Court Opinion

ID: 2965006
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:34:04.918528+00
Date Added: 2024-06-11T11:43:04.550333
License: Public Domain

USCA1 Opinion

	

                            United States Court of Appeals
                                For the First Circuit
                                 ____________________

        No. 97-1049

        ROBERT SALOIS AND DIANNE E. SALOIS, NINON R. L. FREEMAN, AND DAVID M.
         LEARY AND LINDA SCURINI-LEARY, INDIVIDUALLY AND ON BEHALF OF OTHERS
                                 SIMILARLY SITUATED,

                               Plaintiffs, Appellants,

                                          v.

         THE DIME SAVINGS BANK OF NEW YORK, FSB, HARRY W. ALBRIGHT, JR., JOHN
         B. PETTIT, JR., WILLIAM J. MELLIN, WILLIAM J. CANDEE III, WILLIAM A.
         VOLCKHAUSEN, JAMES E. KELLY, RALPH SPITZER, ROBERT G. TURNER, BRIAN
            GERAGHTY, LAWRENCE W. PETERS, E. JUDD STALEY III, AND JOHN DOE
                                      COMPANIES,

                                Defendants, Appellees.
                                _____________________

        No. 97-1050

                                ROBERT SALOIS, ET AL.

                                Plaintiffs, Appellees,

                                          v.

                      THE DIME SAVINGS BANK OF NEW YORK, ET AL.

                               Defendants, Appellants.

                                 ____________________

                    APPEALS FROM THE UNITED STATES DISTRICT COURT

                          FOR THE DISTRICT OF MASSACHUSETTS

                      [Hon. Patti B. Saris, U.S. District Judge]
                                            ___________________
                                 ____________________

                                        Before
                               Selya, Boudin, and Stahl,

                                   Circuit Judges.
                                   ______________

                                 ____________________

            Evans J.  Carter with whom Hargraves,  Karb, Wilcox & Galvani  was
            ________________           __________________________________
        on brief for appellants.
            William S.  Eggeling with  whom Roscoe Trimmier,  Jr., Darlene  C.
            ____________________            _____________________  ___________
        Lynch, Jane E. Willis, and Ropes & Gray were on brief for appellees.
        _____  ______________      ____________

                                 ____________________

                                   November 3, 1997
                                 ____________________

                      STAHL, Circuit  Judge.  In the  mid-1980s defendant
                      STAHL, Circuit  Judge.
                             ______________

            The Dime Savings Bank of New York, FSB ("Dime") made mortgage

            loans to plaintiffs Dianne and Robert Salois, David M.  Leary

            and Linda Scurini-Leary, and Ninon R. L. Freeman.  Plaintiffs

            now appeal from the district court's dismissal on statutes of

            limitations  grounds  of  various  federal and  Massachusetts

            statutory claims  as well  as common-law  contract and  fraud

            claims arising  from the  mortgage transactions.1   Defendant

            cross-appeals from the court's denial of  its motion for Fed.

            R.  Civ. P. 11  sanctions against plaintiffs'  attorneys.  We

            affirm  the   district  court's  ruling   that  statutes   of

            limitations barred all  of plaintiffs' claims and  uphold the

            district   court's  denial  of  Dime's  motion  for  Rule  11

            sanctions because that denial was not an abuse of the court's

            discretion.

                                
            ____________________

            1.    The  amended  complaint alleges  (1)  violation  of the
            Racketeer Influenced and Corrupt Organizations Act (RICO), 18
            U.S.C.    1961-1968,  (2) violation of  the federal Truth  in
            Lending Act (TILA), 15 U.S.C.     1601 et seq. and Regulation
                                                   ______
            Z,  12 C.F.R.  pt.  226,  (3) violation  of  the Real  Estate
            Settlement Procedures Act (RESPA), 12 U.S.C.    2601-2617 and
            Regulation  X,  24 C.F.R.  pt.  3500,  (4) violation  of  the
            federal  Alternative  Mortgage  Transaction  Parity  Act,  12
            U.S.C.      3801-3806,  (5)  violation  of the  Massachusetts
            Consumer  Credit Cost  Disclosure Act,  Mass.  Gen. Laws  ch.
            140D, (6) violation of the Massachusetts Consumer  Protection
            Act, Mass.  Gen. Laws  ch. 93A, (7)  breach of  contract, (8)
            breach  of  the  implied  covenant  of  good  faith and  fair
            dealing,  (9) breach of  fiduciary duty, (10)  fraud, deceit,
            and  misrepresentation,  (11)  civil   conspiracy,  and  (12)
            negligent    misrepresentation,    negligent    hiring    and
            supervision, and vicarious liability.

