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Sorry, you're making points; just not relevant to the points that I was identifying. Not a problem.
The 'not in favor' may (or may not) file objections to the Disclosure Statement and the POR. The same can be said for anyone in equity. IMO, the objections should focus on the omission of the worthless stock deductions (in amount, referenced only in text or words), the increased amount of the NOL, the amount of offset from the COD, and then a valuation allowance against such based upon 'something.'
The point is, if the holding company is worth 'nothing' and the NOLs are worth 'nothing' (as asserted in the Plan documents) then the super majority of the creditors that have pre-agreed to the Plan should have NO OBJECTION to current equity retaining the useless holding company (the Plan calls for LLCs of each of the licensee station groups).
$ 50M for equity is what PPS? $ 50,000,000 / shares. Continuing the math, what then is $ 500M in NOL deferred tax benefits worth (especially as a SPAC vehicle aka Wamu, now COOP)? Hint, previous times 10.
Just saying, and repeating, if one alleges that something is worth nothing then objecting to others that will take it seems a bit interesting. Just ask Mary Walrath. Been there, done that.
And yes, they did the 'steps' before. That's the point actually.
It's represented that it is already agreed to by certain of the creditors (a super majority). They have to ballot for confirmation. This isn't hop-scotch where you just skip steps. First, there are certain creditors, 2nd position, who are not in favor, particularly in the valuation by the Blackstone spinoff and the non-ratable treatment of such creditors. Second, the valuation in the Disclosure Statement appears to intentional value at ZERO the deferred tax assets of the NOL (1) carryforward and (2) from the Worthless Stock Deduction from the creation of the LLCs of each radio station group as each is abandoned by the holding company parent.
AGAIN, some creditors, and certainly equity interests, will cite such. The qualifying NOL carryforwards and the Worthless Stock losses post petition will exceed the cancellation of debt offset income by what appears to be over 1.5 BILLION. At the current tax rates, that is hundreds of millions to 'omit' from the disclosure statement and/or 'omit' from the valuation. How so? They didn't value it at all (in numbers, rather text) and then reduce it by a valuation allowance. That would be the appropriate disclosure. Why not? If no one sees it, they can't put 2+2 together.
We'll see. Many creditors and equity holders are aware. The TX Judge might not let this ride (slide) so fast once apprised of such. Think Nate Thoma. :)
Focusing on assumptions at this time. "Upon the Effective Date" means the Plan of Reorganization HAS BEEN APPROVED. It has not. It has not even been considered. The bankruptcy will not even begin to play out until February and it will LAST MONTHS. During such there will be Equity holders who will make the case for the debt for equity exchange valuation, the value of reorganized debtors Net Operating Loss carryforwards if accompanied by 50% or more of pre filing equity holders and qualified debtors (18 month holders, generally). The NOLs are worth hundreds of millions. If the debtor pleads they are valueless, it is simple. We'll take them (equity holders) and abandon all of the subsidiaries to the supermajority debt proponents.
Then we'll see. If they want just the radio subs (they are all subs) they can have them. We (equity) will keep the holding company debtor. All they have to do is file and claim the NOLs are worth nothing and then a pony show of IRC limitations. Been there done that. They'll lose now with WAMU case history (and current roll forward valuation of former equity holders).
This pre-pack has been well planned. Headlines of those buyer senior secured positions were pre-bankruptcy reflective of such visionaries 'buying Audacy.' Seriously, tipping the hand, good to note. So now we have a debt for equity exchange. At what exchange rate? If dollar for dollar, to wit, then equity is worth it also.
Fascinating to see the same big BK players run this game ad infinite and only get consequences a couple of time (WAMU for one, the NOL valuation buried, only to be resurrected by equity members).
So, who's chomping up the shares? The same debt holders to get that equity under control.
However, could be more to it. Bringing equity along (regardless of the allowance of value) makes the preservation of the NOLs under 382 'better protected' and more valuable.
We'll see. A PETITION for Equity Committee likely in the 'drafting.'
The wait is because of IRC 382. In order to preserve the NOLs for the emerged debtor the basic rule is at least 50% of the new owners where existing owners (stock) and/or 'qualified creditors.' To be qualified, just in a simple term, there is generally an 18 month holding period for the debt holders to qualify to be in that group with equity.
Hopefully, AUDA management and the senior creditors are not working together in a way that will get certain debt holders to their desired holding period.
BK court will certainly not be too happy with such.
Again, probably would be good to see MW, Nate etc. in the fray on this one. Would certainly provide some sunshine.
Actually, the almost $2 billion in expected current losses through 12/31/2023 could be supplemented by the abandonment of the radio station subs after BK petition. Potentially, another $ billion. So, why wait?
If, or when, they file for bankruptcy, retail equity could probably use MW of the WAMU fame. They have "investments in subsidiaries" that, if abandoned in bankruptcy, would likely generate > $2 billion in NOLs which @ 21% is > $400M "if done right" like the HF's usually like to do without retail equity. Ho hum.
hotmeat, agreed with minor commentary...
...comments in RED.
"Laughable" WE BOTH 100% agree on that one...
...how these same erroneous theories re-perpetuate after the facts are presented.
