Cobb Cnty. v. Bank of Am. Corp.
| Citation | 591 F.Supp.3d 1312 |
| Docket Number | CIVIL ACTION NO. 1:15-CV-04081-LMM |
| Decision Date | 17 March 2022 |
| Parties | COBB COUNTY, DeKalb County, and Fulton County, Georgia, Plaintiffs, v. BANK OF AMERICA CORPORATION; Bank of America, N.A.; Countrywide Financial Corporation ; Countrywide Home Loans, Inc. ; Countrywide Bank, FSB ; Countrywide Warehouse Lending, LLC ; BAC Home Loans Servicing, LP; Merrill Lynch & Co., Inc.; Merrill Lynch Mortgage Capital Inc.; and Merrill Lynch Mortgage Lending, Inc., Defendants. |
| Court | U.S. District Court — Northern District of Georgia |
David James Worley, James M. Evangelista, Kristi Stahnke McGregor, Evangelista Worley, LLC, Atlanta, GA, Hezekiah Sistrunk, Jr., Shean DeCarlos Williams, The Cochran Firm, Atlanta, GA, Jeffrey Emery Tompkins, Thomas G. Sampson, Thomas Kennedy Sampson & Tompkins, LLP, Atlanta, GA, Alan R. Perry, Jr., Page Perry, Atlanta, GA, Ezra Salami, Milberg Phillips Grossman LLP, New York, NY, Jennifer Sarah Czeisler, Pro Hac Vice, John David Hughes, Pro Hac Vice, Roy Shimon, Pro Hac Vice, Sanford P. Dumain, Pro Hac Vice, Milberg, Coleman, Bryson, Phillips, Grossman PLLC, Garden City, NY, Justin G. Day, Pro Hac Vice, Ryan P. McMillan, Pro Hac Vice, Virginia Ann Whitener, Pro Hac Vice, Mark E. Silvey, Milberg Coleman Bryson Phillips Grossman, PLLC, Knoxville, TN, Stephen Jarret Raab, Milberg Coleman Bryson Phillips Grossman, PLLC, Chicago, IL, for Plaintiff Cobb County.
David James Worley, James M. Evangelista, Kristi Stahnke McGregor, Evangelista Worley, LLC, Atlanta, GA, Hezekiah Sistrunk, Jr., Shean DeCarlos Williams, The Cochran Firm, Atlanta, GA, Jeffrey Emery Tompkins, Thomas G. Sampson, Thomas Kennedy Sampson & Tompkins, LLP, Atlanta, GA, Ezra Salami, Milberg Phillips Grossman LLP, New York, NY, Jennifer Sarah Czeisler, Pro Hac Vice, John David Hughes, Pro Hac Vice, Roy Shimon, Pro Hac Vice, Sanford P. Dumain, Pro Hac Vice, Milberg, Coleman, Bryson, Phillips, Grossman PLLC, Garden City, NY, Justin G. Day, Pro Hac Vice, Ryan P. McMillan, Pro Hac Vice, Virginia Ann Whitener, Pro Hac Vice, Mark E. Silvey, Milberg Coleman Bryson Phillips Grossman, PLLC, Knoxville, TN, Stephen Jarret Raab, Milberg Coleman Bryson Phillips Grossman, PLLC, Chicago, IL, Stuart Jay Guber, Faruqi & Faruqi, LLP, Philadelphia, PA, for Plaintiffs DeKalb County, Georgia Fulton County.
Andrew Kim, Pro Hac Vice, Henry C. Dinger, Levi Swank, Joseph F. Yenouskas, Pro Hac Vice, Matthew S. Sheldon, Thomas M. Hefferon, Pro Hac Vice, Goodwin Procter LLP, Washington, DC, Charles Scott Greene, Leah Amelia Schultz, William Vance Custer, IV, Bryan Cave Leighton Paisner LLP, Atlanta, GA, Edwin Montgomery Cook, Edwin Cook Law, LLC, Atlanta, GA, Courtney Lynn Hayden, Pro Hac Vice, Goodwin Procter, LLP, Boston, MA, for Defendants Bank of America Corporation, Bank of America, N.A., Countrywide Financial Corporation, Countrywide Home Loans, Inc., Countrywide Bank, FSB, Countrywide Warehouse Lending, LLC, Merrill Lynch & Co., Inc., Merrill Lynch Mortgage Capital Inc., Merrill Lynch Mortgage Lending, Inc.
Andrew Kim, Pro Hac Vice, Henry C. Dinger, Levi Swank, Joseph F. Yenouskas, Pro Hac Vice, Matthew S. Sheldon, Thomas M. Hefferon, Pro Hac Vice, Goodwin Procter LLP, Washington, DC, Charles Scott Greene, William Vance Custer, IV, Bryan Cave Leighton Paisner LLP, Atlanta, GA, Edwin Montgomery Cook, Edwin Cook Law, LLC, Atlanta, GA, Courtney Lynn Hayden, Pro Hac Vice, Goodwin Procter, LLP, Boston, MA, for Defendant BAC Home Loans Servicing, LP.
