Yesterday, Reuters reported that the New York State Attorney General’s Office (NY AG) may proceed with its case against First American. You may recall that First American’s appraisal management company (AMC), eAppraiseIT was accused of “having ‘caved’ to pressure from Washington Mutual to use a list of pre-approved appraisers who provided inflated appraisals, in an effort to win more business.”
First American fought the lawsuit claiming that federal law prohibited New York from suing in this situation. A panel of the New York Appellate Division rejected this claim. According to Reuters, Justice Luis Gonzalez in writing for the Court stated “‘[e]njoining a real estate appraisal management company from abdicating its publicly advertised role of providing unbiased valuations’ is not covered under federal law.”
If you’re curious the case is Cuomo v. First American Corp et al, New York State Supreme Court, Appellate Division, First Department, No. 1308.