing Inc., in which she alleges the company used faulty mortgage statements to try to collect payments she did not owe.

Writing for the panel majority, U.S. Circuit Judge Adalberto J. Jordan acknowledged that Select Portfolio was required to issue the mortgage statements under the Truth in Lending Act, 15 U.S.C.A. § 1638.

However, the mortgage statements fell within the scope of the FDCPA’s prohibition on false or misleading representations, 15 U.S.C.A. § 1692e, because they included additional debt-collection language — “this is an attempt to collect a debt” — the opinion said.

Judge Jordan reasoned that “in determining whether a communication is in connection with the collection of a debt, what could be more relevant than a statement in the communication than ‘this is an attempt to collect a debt’?”

U.S. Circuit Judge Barbara Lagao dissented, saying the majority treated the language like “magic words” that could convert an otherwise routine mortgage statement into a communication covered by the FDCPA.

Judge Lagoa also argued that the decision created a circuit split, although the panel majority insisted that the facts of Daniels’ case distinguished it from others in which federal circuit courts seemed to reach a contrary result.

District Court tosses FDCPA claims

Daniels sued Select Portfolio in the U.S. District Court for the Middle District of Florida in July 2018.

According to the suit, Daniels had prevailed in a state court foreclosure action brought by lender Wells Fargo in 2015, with the judge sanctioning Wells Fargo and enforcing an earlier loan modification agreement between the parties.

But Daniels’ mortgage servicer, Select Portfolio, later issued several monthly mortgage statements misstating the principal balance and amount due, and falsely claiming that her loan was in arrears, the suit says.

At least three of the mortgage statements included the sentence, “This is an attempt to collect a debt,” according to the suit.
Daniels accuses Select Portfolio of using false or misleading representations in connection with the collection of a debt, in violation of the FDCA and the Florida Consumer Collection Practices Act, Fla. Stat. Ann. § 559.72.

Select Portfolio moved to dismiss, saying Daniels was attempting hold it liable for issuing mortgage statements that are required under the Truth in Lending Act.

U.S. District Judge James S. Moody Jr. agreed and dismissed the suit in December 2018. Daniels v. Select Portfolio Servs. Inc., No. 18-cv-1652, (M.D. Fla. Dec. 18, 2018).

Judge Moody said that any discrepancies in language between Select Portfolio’s monthly statements and what is required under TILA “do not take the statements out of the realm of a monthly mortgage statement and into the realm of debt collection communications.”

On appeal, Daniels argued that compliance with TILA does not make a mortgage servicer immune from suit under the FDCPA and, even if it did, the monthly statements at issue included language beyond what is necessary under TILA.

Kaelyn S. Diamond and Michael A. Ziegler of the Law Office of Michael A. Ziegler represented Daniels.

Benjamin B. Brown and Joseph T. Kohn of Quarles & Brady LLP represented Select Portfolio.

By Dave Embree

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