Date: 04-14-2023

Case Style:

Derek Christopherson, et al. v. State Farm Bank, FSB, et al.

Case Number: 1:21-cv-3071

Judge: Roseann A. Ketchmark

Court: United States District Court for the Western District of Florida (Greene County)

Plaintiff's Attorney:

Defendant's Attorney: Monte P. Clithero and Warren E. Harris for J.P. Morgan Mortgage Acquisition Corp.

C. Charles Townsend and Mark Haddad for J.P. Morgan Mortgage Acquisition Corp.

Description: Springfield, Missouri consumer credit lawyer represented Plaintiffs who sued defendants on fraud theories.

Plaintiffs asserted seven claims against the Defendants: Count I - Violation of the Missouri Merchandising Practices Act; Count II - Fraudulent Misrepresentation; Count III - Negligent Misrepresentation; Count IV - Equitable Recission and Cancellation; Count V - Breach of Contract; Count VI - Estoppel; and Count VII - Prima Facie Tort theories.

On March 8, 2017, after receiving approval for a loan from State Farm Bank (“SFB”), Plaintiffs purchased property in Tecumseh, Missouri, consisting of a parcel of land and a house built in 2007. (⁋⁋ 15-18.) Before the purchase, SFB obtained an appraisal of the property, and received the appraisal documents in February of 2017. (⁋⁋ 20-23.) The appraisal “showed and indicated there had been prior LOMA/LOMCs on the Property.”[1] (⁋ 56.) SFB did not provide a copy of the appraisal to Plaintiffs prior to closing.[2](⁋ 22.)

Before the purchase of the property, however, Plaintiffs reviewed at least two documents regarding flood risk to the property.[3] (⁋ 24.) The first document was the Federal Emergency Management Agency's (“FEMA”) Standard Flood Hazard Determination Form (“SFHDF”). The SFHDF was generated by, and purchased through FEMA's contractor, CoreLogic Flood Services LLC (“CoreLogic”). (⁋⁋ 12, 24.) The SFHDF indicated the property had a “Zone X” flood designation and indicated no changes or amendments to the flood assessment of the property. (⁋ 27.) The second document Plaintiffs reviewed was “the FEMA flood certificate, ” also referred to by Plaintiffs as “the Official Flood Certificate.”[4] (⁋⁋ 24, 30, 31, 52, 53, 71-75.) The flood certificate was prepared and produced by CoreLogic. (⁋ 30). The flood certificate “indicated the Property/Home were outside the 500-year flood zone;” “indicated there had been no LOMA/LOMC for the Property/Home at any time;” and “specified the Property/Home were not, and had never been, located within a designated Special Flood Hazard Area.” (⁋⁋ 30, 31.)

Relying on these documents, Plaintiffs received a $230, 000 loan from SFB, closed on the property on March 8, 2017, and began living in the home on March 22, 2017 - with only a “homeowners' insurance” policy, and not with a standard flood insurance policy. (⁋⁋ 18, 34, 39, 112.) The property was destroyed by a flood in April 2017. (⁋⁋ 35-37.) After Plaintiffs applied for governmental disaster assistance, FEMA and the Small Business Administration (“SBA”) informed Plaintiffs they were not eligible for disaster assistance because the home was located within a high-risk flood zone. (⁋ 37.) Both FEMA and the SBA informed Plaintiffs they never should have been allowed to purchase the property without flood insurance. (⁋ 39.)

After the flood, Plaintiffs discovered there had been a flood plain map change (i.e., an LOMC) on the property in 2010.[5] (⁋ 42.) “Plaintiffs learned that not only had there been an LOMA/LOMC [(in 2010)], there had actually been several LOMA/LOMCs hidden from the public within FEMA's engineering file[.]”[6](⁋ 47.) The 2010 LOMC was not reflected on the SFHDF or the flood certificates produced by CoreLogic that Plaintiffs reviewed. However, as previously mentioned, it was reflected on the property's appraisal received by SFB prior to Plaintiffs purchasing the property. (⁋⁋ 21-22, 46, 56.) Despite SFB having the appraisal prior to closing, Plaintiffs only obtained a copy after the flood occurred. (⁋ 55.)
The 2010 LOMC lowered the Base Flood Elevation (“BFE”) of the property by thirty-four feet. (f 42.) This 2010 change took the property from a previous high-risk flood zone (Zone A), and lessened the flood risk to a more favorable flood zone (Zone X). (⁋⁋ 26, 48.) In other words, the property was recategorized to the Zone X designation in 2010, and was no longer categorized as being in the high-risk 100-year flood plain (Zone A). (⁋⁋ 26, 48.)

In 2018, Plaintiffs provided SFB with the documents and information received from the SBA and the U.S. Army Corps of Engineers. (⁋ 82.) With these documents and information, CoreLogic changed the “status of the Property/Home, without informing Plaintiffs.” (⁋⁋ 82, 99.) Plaintiffs refer to this as “the 2018 Change.” (⁋⁋ 82, 83, 91, 92, 100, 104, 105, 210.) To effectuate the 2018 Change, SFB “conspired with CoreLogic to make changes and manipulate official documents in order to cover their tracks.” (⁋⁋ 88, 90, 101, 105.)

In March 2018, “FEMA and/or its contractors (i.e. CoreLogic) updated the property's SFHDF to reflect that an LOMC had been issued on April 4, 2010. (⁋⁋ 82, 99-100.) Plaintiffs were not informed of this change. (⁋ 82.) The change did not impact the property's Zone X designation as it stood either immediately before or after the sale.

Plaintiffs, however, allege the 0.68-acre property is located thirty-four feet below the 100-year flood plain, which would, and should, place it correctly back within a “high-risk designation” zone (Zone A) as it was prior to the 2010 LOMC. (⁋ 44.)

Prior to the 2017 flood, Plaintiffs had an active homeowners' insurance policy on the property. (⁋ 112.) After the flood occurred, the policy was cancelled because the property wasdeemed not to be in “insurable condition” due to the flood damage. (⁋ 113.) SFB proceeded with force-placed homeowners' insurance on the property. (⁋ 114.) In 2020, SFB transferred ownership of the loan to JPMMAC and transferred the servicing of the loan to Shellpoint. (⁋ 126-27.) In December 2020, Shellpoint notified Plaintiffs that “Shellpoint's flood vendor has reviewed the flood zone determination, ” and based on this determination, flood insurance was mandatory on the property. (⁋ 129.) Shellpoint proceeded with force-placed flood insurance on the property.

Outcome: 04/14/2023 106 NOTICE of voluntary dismissal by Derek Christopherson, Jennifer Christopherson (Stubblefield, Kory) (Entered: 04/14/2023)
04/14/2023 108 Order of Dismissal with prejudice per 106 NOTICE of voluntary dismissal. Signed on April 14, 2023 by District Judge Roseann Ketchmark. This is a TEXT ONLY ENTRY. No document is attached. (Wheeler, LaTandra) (Entered: 04/14/2023)

Plaintiff's Experts:

Defendant's Experts:

Comments: