Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 1 of 31

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 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 2 of 31

TABLEOFCONTENTS

PREL
IMINARYSTATEMENT
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..1

BACKGROUND
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..3

A
. S&Aand1
stF
ide
li
typu
rch
asedind
ividu
allo
ansf
romCh
ase
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.3

B
. S
chn
eid
era
skedtopu
rch
aseth
e“w
ors
tofth
ewo
rst
”ofCh
ase
’slo
ans
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..4

1
. S
chn
eid
er’
sdu
edi
lig
enc
eonth
eNov
emb
erD
ataT
ape
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..4

2
. S
chne
ide
r’sf
indingthat5,000ou
tof6,000loansontheNov ember
D
ataTap
elackedint
actfi
rstli
ens
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.4

C
. Schn
eide
rpurchas
ed3,500loansfromtheNov emberD a
taT apefora
“nomin
alpr
ice.
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D
. P
lain
ti
ffs
’po
st-MLPAcondu
ctr
efu
testh
eirc
laim
s..
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..6

1
. S
chn
eid
ersough
ttor
epe
atth
e MLPAd
ealn
inemon
thsl
ate
r.
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.6

2
. Ch
aseg
aveS
chn
eid
erth
elo
anin
form
at
ionh
erequ
est
ed.
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.7

3
. S
chn
eid
err
equ
est
edlo
ana
ssignm
ent
sonac
ase
-by
-ca
seb
asi
s.
...
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..8

4
. Ch
aser
emed
iedm
is
tak
end
ebtfo
rgiv
ene
ssl
ett
ersandl
ienr
ele
ase
s.
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.8

E
. P
lain
ti
ffsb
ela
ted
lyfi
ledth
isl
awsu
it
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LEGALSTANDARD
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ARGUMENT
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..10

I
. MRSI
sNo
tEn
ti
tledToSumm
aryJudgm
ent
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.10

A
. L
iens
tatu
s..
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.10

B
. Lo
anin
form
ation
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.14

C
. Lo
ana
ssignm
ent
s.
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.16

D
. Lo
anb
alan
ces
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..18

E
. L
ienr
ele
ase
s.
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.19

F
. R
eten
tiono
fpaym
ent
s..
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.20

G
. Own
ersh
ipo
flo
ans
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.21
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 3 of 31

I
I. S&AAnd1
stF
ide
li
tyA
reNo
tEn
ti
tledToSumm
aryJudgm
ent
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.22

A
. D
ebtfo
rgiv
ene
ssl
ett
ers
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..22

B
. L
ienr
ele
ase
s.
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.24

C
. R
eten
tiono
fpaym
ent
s..
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.24

CONCLUS
ION
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..25

i
i
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 4 of 31

TABLEOFAUTHOR
ITIES

C
ase
s Pag
e(s
)

Ada
sa rGrp
.,In
c.v.NetComSol
s.In
t’
l,In
c.,
2003 WL1107670(S.D
.N.Y
.M ar
.13,2003
).
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.12

A
lte
rnat
ivesFed.Cred
itUn
ionv
.Olb
ios
,LLC,
787N.Y.S
.2d508(N.Y
.App
.Div
.2005
)..
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.12

Au
ro raLoan
sServ
s.
,In
c.v.Posne
r,Posner&A ssocs
.,P.C.,
513F.Supp
.2d18(S.D
.N.Y.2007
)..
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.22

Ch
rist
ianDio
r-NewYo
rk,Inc
.v.Koret
,Inc.,
792F
.2d34(2dCi
r.1986
).
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.14
,17

Con
fidoAdvi
sors
,LLCv .USAARea
lE s
tat
eCo.,
2018 WL4265900(S
.D.N
.Y.Sep
t.6,2018
).
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.19

CTChem
s.(U
.S.A.
),In
c.v .InmarImpex,Inc
.,
597N.Y
.S.2d284(1993)
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..17

Da
llasAe
rospa
ce,In
c.v
.CISAirCorp.,
352F
.3d775(2dCi
r.2003
).
..
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.9

D
eCarlov
.Arch
ieComicPub
l’ns
,Inc
.,
127F.Supp
.2d497(S
.D.N.Y.2001
).
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.13

D
enburgv
.Pa rk
erChap
inFlat
tau&K limpl,
624N.E.2d995(N
.Y.1993)
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..23

D
ynCorpv
.GTECo rp
.,
215F.Supp
.2d308(S
.D.N
.Y.2002
).
..
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.10

E
cheva
rriav
.158thSt.R
ive
rsid
eDri
veHous.Co.,
979N .Y
.S.2d294(N
.Y.App.D
iv.2014
)..
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.13

F
ergu
sonv
.LionHold
ing,In
c.,
478F
.Supp.2d455(S.D
.N.Y.2007
).
..
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.19

F
ischer& Mand
ell
,LLPv.Cit
ibank
,N .A
.,
632F
.3d793(2dCi
r.2011)
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..19

FPP
,LLCv.XaxisUS,LLC,
2016 WL5477768(S
.D.N
.Y.S
ept
.29
,2016
)(Sw
ain
,J.
)..
..
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..13

Haa
sv .D
el
.&HudsonRy
.Co.,
282F
.App
’x84(2dC
ir.2008
)..
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21

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 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 5 of 31

Johnsonv.Ki
ll
ian,
680F.3d234(2dC
ir
.2012
).
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.9

Kad
e rv
.Pap e
rSoftwa
re,In
c.,
111F.3d337(2dCi
r.1997
).
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.19

L
exington360As
socs
.v.Fi
rstUn
ionNat
.BankofN.Ca rol
ina,
651N.Y.S
.2d490(N.Y
.App.Div
.1996
)..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.19
,23

Lu
janv.Cabana Mgmt
.,Inc
.,
284F
.R.D.50(E.D
.N .Y
.2012
).
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
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..
..
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..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..21

M
ellonBan
k,N.A
.v.Un
itedBankCorp.ofN.Y.,
31F
.3d113(2dC
ir
.1994)
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
...
..
..
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..
..
..
..
..
..
..
..
..
..
..
..
..
..
..13

M
ick
lev
.Chr
is
tie
’s
,In
c.,
207F
.Supp
.2d237(S
.D.N
.Y.2002
).
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
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..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.20

P
rof
ex,In
c.v.TownofFish
kil
l,
883N.Y.S.2d912(N
.Y.App.D
iv.2009
)..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.24

R
.Dwigh
tHarrisv
.Roya
lChrys
ler
/Oneon
taInc
.,
657N.Y
.S.2d847(N
.Y.App
.D iv
.1997
)..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.12

Un
itedSta
tesexre
l.S
chneid
erv.J
.P. MorganCha seBank,N.A.,
No
.14-1047(D.D
.C.2018)
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.20

ShawG roupIn
c.v.Tr
ipl
efin
eInt
’lC o
rp.,
322F.3d115(2dCi
r.2003)
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
...
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..11

Wo
lf
fv .Rar
eM ed
ium
,Inc.,
210F.Supp
.2d490(S.D
.N.Y
.2002
).
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
..
.15
,23

iv
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 6 of 31

JPMo
rganCh
aseB
ank
,N.A
.,ind
ividu
allyanda
ssu
cce
sso
rbym
erg
ertoCh
aseHom
e

F
inan
ceLLC
,andD
efend
antJPMo
rganCh
ase&Co
.(co
lle
ctiv
ely
,“Ch
ase
”),subm
itth
is

m
emo
randuminoppo
si
tiontoP
lain
ti
ffs Mo
rtg
ageR
eso
lut
ionS
erv
ice
s,LLC(
“MRS
”),1
st

F
ide
li
tyLo
anS
erv
icing
,LLC(
“1s
tFid
eli
ty”
),andS&AC
api
talP
artn
ers
,In
c.’
s(“S&A
”) Mo
tion

fo
rSumm
aryJudgm
entonL
iab
il
itya
stoP
lain
ti
ffs
’Br
eacho
fCon
tra
ctC
laim
s.

PREL
IMINARYSTATEMENT

P
lain
ti
ffss
eeksumm
aryjudgm
entr
ega
rdingth
eirc
laim
sth
atCh
aseb
rea
ched(1
)a

F
ebru
ary2009 Mo
rtg
ageLo
anPu
rcha
seAg
reem
ent(
“MLPA
”)w
ith MR
Sbyf
ail
ingtod
eliv
er

th
etyp
eso
flo
ansandlo
ando
cum
ent
ationa
lleg
edlyr
equ
iredun
derth
atag
reem
ent
,and(2
)lo
an

pu
rch
asecon
tra
ctsw
itha
llth
reeP
la
int
if
fsbym
is
tak
enlyr
ele
asingl
ien
sands
end
ingd
ebt

fo
rgiv
ene
ssl
ett
ersonc
ert
ainl
oan
spr
eviou
slyso
ldtoP
lain
tif
fs
.Ma
ter
iald
ispu
teso
ffa
ct

p
rec
lud
esumm
aryjudgm
entonbo
ths
etso
fcl
aim
s.

A
sath
resho
ld m
at
ter
,Pl
ain
ti
ffs
’pr
inc
ipa
lbr
eacho
fcon
tra
ctc
la
ims—
tha
tCh
asef
ai
ledto

d
eliv
erlo
ansandlo
ando
cum
ent
sth
atcon
form
edtoth
erequ
irem
ent
softh
e MLPA—
aret
ime
-

b
arr
ed.A
sCh
aseexp
lain
edini
tsJu
ly2018m
otionfo
rsumm
aryjudgm
ent
,ev
eni
fitw
eret
rue

th
atCh
aseb
rea
chedi
tsa
ll
egedob
lig
at
ion
stop
rov
idecon
form
inglo
ansandlo
anin
form
at
ionto

MRS
,th
eal
leg
edb
rea
che
soc
cur
redinF
ebru
ary2009
,wh
enth
eMLPAw
asex
ecu
ted
.Pl
ain
ti
ffs

th
enw
ait
edov
erf
ivey
ear
sun
ti
lDe
cem
ber2014tof
ileth
isl
awsu
it
.Pl
ain
ti
ffs
’pr
inc
ipa
lbr
each

o
fcon
tra
ctc
laim
sar
eth
ere
foreb
arr
edbyth
eapp
lic
abl
efiv
e-y
ears
tatu
teo
flim
it
ation
s.S
ee Dk
t.

303
.Inadd
it
ion
,al
lofP
lain
ti
ffs
’br
eacho
fcon
tra
ctc
laim
sfa
ila
sam
at
tero
flawb
ecau
se

P
lain
ti
ffsl
ackanyadm
iss
ibl
eevid
enc
eth
atth
eyw
ered
amag
edbyth
eal
leg
edb
rea
che
s.S
ee

Dk
t.361
.Ac
cord
ing
ly,th
eCou
rtn
eedno
tre
achth
ein
stan
tmo
tionfo
rpa
rt
ialsumm
ary

judgm
entth
atCh
asei
sli
abl
efo
rbr
eacho
fcon
tra
ct
.

1
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 7 of 31

I
fth
eCou
rtn
eve
rth
ele
sscon
sid
ersP
lain
ti
ffs
’mo
tion
,th
emo
tionshou
ldb
eden
ied
.

A
lthoughP
lain
ti
ffscon
tendth
atCha
seb
rea
chedana
lleg
edob
li
gat
ionund
erth
e MLPAto

d
eliv
er3
,529lo
anss
ecu
redbyin
tac
tmo
rtg
agel
ien
s,th
atcon
ten
tioncon
fl
ict
swi
thth
epl
ain

l
angu
ageo
fth
e MLPA
,wh
ichp
rov
ide
dth
atth
elo
answou
ldb
e“n
onp
erf
orm
ingand
/or

impa
ired
.” Th
ete
rm“
imp
air
ed”exp
res
sedth
epa
rt
ies
’und
ers
tand
ingth
atth
eli
ensonth
e

r
elev
antlo
ansm
igh
tnolong
erb
ein
tac
t. Anyo
the
rin
terp
ret
at
iono
f“im
pai
red
”wou
lds
tr
ipth
at

t
ermo
fanyind
epend
entm
ean
ingi
nth
e MLPA
,inv
iol
ationo
fse
ttl
edp
rin
cip
leso
fNewYo
rk

l
aw. Fu
rth
erm
ore
,Pl
ain
ti
ffs
’as
ser
tionth
atth
e MLPAlo
answ
eresuppo
sedtocon
sis
tso
lelyo
f

lo
anss
ecu
redbyin
tac
tmo
rtg
agel
ien
sisb
eli
edbyth
eirc
lea
randcon
tempo
ran
eou
sadm
iss
ion
s

th
atth
e MLPAlo
answou
ldin
clud
e“bo
ths
ecu
reandun
secu
relo
ans
.”C
has
eSOF¶49(quo
ting

P
lain
ti
ffs
’pr
inc
ipa
l,L
aur
enc
eSchn
eid
er)
. Summ
aryjudgm
ents
hou
ldth
ere
for
ebed
eni
eda
sto

P
lain
ti
ffs
’cl
aimth
atCh
aseb
rea
chedth
e MLPAbyf
ail
ingtod
eliv
erlo
answ
ithin
tac
tmo
rtg
age

l
ien
s.

