On Thursday, King’s County Supreme Court Justice Arthur Schack made scathing comments about how the IndyMac Federal Bank could have initiated a foreclosure on a homeowner, three weeks after the date the bank had legally ceased to exist. The judge said that for IndyMac to have locus standi to foreclose on homeowner Mendel Meisels’ property “would be the legal equivalent of a vampire – the “living dead.””
After comparing the bank to Dracula, the legendary vampire that rose from its coffin to feed on victims, Shack compared the law firm of Fein, Such & Crane to Dracula’s loyal servant Renfield.
The judge said that the law firm, “similar to Renfield, throughout its papers and at oral argument demonstrated its loyalty by not betraying its client and Master, the ‘living dead’ IndyMac Fed.” The law firm can face sanctions for “engaging in frivolous conduct” by bringing a case on behalf of a client that had legally ceased to exist.
IndyMac was seized by federal authorities in July 2008, and in March 2009, the Federal Deposit Insurance Corp sold IndyMac to OneWest bank. However, in April 2009, lawyers at Fein Such, happily filed a foreclosure case against Meisels who had taken out a mortgage from IndyMac in 2005.
Shack said following a 2009 appellate decision, IndyMac would have legally ceased to exist by the time of the foreclosure and could not be named as a party in the lawsuit. Though Schack dismissed the lawsuit, he said the “correct owner” of Meisels’ mortgage may be allowed to bring a new claim allowing the lawsuit to be resurrected.
While the lawyer handling the case on behalf of Fein Such could not be reached, Derrick Hanna, the lawyer for the homeowner said “proper documentation in compliance with current laws should be the only documents filed in court … The banks have rights, but the consumer homeowner does as well, and the law protects them equally.”