...actual transcripts indicating why the SLIDE wasn't admissible as evidence at the time due to the failure to comply with the Bankruptcy Court Rules of Evidence.
...again, we both 100% agree, in the sunlight of actual factual reality, such are laughable.
JUSTIN NELSON!!!!! "Myth" is Absolutely False...
...it was about objection to him submitting the Equity Committee SLIDE as evidence "at the time," as he did not comply with the Rules of Evidence prior to presenting it in court.
...JMW let him use the slide, just not submit it as evidence.
...shortly thereafter, the slide was forwarded to a Moderator of a WMI board for retail shareholders to see.
Sorry, $72M "does not" get to Escrows...
...first, escrows aren't a claimant and neither is or was the WMILT or the Debtor.
...second, the FDIC-R claim is on behalf of all of the failed banks taken into receivership; which they must have calculated and documented the damage claim for each.
...third, looking at the "covered period," WMB was in a less than half time period.
...fourth, there are hundreds (possibly thousands) of other direct and derivative claimants.
...state and local governments had $500 Billion per year in investments or debt tied to LIBOR.
...Fidelity (alone) had $364 Billion.
...I could go on.
..."so," there is no reason to expect the FDIC-R, in aggregate to even get a material amount, after when allocated to all the failed bank taken into receivership, and made available to the FDIC-R receivership, that such would be di minimis (sprinkles to the Senior bond holders still billions out of the money and Jr. bond holders billions completely out of any money at all).
...why does that matter, well there is $15 BILLION above shareholders (last priority rank, WMI owned all shares).
...not happening.
DNT, the FDIC-R must "apply" per that website...
...instructions for claims.
...if they (i.e., ANY of their failed banks in receivership, had instruments tied to LIBOR directly or indirectly damaged by Barclays during the "covered period."
...here is the template from Barclays, extract.
...notice the "covered period."
...this is not a GENERAL LIBOR POOL for all claimants, this one is for those that instruments WITH BARCLAYS, during that covered period, and a calculation of what was the damage.
...all claimants added up and divided by what's in the pot; less of course, the legal fees which appear to scheduled to be awarded to the Plaintiffs "from the fund" not from the Defendants.
...below you'll find $120M settlement pool reduced by $72M (it appears) leaving $48M for pro-rata to the claimants.
...here is just Susman Godfreys request.
LIBOR Settlement(s) Amounts, Website and Counsel...
...it's not the hundreds of billions that were proffered by the plaintiffs.
...and Susman Godfrey and Hausfeld Co-Counsel (Carmody and Ard SG Attorneys).
LIBOR SETTLEMENT HOME PAGE
https://www.usdollarliborsettlement.com/
LINK TO BARCLAYS SETTLEMENT - $120M
https://www.barclaysliborsettlement.com/
LINK TO CICITBANK SETTLEMENT - $130M
https://usdollarliborsettlement.com/mainpage/Citibank/Home.aspx
LINK TO DEUTSCHE BANK SETTLEMENT - $340M
https://usdollarliborsettlement.com/mainpage/DeutscheBankHSBC/Home.aspx
COURT DOCUMENTS
https://www.barclaysliborsettlement.com/mainpage/CourtDocuments.aspx
ATTORNEY CONTACTS
https://www.barclaysliborsettlement.com/mainpage/ContactInformation.aspx
There were no ELUSIVE RETAINED ASSETS...
...that the Examiner asked to see, but was denied.
"Methinks...was not required by law of WMI...
...laws and regulations require the issuer (WMB and Subs) to participate.
...such is called and valued as retained interests.
...depending on investment grade, reported as investment assets or as trading assets.
...of the issuer (WMB and Subs).
...and no, retained interests are recorded on the books and records of the applicable entity.
...if recorded, not hidden.
...and nothing to do with Safe Harbor, a protective provision for the buyers of the security pools of mortgages.
...and none were in process at seizure.
"Me Thinks" does not rise to any credible source evidence...
...to support the supposition that WMI owned Retained Assets or Interests' in the WMB/Sub pre-seizure MBS securitizations.
...no links, no quotes, nothing.
...add to that, no challenge by the Creditor's Committee, the Equity Committee, or any non-equity creditor Claimants "out of the money" at any time during the entire 2008-2012 debtor's bankruptcies or thereafter.
...why?
...no such WMI interests exist or existed in such.
AZ, I believe the NOL was the 'target value of WMIH...
...and honestly nothing else.
...the IRC Section 382 Limitations on a Change of Control of more that 50% by the 5% shareholders within the measurement period would, under the proffer, make the entire NOL voidable to the acquirer.
...I truly believe the NOL had the only value post emergence, plus the $75M pocket change from the AAOC, and not the useless LOC.
...in the above light, I can't agree with the following.
AZ, THERE IS EXPLANATION, SENT PM...
...TAKE CARE.
William J Paatalo V JPMorgan Chase...
...things that make you go HMMMMMMMMMMMMMMMMMMMMMMM.
https://stopforeclosurefraud.com/2016/09/22/william-j-paatalo-plaintiff-v-jpmorgan-chase-bank-defendant-dismissed/
Categorized | STOP FORECLOSURE FRAUD
WILLIAM J. PAATALO, Plaintiff, v. JPMORGAN CHASE BANK, Defendant. | DISMISSED
Posted on22 September 2016.