Summ
aryjudgm
entl
ikew
iseshou
ldb
eden
iedonP
lain
ti
ffs
’cl
aimth
atCh
aseb
rea
chedan

a
lleg
edob
lig
ationtod
eliv
erc
ert
ainlo
anin
form
at
ionandlo
ana
ssignm
ent
sto MRS
. Con
sis
ten
t

w
ithth
e MLPA
’sb
arg
ain
-bas
emen
tpu
rch
asep
ric
e—on
ly$200
,000f
orlo
answ
ithunp
aid

b
alan
cesinex
ces
sof$156 m
il
lion—MRSa
ssum
edth
eri
sko
fre
ceiv
ingin
com
ple
tein
form
at
ion

onth
e MLPAlo
ans
. Nop
rov
is
iono
fth
e MLPAr
equ
iredCh
asetod
eliv
eranyp
art
icu
lars
eto
f

lo
anf
ile
sorlo
ana
ssignm
ent
sto MRS
.Ra
the
r,th
eon
lylo
ani
nfo
rma
tionr
equ
iredund
erth
e

MLPAw
asou
ts
tand
ingb
alan
ceinfo
rma
tion
,wh
ichCh
asep
rov
ided
. Th
edi
scov
eryr
eco
rda
lso

show
sth
at(
i) MRSexp
res
slyag
reedtor
equ
estlo
ando
cum
ent
sanda
ssignm
ent
sonth
e MLPA

lo
anson
lyonan“
as-n
eed
ed,
”lo
an-by
-lo
anb
asi
s,and(
ii
)Ch
asep
rov
ided MRSw
ithth
e

2
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 8 of 31

do
cum
ent
sanda
ssignm
ent
sitr
equ
est
ed.A
cco
rding
ly,summ
aryjudgm
entshou
ldb
eden
iedon

th
esec
laim
sasw
ell
.

P
la
int
if
fsf
arenob
ett
eronth
eirr
ema
iningc
laim
sth
atCh
ase
(i)m
is
tak
enlyr
ele
asedl
ien
s

ands
entd
ebtfo
rgiv
ene
ssl
ett
ersonc
ert
ainlo
ansso
ldtoP
lai
nt
if
fsand(
ii
)im
prop
erlyr
eta
ined

p
aym
ent
sitr
ece
ivedonc
ert
ainlo
ansa
fte
rth
elo
answ
ereso
ld.P
lain
ti
ffsa
reun
abl
etopo
intto

anycon
tra
ctp
rov
is
iona
lleg
edl
ybr
each
edbyth
emi
stak
enl
ienr
ele
ase
sandd
ebtfo
rgiv
ene
ss

l
ett
ers
. No
rcanth
eypo
inttoa
nyev
iden
ceth
atth
eysu
ffe
redd
amag
esa
sar
esu
lto
ftho
se

m
is
tak
eso
rth
atth
est
epsCh
asetooktor
emedyi
tsm
is
tak
esw
erein
suf
fic
ien
t. Th
ati
s

p
resum
ablywhyP
lain
ti
ffs
’dam
age
sexp
ertn
eve
rev
ena
ttemp
tedtoqu
ant
ifyanyd
amag
es

r
ela
tingtol
ienr
ele
ase
sord
ebtfo
rgiv
ene
ssl
ett
ers
.Fin
ally
,Pl
ain
ti
ffs
’cl
aimth
atCh
ase

im
prop
erlyr
eta
inedlo
anp
aym
ent
sonlo
ansa
cqu
iredbyP
lain
ti
ffsf
ail
sbe
cau
seP
lain
ti
ffsl
ack

anyev
iden
ceth
atCh
aseev
err
ece
ive
dorr
eta
inedsu
chp
aym
ent
s.

Fo
rth
eser
eason
sandth
eadd
it
ion
alr
eason
sse
tfo
rthb
elow
,Pl
ain
ti
ffsh
avef
ail
edto

d
emon
str
ateth
eab
sen
ceo
fa m
ate
ria
ldi
spu
teo
ffa
cta
stoanyo
fth
eircon
tra
ctc
laim
s.

BACKGROUND

L
aur
enc
eSchn
eid
eri
sth
epr
ima
ryown
erandop
era
toro
fth
eth
reeP
la
int
if
fen
ti
tie
sinth
is

a
ction
: MRS
,S&A
,and1
stF
ide
li
ty. Ch
ase
’sR
espon
sestoP
la
int
if
fs’S
tat
emen
tofF
act
s

(
“Ch
aseSOF
”)¶161
.

A
. S&Aand1
stF
ide
li
typu
rcha
sedind
ividua
lloan
sfromCha
se.

B
etw
een2005and2010
,Ch
asem
adeapp
rox
ima
tely1
,000on
e-o
fflo
ans
ale
stoS&Aand

1
stF
ide
li
ty. Ch
aseSOF¶28
. Pl
ain
ti
ffsa
cknow
ledg
eth
atCh
ase“
alw
aysp
erfo
rmeda
sag
reed

wh
ens
ell
inglo
anstoS&Aand1
stF
ide
li
ty.
”Pl
.SOF(Dk
t.351
)¶61
.Pl
ain
ti
ffs
’dam
age
s

exp
ert
,Je
ff
reyAnd
rien
,ha
sno
tat
temp
tedtoqu
ant
ifyanyd
ama
gesa
lleg
edlyin
cur
redbyS&A

o
r1s
tFid
eli
ty. Ch
aseSOF¶189
.

3
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 9 of 31

B
. S
chn
eid
era
skedtopu
rcha
seth
e“w
ors
tofth
ewo
rst”o
fCha
se’
sloan
s.

Inth
efa
llo
f2008
,Schn
eid
erapp
roa
chedCh
asetobuyapoo
loflo
ans
. Ch
aseSOF¶43
.

OnO
ctob
er8
,2008
,heto
ldanow
-de
cea
sedCh
aseem
ploy
ee,Edd
ieGu
err
ero
:“Iams
eriou
sly

look
ingin
tobuy
ingth
ewo
rsto
fth
ewo
rstlo
ansfo
ran
ewg
rou
pofinv
esto
rsth
atIh
aveb
een

t
alk
ingto
.” Ch
aseSOF¶43
.Asp
arto
fhi
sof
fer
,Schn
eid
erag
reedto“
scrub
”al
is
tofd
efau
lted

lo
ansfo
rli
end
efe
ctsi
fher
ece
ivedar
igh
toff
irs
tre
fus
alonth
eirs
ale
. Ch
aseSOF¶
¶44–45
.

1
. S
chn
eid
er’
sdu
edi
lig
enc
eonth
eNov
emb
erDa
taTap
e

OnNov
emb
er5
,2008
,Gu
err
eros
entS
chn
eid
erasp
read
she
etl
is
tingabou
t6,000lo
ans

(
the“Nov
emb
erD
ataT
ape
”).C
has
eSOF¶49
. Th
elo
answ
eret
akenf
romCh
ase
’sd
atab
aseo
f

d
efau
ltedlo
ansfo
rwh
ichCh
aseh
add
ete
rmin
edth
atth
erew
asze
rofo
rec
losu
rev
alu
e. Ch
ase

SOF¶168
.Al
thoughth
elo
anso
rig
ina
llyw
eres
ecu
redbyin
tac
tmo
rtg
agel
ien
s,S
chn
eid
er’
s

t
askw
astod
ete
rmin
ewh
eth
erth
eli
ensh
ads
inc
ebe
com
eimp
air
ed. Ch
aseSOF¶49(d
iscu
ssing

“
lienv
eri
fic
ation
”pro
jec
t)
.Schn
eid
erp
rom
isedth
ath
ewou
lddo“
atho
roughjob
”and

“d
efin
ite
lyid
ent
ify
”wh
eth
ere
achlo
aninth
eNov
emb
erD
ataT
apeh
ada“v
alidl
ien
”orw
as

“un
secu
re.
” Ch
aseSOF¶52
.

2
. Schne
ide
r’sf
indingthat5
,000outo
f6,000loan
sonth
eNov
embe
r
DataTap
elackedinta
ctfi
rstl
ien
s

T
ruetoh
iswo
rd,S
chn
eid
erconduc
tedas
ear
chingr
evi
ewo
fth
e Nov
emb
erD
ataT
ape

lo
ans
. Ch
aseSOF¶52
.Heandh
isem
ploy
ees“
inv
est
edov
er10
00hou
rs”ind
ete
rmin
ing

wh
eth
ere
achlo
anw
ass
ecu
redorun
secu
red
. Ch
aseSOF¶64(d
esc
rib
ingS
chn
eid
er’
s

“
tho
rough
”du
edi
lig
enc
ean
aly
sis
).S
chn
eid
erd
iscov
eredth
atm
ostd
idno
thav
ein
tac
tli
ens
.

Ch
aseSOF¶49
.Heto
ldCh
aseth
at“5ou
tof6lo
ans
”ei
the
rwe
reun
secu
redo
rhads
econd

l
ien
s,andth
at“on
lyabou
t1000
”ofth
e6,000lo
ansonth
eda
tat
ape“w
il
lbet
ruef
ir
stl
ien

4
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 10 of 31

s
ecu
redf
ile
s.” Ch
aseSOF¶60
;se
eal
soid
.¶49(quo
tingS
chn
eid
ert
ha
t“abou
t95%o
fth
epoo
l

i
stru
lyun
secu
redandju
stahug
epo
ten
tia
lli
abi
li
ty”
).

C
. Schn
eide
rpurcha
sed3
,500loan
sfromth
eNov
emb
erDa
taTap
efo
ra
“nomina
lpr
ice
.”

D
esp
itecon
clud
ingth
atf
ive
-six
thso
fth
e6,000lo
ansonth
eNov
emb
erD
ataT
apel
ack
ed

in
tac
tfi
rstl
ien
s,S
chn
eid
ero
ffe
redtobuya
ll6
,000lo
ansfo
r“anom
ina
lpr
ice
,$100
,000
.” Ch
ase

SOF¶57(
cit
ingNov
emb
er19
,2008of
fer
). Ch
asecoun
ter
edw
ithano
ffe
rtos
ellasub
seto
fth
e

lo
ansfo
r$200
,000
. Ch
aseSOF¶57
.Schn
eid
erag
reed
,andh
ecr
eat
edan
ewco
rpo
rat
een
ti
ty,

MRS
,toa
cqu
ireth
elo
ansdu
etoth
e“d
ete
rio
rat
edund
erly
inga
sse
tsw
ith
inth
epoo
l.
” Ch
ase

SOF¶166(quo
tingS
chn
eid
erd
epo
si
tion
).

S
chn
eid
err
epe
ated
lyp
res
sedCh
asetoc
los
eth
ede
alqu
ick
ly.Ch
aseSOF¶165
. Toth
at

end
,hesough
ttor
eas
sur
eCh
aseth
ath
efu
llyund
ers
toodwh
ath
ewa
spu
rch
asing
,te
ll
ingCh
ase

onJ
anu
ary28
,2009th
at:

Iund e
rstandthattheloansarenonp e
rfo
rm ing
,bo ths ecur
eand
uns
ecurel oans and that the
rea re no buyb ack
s,c r
edi
ts,
rep
resen
ta t
ionso rw a
rran
tie
sa st otheinform a
tion, qua
li
ty or
ava
ilab
il
itya stoanyoftheco
l l
ate
raldo
cumen ta
tionwh a
t so
ever
.

...W eknowexac
tlywha
tw ea
rege
tt
inginth
isloanpoo
landhav
e
compl
etedourdu
edil
ige
nceandwea
rewill
ingtos
ignany
thin
gtha
t
youpu
tinfronto
fu s
.

Ch
aseSOF¶87(
emph
asi
sadd
ed)
.

OnF
ebru
ary25
,2009
,th
epa
rt
iesex
ecu
teda“Mo
rtg
ageLo
anPu
rch
aseAg
reem
ent
”

(
“MLPA
”).P
l.Ex
.55
. Und
erth
e MLPA
, MRSp
aid$200
,000fo
r3,529lo
answ
ithto
tallo
an

b
alan
ceso
f$156
,324
,399—
apu
rch
asep
ric
eofs
ligh
tlym
oreth
anat
entho
fap
ennyp
erdo
lla
rof
1
unp
aidlo
anb
alan
ce. MLPA§1(P
l.Ex
.55
). A
llo
fth
elo
answ
ered
raw
nfromth
e6,000lo
ans

1
“P
l.Ex
.”r
efe
rstoexh
ibi
tsa
ccom
pany
ingP
lain
ti
ffs
’mo
tion
,atdo
cke
ten
try353
.

