Alabama Case Filings — Wrongful Foreclosure After Bankruptcy Discharge By Deutsche Bank And AHMSI

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AMENDED ANSWER AND COUNTERCLAIM

COMES NOW, Defendant, by and through his attorneys of record and files his amended Answer and Counterclaim against Deutsche Bank National Trust Company as Trustee (Deutsche) and American Home Mortgage Servicing, Inc. (AHMSI) as follows:
1. All allegations of the original answer and counterclaim are asserted and incorporated as if fully set forth herein. This amendment is adding to the original answer and counterclaim – no claims or allegations are withdrawn.
2. This amended pleading is filed pursuant to Rule 15 and Rule 8.
3. Deutsche and AHMSI are considered “Debt Collectors” under the Fair Debt Collection Practices Act (FDCPA) as they bought the loan or were assigned the loan after it was allegedly in default.
4. The debt at issue was discharged by the Bankruptcy Court for the Northern District of Alabama.
5. At all relevant times AHMSI was acting as the agent for Deutsche.
6. AHMSI and Deutsche sought, on numerous occasions, by phone calls, letters, credit reporting, and other methods, to collect the debt that had been discharged.
7. One way that the AHMSI, acting on its own and in its capacity as the agent of Deutsche, attempted to illegally collect this discharged debt was by committing fraud upon Defendant, starting at least in May or June 2009.
8. AHMSI and the Deutsche represented to Defendant that Defendant could keep his home after the discharge by signing a so called “Security Retention Agreement” that was signed by Defendant on May 21, 2009.
9. This was a blatant attempt to illegally collect the discharged debt.
10. Put into this “new loan” were all sorts of illegal and bogus charges that were not approved by the Bankruptcy Court (one reason reaffirmation agreements are required to be handled under Bankruptcy Court supervision) and Defendant was told that if he made these payments he would own the house.
11. AHMSI and Deutsche never intended to allow Defendant to own his home.
12. The present intent when AHMSI and Deutsche made these representations to Defendant was that Defendant would not own the home as this was simply as scheme and design to wrench more money out of Defendant in an illegal attempt (successful) to collect on a discharged debt and the bogus charges and expenses that occurred during and after bankruptcy.
13. Defendant was deceived by Deutsche and AHMSI (who also hid the truth) in that this was represented to Defendant to be a proper and legal agreement and would benefit Defendant.
14. These misrepresentations and suppressions were of material facts – namely concerning the ability of Defendant to save his home and the legality of the agreement.
15. Defendant, an unsophisticated consumer, did not understand that he was being deceived and that AHMSI and Deutsche had suppressed the truth from him about its intentions and designs.
16. Defendant’s reliance upon Deutsche and AHMSI’s misrepresentations and suppressions of material facts was reasonable and justifiable.
17. Defendant has been damaged in that he signed this bogus and illegal agreement, made payments, had his credit report damaged by AHMSI’s credit reporting, been subject to emotional distress in that he believed he was saving his home when this was all an elaborate scheme to steal money from Defendant.
18. This is prohibited under the Court Order granting the discharge to Defendant.
19. This fraud continued through numerous phone calls and letters that are documented in the documents produced by Deutsche and AHMSI in this case related to collecting the nonexistent discharged debt.
20. AHMSI, at the request and with full approval of Deutsche, falsely credit reported that Defendant owed over a $100,000 to AHMSI and was late in paying this debt.
21. Defendant disputed, through Experian (one of the national Credit Reporting Agencies), the debt listed by AHMSI on his credit report.
22. Experian properly notified AHMSI in accordance with the Fair Credit Reporting Act (FCRA) of the dispute and that the account was allegedly discharged in bankruptcy.
23. AHMSI was required by the FCRA to properly and fully investigate this dispute.
24. AHMSI knew, prior to and at the time of its alleged investigation, that the debt was discharged and has known that for over a year.
25. Despite this knowledge, AHMSI updated and reported as recently as September 2010 to Experian that the loan was recently 150 days late.
