Pennsylvania lawyer sues foreclosure firm employees for unauthorized practice of law.

Many thanks to my friend in Pennsylvania for alerting me to this interesting state court case, Loughren v. Bair, where the employees of a foreclosure law firm are being sued for their alleged unauthorized practice of law.  Here is a copy of the complaint,  or here.  If you have access to the docket system for the Allegheny Court of Common Pleas, input the case reference GD-10-021437, and you will find the entire docket.

The Amended Complaint details the allegations of the Plaintiff, a Pennsylvania lawyer, against more than a dozen firm employees who are processing foreclosures.  Among the allegations is reference to deposition testimony in a federal lawsuit, Robinson v Countrywide, 08-cv-01563,where a law firm partner admitted during deposition that foreclosure complaints were processed and even signed without attorney oversight. The testimony is recited along with facsimiles of various lawyer signatures made by the non-lawyer firm employees.  The federal case is plodding through discovery, with a recent court order requiring disclosure of portions of attorney/client fee agreements to the Plaintiff.  Use PACER to access the full docket of the federal case, which is now plodding through discovery and motions.

The state court complaint goes on to allege that foreclosures filed by the law firm violate FHA regulations, primarily because there was no oversight or review to determine whether the regulations had been satisfied before filing.  The amended complaint also collects several citations to federal court cases where non-lawyer signatures on foreclosure documents are discussed.

Lawyers sued by former paralegal/notary forced to notarize wrongly signed documents

In another twist, the Baltimore Sun reports that Shapiro & Burson has been sued by a former employee who alleges that he was told to notarize stacks of instruments signed by one non-firm attorney who had signed for absent firm attornies.  I have not yet read the complaint, so I can't describe more than what is in the news article.

As a title lawyer, I have only received one claim involving allegations of wrongfully notarized lawyer signatures. I expect that the plaintiff's bar recognizes that most of these signatures are easily fixed, and that even if a foreclosure is vacated and re-advertised, the borrower either can or cannot afford his mortgage.

The fallout begins.

So, the rules committee starts meeting, today, to discuss adjustments to foreclosure rules relating to affidavits. It appears PG County, alone, is reviewing over 14,000 open cases.

The article suggests a rule whereby the filing of a corrective affidavit would trigger a hearing where the offending lawyer would appear in court to testify to the facts and circumstances of the affidavit. Others could examine and cross-examine the lawyer.

Considering 400+ corrective affidavits by two lawyers, that is a lot of "testifying" by two men!