WILLIAM J. PAATALO, Plaintiff, v. JPMORGAN CHASE BANK, Defendant. | DISMISSED
WILLIAM J. PAATALO, Plaintiff,
v.
JPMORGAN CHASE BANK, Defendant.
Case No. 6:15-cv-01420-AA.
United States District Court, D. Oregon, Eugene Division.
September 7, 2016.
William J. Paatalo, Plaintiff, represented by John A. Cochran, Pacific Property Law LLC.
J.P. Morgan Chase Bank, Defendant, represented by Frederick B. Burnside, Davis Wright Tremaine, LLP, Kaley L. Fendall, Davis Wright Tremaine, LLP & Kevin H. Kono, Davis Wright Tremaine, LLP.
OPINION AND ORDER
ANN AIKEN, District Judge.
Plaintiff William J. Paatalo seeks a declaratory judgment deeming null and void the 2009 foreclosure of his home loan and trustee’s sale of the property securing the loan. The lender and original trustee was Washington Mutual Bank, F.A. (“WaMu”). Defendant JPMorgan Chase was the purchaser of the property at the trustee’s sale and the assignee of many of WaMu’s assets and liabilities after WaMu’s failure during the financial crisis.
The parties filed cross-motions for summary judgment. For the reasons set forth below, plaintiffs motion is denied, defendant’s motion is granted, and this case is dismissed.
BACKGROUND
In 2004, plaintiff purchased real property in Yachats, Oregon (“the property”) for $449,500. Compl. ¶ 1. In 2006, he refinanced the property by obtaining an $880,000 “Option Arm” loan and a nearly $110,000 home equity line of credit (“HELOC”) from WaMu. Id. ¶ 2. In 2007, the HELOC was increased to $155,000. Id. ¶ 3. Both loans were secured by deeds of trust on the property. Id. ¶ 2.
Plaintiff alleges WaMu misapplied payments and reported false derogatory information to credit reporting agencies on the HELOC account. Id. ¶ 5. After disputing those actions with WaMu, plaintiff alleges he began to suspect fraud. Id. ¶ 6. He alleges WaMu inflated the appraised value of his property, falsified his income on his loan application without his knowledge or consent, and committed numerous violations of the Truth in Lending Act (“TILA”), 15 U.S.C. §§ 1601 et seq., including “fail[ing] to provide proper `Notices of Rescission’ on the 2006 loans[.]” Id.
Plaintiff further alleges he sent a written “Notice of Rescission” on both loans to WaMu in March 2008. Id. He asserts WaMu responded with a letter declining his rescission and attaching a “payoff quote” of just under one million dollars. Id. ¶ 7. According to plaintiff, the letter stated he could not rescind unless he first paid off the amount of the debt in full — something he was unable to do. Id. In July 2008, plaintiff filed suit in this Court against WaMu, alleging violations of the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., and the Real Estate Settlement Procedures Act, 12 U.S.C. § 2601 et seq. See Paatalo v. Wash. Mut. Bank, 2011 U.S. Dist. LEXIS 46350, *1 (D. Or. Apr. 27, 2011).
On September 25, 2008, at the “height of the global financial crisis, [WaMu] was seized by its regulator . . . in what has been described as `the largest bank failure in U.S. history.'” Anchor Savs. Bank, FSB v. United States, 121 Fed. Cl. 296, 302 (Fed. Cl. 2015) (quoting Robin Sidel et al., WaMu Is Seized, Sold Off to JP. Morgan, In Largest Failure in US. Banking History, Wall Street Journal, Sept. 26, 2008, availableatwww.wsj.com/articles/SB122238415586576687). Pursuant to a Purchase and Assumption Agreement, the Federal Deposit Insurance Corporation (“FDIC”) transferred many of WaMu’s assets and liabilities to defendant. Id.; Compl. ¶ 28. After WaMu’s failure, plaintiffs pending claims against WaMu “went to the FDIC,” pursuant to the Federal Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”), 12 U.S.C. §§ 1811 et seq. Compl. ¶ 8. In 2011, plaintiffs suit against WaMu was dismissed due to plaintiffs failure to file an administrative claim with the FDIC within the allotted timeframe. Paatalo, 2011 U.S. Dist. LEXIS 46350 at *5.
Plaintiff alleges that WaMu recorded a “Notice of Default and Election to Sell” in connection with the property on April 2, 2009. Compl. ¶ 10. A set of additional documents were recorded in connection with the property on July 31, 2009. Id. ¶ 11. Those documents included a Notice of Foreclosure, Trustee’s Notice of Sale, and affidavits claiming WaMu was the beneficiary of plaintiffs’ deeds of trust. Id. At the trustee’s sale, defendant purchased the property for $410,000 cash, and on August 18, 2009, a Trustee’s Deed was issued to defendant for the property. Id. ¶ 13.
