IMPORTANT NOTE/DISCLAIMER:  The following article is not and should not be construed as legal advice and was not written by an attorney.  It is merely a collection of common-sense, rational observations written by a sane, rational layperson with common sense.  It is recommended that you consult with an attorney for any and all legal advice and/or action.

Thanks to the “botched” Independent Foreclosure Review (IFR) and recent testimony elicited by Elizabeth Warren, we now know: 1) that the banks have, by making payments to almost 4 million homeowners, essentially admitted to wrongdoing in that same number of foreclosures in 2009-2010 (12 specific categories of wrongdoing are spelled out in the PDF file of who will receive payment) and 2) that the banks have the records of and have now been made aware of this wrongdoing–we know this from Warren’s questioning on April 11, 2013:

“Sen. Warren: All right, so let me ask it from the other point of view. You now have evidence in your files of illegal activity, I take it, for some of these banks. I get that from the evidence you’ve released about the charts, who’s going to get paid what, so if someone believes that they have been illegally foreclosed against, will they still have a right under this settlement to bring a lawsuit against the bank?

Mr. Stipano, OCC: Yes.

Sen. Warren: All right. Now, if a family wants to bring a lawsuit, you’re both lawyers, would it be helpful, if you’re going against one of these big banks, would it be helpful for these families to have the information about their case that’s in your files. Mr. Ashton?

Mr. Ashton, Fed: It would be helpful, obviously, to have information related to the injury, yes it would.

Sen. Warren: Okay. So, do you plan to give the families this information? That is, those families that have been victims of illegal foreclosures, will you be giving them the information that’s in your possession about how the banks illegally foreclosed against them? Mr. Ashton?

Mr. Ashton, Fed: I think that’s a decision that we’re still considering. We haven’t made a final decision yet.

Sen. Warren: So you have made a decision to protect the banks, but not a decision to tell the families who were illegally foreclosed against?

Mr. Ashton, Fed: We haven’t made a decision about what information we would provide to individuals, that’s true, yes.

Sen. Warren: Mr. Stipano?

Mr. Stipano, OCC: Same position.

Sen. Warren: So, I just want to make sure I get this straight. Families get pennies on the dollar in this settlement for having been the victims of illegal activities or mistakes in the bank’s activities. You let the banks – and you now know individual cases where the banks violated the law, and you’re not going to tell the homeowners, or at least it’s not clear yet whether or not you’re going to do that?”

Neil Garfield over at Living Lies had a great idea in relation to this revelation: FOIA requests to get this information regarding illegal activity in the files of the OCC which Stipano admitted to having.  Here’s where to start with that process: How do I make a FOIA request?

Also, we know that the meager payouts (“The vast majority of borrowers – 3.4 million – will receive $1,000 or less“) from the January settlement that stopped the IFR essentially only add insult to injury and we need to do something about it. But what to do? Well, here’s an idea…

A Homeowner Named “Sue”

How about this: we stage a Million Homeowner March, in which all of us receiving payments from the IFR settlement sue the banks to express our discontent at the pittance we’re being given and at the fact that they are deliberately withholding actionable information from us. If you’ve already sued them, sue them again. The stupid banks and their crooked, impotent regulator just handed us our causes of action on a silver platter (i.e., the 12 categories of wrongdoing from the PDF mentioned above). Of course, they’ll scream that the IFR settlement is not an admission of wrongdoing.  And we’ll scream back, “It’s also not a denial,” and that much is covered in, for example, this statement from the amended consent order with Bank of America:

“…the amount of any payments to borrowers made pursuant to this Amendment to the Consent Order do not in any manner reflect specific financial injury or harm that may have been suffered by borrowers receiving payments, except as expressly provided for in this Amendment to the Consent Order, nor do the payments constitute either an admission or a denial by the Bank of wrongdoing or a civil money penalty under 12 U.S.C. § 1818(i)…“

And let’s face it, when you lay out 12 categories of harm–which are specific, contrary to the language above–and agree to pay money to people who fall into those categories of harm, that is, here in the real world, an admission of wrongdoing.  The quote above is merely doublespeak, because “specific financial injury or harm” has been identified by the banks themselves (and/or the OCC)!

So here’s why we do this Million Homeowner March—to cripple the banks and the courts until the banks cry uncle and the courts actually listen to the overwhelming evidence against the banks instead of just issuing knee-jerk opinions against homeowners. Make them feel our power—flex our muscles.

How will this make the banks feel our power? Well, there were 4.2 million homeowners affected by the January settlement. If just 1 million of those homeowners filed suits against the banks, the banks and the courts will be buried in litigation. The banks will be forced to defend these lawsuits, which will cost them A LOT MORE MONEY, and we all know that money is the only language these criminal banks understand. If there are 1 million simultaneous (or near-simultaneous) lawsuits all alleging essentially the same thing—i.e., that the banks fraudulently stole millions of houses—the courts cannot pretend (or will at least have a much harder time doing so) that the lawsuits represent isolated cases of fraud by banks. It’s a win-win for homeowners.

