Opinion ID: 619531
Heading Depth: 3
Heading Rank: 3

Heading: Michigan Consumer Protection Act claim

Text: The Moloskys also fail to state a claim under Michigan Consumer Protection Act, M.C.L. § 445.901 et seq., because the Michigan Consumer Protection Act by its own terms does not apply to Washington Mutual. M.C.L. § 445.904(1)(a) exempts any transaction or conduct specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or the United States. Washington Mutual is specifically authorized by the OTS to invest in, sell, or otherwise deal in ... [r]esidential real property loans. 12 U.S.C. § 1464(c)(1)(B). Such a general authorization is sufficient to exempt Washington Mutual under Michigan law. In Liss v. Lewiston-Richards, Inc., 478 Mich. 203, 732 N.W.2d 514 (2007), the Supreme Court of Michigan explained the phrase to mean that the general transaction at issue,  not the alleged misconduct,  must be mentioned specifically as authorized, id. at 209, 732 N.W.2d 514 (emphasis in original) (internal citation omitted). In Liss, the court held that a statute that defined a residential home builder as one who engages in construction activities for a fixed sum, price, fee, percentage, valuable consideration, or other compensation was sufficient to constitute specific authorization for a residential home builder to contract to build homes. Id. at 214, 732 N.W.2d 514 (internal quotation marks and citations omitted). Because [f]orming an agreement to build a home is the essence of a residential home builder's activity, the contract to build a residential home was exempted from the Michigan Consumer Protection Act, and all claims resulting from it were dismissed. Id. at 215, 732 N.W.2d 514. Because the fees at issue in this case are part of authorized general transactions the service of real property loansthey are exempted. Moreover, Washington Mutual properly pled the exemption in its original motion to dismiss, thereby meeting the requirement recognized in Giura v. Bartolomeo, No. 291952, 2010 WL 3767563, at  (Mich.Ct.App. Sept. 28, 2010). The Moloskys' argument that the transaction that must be authorized is actually purchasing mortgage loans from state-chartered banks and then charging the borrower fees ... in direct breach of contract is both more specific than the Liss standard requires and improperly looks to the alleged misconduct rather than the transaction itself, which is loan servicing. The Michigan Consumer Protection Act is not applicable to Washington Mutual on the facts of this case.