In October 2010, defendant filed an ejectment action against plaintiff in Lincoln County Circuit Court. Id. ¶ 14; Fendall Deel. ¶ 2 & Ex. A May 11, 2016. Plaintiff filed an answer and asserted a host of counter-claims, including claims for declaratory relief, illegal foreclosure, and fraud. Fendall Deel. ¶ 3 & Ex. B May 11, 2016. On June 2, 2011, the court granted defendant’s motion to dismiss plaintiffs counterclaims, granted defendant’s motion to voluntarily dismiss the ejectment complaint, and dismissed the case. Id. ¶¶ 4, 5 & Exs. C, D. Defendant filed an appeal. Id. ¶ 6 & Ex. E. On July 12, 2011, while the appeal was pending, defendant sold the property to a third-party purchaser. Compl. ¶ 16.
In November 2012, the parties signed a settlement agreement (“the settlement agreement”).[1] Fendall Deel. ¶ 7 & Ex. F May 11, 2016. Pursuant to the agreement, plaintiff voluntarily dismissed his appeal in state court. The agreement also contained a mutual release of claims, the terms of which are discussed in more detail later in this Opinion.
Plaintiff filed this lawsuit after the Supreme Court decided Jesinoski v. Countrywide Home Loans, 135 S. Ct. 790 (2015). Before Jesinoski, the federal courts were split in their interpretation of the provisions of TILA governing a borrower’s right to rescind a loan. Some courts, including the Ninth Circuit, had held that when a lender denied a request to rescind, the borrower was required to file a lawsuit to enforce his or her rescission rights, and that such a suit must be filed within three years of closing. SeeYamamoto v. Bank of N.Y., 329 F.3d 1167, 1172 (9th Cir. 2003) (holding that when a lender contests a borrower’s right to rescind, “it cannot be that the security interest vanishes immediately upon the giving of notice”). Other courts disagreed, holding that a notice of rescission automatically voids the lender’s security interest. SeeSherzer v. Homestar Mtg. Servs., 707 F.3d 255, 258 (3d Cir. 2013) (rejecting the argument “that an obligor must both send written notice and file suit within three years of the closing date”). In Jesinoski, a unanimous Supreme Court held “rescission is effected” at the time the borrower gives notice of intent to rescind, so long as the notice is given within the statutory time period. Jesinoski, 135 S. Ct. at 792. Plaintiff argued Jesinoski made clear the loan was rescinded in 2008, when he sent the letter to WaMu; WaMu’s security interest in the property was voided at that time; and, as a result, defendant never obtained a valid interest in the property through the trustee’s sale. Plaintiff asked this Court to declare (1) plaintiff is the sole owner of the property; (2) the foreclosure of the Deeds of Trust was null and void; and (3) all documents recorded on or against title to the subject property after the March 29, 2008 notices of rescission are null and void. Compl. at 9.
Defendant moved to dismiss for failure to state a claim. On November 12, 2015, this Court issued an opinion and order denying defendant’s motion to dismiss (“November 2015 Opinion”) because “if—as plaintiff alleges—WaMu failed to provide the required disclosures and plaintiff delivered written notice of rescission in March 2008, the rescission was effected and the security interest in plaintiffs property voided at that time.” Paatalo v. JPMorgan Chase Bank, 146 F. Supp. 3d 1239, 1244 (D. Or. 2015).
Defendant then filed an answer, asserting various affirmative defenses, including defenses of release and waiver stemming from the 2012 Settlement Agreement. Am. Answer ¶¶ 44, 45. Plaintiff moved to strike defendant’s affirmative defenses and for judgment on the pleadings. On February 24, 2016, this Court struck defendant’s preclusion and estoppel defenses but otherwise denied plaintiffsmotion(“February 2016 Opinion”). Paatalo v. JPMorgan Chase Bank, 2016 U.S. Dist. LEXIS 44093, *6 (D. Or. Feb. 24, 2016). With respect to the defenses of release and waiver, the February 2016 Opinion explained that “[e]ven assuming the questions of fact related to rescission are resolved in plaintiffs favor, [the settlement agreement] might bar plaintiff from asserting his claims in this action.” Id.
Before the Court now are the parties’ cross-motions for summary judgment.
STANDARD
Summary judgment is appropriate if “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The moving party has the burden of establishing the absence of a genuine issue of material fact. Id.; Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial.Celotex Corp., 477 U.S. at 324. “Summary judgment is inappropriate if reasonable jurors, drawing all inferences in favor of the nonmoving party, could return a verdict in the nonmoving party’s favor.” Diaz v. Eagle Produce Ltd. P’ship, 521 F.3d 1201, 1207 (9th Cir. 2008).
DISCUSSION
I. Conferral Pursuant to Local Rule 7-1
As a preliminary matter, I must address plaintiffs counsel’s conferral obligations. Defendant’s counsel states that plaintiffs counsel “conferred” on plaintiffs summary judgment motion via a short email stating, in its entirety, “Just wanted to confer with you that my Client and I will be filing a motion for summary judgment in the next 10 to 14 days. I assume you will oppose but just wanted to confer so I can file when we have it prepared. Thanks!” Fendall Deel. ¶2 & Ex. 1 Apr. 18, 2016. Defendant’s counsel wrote back that a more substantive conversation would be necessary to meet the parties’ conferral obligations. Id ¶ 3 & Ex. 2. Plaintiffs counsel never responded to that message, and he filed the motion without further conferral. Id. ¶ 4. Plaintiffs counsel has not addressed conferral in his filings.