But it’ll never work?

Now this may seem like a pie-in-the-sky fantasy, but it doesn’t have to be. If the attorneys out there would step up and get in their pro bono hours or work on contingency–and why not, because as mentioned above, the banks have already essentially (and, I would argue, substantively) admitted to wrongdoing, so all the attorney has to do is make that argument halfway competently and point out that if their client received an IFR payment, the bank has already pretty much admitted to fraudulent behavior—we could get this ball rolling real quick-like. Enterprising attorneys could run ads like: “Did you receive money from the Independent Foreclosure Review settlement? This is essentially an admission that you were wronged by your bank—let me help you sue them as part of a national movement to bring the banks to their knees: call me or visit my website!”

And if the attorneys won’t make that happen, or they can’t or don’t make it happen on a large enough scale, then people could become pro se litigants and just sue the banks themselves. Don’t be frightened—it’s not as hard as attorneys make it sound. Being pro se should actually be a huge advantage because judges are required by precedent to give pro se litigants a break. At least two U.S. Supreme Court cases point this out: 1) Haines v. Kerner states that “the pro se complaint…[is held]to less stringent standards than formal pleadings drafted by lawyers,” while 2) Erickson v. Pardus says that “a document filed pro se is ‘to be liberally construed’” and that “a pro se complaint, however inartfully pleaded, must be held to less stringent standards than formal pleadings drafted by lawyers.”  Of course, the courts usually ignore these binding precedents, but what else is new?

Now, would all these people be counter-sued or be sanctioned for filing frivolous suits? That would be a downside, of course. But it could be dealt with and strikes me as unlikely in any event. After all, to file a counter-claim, the bank would have to SPEND MONEY to have someone write it up, and as we all know, the banks hate parting with their money. And it would be hard to argue, it seems to me, that a lawsuit could be characterized as frivolous when the defendant has essentially already admitted wrongdoing (i.e., when he paid the settlement funds to the homeowner).

Another downside—what if the judges rule against the million homeowners, i.e., they lose? Well, there’s always an appeal. Plus, many of us have already lost anyway—lost homes, money, self-respect, etc. What’s one more loss (as the old song says, “Freedom’s just another word for nothing left to lose”)? We can at least have the satisfaction that we tried, that we actually stood up for ourselves. Because an action like this isn’t really about winning in any conventional sense, it’s about MAKING THE BANKS PAY, literally—making them fight for their financial lives. It’s about “returning the screw” that the banks have given us—bleeding THEM dry financially, bleeding THEM dry of their energy and sustenance.

So what say you out there? Shall we sue the banks en masse?  No class actions, either—it’s got to be the most labor-intensive, billable-hours-creating monumental morass we can possibly create for these banks. Then maybe the foreclosures will stop or slow to a few isolated dribs and drabs. That’ll be our de facto moratorium.  In the comments below, indicate whether or not you’ll be a part of the Million Homeowner March!

On the other hand, a caveat…

In the past, I have advocated not attempting to use the courts to solve these problems because the courts are essentially deaf to the claims of homeowners, even if the homeowners are represented by counsel.  In the past year I have been of the belief that people should save their money and energy and fight these battles outside of the courtroom, in the media and in collective actions like Occupy Our Homes and so on.  So I’m kind of going against my own advice in this post by advocating mass lawsuits, but I’m only doing so precisely because I’m advocating mass lawsuits.  I don’t think this idea will work unless it does happen on a mass scale, because if it doesn’t, the courts will just continue to crank out anti-homeowner decisions based not on the evidence presented, but on the idea that banks are always in the right and even if they aren’t, they should be allowed to create new paperwork to try to make things right.

So, unless it becomes clear that there is a massive move to sue the banks into the ground, to bring them down with the proverbial “death by a thousand (or in this case, a million) cuts,” I would suggest not suing your bank.  Because, based on my personal experience and the experience of others I have talked to, unless there is a massive spate of suits similar to yours (and who knows, maybe even then) you will likely find the courts to be hostile to you and/or your claims, even if you have an attorney.

Having said that, post in the comments below if you think a Million Homeowner March is a good idea and if you would consider participating.  If there is enough interest–and I certainly believe there could be–we can begin to get organized via a petition/sign-up type of website.

IMPORTANT NOTE/DISCLAIMER:  The above article is not and should not be construed as legal advice and was not written by an attorney.  It is merely a collection of common-sense, rational observations written by a sane, rational layperson with common sense.  It is recommended that you consult with an attorney for any and all legal advice and/or action.