Wednesday, June 20, 2012

Secret FDIC & JPMorgan Chase Bank 118 Page Purchase and Assumption Agreement for Washington Mutual Bank Uncovered


Smoking Gun or Another Murder of Crows?  You be the judge.

QUESTION -- Are the FDIC and JPMorgan Chase Bank and their attorneys keeping secrets and playing destructive games with the lives of good decent Americans across the land that results in their stealing homes and damaging forever lives and communities?  Are they in fact hiding the true agreement (PAA) for the assets and liabilities of Washington Mutual Bank, the failed bank seized by the Office of Thrift Supervision and placed in Receivership with the FDIC who sold WAMU to JPMorgan Chase Bank NA on the very same day in September 2008?

Repeatedly homeowners in foreclosure and their attorneys have questioned the veracity of the 39 page Purchase and Assumption Agreement between the FDIC and JPMorgan Chase Bank, NA for Washington Mutual Bank that Chase, the FDIC, and their attorneys represent to be the real PAA.  They have used this 39 page public document in courts of law to reap all of WAMU's benefits without bearing any of its burdens in courtrooms, federal and state, throughout the United States.
Attorney Vernon Bradley of Sausalito, California, recently filed a lawsuit to stop a foreclosure action on behalf of  the Plaintiff, Scott Call Jolley, against Chase et al in California Superior Court in Marin County, California and it is under appeal.  This case and the revelations that have come to light through  Appellant's Opening Brief filed with the California Appellate Court points to the existence of a different "full copy" PAA (the full and complete copy of the PAA) that consists of 118 or so pages as revealed in the deposition and declaration of Jeffrey A. Thorpe, whose credentials make him a reliable witness. (see below excerpts from Appellant Brief.)

Jeffrey Thorpe was employed October 21, 2011, the date of his declaration, as an asset manager for the FDIC through a contractor for the FDIC, RSM McGladrey Inc.  He stated that he was intimately familiar with the procedures for taking over a failed bank and the required notices that must be given to insulate the buying bank from liability for the original loans of the failed banks.  Thorpe stated that he was familiar with a 118 page PAA that has not been made public.  "Chase took liability for the ongoing contracts in return for getting an 80% discount on the loan's principal owed.  Essentially, Chase Bank traded their right to cut off all liability on WAMU's end for money and a good deal."

Appellant's Opening Brief presents a strong argument that the FDIC and JPMorgan Chase Bank NA entered into an approximated 118 page "full " Purchase and Assumption Agreement, rather than the "public" PAA being circulated through internet and the courts in foreclosure cases throughout the United States federal and state courts.

If in fact this 118 page PAA exists, can one conclude that the Respondents and their attorneys have perpetrated a possible fraud on the court and that this possible fraud extends to foreclosure lawsuits (past, present, and future) throughout the United States?  And if so, what can be done to help these homeowners who were possibly victimized by judges who unwittingly relied on the purported 39 page PAA to seize and sell their homes?  What will these judges have to say about this serious misrepresentation of the PAA if found to be true?  Will these victimized homeowners be recompensed for the damage caused to them financially and personally?  Will the courts take another look?

Below is information obtained through court proceedings.  Please read this post in its entirety.


SCOTT CALL JOLLEY,  Plaintiff and Petitioner/Appellant,


CHASE HOME FINANCE, LLC, a Delaware Limited Liability  Corporation and successor in interest to WASHINGTON MUTUAL BANK, F.A., a Washington Corporation; CALIFORNIA RECONVEYANCE COMPANY, a California corporation, and DOES 1 through 100, inclusive,

Defendants and Respondents.
Appellate Docket No. A134019
Marin County Superior Court
Case No. CIV1002039

Hon. Lynn Duryee, Judge
Phone: (415) 444-7221

Appellant's Opening Brief in Jolley vs. Chase Home Finance LLC et al filed by the Law Offices of Vernon Bradley in Marin County, California presents a strong argument that the FDIC and JPMorgan Chase Bank NA entered into an 118 page Purchase and Assumption Agreement, rather than the PAA being circulated through the courts in foreclosure cases throughout the United States federal and state courts. 