“When conferring about a dispositive motion, the parties must discuss each claim, defense, or issue that is the subject of the proposed motion.” L.R. 7-1(a)(2). This is not a meaningless procedural requirement; it exists “to encourage parties to confer and resolve disputes amicably whenever possible, thus preserving judicial resources for only those disputes that truly require court intervention.” Kazemy v. BMW of N. Am., LLC, 2014 WL 3667217, *2 (D. Or. Jul. 17, 2014). Here, conferral could have streamlined plaintiffs motion, most notably by bringing to light that the parties planned to introduce different versions of the notices to rescind from WaMu’s files.
Plaintiffs counsel’s three-sentence email did not even come close to meeting the standard imposed by the local rule. Plaintiffs counsel is admonished in the future to comply with the local rules, and reminded that the Court has discretion to deny any motion on the basis of failure to meet conferral obligations. L.R. 7-1(a)(3).
II. Questions of Material Fact Regarding Rescission of the Loan
To prevail on his claims, plaintiff must show that he had a conditional right to rescind the loan and that he exercised that right within the relevant timeframe. Paatalo, 146 F. Supp. 3d at 1245-46. Plaintiff contends he has met this burden. To the contrary, I conclude substantial questions of material fact remain as to both issues, and that plaintiffs motion for summary judgment must be denied.
Congress enacted TILA “to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uniformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices.” Hauk v. JP Morgan Chase Bank USA, 552 F.3d 1114, 1118 (9th Cir. 2009) (quoting 15 U.S.C. § 1601) (quotation marks omitted). TILA provides special rescission rights for loans secured by a borrower’s principal dwelling. 15 U.S.C. § 1635(a); Semar v. Platte Valley Fed. Sav. & Loan Ass’n, 791 F.2d 699, 701 (9th Cir. 1986). TILA’s “buyer’s remorse” provision, Semar, 791 F.2d at 701, grants buyers the right to rescind within three days of either “the consummation of the transaction or the delivery of the information and rescission forms required under this section together with a statement containing the material disclosures required under this subchapter, whichever is later[.]” 15 U.S.C. § 1635(a). This provision creates two separate rescission rights. The first is an “unconditional” right to rescind, good for three business days after the transaction. Jesinoski, 135 S. Ct. at 792. The second is a “conditional” right, and exists only if the lender has failed to provide the required information, forms, and disclosures or if those materials are deficient. Id.; 12 C.F.R. § 226.23(a)(3). The conditional right expires after three years or upon sale of the property “[e]ven if a lender never makes the required disclosures.” Jesinoski, 135 S. Ct. at 792 (emphasis in original).
A. Plaintiff’s Conditional Right to Rescind
Plaintiff argues he never received written notice of his write to rescind. In support of this argument, he introduced copies of two documents, each titled Notice of Right to Cancel, which he obtained from defendant through discovery. The notices include plaintiffs name and address, but they are unsigned and undated. Paatalo Aff. Ex. BB at 1, 3 Mar. 25, 2016 (doc. 22-5). In an affidavit accompanying his Motion for Summary Judgment, plaintiff states WaMu never provided the unsigned notices to him. Paatalo Aff. at 4 Mar. 25, 2016 (doc. 22-3). In response, defendant produced two different documents, also titled Notice of Right to Cancel. The forms are similar but not identical to the unsigned documents introduced by the plaintiff. These documents, however, bear plaintiffs signature or initials and contain dates corresponding to plaintiffs August 2006 refinance and September 2007 increase in the HELOC. Dunn Deel. Exs. 1-3. Plaintiff, for his part, states he has “no recollection of ever seeing or signing” those documents. Paatalo Aff. at 2 Apr. 21, 2016 (doc. 27-1). Accordingly, there remain questions of material fact as to whether WaMu gave plaintiff written notice of his right to rescind.
In the alternative, plaintiff argues the notices are deficient under TILA and its accompanying regulations. Specifically, he argues that the notices fall short of 12 C.F.R. § 226.23(b)(1)(iv)’s requirement to disclose the effects of rescission because they do not state that rescission of the loan extinguishes the lender’s security interest, as set forth in 12 C.F.R. § 226.23(d)(1). But the notices plainly contain such a statement. The signed notices introduced by defendant each explain, under the heading “Your Right to Cancel,” that canceling the transaction also cancels the security interest in the home. Dunn Deel. Exs. 1-3. The unsigned notices introduced by plaintiff contain similar statements. Paatalo Aff. Ex. BB Mar. 25, 2016. The notices do not track the exact language of section 226.23(d)(1), but neither does the model form contained in Appendix H to the TILA regulations. Compare 12 C.F.R. 226.23(d)(1) (security interest becomes “void” upon rescission) with 12 C.F.R. § 1026 Appx. H (“Rescission Model Form (General)” stating that “f you cancel the transation, the (mortgage/lien/security interest) is also cancelled”). With respect to explaining what happens to the security interest after rescission, each notice in the record is either identical to or substantially similar to this model form. That is precisely what the regulations require. 12 C.F.R. § 226.23(b)(2). Plaintiff has not shown that any of the notices in the record, signed or unsigned, are deficient under the regulations.
