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Cohen v. JP Morgan Chase and Co.

January 4, 2006

SYLVIA COHEN, PLAINTIFF,
v.
JP MORGAN CHASE AND CO. AND JP MORGAN CHASE BANK, RESPONDENT.



The opinion of the court was delivered by: Sifton, Senior Judge.

MEMORANDUM OPINION AND ORDER

Plaintiff Sylvia Cohen brings this action against defendants J.P. Morgan Chase & Co. and J.P. Morgan Chase Bank stating three claims for relief on her own behalf and on behalf of an as yet uncertified class: (1) defendants' violation of section 8(b) of the Real Estate Settlement Procedures Act, 12 U.S.C. §2607(b) ("RESPA"); (2) defendants' violation of the Truth in Lending Act, 15 U.S.C. §1601 et seq. ("TILA"); and (3) defendants' violation of section 349 of the New York General Business Law ("NYGBL"). By Memorandum and Order dated March 16, 2005, I granted defendants' motion to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Now before this Court is plaintiff's motion for reconsideration of that dismissal. For the reasons that follow the plaintiff's motion for reconsideration is denied.

BACKGROUND

The following facts are drawn from the complaint and are accepted as true for purposes of this motion to reconsider the dismissal of plaintiff's claims.

In September 2003, Cohen refinanced her residential mortgage loan with the defendants. The defendants presented Cohen with a closing statement, containing all of the fees charged for settlement services. One such fee was a "post-closing fee" of $225, purportedly for future services to be rendered by defendants. At the time of the closing defendants had yet to provide any services in exchange for this fee. Nor did defendants disclose what future services they intended to perform in exchange for the fee. After the dismissal of her claims, plaintiff learned that the fee was to be used to offset costs incurred by Chase in repackaging plaintiff's and other mortgages for sale in the secondary mortgage market.

DISCUSSION

A motion for reconsideration pursuant to Local Rule 6.3 will be granted if the moving party presents factual matters or controlling decisions the court overlooked that might materially have influenced its decision. Pereira v. Aetna Casualty and Surety Co. (In re Payroll Express Corp.), 921 F. Supp. 1121, 1123 (S.D.N.Y. 1996); Violette v. Armonk Assocs., L.P., 823 F. Supp. 224, 226 (S.D.N.Y. 1993). Reconsideration is also appropriate in light of an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice. Doe v. New York City Dep't of Social Servs., 709 F.2d 782, 789 (2d Cir. 1983); Casino, LLC v. M/V Royal Empress, 98-CV-2333, 1998 WL 566772, at *1 (E.D.N.Y. Aug. 21, 1998).

Local Rule 6.3 is to be narrowly construed and strictly applied so as to avoid repetitive arguments on issues that have been fully considered by the court. See Caleb & Co. v. E.I. Du Pont De Nemours & Co., 624 F. Supp. 747, 748 (S.D.N.Y. 1985). In deciding a Local Rule 6.3 motion, the court will not allow a party to use the motion as a substitute for appealing from a final judgment. See Morser v. A.T. & T. Information Systems, 715 F. Supp. 516, 517 (S.D.N.Y. 1989); Korwek v. Hunt, 649 F. Supp. 1547, 1548 (S.D.N.Y. 1986). Therefore, a party in its motion for reargument "may not advance new facts, issues or arguments not previously presented to the court." Litton Indus., Inc. v. Lehman Bros. Kuhn Loeb, Inc., No. 86 CIV. 6447 (JMC), 1989 WL 162315, at *3 (S.D.N.Y. Aug. 4, 1989).

Section 8(b) of RESPA

Section 8(b) of RESPA was enacted in response to Congress's finding that significant reforms in the real estate settlement process are needed to insure that consumers . . . are provided with greater and more timely information on the nature and costs of the settlement process and are protected from unnecessarily high settlement charges caused by certain abusive practices that have developed in some areas of the country.

12 U.S.C. §2602(a). Congress declared that one purpose of the Act was, "the elimination of kickbacks or referral fees that tend to increase unnecessarily the costs of certain settlement services."

12 U.S.C. §2602(b). Congress achieved this purpose through Section 8 of RESPA, codified at 12 U.S.C. §2607, entitled "prohibition on kickbacks and unearned fees" which states in relevant part:

(a) Business Referrals

No person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a ...


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