Christopher Blake v. JP Morgan Chase Bank NA
927 F.3d 701
3rd Cir.2019Background
- Plaintiffs Christopher Blake and James Orkis obtained JP Morgan mortgages in 2005–2006 and alleged JP Morgan received kickbacks from mortgage insurers (via a captive reinsurer) in violation of RESPA § 2607.
- RESPA contains a one-year statute of limitations that runs “from the date of the occurrence of the violation” (12 U.S.C. § 2614); the key question was what constitutes the triggering “occurrence.”
- Plaintiffs alleged each insurance premium payment (a kickback) was a discrete § 2607 violation, continuing through 2010, so some claims would have been timely in 2011 under separate-accrual.
- Plaintiffs also relied on tolling under American Pipe: they were members of a putative class (Samp) filed in 2011 and argued that pending Samp tolled the limitations period through Samp’s pendency, allowing their 2013 class action to be timely.
- The district court held (1) RESPA violations accrue separately for each kickback, but (2) American Pipe tolling does not extend to subsequent class actions filed after a prior class action is pending; it dismissed the suit as time-barred. The Third Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does RESPA’s one-year period accrue per kickback or only at loan closing? | Each discrete kickback (payment of premiums) is a violation that triggers its own one-year period (separate-accrual). | The statute should be tied to the closing/agreement creating the referral stream, not each later payment. | Separate-accrual governs: each kickback is a distinct § 2607 violation and starts its own limitations period. |
| Does American Pipe toll the limitations period for a later-filed class action when an earlier putative class action is pending? | Tolling should apply because plaintiffs were putative members of the timely Samp class, so Samp’s pendency tolled their class claims. | American Pipe tolling does not permit successive class actions to piggyback; tolling applies only to individual claims. | China Agritech controls: American Pipe tolling does not extend to subsequent class actions; tolling is limited to individual claims. |
| Can the court address separate-accrual though plaintiffs did not appeal that point? | (Not raised on appeal) | District court decided separate-accrual; the appellate court can affirm on any correct ground in the record. | Court may affirm on separate-accrual issue without a cross-appeal because it does not alter the parties’ rights. |
| Do policy or precedent (e.g., Cunningham, Snow) require accrual at closing? | Separate-accrual consistent with statutory text and precedent nuances. | Policy concerns about extended liability and certain precedent suggest closing date accrual. | Policy and cited precedents do not override textual reading; prior cases are consistent with separate-accrual in this context. |
Key Cases Cited
- American Pipe & Constr. Co. v. Utah, 414 U.S. 538 (tolling putative class members’ individual claims during pendency of class action)
- China Agritech, Inc. v. Resh, 138 S. Ct. 1800 (limiting American Pipe: tolling does not permit new successive class actions)
- Petrella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 663 (separate-accrual rule for successive discrete violations)
- Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 101 (continuing-violations doctrine vs. discrete acts)