                                         -3-
                                          3

                                        I.   
                                        __

                           BACKGROUND AND PRIOR PROCEEDINGS
                           ________________________________

                      Because plaintiffs  challenge the  district court's

            dismissal of their claims under  Fed. R. Civ. P. 12(b)(6), we

            recite  the facts  and reasonable  inferences  raised by  the

            facts in their  favor.  See Aybar v.  Crispin-Reyes, 118 F.3d
                                    ___ _____     _____________

            10, 13 (1st Cir. 1997).  

                      Dime   is  a   federally-chartered  savings   bank.

            Between July 1,  1986, and December  31, 1989, Dime,  through

            its wholly  owned subsidiary,  Dime Real  Estate Services  --

            Massachusetts, Inc.  ("DRES-MA"),  made  over  four  thousand

            (4,000) home mortgage  loans on residential homes  located in

            Massachusetts,  totalling over  six  hundred million  dollars

            ($600,000,000).  DRES-MA ceased to exist in 1990.2

                      Dime  marketed  to Massachusetts  residential  home

            purchasers  an  adjustable  rate loan  product  known  as the

            Impact  Loan.  In  evaluating applications for  Impact Loans,

            Dime  required only  minimal  verification of  the employment

            status, assets, and  income of prospective  borrowers, basing

            its lending  decisions instead on  the value of  the property

            subject  to the  mortgage.    Moreover,  Dime  loan  officers

            operated  under  instructions  to push  Impact  Loans  to the

            virtual exclusion  of other types  of mortgage  loans.   This

                                
            ____________________

            2.  It is unclear from the  record whether DRES-MA was merged
            into Dime or whether it was dissolved.

                                         -4-
                                          4

            effort was part of Dime's national campaign to expand rapidly

            its home lending business.

                      A  principal feature  of  an  Impact  Loan  was  an

            initial "teaser" interest  rate of 7.5 percent  for the first

            six  months with  a cap  of 9.5  percent for  the second  six

            months.  Thereafter, the rate  would adjust to conform to the

            Cost of  Funds Index plus three  percent, with a  cap of 13.9

            percent.  This arrangement was designed to result in negative

            amortization, a situation in which monthly loan payments fall

            short of the  actual monthly interest due  on the loan.   The

            unpaid interest, or "deferred interest," is then added to the

            principal and begins  to accrue interest itself,  causing the

            principal  owed to  increase despite  the  borrower's regular

            payments.   The  terms of  the Impact  Loan provided  that no

            payments or portions of payments would apply to the principal

            until all "deferred interest," or  negative amortization, had

            been paid.  Once the principal balance reached 110 percent of

            the original  principal amount, the  loan contracts  required

            mortgagors  to  make  fully  amortizing  payments;  that  is,

            mortgagors were required to  increase their monthly  payments

            to cover the additional principal plus interest.

                      Plaintiffs  secured residential  Impact Loans  from

            DRES-MA in 1986 and 1987.  To induce plaintiffs to enter  the

            loan  contracts,  Dime downplayed  the  negative amortization

            feature  of the Impact Loans, and discouraged plaintiffs from

                                         -5-
                                          5

            hiring   their  own  attorneys  by  telling  them  that  Dime

            attorneys  would "handle  things" and  "protect"  them.   Six

            months into the loans, monthly statements  revealed increases

            in  the owed  principal, and,  in the  second year,  deferred

            interest began  to appear on  the statements.   Although  the

            initial loan documents contained  the information from  which

            plaintiffs  could have  discovered that  their loan  payments

            would  increase,   plaintiffs  contend   that  teasing   this

            information  out  of   the  documents  would  have   required

            computation  skills,  computer  software,  and  a   level  of

            sophistication that  they did  not, and  could not  have been

            expected to,  possess.   In addition,  plaintiffs argue  that

            Dime  charged  them  excessive  fees  for  closing  the  loan

            contracts,  serviced  their  loans  improperly  by  providing

            unsatisfactory  responses  to  their  queries about  negative

            amortization, and altered the Saloises' loan impermissibly by

            requesting that the Saloises sign "corrective" documents that

            lifted  a two  percent per  month  cap on  the interest  rate

            applicable to the loan.

