William M. Freeman v. JPMorgan Chase Bank N.A., 675 F. App'x 926

Background

Freeman wired $1.3 million to an account titled “OPT Title & Escrow Inc Escrow Account” at JPMorgan Chase after agreements (including an escrow agreement between OPT Title and Standard Energy) obligated OPT Title to return escrow funds to the account of origin.
OPT Title’s owner Charles Gordon diverted escrow funds (including Freeman’s) for personal and business use; over $3 million was stolen.
Olga Padgett-Perdomo, a JPMorgan vice president, helped open and label the OPT Escrow Account as an escrow account, vouched for OPT Title to prospective funders, wrote a misleading “seven-digit” letter about account balances, attempted to stymie internal inquiries, and received $100,000 from Gordon.
Freeman sued JPMorgan for negligence, gross negligence, aiding and abetting fraud, and aiding and abetting conversion; the district court granted summary judgment for the Bank, excluding certain evidence about another victim (Chang) under Rule 403.
The Eleventh Circuit reviewed de novo and reversed, holding Freeman had produced evidence that (1) OPT Title owed him a fiduciary duty, (2) the Bank knew or should have known of that fiduciary relationship (through Padgett-Perdomo), and (3) the Bank (through her) knew Gordon was misappropriating funds; summary judgment was therefore improper.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Bank owed duty to noncustomer Freeman	Freeman: OPT Title acted as escrow holder for him; escrow agreement obligated return to account of origin → fiduciary duty; Bank knew or should have known via Padgett-Perdomo	Bank: No duty because Freeman was not a customer and was not a party to the escrow agreement	Held: Duty existed triable issue — escrow agreement conferred direct benefit; Padgett-Perdomo’s knowledge imputable to Bank
Whether Bank actually knew of misappropriation	Freeman: Evidence (Padgett-Perdomo’s conduct, assurances, seven-digit letter, payment from Gordon) permits inference she knew Gordon was stealing	Bank: No evidence of actual knowledge by the Bank; Padgett-Perdomo’s actions were personal and not imputed	Held: A jury could find Padgett-Perdomo knew and her knowledge may be imputed to Bank (adverse-interest exception inapplicable)
Whether Bank’s conduct proximately/factually caused Freeman’s loss (standing / traceability)	Freeman: Injury is fairly traceable; Bank allowed continued use of OPT Escrow Account despite knowledge	Bank: Injury not fairly traceable to Bank conduct	Held: Fairly traceable standard met at summary judgment stage — causation for standing satisfied
Whether aiding-and-abetting claim survives summary judgment	Freeman: Bank provided substantial assistance by affirmatively assisting, concealing, and failing to act despite knowledge of misappropriation	Bank: No actual knowledge and no substantial assistance; inaction insufficient absent duty	Held: Material fact disputes exist; a reasonable jury could find Bank provided substantial assistance (inaction + knowledge) — summary judgment improper

Key Cases Cited

Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard)
Fla. Dep’t of Corr. v. Abril, 969 So. 2d 201 (Fla. 2007) (elements of negligence under Florida law)
ZP No. 54 Ltd. P’ship v. Fid. & Deposit Co. of Md., 917 So. 2d 368 (Fla. Dist. Ct. App. 2005) (elements of aiding and abetting fraud assumed in Florida)
Lerner v. Fleet Bank, N.A., 459 F.3d 273 (2d Cir. 2006) (substantial assistance by inaction when fiduciary/trust funds are at issue)
In re First Alliance Mortg. Co., 471 F.3d 977 (9th Cir. 2006) (bank’s routine transactions can constitute substantial assistance if bank knew they aided the fraud)
Resnick v. AVMed, Inc., 693 F.3d 1317 (11th Cir. 2012) (standing — ‘‘fairly traceable’’ is a looser causation standard)
Hamilton v. Southland Christian Sch., Inc., 680 F.3d 1316 (11th Cir. 2012) (standard of review for summary judgment)
Valderrama v. Rousseau, 780 F.3d 1108 (11th Cir. 2015) (view evidence in light most favorable to nonmovant)