26. This is false credit reporting as the loan was discharged over a year ago.
27. AHMSI has also falsely “re-aged” this debt to show the first date of major delinquency or other items which form the trigger for the 7 year reporting period, in 2010 instead of earlier when the debt was delinquent before it was discharged.
28. If AHMSI had conducted a reasonable investigation, it would have corrected the false credit reporting.
29. AHMSI has a policy to “park” its accounts on at least one of the consumer’s credit report. This is a term in the industry for keeping a false account on the credit report so that the consumer will be forced to pay off the balance in order to obtain a refinancing or to qualify for a loan or to increase the consumer’s credit score from the artificially lowered score which directly resulted from the AHMSI’s intentional and malicious conduct.
30. In parking an account, AHMSI knows it is violating its obligations and duties under federal law to accurately report the account, including the dates of delinquencies and the balance.
31. AHMSI knows that parking will lead to false and defamatory information being published every time Defendant’s credit report is accessed and this is the malicious and intentional design behind AHMSI’s actions with the goal to force Defendant to pay on a discharged debt.
32. The violation of the FCRA was done intentionally, maliciously, recklessly, wantonly, and/or negligently.
33. Despite the knowledge of AHMSI and Deutsche, multiple and repeated illegal attempts to collect a nonexistent debt were made by these parties.
34. The multiple incidents of illegal collection activities were not isolated.
35. Instead, Deutsche and AHMSI have a corporate policy of planning, scheming, and conspiring to target consumers who do not fully understand their rights under bankruptcy law, the FDCPA, the FCRA, and state law.
36. The objective of targeting these consumers is to force the consumers into paying for debts that do not exist.
37. The only legal and legitimate means a creditor has to collect on a discharged debt is if that discharged debt has been reaffirmed in a manner that the Bankruptcy Court approves.
38. Deutsche and AHMSI know (and knew at the time of their actions) that this discharged debt was never reaffirmed.
39. Deutsche and AHMSI know (and knew at the time of their actions) that it is illegal to make any efforts to collect this discharged debt.
40. Despite this knowledge, the plan of these parties was successfully carried out as they took advantage of an unsophisticated consumer.
41. The standard that applies in the FDCPA is the “least sophisticated consumer.”
42. By sharp contrast, these parties are some of the largest companies in this country and have extensive and widespread experience with bankruptcy, mortgage issues, debt collection, and credit reporting.
43. These companies know the law but willfully, maliciously, wantonly, recklessly, negligently or otherwise violated these laws to carry out the illegal purpose of collecting money to which these parties had no right to collect.
44. These parties have expressed absolutely no remorse for the way in which they have treated Defendant, an unsophisticated consumer, and this lack of apology or remorse will continue throughout this case with further denials of their wrongdoing instead of admitting the illegal collection activities.
45. Congress found it necessary to pass the FDCPA due to rampant abusive practices by dishonorable debt collectors. 15 USC § 1692 is entitled “Congressional findings and declaration of purpose” and it states as follows:
(a) There is abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors. Abusive debt collection practices contribute to the number of personal bankruptcies, to marital instability, to the loss of jobs, and to invasions of individual privacy.
(b) Existing laws and procedures for redressing these injuries are inadequate to protect consumers.
(c) Means other than misrepresentation or other abusive debt collection practices are available for the effective collection of debts.
(d) Abusive debt collection practices are carried on to a substantial extent in interstate commerce and through means and instrumentalities of such commerce. Even where abusive debt collection practices are purely intrastate in character, they nevertheless directly affect interstate com-merce.
(e) It is the purpose of this title to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt col¬lection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.