B. Plaintiff’s Exercise of the Right to Rescind
Plaintiff alleges he sent a handwritten letter on or about March 29, 2008, notifying WaMu he intended to exercise his right to rescind. Paatalo Aff. at 2 Mar. 25, 2016. He attached a copy of a handwritten letter to his Motion for Summary Judgment. Id Ex. BB. The letter states “because I’m in within 3-years of the loan closings, I hereby rescind and demand a full return of all money I have paid to date, and a cancellation of the contracts.” Id (capitalization normalized and emphasis omitted). Plaintiff contends introduction of this letter irrefutably proves he exercised his right to rescind in 2008.
Defendant does not concede that plaintiff sent a rescission letter to WaMu in 2008. Rather, defendant points out that plaintiff has introduced no proof of mailing despite asserting he sent the letter by certified mail. Defendant further asserts the files it inherited from WaMu contained neither a copy of the letter nor WaMu’s purported response with the payoff quote. The only evidence plaintiff sentthe letter to WaMu or that WaMu received it is plaintiffs own testimony. Accordingly, there remains a material question of fact regarding whether plaintiff notified WaMu within years of his intent to rescind the loan. Plaintiffs motion for summary judgment must be denied.
II. Release of Claims in the Agreement
Defendant contends it is entitled to summary judgment because the release of claims in the settlement agreement bars plaintiff from bringing the claims asserted in this lawsuit. I agree.
The settlement agreement provides it will be interpreted according to Oregon law.See Fendall Deel. Ex.Fat 7-8 May 11, 2016. Under Oregon law, “[a] release is a contract in which one or more parties agrees to abandon a claim or right.” Lindgren v. Berg, 772 P.2d 1336, 1339 (Or. 1989). Releases are favored in Oregon because “[c]ertainty and judicial economy are served when parties can negotiate settlement of their disputes with confidence that their settlement agreements will be upheld and enforced by the courts.” Id.; accord Graves v. Tulleners, 134 P.3d 990, 997 (Or. Ct. App. 2006). Although interpretation of the terms of a release sometimes is a question of fact for the jury, “f the terms of a release agreement are unambiguous, the construction of the contract is a question for the court and is treated as a matter of law.” Pioneer Res., LLC v. D.R. Johnson Lumber Co., 68 P.3d 233, 245 (Or. Ct. App. 2003) (quotation marks omitted).
The settlement agreement states that “except as more specifically stated herein, the Parties wish to finally andforever resolve all claims, disputes, and differences between them regarding . . . the Account . . . and the Property.” Fendall Deel. May 11, 2016 Ex. Fat 4 (emphasis added). The settlement agreement defines “the Account” as the deed of trust dated August 10, 2006 and the promissory notes associated with that deed of trust. Id. It also specifies that “the Property” is the same Yachats property at issue in the instant lawsuit. Id. The settlement agreement further provides that “it is the desire and intention of each of the Parties to effect a final and completeresolution of all claims and causes of action” they “ha[ve] or may have] against one another” related to “the Account” or “the Property.” Id at 4-5 (emphasis added). Accordingly, the parties agreed to “forever” release one another from all claims, counter-claims, third-party claims, demands, obligations, judgments, actions, causes of action, appeals, liens and liabilities for injuries, losses, and damages, whether personal, property, economic, non-economic, exemplary or punitive, whether now known or unknown, foreseen or unforeseen, liquidated or unliquidated, that in any way relate to, arose or arise out of the Account or the Property that in any way relate to, arose or arise out of any occurrence, act, or omission that could have been alleged in the Action brought by or on behalf of Chase against Defendant . . . or by or on behalf of Defendant against Chase. . . . relating to the Account or the Property.
Id at 5-6.
Plaintiff first argues that his current claims are not covered by the release because he could not have asserted them until the Supreme Court decided Jesinoski. In the November 2015 Opinion, this Court acknowledged that “had [plaintiff] made the arguments he now makes [regarding Jesinoski] at the time of the trustee’s sale, they would have been foreclosed by Ninth Circuit precedent.” Paatalo, 146 F. Supp. 3d at 1247. Nonetheless, plaintiffs claims fall within the scope of the release. The phrase “could have been alleged” in the release modifies the words “occurrence,” “act,” and “omission”; it does not modify “claim,” “demand,” or any other similar term. The release is clearly intended to sweep broadly to include any and all claims arising out of the factual dispute at issue in the 2010 state-court lawsuit. Moreover, the release specifically states that it covers claims that are “unknown” or “unforeseen.” The inclusion of both terms suggest coverage of claims currently available but not known to the parties and coverage of claims that have not yet arisen and are not predicted to arise by the parties. Finally, terms such as “forever,” and “complete” drive home the parties’ intent to fully resolve their differences related to the property, deed of trust, and notes. Plaintiffs current claims are covered by the release because they arise out of occurrences, acts, and omissions he could have alleged in the 2010 state court action.
Next, plaintiff contends his request for declaratory relief in this action is not covered by the release because rescission under TILA is remedy, not a “claim” or a “cause of action.” This semantic argument is an attempt to escape the clear intent of the release. The most straightforward interpretation of the release is as a promise not to sue each other in the future over the property or deed of trust. Plaintiff then filed this lawsuit against defendant, asking the Court to declare that the property is his and the trustee’s sale is void. This is plainly a claim, cause of action, or demand covered by the release.