5
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 11 of 31

inth
eNov
emb
erD
ataT
ape
,ju
sta
sSchn
eid
erexp
ect
ed. Ch
aseS
OF¶44(quo
tingS
chn
eid
er

d
ecl
ara
tionth
ati
twa
sth
e“int
ento
fbo
thp
art
ies
”th
atth
eMLPAlo
answou
ldb
edr
awn

ex
clu
siv
elyf
romth
eNov
emb
erD
ataT
ape
);s
eea
lsoP
l.SOF¶60(
acknow
ledg
ingth
atth
e

p
art
iesin
tend
edth
e MLPAtoconv
eyapo
rt
iono
fth
eNov
emb
erD
ataT
apelo
ans
).

Th
e MLPAd
esc
rib
edth
elo
ansb
eingconv
eyeda
s“c
ert
ainnonp
erf
orm
ingand
/or

impa
ired
”mo
rtg
agelo
ansth
at“
areo
rhav
ebe
end
elinqu
entfo
r180d
ayso
rmo
reandh
aveb
een

o
rmayo
the
rwi
seb
eind
efau
lt
.” MLPA
,pr
eam
ble(P
l.Ex
.55
)(em
pha
sisadd
ed)
. Th
emod
if
ier

“
imp
air
ed”m
ean
tth
atth
emo
rtg
agel
ien
smigh
tnolong
erb
ein
tac
t,anund
ers
tand
ingth
at

S
chn
eid
erd
idno
tdi
spu
tefo
rye
ars
. Ch
aseSOF¶169
. Sub
jec
ttoc
ert
ainex
cep
tion
s, MRS

ag
reedth
ati
twa
sacqu
ir
ingth
elo
ans“ASIS
,”w
ith“NORECOURSEwh
atso
eve
r.” MLPA

§§4
,6(P
l.Ex
.55
). MRSexp
res
slya
cknow
ledg
edth
ati
t“h
adanoppo
rtun
itytocondu
ctadu
e

d
il
igen
cer
evi
ewo
fea
ch Mo
rtg
ageL
oan
.” MLPA§4(P
l.Ex
.55
).

D
. P
lain
ti
ffs
’po
st-MLPAcondu
ctr
efu
testh
eirc
laim
s.

Th
epa
rt
ies
’condu
ctfo
llow
ingth
eex
ecu
tiono
fth
e MLPAcon
fl
ict
swi
thP
lain
ti
ffs
’

c
laim
sins
eve
ralr
esp
ect
s.

1
. S
chn
eid
ersough
ttor
epea
tth
e MLPAd
ealn
ine mon
thsla
ter
.

S
chn
eid
erw
assop
lea
sedw
ithth
e MLPAth
ath
eask
edCh
asetoen
terano
the
r“s
imi
lar
”

d
ealn
inemon
thsl
ate
r. Ch
aseSOF¶174
. On
ceag
ain
,Schn
eid
ero
ffe
redtodo“du
edi
lig
enc
e”

onalo
anpoo
l,a
fte
rwh
ichh
ewou
ldo
ffe
rtobuy“wh
atev
erlo
ansa
reinth
epoo
l,wh
eth
ers
ecu
re

o
run
secu
reund
erth
esam
ete
rmso
f‘nobuyb
ack
sfo
ranyr
easonwh
atso
eve
r’and‘
anylo
an

n
eed
edtob
epu
lledb
ackbyCh
aseag
reedtofo
ranyr
easonwh
atso
eve
r.
’” Ch
aseSOF¶174

(
emph
asi
sadd
ed)
.Hea
ssu
redCh
aseth
ath
ewa
s“p
rep
aredtom
aketh
isn
extt
ran
sac
tiona
s

s
eam
les
sasth
epr
iord
eal
.” Ch
aseSOF¶174
.

6
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 12 of 31

S
chn
eid
eremph
asi
zedth
atas
econd MLPAd
ealcou
ld“
ess
ent
ial
ly b
eclo
sedinad
ay.
”

Ch
aseSOF¶174
.Heexp
lain
edtha
t,l
iketh
e MLPAd
eal
,al
lhen
eed
edf
romCh
asew
asa

“
spr
ead
she
etg
ene
rat
edw
ithth
enam
e,add
res
s,lo
annum
berandlo
anam
oun
t.
” Ch
aseSOF

¶174
.Schn
eid
ercon
tinu
edtop
res
sfo
ras
econd MLPAd
ealth
rough M
arch2010
,argu
ingth
at

Ch
aseshou
ldl
eth
im“h
elpid
ent
ify
”th
e“s
ecu
rev
s.un
secu
res
tatu
s”o
fit
sde
fau
ltedlo
ansand

th
at“Youwon
’tb
eab
letob
eatth
epr
iceo
f$0
.00p
erf
ileto
prov
ideyouw
ithad
atat
apeand

b
ackupp
roo
f.” Ch
aseSOF¶175
.De
spi
teS
chn
eid
er’
spr
essu
re,nos
econdd
ealw
asev
er

con
summ
ated
.

2
. Cha
segav
eSchn
eid
erth
eloanin
forma
tionh
erequ
est
ed.

S
chn
eid
err
ecogn
izedth
atth
evas
tma
jor
ityo
fth
elo
ansonth
eNov
emb
erD
ataT
ape

w
ere“
jus
tahug
epo
ten
tia
lli
abi
li
ty”andwou
ldno
tju
st
ifyco
ll
ect
ione
ffo
rts
. Ch
aseSOF¶49
.

A
cco
rding
ly,h
eag
reedth
ath
e wou
ldr
equ
estin
form
at
iononth
elo
ansh
eacqu
iredon
lyonan

“
asn
eed
ed”b
asi
s. Ch
aseSOF¶90
. Fo
rth
efi
rsts
eve
raly
ear
saf
terth
e MLPAw
asex
ecu
ted
,

S
chn
eid
err
equ
est
edlo
anin
form
at
iononana
s-n
eed
edb
asi
s,andCh
aseemp
loy
eeL
aun
i

So
lom
ona
lway
sprov
idedS
chn
eide
rwi
thth
elo
anin
form
at
ionh
erequ
est
ed. Ch
aseSOF¶
¶90
,

103(
cit
ingem
ai
lfrom M
s.So
lom
ontoS
chn
eid
erexp
lain
ingth
ath
ehadr
ece
ived“
eve
ryth
ing

w
ehav
e”)
. Wh
enS
chn
eid
ert
rie
dtoen
terin
toas
econd MLPAd
ealw
ithCh
ase
,hep
ropo
sedto

fo
llowth
iss
amep
rac
tic
eof“on
lyr
equ
est
[ing
]fi
lesf
roms
torag
easn
eed
ed.
” Ch
aseSOF¶90
.

M
s.So
lom
oncon
tinu
edtos
endS
chn
eid
erlo
ando
cum
ent
sandd
ata onana
s-n
eed
ed

b
asi
sun
ti
lFeb
rua
ry2013
,wh
enS
chn
eid
erth
rea
ten
edCh
asew
ithl
it
iga
tionanda
skedth
atth
e

p
art
iescondu
ctfu
tur
ecomm
uni
cat
ion
sth
roughcoun
sel
. Ch
aseSOF¶152
. Con
sis
ten
twi
th

S
chn
eid
er’
srequ
est
,commun
ica
tion
saf
terth
atpo
into
ccu
rredt
hroughcoun
selr
ath
erth
an

th
rough M
s.So
lom
on. Ch
aseSOF¶155
.

7
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 13 of 31

3
. S
chn
eid
err
equ
est
edloana
ssignm
ent
sonaca
se-by
-ca
seba
sis
.

S
chn
eid
erl
ikew
iseag
reedth
ath
ewou
ldr
equ
estfo
rma
llo
ana
ssignm
ent
son
lyfo
rce
rta
in

lo
ansa
s“n
ece
ssa
ry.
” Ch
aseSOF¶96
. Con
sis
ten
twi
thth
isap
pro
ach
,af
eww
eek
saf
terth
e

MLPAw
asex
ecu
ted
,Schn
eid
erin
form
edCh
aseth
ath
ewou
lds
tar
t“o
rde
ring
”as
signm
ent
sfo
r

c
ert
ainlo
ansandr
equ
est
edth
eas
signm
ento
fanind
ividu
allo
an. Ch
aseSOF¶96
. Wh
en

S
chn
eid
eru
rgedCh
asetoen
terin
toas
econd MLPAd
ealinNov
emb
er2009
,heno
tedth
atund
er

th
e MLPA
,heh
adp
rep
aredh
isowna
ssignm
ent
stos
aveCh
ase“
ti
meandr
esou
rce
s,”andth
at

Ch
aseh
ada
ssign
edabou
t1,500o
fth
eapp
rox
ima
tely3
,500 MLPAlo
ansund
erth
isa
rrang
emen
t.

Ch
aseSOF¶96
.

4
. Cha
ser
emed
ied m
is
tak
end
ebtfo
rgiv
ene
ssl
ett
ersandl
ienr
eleas
es.

B
etw
een2012and2014
,Ch
aser
ele
asedli
ensandfo
rgav
edeb
tso
nten
softhou
sand
sof

ch
arg
ed-o
ffmo
rtg
agelo
anstoc
omp
lyw
ithn
ewr
egu
lato
ryr
equ
irem
ent
sandas
ett
lem
entw
ith

th
efed
era
lgov
ernm
ent
. Ch
aseSOF¶178
. Ch
asel
ate
rde
term
inedth
ati
thadin
adv
ert
ent
lys
ent

abou
ttwodo
zend
ebtfo
rgiv
ene
ssl
ett
erstobo
rrow
erswho
selo
answ
ereso
ldtoP
lain
ti
ffsS&A
2
and1
stF
ide
li
ty. Ch
aseSOF¶179
. Upond
iscov
eringth
ise
rro
r,C
has
eof
fer
ede
ith
ertos
end

r
etr
act
ionl
ett
erstoth
eaf
fec
tedbo
rrow
erso
rtobuyb
ackth
elo
ansa
ta50%p
rem
iumov
erth
e

pu
rch
asep
ric
e. Ch
aseSOF¶180
. S&Aand1
stF
ide
li
tya
ccep
tedC
has
e’so
ffe
rtor
epu
rch
ase

s
eve
ralo
fth
elo
ansandtos
endr
etr
act
ionl
ett
ersonth
erem
aind
er. Ch
aseSOF¶181
.

Mo
reov
er,f
orth
reeo
fth
erepu
rch
ase
s,Ch
asep
aidth
efu
llou
tst
and
ingb
alan
ceonth
elo
ans—
a

to
talo
fabou
t$428
,000
,orm
oreth
anf
if
teent
ime
sth
eam
oun
tth
atS
chn
eid
erp
aidtopu
rch
ase

th
elo
ans
. Ch
aseSOF¶182
.

2
No MRSbo
rrow
ersr
ece
ivedm
is
ta
kend
ebtfo
rgiv
ene
ssl
ett
ers
.Se
e Ch
aseSOF¶176
.

8
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 14 of 31

Ch
asea
lsod
ete
rmin
edth
ati
thadin
adv
ert
ent
lyr
ele
asedth
eli
ensonc
ert
ainlo
ansi
thad

so
ldtoP
la
int
if
fs
. Ch
aseS
OF¶183
. Upond
iscov
eringi
tse
rro
r,Ch
asem
adee
ffo
rtstov
aca
teo
r

r
esc
indth
emi
stak
enl
ienr
ele
ase
s. Ch
aseSOF¶184
.

E
. P
lain
ti
ffsb
ela
ted
lyf
iledth
islaw
sui
t.

N
ear
lys
ixy
ear
saf
terth
eFeb
rua
ry2009ex
ecu
tiono
fth
e MLPA
,Pl
ain
ti
ffsf
il
edth
is

l
awsu
it
.Se
eDk
t.1
.Asar
esu
lto
fth
isCou
rt’
sdi
smi
ssa
lofm
anyo
fPl
ain
ti
ffs
’or
igin
alc
laim
s,

th
eon
lyr
ema
iningc
laim
sar
eth
osefo
rbr
eacho
fcon
tra
ct(b
rough
tbya
llth
reeP
la
int
if
fs)and

f
raudandn
egl
igen
tmi
srep
res
ent
ation(b
rough
tby MRS
).S
eeDk
t.140
.

Du
ringth
efa
ctd
iscov
eryp
eriod
,Ch
ases
erv
edIn
ter
rog
ato
rie
sask
ingP
lain
ti
ffsto

id
ent
ify
:(1
)anylo
anp
aym
ent
sre
tain
edbyCh
aseth
ata
lleg
edlyshou
ldh
aveb
eenfo
rwa
rdedto

P
lain
ti
ffs
,and(2
)anylo
ansonwh
ichP
lain
ti
ffs
’paym
ents
tre
amsw
ereimp
air
eda
sar
esu
lto
f

m
is
tak
enl
ienr
ele
ase
sord
ebtfo
rgiv
ene
ssl
ett
ers. C
has
eSOF¶162
.Af
terP
lain
ti
ffsr
efu
sedto

an
swe
rth
eseIn
ter
rog
ato
rie
s,Ch
asem
ovedtocom
pel
.Se
eDk
t.256
. Th
eMag
is
tra
teJudg
e

o
rde
redP
la
int
if
fstop
rov
ideth
erequ
est
edin
form
at
ionwh
enth
eys
erv
edth
eirexp
ertr
epo
rts
.

