The largest U.S. bank said the Indiana plaintiffs, who lost their home to foreclosure in 2009, failed to show they were harmed by its alleged practice of routinely submitting perjured affidavits, given they might have lost their home anyway.
It also said the plaintiffs do not deserve relief against Bank of America and its Countrywide Home Loans unit under a federal debt collection law because foreclosures are intended to protect lenders' interest in homes, not to collect debt.
Wednesday's filing with the U.S. District Court in Indianapolis provides an early glimpse into how lenders might defend against the growing number of lawsuits over foreclosure paperwork and securities backed by home loans.
Irwin Levin, a partner at Cohen and Malad LLP representing the plaintiffs Dwayne and Melisa Davis, did not immediately return a call seeking comment. The plaintiffs are seeking class-action status on behalf of thousands of homeowners.
Many homeowners and their lawyers accuse robo-signers of signing hundreds of foreclosure documents at a time on behalf of lenders without having read or understood their contents.
On Thursday, real estate company RealtyTrac Inc said banks foreclosed on 9 percent fewer homes in October than September as paperwork issues stalled processing.
Since the controversy began to swell in September, lenders such as Bank of America, JPMorgan Chase & Co (JPM.N), Wells Fargo & Co (WFC.N) and Ally Financial Inc's GMAC Mortgage have revealed paperwork problems, froze foreclosures, or both.
U.S. investigators, including all 50 state attorneys general, are examining whether banks prepared foreclosure documents that were false or poorly reviewed in order to evict borrowers.
In their October 19 lawsuit, the Davises said they lost their Knightstown, Indiana home prematurely because of false affidavits from two robo-signers, including a nationally-known "robo-signer extraordinaire." They requested money damages.
But in its filing, Bank of America said that, by not trying to upset their foreclosure, the Davises could not show any harm caused by alleged inaccuracies in the underlying affidavits.
"Plaintiffs plead no facts to support their claim that the result, i.e., a judgment of foreclosure, would have been any different," wrote Matthew Strzynski, a partner at Krieg DeVault LLP representing the Charlotte, North Carolina-based bank.
Bank of America also said the law does not allow attacks on state court foreclosure judgments in federal court even if fraud is involved, and that the Davises waited too long by not raising their claims until after they lost their home.
The case is Davis v. Countrywide Home Loans Inc et al, U.S. District Court, Southern District of Indiana, No. 10-01303.
(Reporting by Jonathan Stempel in New York; editing by Andre Grenon)
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