Archive for April 12th, 2011

Citimortgage lawsuit with Stern

I have one question as I review the following story, explaining the pending lawsuit between Citimortgage and David Stern:  Wouldn’t it be fun to serve an interrogatory on Citimortgage, something along the lines of:

‘Identify all facts, including but not limited to all documents and the name, address, and phone number of all witnesses, that in any way pertain to your allegation that you don’t owe back pay to Stern because his own negligence caused you to terminate your contract with him.  In your answer, please explain in detail all acts of negligence committed by Stern which you believe justify the termination of your contract.’” 

I’m not asking for much – just one interrogatory. 

Of course, I don’t have the ability to procure this information, as I’m not The Florida Bar or the Florida AG.  Sigh.  Of course, it seems neither of them is doing much to procure answers to these sorts of questions, either.  Louder sigh. 

Here’s the story.   

by Kim Miller, Palm Beach Post

CitiMortgage, Inc., says it doesn’t owe back pay to the Law Offices of David J. Stern because the Plantation-based firm’s own “decisions, conduct, and/or negligence” caused its contract to be terminated.

Stern’s firm filed a breach of contract lawsuit against CitiMortgage last month in Miami-Dade County, claiming it is owed $4.4 million for work completed on the bank’s foreclosure cases.  CitiMortgage and the firm _ once one of the largest so-called “foreclosure mills” in the state _ had been doing business since about July 2009.

In a Thursday response to the suit, now removed to the United States District Court, Southern District of Florida, CitiMortgage complains that Stern’s firm made business promises that it broke when allegations of foreclosure-related wrongdoing surfaced and it was fired by federal mortgage backers Fannie Mae and Freddie Mac.

CitiMortgage also claims the bank’s own performance review of the firm in September found that it “falsely reported” that it had completed tasks on files that it had not.  The bank also filed a counterclaim against the firm in excess of $75,000.

“CitiMortgage has incurred, and continues to incur, costs and attorneys’ fees in connection with issues arising from plaintiff’s alleged or actual acts or omissions, performance, attempted performance, and/or handling of the matters referred by CitiMortgage to plaintiff,” the bank’s response says.

The costs include the reassignment of cases to new attorneys _ an ongoing problem in Florida’s foreclosure courts that was likely exacerbated by the shutdown of Stern’s foreclosure operations March 31.

On Thursday, Palm Beach County Chief Judge Peter Blanc sent out a cattle call of case management conference orders in cases where lawyers from Stern’s firm are still the attorneys of record.  Nearly 9,000 Palm Beach County foreclosures are in limbo following the collapse of the firm and subsequent attempt to transfer cases to new attorneys.  Blanc said today that he hasn’t heard any response yet from the orders.

“I believe Stern attorneys are still appearing in a sporadic manner,” Blanc said. “I have received nothing that would confirm that the office is now officially closed. Only time will tell.”

Mark Stopa

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