S
ee Dk
t.267a
t2–3
.Al
thoughP
lain
ti
ffss
erv
edsupp
lem
ent
alan
swe
rsa
tth
att
ime
,th
ean
swe
rs

s
ti
llf
ail
edtoid
ent
ifyanyp
aym
ent
simp
rop
erlyr
eta
inedbyCh
aseo
ranyd
amag
esr
ela
tingtol
ien

r
ele
ase
sord
ebtfo
rgiv
ene
ssl
ett
ers
. Ch
aseSOF¶164
.

LEGALSTANDARD

Inev
alu
atingam
otionfo
rsumm
aryjudgm
ent
,th
eCou
rtv
iew
sth
efa
ctsinth
eligh
tmo
st

f
avo
rab
letoth
enon
-mov
ingp
arty
,Da
lla
sAe
rosp
ace
,In
c.v
.CISA
irCo
rp.,352F
.3d775
,780

(2dC
ir
.200
3),and“
res
olv
e[s
]al
lamb
igu
it
iesandd
raw
[s]a
llp
erm
iss
ibl
efa
ctu
alin
fer
enc
esin

f
avo
rofth
epa
rtyag
ain
stwhomsumm
aryjudgm
enti
ssough
t,
”John
sonv
.Ki
ll
ian
,680F
.3d234
,

236(2dC
ir
.2012
)(in
tern
alquo
tat
ionm
ark
som
it
ted
).

9
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 15 of 31

ARGUMENT

B
ecau
seCh
ase
’stwop
end
ingm
otion
sfo
rsumm
aryjudgm
entfu
llyr
eso
lveP
lain
ti
ffs
’

b
rea
cho
fcon
tra
ctc
laim
s,th
eCou
rtn
eedno
tde
cid
eth
ein
stan
tmo
tion
.Alm
osta
llo
fPl
ain
ti
ffs
’

con
tra
ctc
laim
sar
etim
e-b
arr
edb
ecau
seth
eyr
elyonb
rea
che
sth
ata
lleg
edlyo
ccu
rredb
efo
re

D
ecem
ber24
,2009
.Se
e Dk
t.303
.Inadd
it
ion
,Pl
ain
ti
ffsf
ai
lasa m
at
tero
flawtoe
stab
li
shth
e

r
equ
irede
lem
ento
fdam
age
sfo
rth
eirb
rea
chth
eor
ies
.Se
e Dk
t.361
.Ifth
eCou
rtn
eve
rth
ele
ss

r
each
esP
la
int
if
fs’m
otion
,itshou
ldd
enyth
ereq
ues
tedr
eli
efb
ecau
sem
ate
ria
ldi
spu
teso
ffa
ct

ex
is
twi
thr
esp
ecttoe
acho
fth
eal
leg
edb
rea
che
sofcon
tra
ct
.

I
. MRSISNOTENT
ITLEDTOSUMMARYJUDGMENT
.

MRScon
tend
sth
atCh
aseb
rea
chedth
e MLPAins
evend
is
tin
ctw
ays
:(1
)fa
il
ingto

p
rov
idelo
anss
ecu
redbyin
tac
tli
ens
,(2
)fa
il
ingtop
rov
ides
uf
fic
ien
tdo
cum
ent
sandin
form
at
ion

onth
elo
ans
,(3
)fa
il
ingtop
rov
idelo
ana
ssignm
ent
s,(4
)mi
srep
res
ent
inglo
anb
alan
ces
,

(5
)mi
stak
enlyr
ele
asingl
ien
sonc
ert
ainlo
ans
,(6
)re
tain
ing
paym
ent
sre
ceiv
edonc
ert
ainlo
ans

a
fte
rth
eyw
ereso
ld,and(7
)se
ll
inglo
anst
hati
tdidno
town
.Ma
ter
iald
ispu
teso
ffa
ctp
rec
lud
e

summ
aryjudgm
enta
stoe
acho
fth
esec
laim
s.

A
. L
iens
tatu
s

MRS
’sp
rim
aryc
laim—
tha
tCh
aseb
rea
chedth
e MLPAbyf
ail
ingto p
rov
idelo
answ
ith
3
in
tac
tmo
rtg
agel
ien
s—i
sun
suppo
rtedbye
ith
erth
elangu
ageo
fth
e MLPAo
rth
efa
ctu
alr
eco
rd.

MRSw
rong
lycon
tend
sth
atth
e MLPAw
asin
tend
edtot
ran
sfe
ron
lylo
answ
ith

un
imp
air
edandin
tac
tfi
rst
-l
ienm
ortg
age
s.P
l.B
r.11–12
. Tha
tcon
ten
tionigno
resth
e

3
MRSalsocla
im sthatChaseb r
each edaw ar
rant
ybyf a
ilingtoc
onveyloansw i
thin t
actfi
rst
liens
,Pl.Br.18,butnosu ch“w ar
ranty”exis
ts
. Chasem adejus
tth
reew ar
r ant
iesinthe MLPA ,
andnoneh adtodow i
thli
e ns
tatus
. Ch a
seSOF¶167 ; MLPA§6 .a(Pl
.Ex .55). Thep a
rt
ies
al
sod i
scla
im edal
lo the
rrepresent
ationsandw ar
rant
ies
,wh ichprec
ludesth e“warran
ty”argued
by MRS.Id .§6 .c
;s e
eD ynCorpv .GTECo rp.
,215F.Supp .2d308,319–22(S .D.N.Y.2002)
(cont
ractua
ldiscl
aim e
rofw a
rran
tie
sn ega
tesaw a
rran
tyb asedonaparo
lr epre
sentat
ion).

10
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 16 of 31

con
tra
ctu
all
angu
aged
esc
rib
ingth
elo
ansa
tis
suea
s“nonp
erf
orm
ingand
/orimpa
iredc
los
edend

f
irs
tli
enm
ortg
agelo
ans
.” MLPA
,pr
eam
ble(P
l.Ex
.55
)(emph
asi
sadd
ed)
. Th
isl
angu
age

exp
lic
it
lyr
ecogn
ize
sth
atth
eli
enson MLPAlo
ansm
igh
tbe“
imp
air
ed”andnolong
erin
tac
t.

S
eeCh
aseSOF¶169(
tes
tim
onyo
fmo
rtgag
eexp
ertD
r.M
arsh
aCou
rch
aneth
atth
ete
rm

“
imp
air
ed”f
irs
tli
en m
ortg
agelo
an“
cou
ldc
ert
ain
lyind
ica
tet
ha
tth
efi
rstl
ieni
sno
tin
tac
t”)
.

A
lthough MRSin
terp
ret
sth
econ
trac
tua
lre
fer
enc
eto“
imp
air
ed”m
ortg
agelo
anstom
eanon
ly

th
atth
elo
ansinqu
est
ionw
erenonp
erfo
rmingo
rde
fau
lted
,th
atin
terp
ret
ationwou
lds
tr
ipth
e

t
erm“
imp
air
ed”o
fanyind
epend
entm
ean
inginth
econ
tra
ctu
alp
hra
se“n
onp
erf
orm
ingand
/or

impa
iredc
los
edendf
irs
tmo
rtg
agel
ine
sth
ata
reo
rhav
ebe
end
elinqu
en
tfo
r180d
ayso
rmo
re

andh
aveb
eeno
rmayo
the
rwi
seb
eind
efau
lt.
” MLPA
,pr
eamb
le(P
l.Ex
.55
)(em
pha
sisadd
ed)
.

MRS
’sin
terp
ret
ationo
f“im
pai
red”thu
svio
lat
esth
ese
tt
ledru
leth
at“
anin
terp
ret
ationo
fa

con
tra
ctth
ath
asth
eef
fec
tofr
end
eringa
tle
aston
ecl
aus
esup
erf
luou
sorm
ean
ing
les
s...i
sno
t

p
ref
err
edandw
il
lbeavo
idedi
fpo
ssib
le
.”ShawG
roupIn
c.v
.Tr
ipl
efin
eIn
t’
lCo
rp.,3
22F
.3d

115
,124(2dC
ir
.2003
)(in
tern
alquo
ta
tion m
ark
som
it
ted
).

MRS
’sin
terp
ret
ationa
lsoi
sim
pos
sib
letor
econ
cil
ewi
thth
enego
tia
tingh
is
toryo
fth
e

MLPA
.AsS
chn
eid
era
dmi
ttedin aswo
rnd
ecl
ara
tionf
iledinth
isa
ct
ion
,“i
twa
sth
ein
ten
tof

bo
thp
art
iesth
atth
e[MLPAlo
ans
]wou
ldcon
sis
tof3
,529lo
ans...d
rawnf
romth
eNov
emb
er

2008D
ataT
ape
.” Ch
aseSOF¶44
.Sc
hne
ide
rkn
ewth
ati
twa
sma
them
ati
cal
lyim
pos
sib
leto

d
raw3
,529lo
answ
ithin
tac
tfi
rst
-li
en m
ortg
age
sfromth
elo
ansonth
atD
ataT
ape
:heh
ad

a
lre
adycon
clud
edth
at“on
lya
bou
t1,000
”oftho
selo
anss
ti
llh
adin
tac
tfi
rstl
ien
s. Ch
aseSOF

¶60
;se
eal
soid
.(S
chn
eid
ere
-ma
ils
tat
ing
tha
t“5ou
tof6
”ofth
e6,000lo
ansonth
eNov
emb
er

D
ataT
apew
ereun
secu
redbyin
tac
tfi
rstl
ien
s);id
.¶52(S
chn
eid
ere
-ma
ils
tat
ingth
at“
abou
t

95%
”ofth
elo
ansonth
eDa
taT
apew
ere“
tru
lyun
secu
red
”);P
l.SOF¶57(MRSadm
it
tingth
at

11
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 17 of 31

“S
chn
eid
erd
iscov
eredth
atm
osto
fth
e6,000lo
ansonth
eNov
emb
erD
ataT
apew
ereno
tfi
rst

l
ienm
ortg
age
s”p
rio
rtoth
eMLPA
). Fu
rth
erm
ore
,inh
isJ
anu
ary28
,2009em
ai
lurg
ingCh
ase

toen
terin
toth
e MLPA
,Schn
eid
erexp
res
slyr
eas
sur
edCh
aseth
at“
Iund
ers
tandth
atth
elo
ans

a
re...bo
ths
ecu
reandun
secu
re.
”Ch
aseSOF¶49(
emph
asi
sadd
ed)
.Th
isc
lea
rand

con
tem
por
aneou
sev
iden
cecom
ple
telyb
eli
esS
chn
eid
er’
saf
ter
-th
e-f
acta
sse
rt
ionth
atth
e MLPA

w
asin
tend
edtor
equ
ired
elive
ryon
lyo
flo
answ
ithun
imp
air
edl
ien
s.A
cco
rding
ly,ev
eni
fth
e

t
erm“
imp
air
ed”w
ered
eem
edam
biguou
s,un
equ
ivo
calex
tr
ins
icev
iden
cewou
ldr
eso
lveth
at

am
bigu
ityinCh
ase
’sf
avo
r.S
ee,e
.g.
,Ada
sarG
rp.
,In
c.v
.Ne
tComSo
ls
.In
t’
l,In
c.
,2003 WL

1107670
,at*7(S
.D.N
.Y.M
ar.13
,2003
)(cou
rtsm
aycon
sid
er“
evid
enc
esu
rround
ingth
e

n
ego
tia
tionandex
ecu
tion
”ofacon
tra
cttoin
terp
retam
biguou
ste
rms
);R
.Dw
igh
tHa
rri
sv.

Ro
yalCh
rys
ler
/On
eon
taIn
c.,657N
.Y.S
.2d847
,848(N
.Y.App
.Di
v.1997
)(app
rov
ingu
seo
f

“
evid
enc
eastoth
epu
rpo
seo
fth
eag
reem
ent
,th
eci
rcum
stan
cesund
erwh
ichi
twa
smad
eando
f

th
enego
tia
tion
sle
adinguptoi
tsex
ecu
tion
”).