[Emphasis added].

46. Defendant incurred a financial obligation that was primarily for personal, family or household purposes (Defendant’s home loan) and is therefore a “debt” as that term is defined by 15 U.S.C. § 1692a(5).
47. Deutsche and AHMSI are considered a “debt collector” under the FDCPA and began engaging in debt collection activities against Defendant.
48. Deutsche and AHMSI failed to make all required disclosures to Defendant in violation of the FDCPA.
49. Misrepresentations were made regarding the character, amount, or legal status of the debt.
50. The amount of the debt, the existence of the debt, the amount of fees and charges, were incorrect and not supported by the law and by the note and mortgage.
51. The foreclosure was illegal and constituted a threat to take action which Deutsche and AHMSI were not legally entitled to take.
52. Deutsche and AHMSI used false representations and/or deceptive means to collect on this debt.
53. The collection methods employed by Deutsche and AHMSI were harassing and illegal.
54. As debt collectors, Deutsche and AHMSI are prohibited from engaging in any illegal conduct described in the FDCPA, including, but not limited to:
a. Threatening or taking any action that cannot be legally taken;
b. Using false representations and/or deceptive means to collect on a debt;
c. Charging fees, expenses, and other items that are not allowed by law;
d. False credit reporting;
e. Using harassing or unfair means to collect the discharged debt; and
f. Failing to make all required disclosures and notifications to Defendant.
55. As both Deutsche and AHMSI are debt collectors, they are each responsible for violations of the FDCPA by each other.
56. As both Deutsche and AHMSI at all times acted as the agent for each other, they are responsible for each other’s wrongful conduct as all such conduct occurred within the line and scope of their agency relationship.
57. The wrongful acts of the Deutsche and AHMSI proximately caused serious past and future injuries and damages to Defendant and all damages that flowed from the wrongful conduct was foreseeable to Deutsche and AHMSI who undertook the wrongful acts without any concern for the impact on Defendant.
58. This same conduct by Deutsche and AHMSI has been committed against numerous other consumers who are in the same or similar circumstances as Defendant.
59. Defendant claims all damages and relief allowable by law and equity.
60. All causes of action and counts are realleged as if fully set forth herein.
61. Three new causes of action and counts are pled as follows:

COUNT THIRTEEN VIOLATIONS OF THE FAIR DEBT COLLECTION PRACTICES ACT 15 U.S.C. § 1692 et seq.

62. Defendant incorporates by reference all of the above paragraphs of this Complaint as though fully stated herein.
63. The acts and omissions of Deutsche and AHMSI and their agents constitute numerous and multiple violations of the FDCPA with respect to Defendant.
64. As a result of the violations of the FDCPA, Defendant is entitled to actual damages pursuant to 15 U.S.C. § 1692k(a)(1); statutory damages in an amount up to $1,000.00 pursuant to 15 U.S.C. § 1692k(a)(2)(A); (2) actual and compensatory damages; and, (3) reasonable attorney’s fees and costs pursuant to 15 U.S.C. § 1692k(a)(3), from the Deutsche and AHMSI.

