Rocker and record producer Todd Rundgren and his wife Michele lost a federal appeal Tuesday in his effort to stop foreclosure on their $3 million Hawaii house and reinstate a suit accusing JPMorgan Chase Bank of fraud in handling the mortgage.
The 9th U.S. Circuit Court of Appeal tossed the appeal saying the musician failed to exhaust his administrative remedies before suing.
Rundgren, a 1970s pop star who also produced records for many major bands, sued JPMorgan Chase, as the owners of now defunct Washington Mutual Bank, which provided the loan to the couple. The Rundgrens accused WaMu of creating a false loan application in 2005 that exaggerated their income without their knowledge and misled them about the type of loan, then rushed the process, according to the opinion.
WaMu was later seized by the government and placed in receivership.
Chase took over the mortgage and notified the Rundgrens they were in default and the bank would begin a foreclosure sale in August 2009.
The Rundgrens sent a letter to the bank they were exercising their right to cancel the loan transaction and then sued Chase and WaMu in Hawaii state court.
Chase removed the case to federal court and argued the couple failed to exhaust their claims with the Federal Deposit Insurance Corp. prior to bringing suit.
The trial judge agreed and the Rundgrens appealed. The 9th Circuit rejected the couple’s claims.
Rudgren, 66, is best known for his songs, “Hello It’s Me” and “I Saw the Light.” His style is said to have inspired Pink Floyd, the Who, the Yardbirds and the Beatles.
Utopia formed out of his 1973 back-up band. Performing progressive rock. By the late 70s they had a more pop oriented style.
He also produced songs, including for the Band, Janis Joplin, Grand Funk Railroad, Cheap Trick and Hall & Oates.
In 1996, the Rundgrens moved from Sausalito, California to Kaua’i, Hawaii.
Case: Rundgren v. Washington Mutual Bank, No. 12-15368
TrialInsider.com 