Th
epa
rt
ies
’cou
rseo
fpe
rfo
rmanc
eund
erth
e MLPAfu
rth
ercon
firm
sth
atth
eyd
idno
t

in
tendtor
equ
ireth
ata
ll MLPAlo
answou
ldh
avein
tac
tmo
rtg
agel
ien
s.S
ee,e
.g.,A
lte
rna
tiv
es

F
ed.C
red
itUn
ionv
.Olb
ios
,LLC,787N
.Y.S
.2d508
,511(N
.Y.App
.Div
.2005
)(“
the

sub
sequ
entcondu
cto
fth
epa
rt
iesm
ayb
eus
edtoind
ica
teth
eirin
ten
t”con
cern
inganam
biguou
s

t
erm(
int
ern
alquo
tat
ionm
ark
som
it
ted
))
. Sho
rt
lya
fte
rex
ecu
tiono
fth
e MLPA
,Schn
eid
er

ind
ica
tedth
ath
ewou
ldn
eedon
ly“
abou
t25%
”ofth
elo
ansa
ssign
edtoh
im,anodtoth
efa
ct

th
atal
arg
epropo
rt
iono
fth
elo
answ
ereun
secu
red
. Ch
aseSOF¶144
.Inadd
it
ion
,inNov
emb
er

2009
,Schn
eid
erp
itch
edCh
asetorep
eatth
e MLPAt
ran
sac
tion“u
nde
rth
esam
ete
rms
”wi
tha

“
sim
il
ar”poo
loflo
ansth
atw
eree
ith
er“
secu
reo
run
secu
re.
” Ch
aseSOF¶174(d
iscu
ssing

S
chn
eid
er’
sof
fertopu
rch
asea“n
ew1
stl
ienpoo
l”th
atwou
ldin
clud
e“un
secu
re”lo
ans
). Non
e

12
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 18 of 31

o
fth
ispo
st-MLPAcondu
ctm
ake
ssen
seund
erS
chn
eid
er’
srev
is
ion
is
tth
eoryth
atth
e MLPA

lo
ansshou
ldh
avecon
sis
tedex
clu
siv
elyo
flo
answ
ithin
tac
tli
ens
.Atth
eve
ryl
eas
t,th
e MLPA
’s

r
efe
ren
ceto“
imp
air
ed”mo
rtg
agelo
ansi
sam
biguou
s,thu
spr
ecl
udingsumm
aryjudgm
entfo
r

MRS
.Se
eMe
llonBan
k,N
.A.v
.Un
itedBan
kCo
rp.o
fN.Y
.,31F
.3d113
,115(2dC
ir
.1994
)

(
“Summ
aryjudgm
enti
son
lyp
rop
erincon
tra
ctd
ispu
tesi
fth
elangu
ageo
fth
econ
tra
cti
s

‘who
llyun
amb
iguou
s.
’”)
;FPP
,LLCv
.Xa
xisUS
,LLC,2016 WL5477768
,at*5(S
.D.N
.Y.

S
ept
.29
,2016
)(Sw
ain
,J.
)(s
ame
).

F
ina
lly
,ev
eni
f MRSsom
ehowcou
ldshowth
atth
e MLPAi
sprop
erlyr
eadtor
equ
ire

d
eliv
eryso
lelyo
flo
answ
ithin
tac
tli
ens
,th
edo
ctr
ine
sofw
aiv
erande
stopp
elwou
ldb
ar MRS

f
romen
for
cingth
atr
ead
ingo
fth
econ
tra
cta
tth
isl
ated
ate
.Und
erN
ewYo
rkl
aw,“p
art
iestoa

con
tra
cta
reab
letoa
lte
rorw
aiv
epo
rt
ion
sofanag
reem
entbyth
eircou
rseo
fcondu
ct
.”

E
che
var
riav
.158
thS
t.R
ive
rsid
eDr
iveHou
s.Co
.,979N
.Y.S
.2d294
,295(N
.Y.App
.Div
.

2014
).N
ewYo
rkl
awfu
rth
erp
rov
ide
sth
atap
artym
ayb
eequ
itab
lye
stopp
edf
romb
ring
inga

b
rea
cho
fcon
tra
ctc
laimwh
erei
ttooknoa
ctioni
nre
spo
nset
oab
rea
cha
ndth
ecoun
terp
arty

r
eli
edonth
atin
act
iontoi
tsd
etr
imen
t.S
eeD
eCa
rlov
.Ar
chi
eCom
icPub
l’n
s,In
c.,1
27F
.Su
pp.

2d497
,509(S
.D.N
.Y.2001
).

Bo
tho
ftho
sedo
ctr
ine
ssqu
are
ly app
lyh
ere
.Schn
eid
ert
est
if
iedth
ath
ekn
ewf
romth
e

d
ayth
e MLPAw
ass
ign
edth
atm
anyo
fth
elo
ansd
eliv
eredpu
rsu
anttoth
e MLPAw
ereno
t

s
ecu
redbyin
tac
tli
ens
. Ch
aseSOF¶173
.Hen
eve
rth
ele
ssf
ail
edtoob
jec
ttoth
ispu
rpo
rted

b
rea
cho
fcon
tra
ctun
ti
lmanyy
earsl
ate
r,thu
spr
even
tingCh
asef
romcu
ringth
eal
leg
edb
rea
ch

byt
ime
lyp
rov
idingsub
st
itu
telo
ans
. Ch
aseSOF¶
¶173–75
.Fa
rfromob
jec
tingtoth
epu
rpo
rted

b
rea
ch,S
chn
eid
erind
ica
tedth
ath
ewa
ssa
ti
sf
iedw
ithth
e MLPAlo
ansth
atCh
ased
eliv
ered
:he

p
itch
edCh
asetor
epe
atth
e MLPAd
ealw
itha“
sim
il
ar”poo
lof“
secu
reo
run
secu
re”lo
ans

13
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 19 of 31

“und
erth
esam
ete
rms
.” Ch
aseSOF¶
¶174–75
;se
eal
sosup
raa
t6.A
cco
rding
ly,ev
eni
fth
e

Cou
rtw
eretoadop
t MRS
’ss
tra
inedr
ead
ingo
fth
ete
rm“
imp
air
ed,
”Ch
asewou
ldb
een
ti
tledto

p
res
entth
ede
fen
seso
fwa
ive
rande
stopp
ela
ttr
ial
.Se
e,e
.g.,Ch
ris
tianD
ior
-NewYo
rk,In
c.v
.

Ko
ret
,In
c.,792F
.2d34
,39(2dC
ir
.1986
)(r
eve
rs
ingg
ran
tofsumm
aryju
dgm
entb
ecau
se

d
efend
antw
asen
ti
tled“
top
rov
eit
swa
ive
rde
fen
sea
ttr
ial
”);s
eea
lsoDk
t.295a
t41(
ass
ert
ing

w
aiv
erande
stopp
ela
saf
fi
rma
tiv
ede
fen
ses
).

B
. Loanin
forma
tion

MRSfu
rth
ercon
tend
sth
atCh
aseb
rea
chedth
e MLPAbyf
ail
ingto p
rov
idelo
an

do
cum
ent
ationandacomp
let
eandac
cur
ate“Exh
ibi
tA”con
tain
ing“
theb
arem
inim
um

in
form
at
ionn
ece
ssa
rytos
erv
iceth
elo
ans
.”P
l.B
r11–13
. Th
isc
laimi
sun
suppo
rtedbye
ith
er
4
th
ete
rmso
fth
econ
tra
cto
rth
efa
ctu
alr
eco
rd.

Con
sis
ten
twi
thth
e“nom
ina
l”p
ric
eth
atS
chn
eid
erp
aidtoa
cqu
ireov
er$156 m
il
lio
nin

lo
anb
alan
ces
,Ch
ase
’scon
tra
ctu
alob
lig
ationtoa
ssem
bleandprov
idelo
anin
form
at
ionw
as

l
imi
tedtol
is
tinge
achlo
anandi
ts“ou
ts
tand
ingp
rin
cip
alb
al
anc
e”inan“Exh
ibi
tA”toth
e

MLPA
. MLPA§2(P
l.Ex
.55
).P
laint
if
fs’m
ortg
ageindu
stryex
per
t,R
ich
ardP
ayn
e,ag
ree
s

w
ithth
isr
ead
ing
,andh
ewi
llno
top
ineth
atCh
asef
ail
edtosupp
lyth
eExh
ibi
tAin
form
at
ion

r
equ
iredbyth
econ
tra
ct
. Ch
aseSOF¶70
.Al
though MRScon
ten
dsth
atc
ert
ainadd
it
ion
al

in
form
at
ionsu
cha
sor
igin
allo
anb
alan
ces
,or
igin
alin
ter
estr
ate
s,andp
aym
enth
is
tor
ieswou
ld

h
aveb
eenh
elp
fulfo
rse
rvi
cingth
elo
ans
,Mr
.Payn
econ
ced
es—
con
sis
ten
twi
thth
epl
ain

l
angu
ageo
fth
e MLPA—
tha
tth
e MLPAd
idno
trequ
ire Ch
asetop
rov
ide
tha
tin
form
at
ion
.

Ch
aseSOF¶70
. MRS
’sb
rea
cho
fcon
tra
ctc
laimth
ere
for
efa
il
sbe
cau
se MRSc
anno
t“id
ent
ify

4
MRSal
soc
laimsth
atCha
seb
rea
chedawarr
antybyf
ail
ing“
top
rov
ideacom
ple
teanda
ccu
rat
e
Exh
ibi
tA,”P
l.Br
.18,bu
tnosu
ch“war
ran
ty”exi
sts
.Seesupr
anote3.

14
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 20 of 31

th
esp
eci
ficp
rov
is
iono
fth
econ
tra
ct”th
atCh
asea
lleg
edlyb
rea
ched
.Wo
lf
fv.Ra
reM
edium
,

In
c.,210F
.Supp
.2d490
,494(S
.D.N
.Y.2002
).

MRSa
lsov
agu
elysugg
est
sth
atCha
seb
rea
chedth
e MLPAbyf
ail
ingtop
rov
ide MRS

w
ithun
spe
cif
ieddo
cum
ent
sandr
eco
rdsr
ela
tingtoth
e MLPAlo
ans
. Bu
tSchn
eid
err
equ
est
ed

r
eco
rdson MLPAlo
anson
lyonan“
as-n
eed
ed”b
asi
s,s
ees
upr
aat7
,andCh
aseemp
loy
eeL
aun
i

So
lom
onp
rov
ided MRSandS
chn
eid
erw
itha
llo
f“th
edo
cum
ent
sandd
atath
eyr
equ
est
edf
rom

Ch
ase
,in
clud
ingo
rig
ina
llo
anf
ile
s,toth
eex
ten
tth
eye
xis
tedw
ith
inCha
se.
” Ch
aseSOF¶90

(
emph
asi
sadd
ed)
. No
thinginth
e MLPAr
equ
iredCh
asetodoany
thingmo
re.A
lthougha

s
ect
iono
fth
e MLPAen
ti
tled“Exp
ens
es”s
tat
est
hatCh
asewou
ldb
earth
eexp
ens
eofd
eliv
ering

any“
serv
icing
/or
igin
ationf
ile
s”to MRS
,th
atp
rov
is
ionn
eith
err
epr
esen
tedth
atCh
asepo
sse
ssed

anyp
art
icu
larlo
anf
ile
sno
rim
pos
edar
equ
irem
enttod
eliv
eranysu
chf
ile
s. MLPA§7(P
l.Ex
.

55
).Ino
the
rwo
rds
,asM
r.P
ayn
eacknow
ledg
eda
thi
sdepo
si
ti
on
,th
isp
rov
is
iondo
esno
t

“
cre
ateind
epend
entob
lig
ation
sastoth
econ
ten
tso
fth
ese
rvi
cingf
ile
”;i
tme
relysp
eci
fie
s“[
a]s

b
etw
eenCh
aseand MRSwhob
ear
sth
ede
liv
eryco
sts
.” Ch
aseSOF¶170
.

Ev
eni
fth
e MLPAw
ered
eem
edamb
iguou
s,ex
tr
ins
icev
iden
cewou
ldcon
fi
rmth
ati
twa
s

S
chn
eid
er—no
tCh
ase—whoag
reedtob
earth
eri
sko
fin
comp
let
eandin
accu
rat
elo
anr
eco
rds
.

Th
ati
swhyS
chn
eid
ercondu
ctedov
erathou
sandhou
rso
fdu
edil
igen
ceonth
e MLPAlo
ans

p
rio
rtoen
ter
ingin
toth
e MLP
A,in
clud
ingpu
ll
ing“p
rop
ertyID c
ard
sfo
rev
eryp
rop
erty

av
ail
abl
e”andpu
rch
asing“
ti
tles
ear
chr
epo
rts
”tom
akeupfo
rth
ela
cko
flo
anin
form
at
ion
.

Ch
aseSOF¶64(quo
tingP
l.Ex
.41
);sup
raa
t2(d
esc
rib
ingS
chn
eid
er’
spr
e-MLPA“
lien

v
eri
fic
ation
”). Andth
ati
swhy
,sho
rt
lyb
efo
reth
e MLPAw
asex
ecu
ted
,Schn
eid
er

a
cknow
ledg
ed“
tha
tth
ere[w
ere
]no
...r
epr
esen
tat
ion
sorwa
rran
tie
sastoth
ein
forma
tion
,

qua
li
tyo
rava
ilab
il
itya
stoan
yofth
eco
lla
tera
ldo
cum
enta
tio
nwha
tso
eve
r.” Ch
aseSOF¶87

15
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 21 of 31

(quo
tingS
chn
eid
erem
ai
l)
. Th
iscon
tem
por
aneou
sst
atem
entbyS
chn
eid
eri
sim
pos
sib
leto

r
econ
cil
ewi
thh
isa
fte
r-
the
-fa
cta
ttemp
ttoinv
entacon
tra
ctu
alob
lig
ationtop
rov
idecom
ple
te

anda
ccu
rat
elo
anr
eco
rds
.

