DALLAS (CN) - AmericaHomeKey, a mortgage company, asked a state judge to stop the U.S. Secretary of Housing and Urban Development from publishing a press release that it claims will damage its relationship with a bank and cause it to lose $14 million worth of loans.
AmericaHomeKey sued the U.S. Department of Housing and Urban Development and its Secretary Shaun Donovan in Dallas County Court.
Dallas-based AmericaHomeKey originated, serviced and sold mortgage loans until recently, when it completed "a sale of substantially all of its business," according to the complaint.
The company claims that though it no longer originates mortgages, it continues to sell loans that were locked in before March 12 to its business partner, Ally Bank.
AmericaHomeKey claims that this month the Department of Housing and Urban Development barred it from originating and underwriting new mortgages insured by the Federal Housing Administration.
It claims that HUD intends to publish a press release about the decision to terminate AmericaHomeKey's authority before the company's right to appeal expires after 30 days.
"On or about March 22, 2012, plaintiff communicated with representatives of defendants and informed them of the business relationship between plaintiff and Ally Bank," the complaint states. "Plaintiff's representative was then informed that defendants intended to immediately publish a press release ('the press release') that would publicize the actions being taken by HUD pursuant to the HUD letter without waiting for the appeal deadline to expire."
AmericaHomeKey claims the press release will hurt its business relationship with Ally Bank, whose investors will back away from AmericaHomeKey loan purchases, causing it to lose $14 million worth of loans.
"Upon information and belief, the publication of the press release prior to the appeal deadline is unwarranted because plaintiff has already sold substantially all of its loan origination business and plaintiff is unable to originate any mortgage loans at this time," the complaint states.
"The premature publication of the press release would result in irreparable damage to the business relationship between plaintiff and Ally Bank, including the ability of Ally Bank to sell loans that have been previously locked by plaintiff prior to the termination of plaintiff's FHA/HUD approval. Specifically, once the press release is published, investors who are expected to purchase the locked mortgage loans from Ally Bank will withdraw their commitments, resulting in a loss of approximately fourteen million dollars ($14,000,000.00) worth of mortgage loans and one million dollars ($1,000,000.00) worth of income to plaintiff."
AmericaHomeKey seeks damages for tortious interference with contract and business relationship, and wants HUD barred from publishing the press release before the appeal deadline.
It is represented by Rakhee Patel with Pronske & Patel.
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