Legore v. OneWest Bank, FSB
2012 U.S. Dist. LEXIS 149202
D. Maryland2012Background
- Legore applied to OneWest for a HAMP-modified loan; OneWest participates in HAMP but private rights are limited.
- HAMP creates two-stage modification eligibility: initial eligibility/positive NPV, then a three-month Trial Period Plan with documentation verification.
- Legore’s income consisted of Social Security disability, rental income, and small non-documentable cash from umpiring; OneWest relied on these representations.
- OneWest denied Legore’s permanent modification in August 2010 for missing documents, later acknowledging the denial was premature, and required resubmission.
- Legore was ultimately approved for a permanent HAMP modification in July 2011 after a renewed TPP; plaintiff filed suit asserting five counts before modification, later seeking dismissal under summary judgment rules.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue under HAMP | Legore cannot sue directly under HAMP but may rely on common-law claims. | HAMP does not create a private right of action; claims fail on standing. | HAMP lacks an private-action private right; court analyzes remaining claims on merits. |
| Breach of contract | Counts suggest contractual breach by failure to secure permanent modification. | No causally linked damages; contract claim moot once modification is permanent. | Granted; breach of contract claim dismissed due to lack of economic damages. |
| Negligence and negligent misrepresentation | Defendant owed a duty of care in processing the HAMP application; misprocessing caused damages. | No tort duty or special circumstances; relationship remains contractual. | Granted; OneWest entitled to judgment as a matter of law on these claims. |
| MCPA and common-law fraud | Defendants deceived consumer by misrepresentations about modification process and outcomes. | Misrepresentations not proven false; no identifiable economic loss; lack of reliance. | Granted; OneWest entitled to judgment on MCPA and fraud claims. |
Key Cases Cited
- Jacques v. First Nat’l Bank of Md., 307 Md. 527, 515 A.2d 756 (Md. 1986) (no tort duty arising from ordinary contractual relationship absent special circumstances; economic loss requires special nexus)
- Lloyd v. Gen. Motors Corp., 397 Md. 108, 916 A.2d 257 (Md. 2007) (elements of negligence; duty requirement for economic-loss claims)
- Alleco Inc. v. Harry & Jeanette Weinberg Found., Inc., 340 Md. 176, 665 A.2d 1038 (Md. 1995) (elements of common-law fraud; reliance and injury)