C
. Loana
ssignm
ent
s

MRSn
extcon
tend
sth
atCh
aseb
rea
chedth
e MLPA“byf
ail
ingand
/o
rre
fus
ingtoi
ssu
e

a
ssignm
ent
sorendo
rsem
ent
s.”P
l.B
r.15
. Th
isc
laimf
ail
sbe
cau
se(
i)nop
rov
is
iono
fth
e

con
tra
ctr
equ
iredCh
asetop
rov
idea
ssignm
ent
s,(
ii
)anya
lleg
edr
equ
irem
enttop
rov
ide

a
ssignm
ent
swa
smod
if
iedbysub
sequ
entag
reem
ento
fth
epa
rt
ies
,and(
ii
i) MRSh
asf
ail
edto

com
efo
rwa
rdw
ithev
iden
ceo
fab
rea
ch.

Nop
rov
is
iono
fth
e MLPAr
equ
iredCh
asetoi
ssu
eas
signm
ent
sfora
llo
fth
elo
ans

in
clud
edinth
ede
al
.Se
egen
era
lly MLPA(P
l.Ex
.55
). Th
ela
cko
fanysu
chr
equ
irem
entw
as

d
elib
era
te:th
epa
rti
esin
tend
edtoh
and
lea
ssignm
ent
sonana
s-n
eed
edb
asi
sba
sedon

S
chn
eid
er’
srequ
est
sfo
ras
signm
ent
sofp
art
icu
larlo
ans
.Su
praa
t8. Con
sis
ten
twi
thth
at

und
ers
tand
ing
,Schn
eid
ere
-ma
iledCh
aseon M
arch19
,2009
,on
lyaf
eww
eek
saf
terex
ecu
tion

o
fth
e MLPA
,th
ath
ewou
ldsoonb
egin“o
rde
ring
”as
signm
ent
sforth
e MLPAlo
ans
. Ch
ase

SOF¶96(quo
tingP
l.E
x.58
). Sho
rt
lyth
ere
aft
er,S
chn
eid
err
equ
est
edana
ssignm
entfo
ra

s
ing
lelo
an. Ch
aseSOF¶96(
quo
tingP
l.Ex
.61
).H
eal
soind
ica
tedth
ath
ewa
slik
elytow
ant

a
ssignm
ent
sfo
ron
ly“
abou
t25%
”ofth
e MLPAlo
ans
. Ch
aseSOF
¶145(quo
tingP
l.Ex
.61
).

On M
arch23
,2009
,th
epa
rt
iesr
eit
era
tedth
eirag
reem
entth
atS
chn
eid
erwou
ldp
rep
areany

a
ssignm
ent
sth
ath
ene
ededandCh
asewou
lds
ignth
em. Ch
aseSO
F¶145
.

S
chn
eid
err
e-con
fi
rmedth
isag
reem
enta
stolo
ana
ssignm
ent
sin Nov
emb
er2009
,wh
en

h
epi
tch
edCh
aseonano
the
rde
alth
atwou
ldb
e“s
imi
lar
”toth
e MLPA
. Ch
aseSOF¶174
.In

suppo
rto
fhi
spi
tch
,Schn
eid
erno
tedth
ath
isf
irmh
adp
rep
ared(
andCh
aseh
adex
ecu
ted
)th
e

a
ssignm
ent
sth
ath
ewan
tedon MLPAlo
ansto“
sav
e[]Ch
aseth
etim
eandr
esou
rce
srequ
iredto

16
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 22 of 31

h
and
leth
ecoo
rdin
ationo
fsu
ch.
” Ch
aseSOF¶96
.Schn
eid
ers
ough
ttoc
arryov
erth
ese“
sam
e

t
erm
s”toas
econd MLPAd
eal
. Ch
aseSOF¶96
.

Ev
eni
fth
e MLPAcou
ldb
ere
adtor
equ
ireCh
asetop
rov
idea
ssi
gnm
ent
sona
llo
fth
e

MLPAlo
ans(
andi
tcanno
t)
,th
ere
cordwou
lde
stab
li
shth
atS
chn
eid
ersub
sequ
ent
lyag
reedto

mod
ifyth
atr
equ
irem
ent
.Ac
cord
ingtoane
-ma
ilth
atS
chn
eid
ers
entCh
aseinJ
anu
ary2010
,he

andh
isf
irmag
reedto“p
rep
area
ssignm
ent
s”fo
r MLPAlo
ans“
asw
ene
edth
emands
endth
em

to[Ch
ase
]fo
rex
ecu
tion
”as“
age
stu
reo
fgoodw
il
lfo
rfu
tur
ebu
sin
ess
.” Ch
aseSOF¶96
.

S
chn
eid
erandh
isf
irmd
idp
rec
ise
lyth
at
,andC
has
eex
ecu
teda
pprox
ima
tely1
,500a
ssignm
ent
s

und
erth
isa
rrang
emen
t. Ch
aseSOF¶96
. Thu
s,a
ta m
inim
um,m
ate
ria
lqu
est
ion
soff
act

r
ega
rdingmod
if
ica
tiono
fCh
ase
’sa
lleg
edob
lig
ationtop
rov
idelo
ana
ssignm
ent
spr
eclud
e

summ
aryjudgm
entonth
isc
laim
.Se
eCTCh
ems
.(U
.S.A
.)
,In
c.v
.Inma
rImp
ex,In
c.,5
97

N
.Y.S
.2d284
,287(1993
)(“p
art
iesmayo
fcou
rsech
ang
eth
eira
gre
emen
tbyano
the
rag
reem
ent
,

bycou
rseo
fcondu
ct
,orbycondu
ctamoun
tingtoaw
aiv
ero
res
topp
el”
);Ch
ris
tianD
ior,
792

F
.2da
t40(d
ete
rmin
ationo
fwh
eth
erth
epa
rt
iesm
odi
fiedth
eirag
reem
ent“
shou
ldb
emad
ebya

t
rie
roff
acta
ttr
ia
l”)
.

F
ina
lly
, MRSh
asf
ail
edtocom
efo
rwa
rdw
ithanyadm
iss
ibl
eev
iden
ceth
atCh
ase

b
rea
chedacon
tra
ctu
alr
equ
irem
enttop
rov
idelo
ana
ssignm
ent
s,l
eta
lon
eth
ati
twa
sdam
agedby

anysu
chb
rea
ch.I
tha
sno
tpo
int
edtoas
ing
lein
stan
ceinwh
ichCh
asee
ith
er“
fai
led
”or

“
refu
sed
”toi
ssu
eana
ssi
gnm
ent
. Ch
aseSOF¶
¶90–92
,97–98(P
lain
ti
ffs
’pu
tat
ivef
act
sabou
t

lo
ana
ssignm
ent
s)
. Mo
reov
er,P
lain
ti
ffs
’ownexp
ertt
est
if
iedth
atth
erew
asn
eve
ranin
stan
cein

wh
ich MRSr
equ
est
edana
ssignm
entandCh
asef
ail
edtoi
ssu
eon
e. Ch
aseSOF¶98(
cit
ing

P
ayn
edepo
si
tion
).In
ste
ad, MRS m
ere
lyc
ite
sanem
ai
linwh
ich S
chn
eid
ers
aidh
ewa
sgo
ingto

b
egin“o
rde
ring
”as
signm
ent
sfo
rth
elo
ans
,andt
est
imonybyCh
aseemp
loy
eeL
aun
iSo
lom
on

17
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 23 of 31

th
atsh
ehe
rse
lfd
idno
tpe
rson
allyh
and
lea
ssignm
ent
sfo
rth
e MLPAlo
ans
. Ch
aseSOF¶
¶91
,

97–98
. Tho
seb
rie
fandp
erem
pto
rycommun
ica
tion
sdono
tcom
eclo
setoe
stab
li
shingth
at

Ch
asef
ail
edo
rre
fus
edtop
rov
idea
ssignm
ent
son MLPAlo
ans
.

D
. Loanba
lan
ces

MRSfu
rth
ercon
tend
sth
atCh
asef
ail
edtop
rov
ideth
efu
ll$156
,324
,399inunp
aidlo
an

b
alan
cesr
equ
iredbyth
e MLPA
.Pl
.Br
.13
. MRSdo
esno
tdeny
tha
tth
elo
anb
alan
cesin

Exh
ibi
tAs
ati
sfi
edth
isamoun
t,bu
targu
esth
atsom
eofth
isunp
aidb
alan
cecon
sis
tedo
fth
e

lo
ans
’“ch
arg
edo
ffam
oun
ts
,”wh
ichi
tcl
aim
sar
e“s
ign
if
ican
tl
yhigh
erth
anth
eou
ts
tand
inglo
an

b
alan
ce.
”Id
. How
eve
r, MRSf
ail
stocom
efo
rwa
rdw
ithanyev
iden
cesuppo
rt
ingi
tscon
ten
tion

th
atsom
eofth
eunp
aidd
ebtc
ons
is
tedo
f“ch
arg
edo
ffam
oun
ts”r
ath
erth
anou
ts
tand
ingb
alan
ce.

MRSc
ite
son
lyExh
ibi
tAi
tse
lf,wh
ichs
imp
lyl
is
tsab
alan
ceam
oun
tfo
rea
chlo
anandwh
ich

to
tal
stos
ligh
tlym
oreth
anth
eam
oun
trequ
iredund
erth
e MLPA
.Id
.;Ch
aseSOF¶145
. MRS
5
n
eve
rid
ent
if
iesasp
eci
ficlo
anfo
rwh
ichCh
asea
lleg
edlyp
rov
idedanin
accu
rat
eba
lan
ce.

MRSi
sal
sow
rongtoa
sse
rtth
atth
erei
sanyr
elev
antd
is
tin
ctionb
etw
eenalo
an’
s

ou
ts
tand
ingp
rin
cip
alb
alan
ceandth
elo
an’
sch
arg
e-o
ffam
oun
t.P
l.B
r.13
. Th
erei
snod
ispu
te

th
ata
llo
fth
elo
ansin
clud
edi
nth
e MLPAt
ran
sac
tionw
ereind
efau
lt
.Se
e MLPA(P
l.Ex
.55
);

Ch
aseSOF¶168
. Upond
efau
lt
,lo
anag
reem
ent
styp
ica
llyp
rov
ideth
atth
efu
llam
oun
tofth
e

bo
rrow
er’
sind
ebt
edn
essb
ecom
esimm
edi
ate
lydu
eandp
ayab
le
,thu
sconv
ert
ingth
efu
llam
oun
t

o
fou
ts
tand
ingind
ebt
edn
essin
top
rin
cip
al
.Se
e,e
.g.
,Ch
aseSOF¶171(
cit
ingex
emp
lar MLPA

lo
anag
reem
ent
scon
tain
ingsu
chp
rov
is
ion
s)
.Ac
cord
ing
ly, MRSw
asen
ti
tledtoco
lle
ct(
and

ch
arg
ein
ter
eston
)th
efu
llo
uts
tan
din
gba
lan
cesl
is
tedo
nEx
hib
itA
.Se
e,e
.g.
,id
.

5
MRSal
soasser
tstha
tChas
e’salleg
edf a
ilu
reto“conveyth
enum b
erorvalueofloan
sas
requi
redandbarga
inedfo
rwithinthe MLPA”consti
tut
esabreacho
fw a
rranty
.P l
.B r
.18
. Th
e
MLPA,how ev
er,doesno
tcon
t a
inanysu chwarran
ty.S eesupr
ano te3
.

18
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 24 of 31

Fo
rsim
il
arr
eason
s, MRSc
anno
tprov
eane
ssen
tia
lel
emen
tofit
scl
aim—
theex
is
ten
ce

o
fdam
age
str
ace
abl
etoth
eal
leg
edb
rea
ch.S
eeF
isch
er& Mand
ell
,LLPv
.Ci
tiban
k,N
.A.,632

F
.3d793
,799(2dC
ir
.2011
);s
eea
lso Dk
t.361(Ch
ase
’ssumm
aryj
udgm
entm
emo
randumon

th
eab
sen
ceo
fdam
age
s)
. MRSn
eedno
tqu
ant
ifyth
epr
eci
seam
oun
tofd
amag
etoe
stab
li
sh

l
iab
il
ity
,bu
titm
ustp
rov
eatl
eas
tth
efa
cto
fdam
agec
aus
allyconn
ect
edtoth
ebr
each
.Se
e

L
exing
ton360A
sso
cs.v
.Fi
rstUn
ionNa
t.Ban
kofN
.Ca
rol
ina,651N
.Y.S
.2d490
,492(N
.Y.

App
.Div
.1996
)(b
rea
cho
fcon
tra
ctcl
aimf
ail
s“[w
]he
reap
art
yha
sfa
iledtocom
efo
rwa
rdw
ith

ev
iden
cesu
ff
ici
enttod
emon
str
ated
amag
esf
low
ingf
romth
ebr
eacha
lleg
ed”
).N
eith
er MRS

no
rit
sexp
ert
shav
epo
int
edtoanyd
amag
eflow
ingf
romCh
ase
’spu
rpo
rtedu
seo
fch
arg
e-o
ff

b
alan
cesinExh
ibi
tA. No
rcou
ldth
eydoso
,giv
enth
at MRSw
asen
ti
tleda
sam
at
tero
flawto

co
lle
ctth
efu
llam
oun
tsl
is
tedonExh
ibi
tA.

