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Frangos v. Bank of America, N.A.

United States Court of Appeals, First Circuit

June 21, 2016

THOMAS FRANGOS; FRANCES FRANGOS, Plaintiffs, Appellants,
v.
BANK OF AMERICA, N.A.; THE BANK OF NEW YORK MELLON; NEW PENN FINANCIAL, LLC, d/b/a Shellpoint Mortgage Servicing, Defendants, Appellees.

         APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE [Hon. Paul J. Barbadoro, U.S. District Judge]

          John L. McGowan on brief for appellants.

          Phoebe N. Coddington, Elizabeth T. Timkovich, and Winston & Strawn LLP on brief for appellees Bank of America, N.A. and The Bank of New York Mellon.

          Joseph J. Patry and Blank Rome LLP on brief for appellee New Penn Financial, LLC.

          Before Lynch, Stahl, and Kayatta, Circuit Judges.

          STAHL, Circuit Judge.

         After twice defaulting on their mortgage, Thomas and Frances Frangos brought suit against the defendants, Bank of America, N.A. ("BoA"), The Bank of New York Mellon ("BoNYM"), and New Penn Financial, LLC, seeking to forestall a planned foreclosure sale of their home. The Frangoses now appeal from the district court's entry of summary judgment in favor of the defendants. Discerning no error, we AFFIRM.

         Facts & Background

         In 2005, the Frangoses borrowed $599, 000 to refinance an existing mortgage on their Portsmouth, New Hampshire home. In exchange, the Frangoses pledged the home as collateral to secure a promissory note issued to the lender in the same amount.

         Beginning in 2007, the Frangoses suffered financially as Mr. Frangos battled cancer and as the recession battered his construction business. The Frangoses defaulted on the mortgage twice, first in 2007 and again in 2009. After the first default, the loan was restructured, but, notwithstanding the restructuring, the Frangoses again fell into default. It is undisputed that although the Frangoses' last mortgage payment was made in 2009, they continue to reside in the home to this day.

         As often occurred during this period of time, after their initial issuance, the mortgage and the promissory note changed hands repeatedly in the secondary mortgage market. In 2011, both came to be held by BoNYM.[1] From 2011 until 2013, BoNYM and the Frangoses engaged in protracted negotiations aimed at further restructuring the loan. When these negotiations ultimately proved unsuccessful, a foreclosure sale was scheduled for September 2013. On the eve of the sale, however, the Frangoses filed suit in New Hampshire state court, where they successfully obtained a preliminary injunction barring the sale from moving forward.

         Although the foreclosure proceedings were later cancelled, the lawsuit remained pending. After the removal of the action to the federal court, the Frangoses filed an amended complaint. They sought an injunction permanently barring the defendants from foreclosing, as well as damages premised on BoA's alleged breach of a provision in the mortgage agreement obligating the lender to provide the borrower with a detailed notice of default and right to cure prior to foreclosing.

         Ultimately, the district court granted summary judgment in favor of the defendants. See Frangos v. Bank of Am., N.A., No. 13-CV-472-PB, 2015 WL 6829104 (D.N.H. Nov. 6, 2015). With respect to the request for a permanent injunction, the district court found that because the foreclosure had been cancelled, the Frangoses could not make the necessary showing that they would suffer irreparable harm in the absence of injunctive relief. Id. at *2 (citing Global Naps, Inc. v. Verizon New Eng., Inc., 706 F.3d 8, 13-14 (1st Cir. 2013) (per curiam)). And, as to the claim for breach of the mortgage agreement's notice provision, the district court found that the Frangoses had not suffered compensable monetary damages. Id. at *2-3. This appeal followed.

         Discussion

         We review de novo the district court's entry of summary judgment, assessing the record in the light most favorable to the Frangoses and resolving all reasonable inferences in their favor. Binghamv.Supervalu, Inc., 806 F.3d 5, 9 (1st Cir. 2015). The entry of summary judgment is appropriate where "there is no genuine dispute as to any material fact and the ...


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