Cenat v. U.S. Bank, N.A.
930 F. Supp. 2d 1347
S.D. Fla.2013Background
- Plaintiff Nicole Cenat sues U.S. Bank, N.A. as Trustee for CMLT 2007-AMC2 under TILA, two counts.
- U.S. Bank did not originate the note and mortgage and is an assignee/creditor through assignment.
- CitiMortgage, Inc. is the loan servicer and is alleged to have failed to identify owner/master servicer and provide a payoff statement in 2011.
- Citi allegedly failed to respond with the owner/master servicer information and a proper payoff statement within a reasonable time.
- Defendant moves to dismiss on grounds related to 226.36, eligibility of assignee liability, and agency/vicarious liability theories.
- Court analyzes whether the request complied with § 226.36 and whether assignee liability under § 1641 is viable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Cenat's request qualifies under 226.36(c)(1)(iii) | Cenat's request for an itemized payoff and reinstatement amount suffices | Request deviates from exact regulatory language and fails to trigger § 226.36 | Denied; court finds the request functionally equivalent and sufficiently liberal |
| Liability of U.S. Bank as creditor and/or assignee for Citi’s violations | U.S. Bank liable under § 1640(a) as assignee for Citi’s violations | As assignee, no liability unless violations are apparent on face of disclosures | Plaintiff may pursue assignee liability; vicarious liability theories apply |
| Whether assignee liability under § 1641 is limited to violations apparent on the face of disclosures | Liability extends to post-assignment disclosures as well | § 1641 limits liability to disclosures apparent on the face | Assignees can be liable for post-assignment disclosures; liability extends to assignee’s disclosures |
| Whether vicarious liability applies to TILA claims against the assignee | Servicer is an agent; assignee liable for agent’s violations | Limitations on assignee liability should bar vicarious liability | Court adopts vicarious liability framework for assignees and servicers |
| Overall viability of the complaint against U.S. Bank | Cenat states plausible TILA violations by Citi as agent of Bank | Defense arguments on causation and scope of liability defeat claims | Motion to dismiss denied; claims proceed |
Key Cases Cited
- St. Breux v. U.S. Bank, Nat. Ass’n, 919 F. Supp. 2d 1371 (S.D. Fla. 2013) (assignee liable for post-assignment TILA disclosures when apparent on face)
- Runkle v. Federal National Mortgage Association, 905 F. Supp. 2d 1326 (S.D. Fla. 2012) (assignee liability for servicer’s disclosures when apparent on face)
- Khan v. Bank of New York Mellon, 849 F. Supp. 2d 1377 (S.D. Fla. 2012) (supports assignee liability for servicer violations)
- Balderos v. City Chevrolet, 214 F.3d 849 (7th Cir. 2000) (assignee liability when disclosures deficient; post-assignment conduct covered)