E
. L
ienr
elea
ses

MRScon
tend
sth
atCh
asem
is
tak
enlyr
ele
asedl
ien
sth
ats
ecu
redMLPAlo
ans
. Th
at

con
ten
tionf
ail
stosuppo
rtab
rea
cho
fcon
tra
ctc
laimfo
rtwoind
epend
entr
eason
s.

F
irs
t, MRSdo
esno
tid
ent
ifyanyp
rov
is
iono
fth
e MLPAth
atth
eli
enr
ele
ase
svio
lat
ed.

In
ste
ad, MRSa
sse
rtsth
atth
eli
enr
ele
ase
sbr
each
edanim
pli
edcov
enan
tofgoodf
aithandf
air

d
eal
ing
.Pl
.Br
.19
. Bu
tino
rde
rtod
emon
str
ateab
rea
cho
fth
eim
pli
edcov
enan
t, MRSm
ust

p
rov
eth
atCh
ase“
int
ent
ion
allyandpu
rpo
sely
”ac
tedtop
rev
enti
tfromr
ece
ivingth
efru
it
softh
e
6
p
art
ies
’con
tra
ct
. MRSh
asno
tcom
efo
rwa
rdw
ithan
yev
iden
ceth
atth
eal
leg
edl
ienr
ele
ase
s

6
E
.g.,Kaderv.PaperSof
tware
,In c
.,111F .3d337,342(2dCir
.1997)(N .Y.law
);Conf
ido
Adv
isors,LLCv .USAAR ea
lE s
tat
eCo .,2018 WL4265900 ,at*6–7(S.D.N.Y.Sept
.6,2018 );
seealsoF e
rgusonv.LionHold
ing,Inc
.,478F .Supp.2d455,469(S.D.N.Y.2007)(“[T]oprove
aviola
tionoftheimpl
iedcovenan
to fgoodfai
thandf a
irdea
ling,conc
lusoryal
legat
ionsofa
par
ty’sfai
luretoac
tingoodfai
thalonearein su
ff
icien
t.”
);M
ick
lev.Chris
tie’
s,Inc
.,2 0
7F .
Supp
.2d237 ,252(S.D.N.Y.2002
)(nob rea
cho fimpli
edcovenantwh e
rep ar
tyacts“hones
t[ly]”
and“ingoodf ai
th”
).

19
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 25 of 31

w
erein
ten
tion
alo
rpu
rpo
sefu
l. Toth
econ
tra
ry,th
ere
cordd
emon
str
ate
sth
atth
eli
enr
ele
ase
s

w
ereun
int
ent
ion
alandth
atCh
asewo
rked“
asqu
ick
lya
spo
ssib
le[to
]pu
llth
ebr
akeandt
ryto

s
topth
esel
ienr
ele
ase
sfromo
ccu
rr
ingandtor
esc
indanyth
at[
it
]cou
ld.
” Ch
aseSOF¶
¶184–

85
. Th
isev
iden
cea
ta m
inim
umc
rea
tesag
enu
ined
ispu
teo
ffa
cta
stowh
eth
erCh
aseb
rea
ched
7
th
eim
pli
edcov
enan
t.

S
econd, MRSon
ceag
ainc
anno
tprov
eth
ees
sen
tia
lel
emen
toff
acto
fdam
age
s. Non
eof

P
lain
ti
ffs
’exp
ert
spu
rpo
rtedtoqu
ant
ifyanyd
amag
eswh
atso
eve
rre
la
tingsp
eci
fic
al
lytoth
eli
en

r
ele
ase
s. Ch
aseSOF¶191
. Mo
reo
ver
,inr
espon
setoanIn
ter
rog
ato
rya
sking MRStoid
ent
ify

e
achin
stan
ceinwh
ichi
tcon
tend
sth
atabo
rrow
er’
spaym
ent
sde
cre
aseda
sar
esu
lto
fal
ien

r
ele
ase
, MRSr
espond
edth
ati
twa
s“un
abl
etosp
eci
fic
allyid
ent
ifyanyp
art
icu
larlo
annum
ber
s

a
tth
ist
ime
.” Ch
aseSOF¶164
. Th
ati
sun
surp
ris
ingb
ecau
se,a
s MRSr
ecogn
ize
s,th
emi
stak
en

l
ienr
ele
ase
swe
ref
il
ed“w
ithou
tno
tic
etoth
ehom
eown
ers
,”soth
ehom
eown
erswou
ldno
thav
e

a
lte
redanyp
aym
ent
sth
eyw
erem
akingto MRS
. Ch
aseSOF¶190(quo
ting MRS
’s

In
ter
rog
ato
ryan
swe
r)
.Atam
inim
um,th
erei
sag
enu
inei
ssu
ereg
ard
ingf
acto
fdam
age
sth
at

p
rec
lud
essumm
aryjudgm
entonth
isc
laim
.

F
. R
eten
tiono
fpaym
ent
s

MRSc
laim
sth
atCh
aseimp
rop
erlyr
eta
inedpo
st-
sal
elo
anp
aym
ent
son MLPAlo
ans
.

Bu
ton
ceag
ain
, MRSn
eve
rid
ent
if
iesanysp
eci
ficp
aym
entth
atCh
asesuppo
sed
lyw
ithh
eld
.

Th
eon
lyev
iden
ceinth
ere
cordisth
ete
st
imonyo
fCh
aseem
plo
yeeL
aun
iSo
lom
on,whos
aid

7
A
lthoughP la
int
iff
sa s
sertthatChasecouldre
ceivese
tt
l ementcredi
tsorHAMPp aym en
tsfor
lienrelea
ses,theycit
enoev idencethatChaserece
ivedanys uchcred
it
so rpaym en
tsforloans
own edbyP lain
tif
fs
,andth ereisnon e
. ChaseSOF¶192 . Th a
tiswhyth egove
rnm en
t
concludedthattheallega
tionsinS chne
ider’
squitama c
tionag a
ins
tCh as
e“lacksub st
antia
l
meri
t,”UnitedStatesexrel.Schneiderv.J
.P. MorganCha s
eBan k,N.A.,No.14 -1047,Dkt.135
,
at5(D .D.C.Nov .13,2018),andth eact
ionw a
sd i
smiss
edw ithpre
judice
,seeS chneider,No.14-
1047,Dk t
.138(D .D.C .M ar
ch6 ,2019)(not
iceofappea
lf i
ledA pr
.1,2019).

20
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 26 of 31

th
at
,af
terth
elo
ans
ale
,Ch
asefo
rwa
rdeda
llp
aym
ent
sitr
ece
ivedonth
e MLPAlo
ansto MRS
.

Ch
as .8 Mo
eSOF¶177 reov
er,wh
ena
skedinanIn
ter
rog
ato
rytoid
ent
ifye
achim
prop
erly

r
eta
inedp
aym
ent
, MRSr
espond
ed—
af
terth
eclo
seo
ffa
ctd
iscov
ery—
tha
titi
s“no
tnowin

po
sse
ssiono
fsu
chin
form
at
ion
.” Ch
aseSOF¶164
. MRS
’sf
ailur
etoid
ent
ifyanyimp
rop
erly

r
eta
inedp
aym
ent
sdu
ringd
iscov
eryp
rec
lud
esi
tfroma
ttem
ptingtocom
efo
rwa
rdw
ithev
iden
ce

now
.Se
e,e
.g.,Haa
sv.D
el
.&Hud
sonR
y.Co
.,282F
.App
’x84
,85–86(2dC
ir
.2008
)(f
ailu
re

tod
isc
los
ein
form
at
ionr
equ
est
edind
iscov
eryp
rec
lud
esu
seo
fre
spon
siv
ein
form
at
iona
s

ev
iden
ceon mo
tion
);Lu
janv
.Cabana Mgm
t.
,In
c.,284F
.R.D
.50
,71(E
.D.N
.Y.2012
)

(
col
lec
tingc
ase
swi
thinth
eSe
condC
ircu
itex
clud
ingin
form
at
ionf
romu
sea
tsumm
ary

judgm
entandt
ria
lfo
rfa
ilu
retod
isc
los
e).

No
twi
ths
tand
ingi
tsf
ailu
retoid
ent
ifyanysu
chp
aym
entini
tsIn
ter
rog
ato
ryr
espon
ses
,

MRSa
lsoc
laim
sth
atCh
aseim
prop
erlyr
eta
inedat
it
lein
sur
ancep
aym
ent
.E.g
.,P
l.B
r.14n
.7.

Bu
tth
erei
snoev
iden
ced
emon
str
atingth
atanysu
chp
aym
entw
asev
erm
adetoo
rre
ceiv
edby

Ch
ase
.Pl
.Ex
.86
;Ch
aseSOF¶
¶138–39
. No
rha
s MRSd
emon
str
atedth
ati
twou
ldb
een
ti
tled

toanysu
chp
aym
enth
adi
tbe
enm
ade
.

G
. Own
ersh
ipo
floan
s

F
ina
lly
, MRSc
laim
sth
atCh
aseb
rea
chedaw
arr
antyth
ati
twa
s“th
eso
leown
er”o
fth
e

MLPAlo
ans
.Pl
.Br
.18
; MLPA §6
.a
.i
i(P
l.Ex
.55
).Insuppo
rt
, MRSa
rgu
esth
atCh
ase

suppo
sed
ly“
soldlo
ansi
tdidno
tow
n,bu
twa
sme
relys
erv
icing
.”P
l.B
r.18
. Bu
tth
ispu
rpo
rted

8
MRSc i
tesanem ai
linwhich Ms.Solom onre
ferr
edtoc erta
inamount
ssh einit
ial
lyb e
lieved
wouldb eforwardedto MRSth atu l
tima
telyw e
renotforw arded
.Pl
.Ex.70 . How eve
r,M s.
Solom onsubsequentlyexp
lainedbyem ai
l— andconfirmedinh e
rdeposi
tion— tha
tsh edidnot
forw a
rdtheseam ount
sbecausetheyw e
re“notactua
lp aym en
ts,
”bu
tratherw erecorpor
ate
advanc e
sthatCh asehadm adeonb eha
lfofborrowers(e.g
.,topayrea
lestat
et axe
so r
hom eown e
rs’insurancepr
em iums
).Pl.Ex.70;Ch as
eSOF¶112(quo t
ingSo lom ondeposi
tion
).

21
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 27 of 31

9
f
acti
snowh
eretob
efoundinP
lain
ti
ffs
’Ru
le56
.1S
tat
emen
t.P
l.SOF¶
¶100–03
. A
thi
s

d
epo
si
tion
,mo
reov
er,P
lain
ti
ffs
’li
abi
li
tyexp
ertadm
it
tedth
ath
ewa
sno
taw
areo
fanyev
iden
ce

suppo
rt
ingth
isc
laim
. Ch
aseSOF¶186
.Inadd
it
ion
, MRSf
ail
edtoid
ent
ifyanysu
chlo
ansin

r
espon
setoCh
ase
’sIn
ter
rog
ato
ryonth
issub
jec
t. Ch
aseSOF¶164
. MRS
’sf
ailu
retor
espond

toCh
ase
’sIn
ter
rog
ato
rybyi
tse
lfp
rec
lud
esi
tfroma
ttem
ptingtocom
efo
rwa
rdw
ithev
iden
cein

suppo
rto
fth
isc
laimnow
.Se
esup
raa
t21(
col
lec
tingc
ase
s)
.

I
I. S&AAND1STF
IDEL
ITYARENOT ENT
ITLEDTOSUMMARYJUDGMENT
.

P
la
int
if
fscon
tendth
atCh
aseb
rea
chedcon
tra
ctsw
ithS&Aand1
stF
ide
li
tyby

(1
)send
ingd
ebtfo
rgiv
ene
ssl
ett
erstobo
rrow
ersonlo
anspu
rch
asedbyS&Aand1
stF
ide
li
ty,

(2
)re
lea
singl
ien
sse
cur
ingl
oan
spu
rch
asedbyS&Aand1
stF
ide
li
ty,and(3
)im
prop
erly

r
eta
iningp
aym
ent
sonlo
anspu
rch
asedbyS&Aand1
stF
ide
li
ty.P
lain
ti
ffsh
aveno
tme
tth
eir

summ
aryjudgm
entbu
rdena
stoanyo
fth
esec
laim
s.

A
. D
ebtfo
rgiv
ene
ssl
ett
ers

S&Aand1
stF
ide
li
tya
sse
rtth
at Ch
aseb
rea
chedth
epa
rt
ies
’co
nt
rac
tsbyin
adv
ert
ent
ly

s
end
ingabou
ttwodo
zend
ebtfo
rgi
ven
essl
ett
erstobo
rrow
ersw
hos
elo
ansth
eyh
adpu
rch
ased
.