Leigh Martin May, United States District Judge This case comes before the Court on Defendants’ Motion for Partial Summary Judgment, Dkt. No. [137]. After due consideration, the Court enters the following Order.
Plaintiffs Cobb County, DeKalb County, and Fulton County, Georgia (the "Counties") filed this case on November 20, 2015, Dkt. No. [1], and have since amended the complaint twice, see Dkt. No. [61] (2d Am. Compl.). In the second amended complaint, the Counties allege that, over approximately the last 20 years, Defendants have engaged in mortgage-lending discrimination directed at minority borrowers within the Counties’ borders. Specifically, the Counties allege that Defendants engaged in, and continue to engage in, discriminatory schemes that expose borrowers to unreasonable levels of risk; needlessly inflate interest rates, penalties, and fees; generate unauthorized and inflated charges for default-related services; and lead to higher foreclosure rates among minority borrowers.
The Counties further allege that Defendants’ scheme has harmed them. They contend that Defendants’ actions have caused and will continue to cause (1) direct and indirect financial harm to the Counties, including the cost of county services related to the foreclosure process, the erosion of the Counties’ tax base, the loss of property tax revenue, the loss of certain intangible property recording fee income, and other financial harm due to urban blight1 ; (2) a reduction in the percentage of minority homeowners in the Counties’ communities and neighborhoods, increasing segregation and robbing those communities of their integrated racial character; and (3) organizational harm to the Counties’ departments and authorities because Defendants’ conduct forced and continues to force reallocation of Counties’ limited financial and human resources to address the harms Defendants’ actions have caused. Id. ¶¶ 438-84.
In the present complaint, the Counties assert three counts under the Fair Housing Act ("FHA"), 42 U.S.C. § 3601, et seq. Id. ¶¶ 486-638. In Count I, they assert a claim for disparate impact in minority neighborhoods of an equity-stripping scheme2 based on facially neutral loan origination, servicing, and foreclosure policies and practices. Dkt. No. [61] ¶¶ 486-514. In Count II, they assert a claim for disparate impact in minority neighborhoods of facially neutral mortgage servicing and foreclosure practices. Id. ¶¶ 516-29. In Count III, they assert a claim for intentional disparate treatment in minority neighborhoods based on Defendants’ discriminatory equity-stripping scheme. Id. ¶¶ 531-638. The Counties seek compensatory and punitive damages; injunctive relief; a declaratory judgment that Defendants’ conduct, policies, and practices violate 42 U.S.C. §§ 3604 and 3605 ; attorneys’ fees; and costs of litigation. Id. at 303-04.3
Defendants now move for partial summary judgment on statute-of-limitations grounds, arguing that the Counties’ claims are time-barred to the extent that they are based on allegedly discriminatory conduct taking place prior to November 20, 2013. Dkt. Nos. [137, 137-1].
Rule 56 of the Federal Rules of Civil Procedure provides that "[t]he court shall grant summary judgment if the movant shows that 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). A factual dispute is genuine if the evidence would allow a reasonable jury to find for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A fact is "material" if it is "a legal element of the claim under the applicable substantive law which might affect the outcome of the case." Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997).
The moving party bears the initial burden of showing the Court, by reference to materials in the record, that there is no genuine dispute as to any material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1260 (11th Cir. 2004) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ). The moving party's burden is discharged merely by " ‘showing’—that is, pointing out to the district court—that there is an absence of evidence to support [an essential element of] the nonmoving party's case." Celotex Corp., 477 U.S. at 325, 106 S.Ct. 2548. In determining whether the moving party has met this burden, the district court must view the evidence and all factual inferences in the light most favorable to the party opposing the motion. Johnson v. Clifton, 74 F.3d 1087, 1090 (11th Cir. 1996).
Once the moving party has adequately supported its motion, the non-movant then has the burden of showing that summary judgment is improper by coming forward with specific facts showing a genuine dispute. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). There is no "genuine [dispute] for trial" when the record could not lead a rational trier of fact to find for the nonmoving party. Id. (citations omitted). All reasonable doubts, however, are resolved in the favor of the non-movant. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993).
The FHA carries a two-year statute of limitations: "An aggrieved person may commence a civil action ... not later than 2 years after the occurrence or the termination of an alleged discriminatory housing practice." 42 U.S.C. § 3613(a)(1)(A). Defendants argue that because this case was filed on November 20, 2015, the Counties’ claims are facially time-barred to the extent that they are based on allegedly discriminatory acts occurring prior to November 20, 2013. See generally Dkt. No. [137-1]. They contend that the Counties cannot salvage their claims by alleging a "continuing violation" that tolls the statute of limitations for each allegedly discriminatory act until the continuing violation ends because knowledge of a claim, or reason to have knowledge of a claim, cuts off equitable tolling of the statute of limitations for claims based on a continuing violation, and the Counties knew or should have known of their FHA claims at least as of May 2011. Id. at 6-16, 22-30. Defendants further contend that because Judge Eleanor Ross held in DeKalb County v. HSBC North America Holdings, Inc., Civ. Action No. 1:12-cv-03640-ELR, 2015 WL 8699229, at *5 (N.D. Ga. Nov. 16, 2015) (hereinafter, "...
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