The US District Court for the District of Connecticut recently dismissed a customer suit against an insurer, based upon its determination that all of the underlying claims were excluded by the policy’s Insolvency Exclusion.1 Associated Community Bancorp, Inc., et al. v. The Travelers Companies, Inc., et al.
On Friday, the Washington Department of Financial Institutions closed Washington First International Bank, headquartered in Seattle, Washington, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with East West Bank, Pasadena, California, to assume all of the deposits of the failed bank.
Today, the Board of the Federal Deposit Insurance Corporation took the following actions:
On June 14th, the First Circuit modified the bankruptcy court's $250,000 sanction award against a mortgage servicer who erroneously claimed to be the mortgage holder. The mortgage servicer did not deliberately or intentionally seek to mislead the bankruptcy court and its actions were not prejudicial. First Circuit therefore modified the award to $5,000. In re Jacalyn S. Nosek.
A Massachusetts trial court has denied a borrower’s request to stop a foreclosure proceeding despite the borrower’s claim that the loan was “unfair” under the Massachusetts consumer protection law, Chapter 93A of the General Laws. In its May 13 decision denying the borrower’s request for an injunction, the court examined a stated income (no documentation) loan and determined that the borrower was not likely to prevail on a claim that the loan featured a combination of four characteristics that qualify as “unfair” under Chapter 93A.
On Friday, the Florida Division of Financial Institutions closed Peninsula Bank, headquartered in Englewood, Florida, and appointed the FDIC as receiver for the bank. As receiver, the FDIC entered into a purchase and assumption agreement with Premier American Bank, headquartered in Miami, Florida, to assume all of the deposits of Peninsula Bank.
On July 2nd, the Sixth Circuit affirmed a bankruptcy court's finding that, under Kentucky law, a bank did not perfect its security interest in an auto loan until that security interest was noted on the title. Because perfection did not occur within 20 days after the debtor received possession of the auto, Section 547(c)(3) of the Bankruptcy Code did not protect the bank's loan from avoidance as a preferential transfer. Branch Banking and Trust Co. v. Brock.
On Friday, the Office of the Comptroller of the Currency closed Home National Bank, headquartered in Blackwell, Oklahoma, and the FDIC was appointed receiver.
On Friday, the New York State Banking Department closed USA Bank, headquartered in Port Chester, New York, and the FDIC was appointed receiver.
The Bankruptcy Appellate Panel for the Sixth Circuit has issued an opinion protecting and preserving a bank’s security interest in funds in the debtor’s bank account notwithstanding the fact that the bank released those funds to the trustee. In re Cumberland Molded Products, LLC, No. 09-8049 (6th Cir. B.A.P. June 23, 2010).