Th
eya
reno
ten
ti
tledtosumm
aryjudgm
entonth
isc
laimfo
rth
reer
eason
s.

F
irs
t,P
lain
ti
ffsh
aveno
tid
ent
if
ieda
nyp
rov
is
iono
fth
epa
rt
ies
’con
tra
ctsth
atth
e

fo
rgiv
ene
ssl
ett
ersv
iol
ated
.Se
e Wo
lf
f,210F
.Supp
.2da
t494(b
rea
chc
laimf
ail
swh
erep
lain
ti
ff

do
esno
t“id
ent
ifyth
esp
eci
ficp
rov
is
iono
fth
econ
tra
ct”a
lle
gedtoh
aveb
eenb
rea
ched
).

Mo
reov
er,toth
eex
ten
tPl
ain
tif
fsa
rgu
eth
atth
ele
tte
rsb
rea
chedth
eim
pli
edcov
enan
tofgood

9
MRSc annotra
isenewevidenceonreplytom ee
titssumm a
ryjudgm en
tbu rden
.S eeAuror
a
LoansServs
.,In
c.v.Posne
r,Po sn
er&A ssoc
s.,P
.C.,513F .Supp.2d18,20(S .D.N.Y.2007)
(s
trik
ingn ewevid
encera
isedinsumm aryjudgmentreplybe
causeallowingp l
ain
tiffto“
submit
newm ater
ial
sto mee
tit
sburdenwou ldinapprop
ria
telyal
lowplain
ti
ffas econdbi
t eatth
e
summ aryjudgmen
tapple”
).

22
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 28 of 31

f
aithandf
aird
eal
ing
,th
eyh
aveno
tcom
efo
rwa
rdw
ithev
iden
ceth
atCh
ase“
int
ent
ion
allyand

pu
rpo
sely
”ac
tedtop
rev
entS&Ao
r1s
tFid
eli
tyf
romr
ece
ivin
gth
eben
efi
tso
fth
epa
rt
ies
’

ag
reem
ent
s.S
eesup
raa
t19
. Toth
econ
tra
ry,th
eun
con
trov
ert
edr
eco
rdev
iden
ced
emon
str
ate
s

th
atth
ele
tt
ersw
eres
enttot
hes
ebo
rrow
ersin
adv
ert
ent
ly.S
ee Ch
aseSOF¶
¶178–80
,183–85
.

S
econd,th
edo
ctr
ineo
fac
cordands
ati
sfa
ctionb
arsth
ecl
aim
.Prom
pt
lya
fte
rCh
ase

l
earn
edth
ati
thadm
is
tak
enlys
entth
edeb
tfo
rgiv
ene
ssl
ett
ers
,itm
adeano
ffe
rtoS
chn
eid
er:

Ch
asewou
lde
ith
erbuyb
ackth
elo
ansa
tap
rem
iumo
rsendr
etr
act
ionl
ett
erstoa
ffe
cted

bo
rrow
ers
. Ch
aseSOF¶180
.Af
terfu
rth
ern
ego
tia
tion
s,(1
)Ch
aseag
reedtor
epu
rch
aseth
reeo
f

th
elo
ansfo
rth
eirfu
llf
acev
alu
e(app
rox
ima
tely$428
,000
,orm
oreth
an15t
ime
swh
at

S
chn
eid
erp
aidfo
rth
elo
ans
),(2
)Ch
aseag
reedtor
epu
rch
ase1
3add
it
ion
allo
ansfo
ra50%

p
rem
iumov
erS
chn
eid
er’
spu
rch
asep
ric
e,and(3
)Schn
eid
ere
lec
tedtor
eta
inth
erem
ain
ing

s
evenlo
ans
,ac
cep
tingCh
ase
’so
ffe
rtos
endar
etr
act
ionl
ett
ertoth
eaf
fec
tedbo
rrow
ers
. Ch
ase

SOF¶
¶181–82
.

“Ana
cco
rdands
ati
sfa
ction.
..h
astwocom
pon
ent
s.”D
enbu
rgv
.Pa
rke
rChap
in

F
lat
tau&K
limp
l,624N
.E.2d995
,1000(N
.Y.1993
).“Ana
cco
rdi
sanag
reem
entth
ata

s
tipu
lat
edp
erfo
rman
cew
il
lbea
ccep
ted
,inth
efu
tur
e,inl
ieuo
fanex
is
tingc
laim
. Ex
ecu
tiono
f

th
eag
reem
enti
sas
at
isf
act
ion
.”Id
.He
re,S&Aand1
stF
ide
li
tyag
reedi
nwr
it
ingtoC
has
e’s

p
ropo
saltoe
ith
erbuyb
acka
ffe
ctedlo
anso
rsendr
etr
act
ionl
ett
ers(
the“
acco
rd”
),andCh
ased
id

so(
the“
sat
isf
act
ion
”).S
ee Ch
aseSOF¶
¶7–9
. Su
chana
cco
rdands
ati
sfa
ctioni
s“a
ccep
teda
sa

l
egi
tim
ateandexp
edi
tiou
sme
anso
fse
tt
lingcon
tra
ctd
ispu
tes
.”P
rof
ex,In
c.v
.Towno
fFi
shk
il
l,

883N
.Y.S
.2d912(N
.Y.App
.Div
.2009
).

Th
ird,S&Aand1
stF
ide
li
tyc
anno
tprov
eth
ees
sen
tia
lel
emen
toff
acto
fdam
age
scau
sed

byth
edeb
tfo
rgiv
ene
ssl
ett
ers
.Se
esup
ra19(
col
lec
tingc
ase
s)
. Toth
econ
tra
ry,th
ere
cord

23
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 29 of 31

d
emon
str
ate
sth
atP
lain
ti
ffsh
aveno
tbe
end
amag
eda
sar
esu
lto
ftho
sel
ett
ersb
ecau
seth
e

bo
rrow
ersonth
elo
ansth
atS
chn
eid
ere
lec
tedtok
eepcon
tinu
edtop
aya
fte
rre
ceip
tofth
e

fo
rgiv
ene
ssandr
etr
act
ionl
ett
ers
. Ch
aseSOF¶187
.Pe
rhap
sfo
rth
isr
eason
,Pl
ain
ti
ffs
’

d
amag
esexp
ertd
isc
laim
edanyop
inionth
atS&Ao
r1s
tFid
eli
tysu
ffe
redd
amag
esa
sar
esu
lto
f

th
edeb
tfo
rgiv
ene
ssl
ett
ers
. Ch
aseSOF¶189
. And
,wh
enCh
ases
erv
edanIn
ter
rog
ato
rya
sking

S&Aand1
stF
ide
li
tytoid
ent
ifye
achin
stan
ceinwh
ichabo
rro
wer
’sp
aym
ent
sce
asedo
rwe
re

in
ter
rup
tedbyad
ebtfo
rgiv
ene
ssl
ett
er,th
eyr
espond
ed(
aft
erth
eclo
seo
fdi
scov
ery
)th
atth
ey

w
ere“un
abl
etosp
eci
fic
allyid
ent
ifyanyp
art
icu
larlo
annum
ber
satth
ist
ime
.” Ch
aseSOF

¶164
. Th
eya
rethu
spr
eclud
edf
roma
ttem
ptingtocom
efo
rwa
rd w
ithsu
chev
iden
cenow
.

Sup
raa
t21(
col
lec
tingc
ase
s)
.

B
. L
ienr
elea
ses

S&Aand1
stF
ide
li
tyn
extc
laimth
atCh
aseb
rea
chedcon
tra
ctswi
thth
embyr
ele
asing

l
ien
sonlo
ansth
eypu
rch
asedf
romCh
ase
,bu
tth
isc
laimf
ail
s fo
rth
esam
ere
ason
sth
at MRS
’s

l
ienr
ele
asec
laimf
ail
s.P
la
int
if
fsh
aveno
tid
ent
if
iedanyc
ont
rac
tprov
is
ionth
atCh
ase

suppo
sed
lyv
iol
ated
,hav
eno
tcom
efo
rwa
rdw
ithanyev
iden
ceo
fth
eso
rto
fin
ten
tion
alcondu
ct

r
equ
iredtos
tat
eac
laimfo
rbr
eacho
fth
eim
pli
edcov
enan
t,a
ndl
ackanyev
iden
ceth
atth
eyw
ere

d
amag
ed.Sup
raa
t19–20
;Ch
aseSOF¶
¶179–85
,187
,189
,191
.Pl
ain
ti
ffs
’dam
age
sexp
ertd
id

no
tev
ena
tt
emp
ttoshowanyd
amag
estoS&Ao
r1s
tFid
eli
ty,andP
lain
ti
ffsw
ereun
abl
eto

id
ent
ifyanylo
answho
sep
aym
ents
tre
amsw
erein
ter
rup
tedinth
ei
rIn
ter
rog
ato
ryr
espon
ses
.

Sup
raa
t3;Ch
aseSOF¶
¶164
,189
.

C
. R
eten
tiono
fpaym
ent
s

P
la
int
if
fs’c
laimth
atCh
aseim
prop
erlyr
eta
inedp
aym
ent
sfrombo
rrow
ersonlo
ansso
ld

toS&Aand1
stF
ide
li
tysu
ffe
rsf
roms
imi
larf
law
s. S&Aand1
stF
ide
li
ty,l
ike MRS
,didno
t

id
ent
ifyanyp
aym
ent
sCh
aseim
prop
erlyr
eta
inedonlo
ansso
ldt
oth
eminth
eirIn
ter
rog
ato
ry

24
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 30 of 31

an
swe
rs
.Se
e Ch
aseSOF¶164
. Th
isp
rec
lud
esth
emf
roma
ttem
ptingtocom
efo
rwa
rdw
ith

ev
iden
ceo
fsu
chp
aym
ent
snow
. Sup
raa
t21
.

Mo
reov
er,th
erei
s(a
tle
ast
)agenu
ined
ispu
teo
fma
ter
ialf
actr
ega
rdingth
eon
lylo
an

id
ent
if
iedw
ithsp
eci
fic
ityinP
la
int
if
fs’b
rie
f.A
cco
rdingtoP
lain
ti
ffs
,th
ebo
rrow
ersonas
ing
le

lo
anpu
rch
asedbyS&Ar
ece
ivedal
et
terf
romad
ebtco
lle
ctio
nag
ency
,Re
alT
imeR
eso
lut
ion
s,

m
is
tak
enlys
tat
ingth
atCh
aseh
ada
ssign
edth
eag
encyco
lle
ctio
nrigh
tsonth
elo
an.P
l.B
r.14
.

Bu
tPl
ain
ti
ffsdono
tcl
aimth
atth
ebo
rrow
ersm
adeanyp
aym
entstoCh
ase
.Ra
the
r,th
ere
cord

un
equ
ivo
cal
lyr
efl
ect
sth
atnosu
chp
aym
ent
swe
reev
erm
ade
.Ch
aseSOF¶188
.

Inadd
it
ion
,th
erei
snoev
iden
ceth
atS&Aw
asd
amag
eda
sar
esu
lto
fth
eco
lle
ction

l
ett
er.A
lthoughP
lain
ti
ffsa
sse
rtth
atth
ebo
rro
wer
s’a
tto
rneyth
rea
ten
edl
ega
lac
tionag
ain
st

S&A
,Pl
ain
ti
ffsth
ems
elv
esc
itesub
sequ
entco
rre
spond
enc
efrom
thes
amea
tto
rneys
ta
tingth
at

th
ebo
rrow
ersw
ish
edto“
con
tinu
eth
epaym
ent
s”th
eyh
adb
eenm
akingtoS&A
. Ch
aseSOF

¶
¶134–35
. Andth
eco
lle
ction
sda
tap
rodu
cedbyP
lain
ti
ffsd
emon
str
ateth
atth
ebo
rrow
ersin

f
actd
idcon
tinu
emak
ingth
eirp
aym
ent
stoS&Aa
fte
rre
ceip
tofth
eer
ron
eou
sco
lle
ctionl
ett
er.

S
eeid
. Ag
enu
ined
ispu
teo
ffa
ctth
ere
for
eba
rssumm
aryjudgm
entr
ega
rdingth
isc
laim
.

CONCLUS
ION

Fo
ral
lth
eser
eason
s,th
eCou
rtshou
ldd
enyP
lain
ti
ffs
’mo
tionfo
rsumm
aryjudgm
ent
.

25
 Case 1:15-cv-00293-LTS-RWL Document 384 Filed 04/19/19 Page 31 of 31

D
ated
: W
ashing
ton,DC R
esp
ect
ful
lysubm
it
ted
,
Apr
il19,2019
B
y: s
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ck
Rob
ertD
.Wi
ck

Chr
ist
ianJ .P ist
il
li
LauraB rookov er
Phi
lipJ.L evi
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Jess
icaM e r
ryS am ue
ls
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ter,850T enthStr
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lephon e:(202 )662-6000
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til
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ls@ cov.com

Michae
lC .N ichol
son
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lding
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tto
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ysfo
rDe
fendan
ts

26