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Accuser sits in on foreclosure hearing

Brendan Kearney//Daily Record Legal Affairs Writer//May 23, 2011

Accuser sits in on foreclosure hearing

By Brendan Kearney

//Daily Record Legal Affairs Writer

//May 23, 2011

Midway into Monday morning’s show cause hearing in Baltimore City Circuit Court, Special Master Elizabeth A. Ritter paused to ask if anyone in the gallery was a party to any of the foreclosure cases on the docket.

Two men spoke up.

The first was John Burson, managing partner of Shapiro & Burson LLP, the Virginia-based law firm under scrutiny for several signature irregularities in its foreclosure filing process in Maryland in recent years.

The other, a bespectacled man in a houndstooth sport coat sitting directly ahead of Burson, said only that he was a former paralegal for Burson’s firm.

What Jose Portillo did not say, but what many in the courtroom knew, was that his claims of illegal practices at Shapiro & Burson probably led to the proceeding he was now watching.

Portillo, who said he drove in from Fairfax Monday morning after reading Daily Record articles about previous hearings, worked at the firm for nearly three years before being laid off with other paralegals and attorneys in February. Less than a month later, he filed criminal complaints against the firm in Montgomery and Prince George’s counties and with the Office of the Maryland Attorney General, which were reported in The Baltimore Sun.

About a month after that, Judge W. Michel Pierson, who was not in the courtroom Monday, issued show cause orders in several of Shapiro & Burson’s cases.

“I’m not really certain if that was the catalyst of this,” Portillo said of his criminal complaints, which appear to have landed in the Attorney General’s Consumer Protection Division. “But the time frame seems to be appropriate.”

Portillo’s presence Monday provided a new wrinkle to what was otherwise a typical day of questions and testimony in the city hearings that began in January with a Towson firm and have intensified this month.

Erik W. Yoder, who testified last week at a similar hearing in Montgomery County and whose associate Jason Murphy testified in Baltimore earlier this month, admitted he did not sign all the documents that bore his name, including affidavits. Yoder said most of them were signed by Murphy, as per their agreement, but that he did not recognize some of the signatures.

“I’ve always been aware that one of the paralegals was signing my name,” Yoder said of the practice at the firm he joined some four years ago. He said support staff, three of whom he named, signed bonds and other documents in his and other attorneys’ names.

“We tried to limit that always,” Yoder said of his and Murphy’s signing for each other.

Why? Ritter asked.

“Well, I don’t think we felt it was appropriate,” Yoder responded.

Ritter later asked Yoder why he didn’t just note that he was signing for Murphy. Yoder said he didn’t believe it was necessary.

“It probably would have been a better idea to prevent hearings like this,” he concluded.

Ritter asked what Yoder would say if the court called to ask about a filing he was purported to have reviewed and signed but hadn’t.

“I would have a reasonable belief that that information is accurate,” he said. “I would stand behind any statement of debt that [Murphy] submitted to the court.”

Despite the irregularities identified during a firm audit last fall, Shapiro & Burson has not filed motions to dismiss the sampling of cases Ritter examined — many of which have sold already, if only back to the lender — distinguishing the firm from others that have come before Pierson and Ritter in this process.

The Virginia firm’s lawyers have also claimed there is a difference between an affidavit sworn on the basis of personal knowledge and one based on information and belief, a distinction Ritter seemed to question in court Monday.

“Under Maryland law, a delegated signature is permissible on an affidavit that is based on information and belief,” Andrew Morris, attorney for Yoder and Murphy, argued to Ritter.

Paralegal’s letter

William M. Savage was the other Shapiro & Burson lawyer to testify Monday.

Whereas Portillo thought Yoder’s testimony was “completely honest,” he disputed Savage’s testimony, in which the lawyer said he had not authorized paralegals to sign his name and learned only in October that they were signing for him.

“I try to keep my signature a little closer to home,” Savage testified. “Until recently, I thought I had done a pretty good job of that.”

Minutes later outside the courtroom, Portillo reiterated the claims he has made in his complaints and in a letter to Ritter dated May 19, a copy of which he provided to The Daily Record.

In the letter, Portillo offers to testify “and share what I witnessed at Shapiro and Burson if you think it will help your case.” Ritter did not call Portillo or mention the letter in court on Monday, but did ask specifically about whether any of the documents were signed by another former paralegal, Peyton Reinhart, who was mentioned in Portillo’s letter.

The lawyers said they did not know if she had signed, but that she was not authorized to do so.

At the end of Monday’s hearing, Portillo hand-delivered a CD to Ritter’s office, saying it contains nearly 8,000 signed and notarized documents bearing Savage’s name that were signed by an attorney who was not on staff at Shapiro & Burson.

A message left for Burson and Savage was not returned Monday afternoon.

The firm and its lawyers have until Tuesday to submit briefs on the affidavit distinction issue, after which Ritter will submit a written report of findings and recommendations. The lawyers can take exception to it before Judge Pierson decides whether to adopt it as his own decision.

Though the Baltimore court has not yet dismissed many cases, Portillo, who is doing freelance website design while he looks for another fulltime job, was already happy with what he has read about and now seen in Baltimore, where the hearings have been lengthier and more detailed than in other jurisdictions.

“I’m glad to see that Baltimore City is distinguishing themselves to other counties in Maryland,” Portillo said.


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