Mayor and City Council of Baltimore v Wells Fargo Bank NA

Judge J. Frederick Motz of the United States District Court for the District of Maryland recently granted Wells Fargo’s motion to dismiss the second amended complaint in the “subprime nuisance” case against Wells Fargo. However, the court also granted the City of Baltimore leave to file a third amended complaint.


The Mayor and City Council of Baltimore brought this action against Wells Fargo Bank, N.A. and Wells Fargo Financial Leasing, Inc. under the federal Fair Housing Act, alleging that Wells Fargo’s supposed predatory and discriminatory lending practices led to foreclosures that harmed the City of Baltimore.

The court found that the City failed to allege causal connection between Wells Fargo’s lending and the alleged damages to the City, as required. The court noted that it was reluctant to grant the City leave to file a third amended complaint because it may well be that the damages (if any) that the City might eventually be awarded would be extremely limited.

However, the court indicated that an analysis of the issues persuaded the court that theoretically the City does have viable claims, if it can prove property specific injuries inflicted upon it at properties that would not have been vacant but for improper loans made by Wells Fargo. The court stated that it was in the interest of justice that the City be granted leave to file a third amended complaint.