COUNT FOURTEEN MISREPRESENTATIONS AND SUPPRESSIONS OF MATERIAL FACTS
65. All paragraphs of this Complaint are expressly adopted and incorporated herein as if fully set forth herein.
66. One way that the AHMSI, acting on its own and in its capacity as the agent of Deutsche, attempted to illegally collect this discharged debt was by committing fraud upon Defendant, starting at least in May or June 2009.
67. AHMSI and the Deutsche represented to Defendant that Defendant could keep his home after the discharge by signing a so called “Security Retention Agreement” that was signed by Defendant on May 21, 2009.
68. This was a blatant attempt to illegally collect the discharged debt.
69. Put into this “new loan” were all sorts of illegal and bogus charges that were not approved by the Bankruptcy Court (one reason reaffirmation agreements are required to be handled under Bankruptcy Court supervision) and Defendant was told that if he made these payments he would own the house.
70. AHMSI and Deutsche never intended to allow Defendant to own his home.
71. The present intent when AHMSI and Deutsche made these representations to Defendant was that Defendant would not own the home as this was simply as scheme and design to wrench more money out of Defendant in an illegal attempt (successful) to collect on a discharged debt and the bogus charges and expenses that occurred before, during and after bankruptcy.
72. Defendant was deceived by Deutsche and AHMSI (who also hid the truth) in that this was represented to Defendant to be a proper and legal agreement and would benefit Defendant.
73. These misrepresentations and suppressions were of material facts – namely concerning the ability of Defendant to save his home and the legality of the agreement and the charges, expenses, and fees added into the agreement.
74. Defendant, an unsophisticated consumer, did not understand that he was being deceived and that AHMSI and Deutsche had suppressed the truth from him about its intentions and designs.
75. Defendant’s reliance upon Deutsche and AHMSI’s misrepresentations and suppressions of material facts was reasonable and justifiable.
76. Defendant has been damaged in that he signed this bogus and illegal agreement, made payments, had his credit report damaged by AHMSI’s credit reporting, been subject to emotional distress in that he believed he was saving his home and signing a legal valid agreement when this was all an elaborate scheme to steal money from Defendant.
77. This fraud continued through numerous phone calls and letters that are documented in the documents produced by Deutsche and AHMSI in this case related to collecting the nonexistent discharged debt.
78. The fraud was committed intentionally, recklessly, maliciously, wantonly, negligently, and/or innocently.

COUNT FIFTEEN VIOLATION OF THE FAIR CREDIT REPORTING ACT 15 U.S.C. SECTION 1681
79. All paragraphs of this Complaint are expressly adopted and incorporated herein as if fully set forth herein.
80. AHMSI is a “furnisher” as it is an entity who, regularly and in the course of business, furnishes information to one or more consumer reporting agencies about its transactions or experiences with any consumer 81. Defendant notified Experian directly of a dispute on the AHMSI account’s completeness and/or accuracy, as reported.
82. Experian properly notified AHMSI of Defendant’s dispute in accordance with the FCRA requirements.
83. AHMSI failed to delete information found to be inaccurate, reinserted the information without following the FCRA, or failed to properly investigate Defendant’s disputes.
84. Defendant alleges that at all relevant times AHMSI failed to conduct a proper and lawful reinvestigation.
85. All actions taken by AHMSI were done with malice, were done willfully, and were done with either the desire to harm Defendant and/or with the knowledge that its actions would very likely harm Defendant and/or that its actions were taken in violation of the FCRA and/or that knew or should have known that its actions were in reckless disregard of the FCRA.
86. All of the violations of the FCRA proximately caused the injuries and damages set forth in this answer and counterclaim.

RELIEF REQUESTED
WHEREFORE, Defendant having set forth his claims for relief against the Mortgage Companies, respectfully prays of the Court as follows:
• That Defendant have and recover against AHMSI and Deutsche a sum to be determined by a jury of his peers in the form of actual damages;
• That Defendant have and recover against AHMSI and Deutsche a sum to be determined by a jury of his peers in the form of statutory damages • That Defendant have and recover against AHMSI and Deutsche a sum to be determined by a jury of his peers in the form of punitive damages;
• That Defendant have and recover against AHMSI and Deutsche reasonable attorney fees , costs, and expenses; and
• That the foreclosure sale be set aside; and • That Defendant have such other and further and proper relief as the Court may deem just and proper.

Respectfully Submitted,

/s/ John G. Watts
John G. Watts (WAT056)
Attorney for Defendant
OF COUNSEL:
Watts Law Group, PC The Kress Building 301 19th Street North Birmingham, Alabama 35203 (205) 879-2447 (888) 522-7167 facsimile john@wattslawgroup.com
/s/ M. Stan Herring
M. Stan Herring (HER037)
Attorney for Defendant
OF COUNSEL:
M. Stan Herring, P.C.
The Kress Building 301 19th Street North Birmingham, Alabama 35203 (205) 714-4443 (888) 522-7167 facsimile msh@mstanherringlaw.com

DEFENDANT DEMANDS A TRIAL BY JURY

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