​Joseph Francoeur (Partner–New York) and Eve Mouzouris (Of Counsel–New York) obtained dismissal of an amended complaint asserting violations of the Fair Debt Collection Practices Act, N.Y. General Business Law § 349, N.Y. Judiciary Law § 487, RICO, negligence, gross negligence, legal malpractice, unjust enrichment, prima facie tort, and conversion. The complaint, filed in the United States District Court for the Eastern District of New York, arose out of an underlying 2009 foreclosure action that was litigated over a ten-year period. Plaintiff brought the federal action on behalf of herself and a purported class of similarly situated New York residents. Our client represented the bank in the underlying foreclosure action, involving a mortgage held by the plaintiff on a property in Queens, New York. At the crux of plaintiff's suit were allegations that our client and the bank were engaged in a fraudulent scheme to miscalculate interest due and owing on a residential mortgage to obtain vastly inflated payouts from court-ordered foreclosure sales. Contrary to plaintiff's claims, the methodology utilized by our client for applying interest in the underlying foreclosure action was consistent with long-standing practices in the legal community and had been approved by referees and judges in a myriad of cases. Indeed, the methodology was approved in the underlying action and was not challenged by plaintiff or her counsel, despite multiple opportunities to do so.

We filed a pre-answer motion to dismiss, arguing that plaintiff's claims should be dismissed in their entirety on various procedural and substantive grounds. The Court issued a comprehensive decision addressing plaintiff's claims and concluded, as we had asserted, that all of them were time-barred. Critically, the Court credited our position that plaintiff herself conceded all causes of action began accruing on September 12, 2019 – the filing date of the Referee's Report of Sale – yet she did not commence this action until April 3, 2025, well beyond the applicable limitation periods for each claim. The Court further rejected plaintiff's equitable tolling arguments, finding that she failed to plead any affirmative acts of concealment by the law firm, that the interest calculations she challenged were publicly filed and disclosed on the record, and that she failed to allege any steps she took to exercise reasonable diligence in discovering her claims.
 
The Court also adopted our position that collateral estoppel independently barred plaintiff's various claims, holding that they rested entirely on allegations that the law firm filed fraudulent or deceptive documentation containing interest miscalculations in the underlying state court foreclosure action – issues the state court had already resolved against plaintiff when it determined the interest calculations and foreclosure were valid. Although the Court found that plaintiff's Judiciary Law § 487 claim was not barred by collateral estoppel because the question of the law firm's intent to deceive had not been previously litigated, that claim was nevertheless dismissed as time-barred.