The Fuller Law Firm has obtained the dismissal for one of its clients of a fraud claim brought by Heritage Pacific Financial LLC. Under the settlement, Heritage Pacific will dismiss its claim and the client will pay nothing to Heritage Pacific.
Heritage Pacific Financial LLC is an entity out of Texas that has been buying up second mortgages that other lenders have given up on as uncollectible after the first mortgages were foreclosed. Under California law, the second mortgages generally are wiped out after the first mortgage is foreclosed. However, there is an exception to this general rule when the borrower engaged in fraud. Heritage Pacific is seeking to exploit that exception to make money.
Heritage Pacific bought up large amounts of this toxic debt for pennies on the dollar. Then, in order to avoid the general rule that the debt had been wiped out, Heritage Pacific began suing several hundreds of borrowers for fraud. The borrowers had already lost their properties to foreclosure. Then they had to face a fraud lawsuit. Many borrowers did not have the money or the knowledge to defend themselves. Fearful and defenseless, many borrowers settle this “fraud” claim with Heritage Pacific for a portion of the total claim, but still at a tidy profit for Heritage Pacific.
When one of the Fuller Law Firm’s clients faced the same situation, the Fuller Law Firm fought back. With Steven T. Knuppel as lead litigation counsel, the Fuller Law Firm investigated Heritage Pacific’s practices and the case. Because of its investigation, the Fuller Law Firm developed its opinion that Heritage Pacific was engaging in predatory behavior to take advantage of people who could not fight back by alleging fraud without a good faith basis for doing so. Therefore, the Fuller Law Firm aggressively defended the lawsuit.
The Fuller Law Firm challenged Heritage Pacific’s claim that the borrower had committed fraud. It investigated whether Heritage Pacific’s “investigation” was adequate and in good faith and whether Heritage Pacific had focused only on the borrower and had failed to follow-up on information that suggested the broker, the lender and/or others may have been responsible for inaccurate loan document information. The Fuller Law Firm also investigated the loan application process to show that the lender had not exercised due diligence and had not reasonably relied upon any inaccurate information. The Fuller Law Firm used the discovery process to investigate whether the Heritage Pacific's evidence was admissible and sufficient to meet every legal element that it was required to prove.
As a result of the Fuller Law Firm’s efforts , the matter was settled with our client paying nothing to Heritage Pacific. Perhaps just as importantly, our client has been vindicated and there will be no judgment of fraud on his record, which could have haunted him for years to come.
If you are being sued by Heritage Pacific, let us put our experience to work for you. Call now for a free initial consultation.