Plaintiff also avers that the release should be invalidated on the ground of mutual mistake. His theory is that Jesinoski revealed both parties entered into the settlement agreement under the misconception that defendant had rights to the property it never possessed. Accepting for the sake of argument that the parties’ failure to anticipate a change in the law[2] may correctly be termed a “mistake of fact,” the argument is unavailing here. In Oregon, “mutual mistake is not a basis on which to void a release agreement.” Raymondv. Feldmann, 853 P.2d 297, 299 (Or. Ct. App. 1993); Graves,134 P.3d at 997. Rather, releases in settlement agreements may be invalidated only on grounds of misrepresentation or unconscionable conduct. Graves, 134 P.3d at 997. In Wheeler v. White Rock Bottling Co., 366 P.2d 527, 530 (Or. 1961), a personal injury case, the Oregon Supreme Court acknowledged the “attractive policy reasons for adopting a rule that would permit perfectly honorable releases to be repudiated in the event of aggravation of an injury or the discovery of undiagnosed injuries.” However, the court ultimately determined those policy concerns were outweighed by the “less compassionate but equally sound policy reasons for requiring persons of legal age and capacity to stand by their covenants, including bargains containing an element of chance.” Id. Plaintiff signed a broad release of claims and received valuable consideration in return. The bargain he struck included an element of chance. He is now bound to the terms of that agreement, even though an “undiagnosed injury” in the form of a forfeited Jesinoski argument has materialized.
Finally, plaintiff asserts defendant is not entitled to summary judgment because it has not counterclaimed to vacate the rescission. This argument ignores the fact that defendant is not seeking any relief from this Court. Plaintiff is seeking a declaration he is the owner of the property. The release bars him from seeking that relief in an action against defendant. Defendant is under no obligation to make a counterclaim to succeed in its motion for summary judgment.
The unambiguous terms of the release in the settlement agreement bar this lawsuit. Defendant is entitled to summary judgment on its affirmative defense of release.
Defendant also is entitled to summary judgment on its affirmative defense of waiver. Waiver is the intentional relinquishment of a known right. Oracle Am., Inc. v. or. Health Ins. Exch. Corp., 145 F. Supp. 3d 1018, 1043 (D. Or. 2015). Through the release, plaintiff knowingly and intentionally waived his right to take any future legal action against defendant with respect to the property and the deed of trust. The change in the law effected by Jesinoski does not invalidate this waiver. Cf United States v. Cardenas, 405 F.3d 1046, 1048 (9th Cir. 2005) (refusing to invalidate defendant’s appeal waiver even though the Supreme Court’s intervening decision inUnited States v. Booker, 543 U.S. 220 (2005) substantially changed federal sentencing law).
CONCLUSION
Plaintiffs Motion for Summary Judgment (doc. 22) is DENIED. Defendant’s Motion for Summary Judgment (docs. 37 & 39) is GRANTED and this case is DISMISSED. Defendant’s request for oral argument is DENIED as unnecessary.
IT IS SO ORDERED.
[1] By its terms, the agreement is confidential. A copy was filed under seal in this case. Details of the agreement will be discussed in this opinion only as necessary to resolve the parties’ motions.
[2] Chase argues that Jesinoski did not change in the law, citing Rivers v. Roadway Express, Inc., 511 U.S. 298, 312-13 & n.12 (1994) for the proposition that when the United States Supreme Court interprets a statute, “it is explaining its understanding” of what the statute “has always meant.” It is true that Jesinoski did not change the law in the sense that it did not change the meaning of TILA. However, Jesinoski indisputably changed the governing case law in the Ninth Circuit, which had previously interpreted TILA incorrectly.
JB, AGREE THAT IT IS LAUGHABLE TO STILL BELIEVE...
...IN ANY FANTASY RECOVERY.
...IT IS 2020 AND IT, AFTER THE WMIH SHARES, WAS OVER IN 2012.
...OF COURSE, IN THE WORLD OF REALITY.
The Hedge Funds already got paid, almost $6B...
...they don't hold escrows at any value or they would be reporting them in their holdings.
...they are not.
...it is all fantasy theories that time has not withered but will eventually prevail (for most).
...it is sad such has perpetuated such false hope that they have value from dozens and dozens of failed proffers since 2012.
mw44, the reality is that it is what it is...
...it's life, not always fair (and/or reasonable).
Of course they do, that's why we lost...
...that is "sleep with each other."
...yes it is not fair, not moral, etc.
...however, it is done.
...it is what it is.
...we only got the reorganized debtor because of shareholders, over what appeared to be MWs' lying despicable unethical behavioral objection and obfuscation of shareholder efforts.
Sorry, but that, like so much, has NOTHING to do with COOP...
...the discussion was about the amount that some assert are being paid by the Underwriters in regard to the Alice Griffin appeal (AIW).
...and then re-direct to the amount the WMILT and the Underwriters have paid for the original objection.
...one such was $800,000 (8 lawyers at $100,000 per day LOL), previously $50-$60,000; it hops all over.