The brief states:

"On April 19, 2010, Petitioner Scott Jolley‘s Complaint  Case No. CIV1002039 was filed in the California Superior Court in Marin County, California. On April 20, 2010, Petitioner obtained a temporary restraining order prohibiting the scheduled trustee‘s sale and thereafter obtained a Preliminary Injunction continuing that relief upon posting a $50,000 bond with the Marin County
Superior Court. Petitioner opposed a summary judgment motion brought by Chase and California Reconveyance. The Honorable Judge Duryee took the matter under submission after the hearing, on November 15, 2011, and grant summary judgment in favor of Defendants/Respondents on December
1, 2011.  Judgment was entered the same day thereby immediately dissolving the preliminary injunction of August 20, 2011. On January 25, 2012, Petitioner filed this appeal along with a writ of supersedeas requesting an immediate stay to protect his real property against an impending foreclosure and trustee sale. Since the trial court seemed unreceptive to Petitioner's need for a continued stay during the summary judgment hearing, Petitioner did not formally seek a stay from the trial court because such efforts were clearly futile and the law does not require a litigant to engage in such useless endeavors (please see the accompanying writ reply). Petitioner now files this opening brief along with a reply in support of the writ of supersedeas and stay.

"Petitioner Jolley and Washington Mutual Bank (.WaMu.) entered into a construction loan agreement  which expressly provided that the covenants and agreements of this Security Instrument shall bind the successors and assigns of Lender [WaMu].

"Surprisingly, Respondents now erroneously claim that Chase bears no successor liability for WaMu's torts and contractual breaches arising from that agreement even though Chase continues to enjoy all of the associated benefits. Respondents mistakenly believe Chase is insulated from successor
liability because WaMu subsequently went into FDIC receivership and Chase allegedly took all of WaMu's assets from the FDIC under a Purchase and Assumption Agreement (PAA) that supposedly allowed Chase to reap all of WaMu's benefits without bearing any of its burdens.

"However, under California and federal authority Chase is legally required to step directly into the .shoes. of WaMu, to take the place of WaMu, and to remain fully liable for all torts, breaches of
contract and other .sins. committed by WaMu for several reasons.

"First, because the parties' contract expressly provided that the covenants and agreements of this Security Instrument shall bind . . . the successors and assigns of Lender [WaMu]. and the FDIC was statutorily required to step directly into WaMu's shoes, all of the FDIC's .successors and assigns. were also obligated to take WaMu's assets subject to its burdens since the FDIC failed to exercise its special rescission powers and never issued any rescission notice to Petitioner as required by law (see
below). As explained in the declaration of Petitioner's expert, Jeffrey Thorne, the FDIC had opened an escrow and were supposed to send out notices of repudiation/rescission to Petitioner and other borrowers within 90 days or another reasonable time, but the escrow closed so quickly that
the notices were never sent by the FDIC. Therefore, as discussed below, the FDIC always remained subject to the terms and conditions of Petitioner's loan contract, including the requirement that Chase, as the .successor and  assign. of the FDIC/WaMu must be bound by the contract and .take the
place of. the FDIC/WaMu to bear all associated burdens."

Appellant's brief further asserts the following:

"Second, according the compelling deposition testimony and declaration of Mr. Thorne, the actual, full and complete PAA (118 pages) makes Chase liable for all torts and contractual breaches by WaMu in stark contrast to the identically named public document (34 pages) posted on the internet."

"The record is full of competent and convincing evidence to support this fact, including, without limitation, the deposition testimony of Mr. Thorne (Thorne Depo,. CT 69-88, Pgs. 37, 70-73 ) as well as his sworn declaration (Thorne Dec,. CT 53-59). This evidence cannot be lightly dismissed since Jeffrey Thorne is a highly credible expert witness who swears under penalty of perjury that he actually read the real PAA and it does not absolve Chase of liability for WaMu. More specifically, Mr. Thorne's declaration reads, in pertinent part, as follows:

"1. Currently I am employed as an asset manager for the FDIC through a contractor for the FDIC, RSM McGladrey Inc. I am intimately familiar with the procedures for taking over a failed bank
and the required notices that must be given to insulate the buying bank from liability for the original loans of the failed banks.

