Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—DMass: Wells Fargo Not Liable For Failing to Provide Fair and Accurate Credit Transactions Act Disclosures, (Nov 13, 2012)

By Jody Coultas, J.D.

A home owner, Theresa Marquez, could not state a Massachusetts Consumer Protection Act (CPA) claim against Wells Fargo Bank, N.A. because the claim was time barred and Marquez failed to state more than technical violations of the CPA, according to the federal district court in Boston (Marquez v. Wells Fargo Bank, N.A., November 8, 2012, Stearns, R.).

Marquez secured a mortgage from Wells Fargo’s predecessor-in-interest on a residential property. After Marquez defaulted, she applied for a HAMP loan modification and was admitted into a three-month Trial Period Plan (TPP). However, she was ultimately denied a loan modification. Marquez alleged that Wells Fargo violated the CPA when it failed to provide Fair and Accurate Credit Transactions Act (FACTA) disclosures during the loan application and origination process.

The CPA claim was time barred, according to the court. Marquez acknowledged that the claim was untimely, but argued that she was entitled to equitable tolling pursuant to the discovery rule because she did not become aware that she was entitled to FACTA disclosures until a forensic audit of the mortgage documentation was performed. Because Marquez would have learned at the time of the closing that the originating lender had failed to provide her with the required disclosures using reasonable diligence, the discovery rule was inapplicable.

Also, the court found that the complaint failed to allege more than mere technical violations and clerical errors by Wells Fargo and failed to put Wells Fargo on notice of a CPA claim of this nature.

The case is Civil Action No. 12-11725-RGS.

David Zak (Zak Law Offices, PC) for Theresa Marquez. Morgan T. Nickerson (Nelson Mullins Riley & Scarborough LLP) for Wells Fargo Bank, N.A.

Cases: StateUnfairTradePractices MassachusettsNews