...and nothing verifiable; from one's perspective of overheard of opposing counsel estimating debtor/WMILT counsel's estimated legal fees.
...this has nothing to do with such discussion.
The TPS "lost," 100% clear to any reasonably prudent...
...investor that has read the Court orders and concluding disclosure documents.
...'prolly should read such.
...LOL to theorize that, after the court ruled that the Conditional Exchange took place and JPMC got the underlying mortgage pools ($12+B) and the TPS got Class 19 preferred class, was a "win" the 3rd time. LOLOL.
...reorganized debtor shares is ALL THAT THEY GOT.
...and, in the world of reality that is existent fact based, there is nothing else coming.
...LOL forever.
...they lost, 1st, 2nd and 3rd time.
Alice's and TPS Litigation UNRELATED...
...to any reasonably prudent investor of WMI (formerly) or COOP, the reorganized debtor.
...the TPS lost their case per the DE Bankruptcy Court; no they weren't convinced by MW or SS of SG that there were billions in hidden assets (LOLOLOLOL).
So now we have, AG Counsel "GUESSING" out loud...
...about the WMILT legal expenses for the Griffin case.
...and the Underwriter's JOINDER cost.
...LOL.
...well, let's look who (Counsel) won.
...WMILT.
...looks like their opposing counsels' work was as good as his estimate of the WMILT's legal fees (the the Underwriter JOINDER).
...LOLOLOL.
Any Legal Counsel that reveals their legal fees...
...to opposing Legal Counsel.
...would be professionally unethical.
...Counsel for the Underwriters are of the Highest Acknowledged and Reputable firms.
...Counsel "discussing about the opposing legal team expenses" is from the peanut gallery and not worth the breath in uttering such.
...Underwriters Counsel DID NOT TELL opposing Counsel "ANYTHING."
Any Attorney that would discuss any client matter...
...with anyone other than the client.
...is professionally unethical.
...to wit, what would such a persons' comments about legal fees be worth?
...nothing.
...the $800,000 for just the "first objection" of AYA Objection is LAUGHABLE.
newflow, LEGAL FEES were "Never" $70 BILLION...
...for any and all firms and consultants.
...never mind the OP and Replies which were ALL regarding the UNERWRITER'S Attorney Fees in the Alice Griffin Appeal.
Oh, now $50-$60K and NOT MILLIONS...
..."right there."
...LOL.
Sorry, but one must read the posts to...
...see that such is NOT the case at the Appellant level.
...i.e., currently.
...as in "now."
...as was the point of the OP re: "they "are" spending, then modified to say they are now spending "millions.""
Again, the are NOT SPENDING BIG MONEY...
...other than the JOINDERS.
...to the Appeal.
...the opinion (unfounded, as nothing shown in BLACK and WHITE to prove) below was what the are in the act of doing.
...they are not.
The UNDERWRITER'S aren't PAYING BIG MONEY...
...to stay in Class 19.
...they have only filed 1-3 page JOINDERS (per PACER).
...a JOINDER is a 'template document to such firms.
...BTW, the firm representing them REPRESENTED THE EQUITY COMMITTEE at first.
...comments in RED.
DT, thanks for looking at the interest rate issue...
...as it relates to the value of COOPs MSR's.
...it's pertinent to have analytic discussions on COOP based upon actual technical data.
...again, thanks.
Per COOP's SEC Filings, Declining Interest Rates...
...negatively impact the valuation of its' Mortgage Servicing Rights (its' largest asset and primary business).
...I don't know why much more explanation is required.
JW, the point was declining interest rates...
...is, industry accepted to the reasonably prudent investor, and acknowledged by COOP in SEC filings and Audited financial statements, a negative on the valuation of the Mortgage Servicing Rights "asset" (the largest on the COOP books).
...not interested in the drivel of other articles that are simply not foundational supported.
...COOP will likely have very good operating income; it is just the "hit" to the valuation of the MSR's that I am concerned with.
...also, noted the claims to re-financing is a plus for COOP; it is not as they lose the MSR's and have a reduced chance to be the originator for the refinance.
...mortgage origination's are not the primary business of COOP, it is MSR's (and they are good at it).
JW, Forbearance is a Cash Flow matter...
...that really doesn't impact net service revenues and the bottom line; as COOP can continue to "accrue" earned and unpaid service fees.
...but, yes, Cash Flow dealing with the Government Ordered (CARES Act) Forbearance is also important. Personally, IMO such government action was similar to the Defense Production Act by, directly, requiring the mortgage servicers like COOP to pay the principal and interest for 4 months during the Forbearance.
...if what we've seen is not a 'LC "play" to highlight on the one hand and liquidate with the other; could be governmental and corporate insiders via their underground leak railroads might know if COOP might be soon able to re-finance its debt (with staggering interest rates compared to today) and maybe with the help of, or direct with, the FED.
...regardless, would like to see $18 on whatever the underlying cause.
Mordicai, you might have more red flags...
...we can't be sure until June 30th Form 13F due 45 days after quarter end.
...if he did the publicity to sell, he doesn't know about the embedded WMI retail shareholders in COOP; pretty antsy group of people and not shy about reporting to regulators.
...comments in RED.