 "2. When Washington Mutual failed, I was involved in the takeover of Washington Mutual by FDIC and the escrow that was opened to sell Washington Mutual to Chase Bank. I was uniquely
positioned to be involved in what was known as .Bank No. 26 takeover. as I had previously worked for Washington Mutual, heading their Construction Lending Department for 38 states."

"4. Within the takeover procedures by the FDIC, the FDIC will enter into an agreement with the succeeding bank. In this instance the FDIC entered into an agreement with Chase Bank. But because of the nature of the transaction, the FDIC guaranteed 80% of the loans, while Chase only assumed 20% of the potential losses on the loans. Pursuant to the public part of the agreement with the FDIC, of which were approximately 39 pages, the balance of the contract and the complete agreement with the FDIC and Chase bank is 118 pages long which has not been made public. I am familiar with this agreement, I have read it, I was involved in the takeover of WAMU with the FDIC, and the balance of the agreement imposes liability on Chase for ongoing contracts with WAMU. Chase took liability for the ongoing contracts in return for getting an 80% discount on the loan‘s principal owed. Essentially, Chase Bank traded their right to cut off all liability on WAMU‘s end for money and a good deal.

"5. Chase assumed the rights and benefits owing to WAMU under its outstanding contracts with its customers. Because of the favorable guarantee from the FDIC, they also agreed to assume the
liabilities flowing from the WAMU contracts.

"6. From 2002 to 2006, I was senior loan consultant for WAMU."

Furthermore Appellant's Brief states the following:

"Mr. Thorne's testimony is further bolstered by the FDIC's tacit admission that the document exists, i.e., when Petitioner's counsel sought the smoking gun document by subpoena, the FDIC's agent told Petitioner's counsel that the document could only be obtained after all parties and the trial judge executed a comprehensive stipulated confidentiality agreement and protective order barring dissemination  outside of this case. That response indicates something is being hidden.

"More specifically, on or about November 7, 2011, a request of the full and complete PAA from responding party was made orally, responding party denied the existence of such document. On November 8, 2011, a request for the same document was requested from the FDIC. The FDIC
refused to provide the document but alluded to its existence by requesting Petitioner provide for the specific portions in which he was seeking, and further advising that the FDIC would redact portions of this agreement.
On or about November 8, 2011, a request by subpoena was made to the FDIC, and again the FDIC refused the request and asked Petitioner‘s Attorney to submit to a protective order with a stipulation from all parties. See emails C.T. 142 – 143. On November 9, 2011, Petitioner requested, in writing, the full 118 page contract from Responding party and asked Respondent's counsel to sign the FDIC's stipulation. These requests were immediately denied. Petitioner‘s Attorney was then forced to seek ex parte relief from Judge Duryee of the Marin County Superior Court to have all parties execute the stipulated protective order so that the true PAA could be obtained and to continue the jury trial until Petitioner had a fair chance to seek that dispositive evidence. Judge Duryee ignored these requests.

"Perhaps because of Mr. Thorne's unique qualifications and personal knowledge of the crucial facts, this is the very first case to bring this evidence to light. Previously, Chase mislead courts across the country with the abridged version of the PAA, so case law developed in reliance thereon cannot be deemed valid. It was also reversible error for Judge Duryee to accept the truth of matters asserted in the contested document, i.e., that Chase was absolved of liability. At the very least, Petitioner should be allowed a fair opportunity to finally overcome discovery stonewalling and obtain a copy of the document pursuant to CCP §437c(h), which reads: .If it appears from the affidavits submitted in opposition to a motion for summary judgment or summary adjudication or both that facts essential to justify opposition may exist but cannot, for reasons stated, then be presented, the court shall deny the motion, or order a continuance to permit affidavits to be obtained or discovery to be had or may make any other order as may be just. (emphasis added). Accordingly, it was reversible error to simply ignore Petitioner‘s request. Alternatively, Petitioner should have
been allowed to have a jury of his peers evaluate the credibility of Mr. Thorne and Chase's experts on this crucial factual issue."

