Todd Rundgren Faces Hurdles in Bank Fracas
(CN) - Musician Todd Rundgren and his wife face administrative hurdles in their lawsuit alleging that Washington Mutual Bank defrauded them, the 9th Circuit ruled Tuesday.
Todd and Michele Rundgren sued WaMU and JPMorgan Chase in 2009, claiming that the former had misled them about the terms of a $3 million refinancing loan for their property in Kilauea, Hawaii.
The Rundgrens claimed that WaMu had, among other things, falsified the loan application, exaggerated the couple's income and and assets, rushed the signing process and obtained a false appraisal.
Seeking to stop Chase from going forward with a nonjudicial foreclosure, the Rundgrens sought a court order declaring the loan void and unenforceable.
U.S. District Judge J. Michael Seabright dismissed the lawsuit from federal court in Honolulu, finding that the Rundgrens had failed to exhaust their claims with the Federal Deposit Insurance Company (FDIC) before filing suit.
A unanimous appellate panel affirmed on Tuesday.
Because WaMu had been placed into the receivership of the FDIC, which in turn transferred the Rundgrens' mortgage to Chase, the couple was required to exhaust the administrative remedies provided by the Financial Institutions Reform, Recovery, and Enforcement Act, the three-judge panel found.
"The Rundgrens' complaint alleges claims 'relating to any act or omission' of WaMu,and they have not explained why their claims are not susceptible of resolution through the administrative process," wrote Judge Sandra Ikuta for the panel. "Because the Rundgrens have not exhausted their administrative remedies ... the plain language of [the statute] stripped the district court of jurisdiction to consider the Rundgrens' complaint."
Rundgren is perhaps best known for his 1972 hit "Hello It's Me," from the album "Something/Anything?"