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36 us that all courts, including federal courts, can be aggressive in attacking servicer conduct and lessons need to be learned from each decision. What lessons did you take away from the Oskoui and Sundquist decisions? Oskoui teaches loan servicers at least three lessons, first a letter denying modification should include every reason for denial. Second, avoid "will" language and contradictions in trial payment plans. e "will" language gave Oskoui a breach of contract claim. e Ninth Circuit disregarded the later; inconsistent may "consider" language in the same letter. ird, evaluate if the borrower qualifies for modification before sending an application. Judge Klein's 100-page Sundquist decision provides additional lessons, namely that servicers and/or counsel always need to check PACER before starting foreclosure and eviction proceedings. Judge Klein found six violations of the automatic stay, all of which could have been prevented. Next, combat borrower testimony in contested proceedings with call logs and call recordings. Judge Klein relied on Sundquist's journal entries. Call logs and/or recordings may have been able to rebut these entries. Lastly, do not offer loan modifications if denial is inevitable. Any good news coming out of national case law as it impacts loan servicers? Yes, in its latest term, the Supreme Court heard two FDCPA cases, Midland Funding LLC v. Johnson and Henson v. Santander Consumer USA, Inc. In Midland, decided May 15, 2017, a majority of the justices found that no violation occurred when a debt collector filed a proof of claim in a bankruptcy case, even though collection was barred by the statute of limitations. In Henson, decided on June 12, 2017, the Supreme Court ruled that the FDCPA did not apply to someone who buys consumer receivables originated by someone else. Before Henson, the circuits were split on whether that entity is deemed a "debt collector" for purposes of the FDCPA. Henson was argued on Judge Gorsuch's first day on the job. Judge Gorsuch wrote the opinion, a 9-0 decision. Henson is a big case with potentially far-reaching results, especially as applied to loan servicers who purchase loans. Coincidentally, I Eric Houser is the Founder and President of Houser & Allison, APC, a national law firm with 13 offices across the country. He has practiced law for over 30 years and successfully tried cases from Hawaii to Connecticut (and lots of places in between) on behalf of the mortgage industry. His national practice and experience provides a unique insight into recent cases, laws, and trends that impact our industry. So far in 2017, what do you see as some of the biggest cases coming out of the courts? For me, it would have to be in the West with the Oskoui v. J.P Morgan Chase Bank, N.A decision from the Ninth Circuit Court of Appeals and the Sundquist v. Bank of America, N. A., decision from a bankruptcy court in California where $46 million was awarded against Bank of America. In both cases, these two federal courts were extremely critical of the servicers going so far as to reference Franz Kafka's 1925 novel, e Trial, Josef K. and describing the borrower as the "victim of a meaningless bureaucratic labyrinth." On March 13, 2017, Ninth Circuit Judge Trott referred to the loan modification conduct of defendant loan servicer J.P. Morgan Chase Bank, N.A. as "Kafkaesque." Less than two weeks later, on March 23, 2017, bankruptcy Judge Klein picked up on this literary reference and proclaimed: "Franz Kafka lives . . . he works at Bank of America." Both decisions contained dramatic statements, with stinging commentary and negative results. e Sundquist decision should be overturned on appeal, but in either event, the depiction of our industry was not good. Both decisions remind COUNSEL'S CORNER LEARNING LESSONS FROM DIVERSE COURT CASES Eric Houser Founder and President Houser & Allison, APC "Judge Klein's 100- page Sundquist decision provides additional lessons, namely that servicers and/or counsel always need to check PACER before starting foreclosure and eviction proceedings."

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