Apppellant's Brief argues the following:

"Alternatively, Chase's successor tort liability also exists under the general rule that a purchaser assumes a seller's liabilities when (1) there is an express or implied agreement of assumption, (2) the transaction amounts to a consolidation or merger of the two corporations, (3) the purchasing
corporation is a mere continuation of the seller, or (4) the transfer of assets to the purchaser is for the fraudulent purpose of escaping liability for the seller's debts. Id. At 28. The .mere continuation. ground for liability exists due to Chase's acquisition of all WaMu's operating assets, its use of those
assets and of WaMu's former employees to maintain the same line of .financial products,. its holding itself out to customers and the public as a continuation of the same enterprise under a new name, its failure to provide

"WaMu/FDIC with adequate consideration to meet claims of unsecured creditors (a factual determination subject to disputed material facts); the fact that one or more persons were officers, directors, or stockholders of both WaMu and Chase (a factual determination subject to disputed material facts).2 Id.

"2 The last two facts are based on Appellant's information and belief. Further expert analysis of the
underlying transactions will be required to verify these allegations. However, since expert
discovery had not closed before summary judgment, the disputed nature of these facts should
have been ground for denial of summary judgment.

 "Moreover, the powerful deposition testimony and declaration of Jeffrey Thorne created triable issues of material fact as to whether Chase defrauded and deceived Appellant and the general public by concealing the true purchase and assumption agreement wherein Chase retained full liability for WaMu's torts and contractual breaches in exchange for other favorable terms. Mr. Thorne is uniquely qualified to present evidence on this issue and he had personally read the .smoking gun. document so Appellant was entitled to have a jury evaluate credibility regarding this crucial fact, which would clearly preserve Chase's liability for WaMu's misconduct. 

Link to related documents: 

This is compelling information.  Anyone have further information about these assertions should contact Vernon Bradley, Esq. in Sausalito, California or email this author.

Excerpt from the Deposition of Jeffrey A. Thorne:

13  Q.   BY MR. BRADLEY:  Okay.  Now, this 118-page
14  document, can you again describe to me what its contents
15  was?
16  A.  There's two documents. They're the same
17  document.  And it is the right to purchase a financial
18  institution.   That's the purchase agreement.  One of 
19  them is 35 pages long that is recorded and made public
20  by the FDIC, and the other is a continuation of the 35
21  pages up to the 118 pages that spells out an agreement
22  between the purchasing institution and the FDIC as to
23  how they are to handle the customers upon the purchase
24  of the bank; i.e., how the foreclosures are to be
25    handled, work out agreements that they're supposed to
 [Page 71]
 1  make.  Are they supposed to make an offer?  They have to
2  make certain offers in writing.  They have to present
3 them to the FDIC to Show that they're working with them
4 In good faith.  They just can't go in and just start
5 foreclosing on everybody that's not paying.
6 Q.   And it's your testimony that there was such an
7 agreement that Chase Signed with the FDIC when it took
8  over WaMu, this document?
9  A.  Yeah, at the facility that I was at, that was
10 one of the documents I had access to through my system,
11 and I saw that document.
12  Q.   Okay.  And then where would a copy of that
13  document be?  The first 32 pages, I think you said, were
14  made public, but the balance of them were withheld from
15  the public.
16  A.  Right.  It would be at FDIC.
17  Q.   Okay.  And could those be subpoenaed?
18  A.  I'm sure they could.
19  Q.   And you would refer to it as the right to
20  purchase document?
21  A.  Right.



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  2. Judge Lynn Duryee ruled July 3, 2012 on Jolley's Motion to Compel; motion was denied.