                      At the time of the complaint, plaintiffs Robert and

            Diane  Salois continued to  hold their mortgage.   Plaintiffs

            David M. Leary and Linda Scurini-Leary had defaulted, and the

            mortgage on their home was  foreclosed on in 1991.  Plaintiff

            Ninon R.  L. Freeman  paid her  loan in  full in  1993.   The

            Saloises were  alerted to  their potential  claims when  they

                                         -6-
                                          6

            consulted an attorney about their financial situation in late

            September,   1994,  and  Ms.  Freeman  and  the  Learys  were

            similarly  advised  in  mid-1995.   The  Saloises  filed this

            action on  September 1, 1995,  in the United  States District

            Court for the District of Massachusetts, as a  putative class

            action  on  behalf  of all  persons  who  secured residential

            mortgage loans  from Dime  in Massachusetts  between July  1,

            1986, and  December 31, 1989.   Dime responded on  October 5,

            1995, with a motion to dismiss the complaint as untimely.  On

            November  10, 1995, Dime further moved for Rule 11 sanctions,

            alleging  that  there  was  no legal  or  factual  basis  for

            plaintiffs'  claims.  The Saloises filed an amended complaint

            on February 9,  1996, which added the Learys  and Ms. Freeman

            as plaintiffs.  In a margin order dated November 6, 1996, the

            district court denied the Rule 11 motion and, on November 13,

            1996,  dismissed  the complaint  on  statutes  of limitations

            grounds.  Because the court never acted on plaintiffs' motion

            for class certification, no class was certified.  This appeal

            and cross-appeal followed.

                                         II.
                                         ___

                                      DISCUSSION
                                      __________

            A.  Plaintiffs' Claims 
            ______________________

                      On  appeal,  plaintiffs contend  that  the district

            court  erred in  dismissing  their  actions  on  statutes  of

                                         -7-
                                          7

            limitations grounds, arguing  that the claims are  subject to

            equitable tolling and thus are  timely.  They further contend

            that their  claims warrant  relief on the  merits.   We begin

            with the statutes of limitations issue because, if plaintiffs

            claims in fact are time-barred, that finishes the case. 

                      Arguing for equitable  tolling, plaintiffs draw  on

            federal   and  Massachusetts   law   providing  that   fraud,

            fraudulent concealment,  and wrongs  resulting in  inherently

            unknowable  injuries   toll  limitations   periods,  and   on

            Massachusetts  law providing that  limitations periods may be

            tolled by  the existence of  and breach of a  fiduciary duty.

            The   heart   of  plaintiffs'   allegations   is  that   Dime

            fraudulently  concealed  the  fact  that  their  loans  would

            definitely,  rather  than  only possibly,  go  into  negative
            __________

            amortization and accrue deferred interest.  Plaintiffs assert

            that  this  information  became  available  only  after  they

            consulted a knowledgeable  attorney who was able  to decipher

            the meaning of the facts  and figures contained in their loan

            documents.  Further,  plaintiffs contend that issues  of fact

            relating  to the propriety  of tolling should  have precluded

            the district court from dismissing their claims based on  the

            pleadings alone.  We are not persuaded.

                      As an initial matter we note that plaintiffs' TILA,

            RESPA, and Parity Act claims are subject to one-year statutes

                                         -8-
                                          8

            of limitations.3   Thus,  these claims must  have accrued  no

            earlier than  September 1,  1994.  The  claims for  breach of

            fiduciary duty; fraud,  deceit, and misrepresentation;  civil

            conspiracy; and negligent misrepresentation, negligent hiring

            and  supervision, and vicarious  liability are governed  by a

            three-year limitations  period.4  These claims must therefore

            have accrued no earlier than September 1,  1992.  Plaintiffs'

            claims  under RICO and the Massachusetts Consumer Credit Cost

            Disclosure  and Consumer Protection Acts are subject to four-

            year  limitations periods.5   Thus,  these  claims must  have

                                
            ____________________

            3.  The TILA states that "[a]ny action under this section may
            be  brought  . .  .  within one  year  from the  date  of the
            occurrence  of the  violation."   15 U.S.C.    1640(e).   The
            RESPA  provides that "[a]ny action pursuant to the provisions
            of section . . . 2607 . . . of [Title 12] may  be brought . .
            . within  1 year . . . from the date of the occurrence of the
            violation."  12  U.S.C.   2614.   The Parity Act states  that
            "[a]ny violation  of  this  section shall  be  treated  as  a
            violation of the Truth in Lending Act."  12 U.S.C.   3806(c).
            We  note that  one other court  of appeals has  held that the
            RESPA is  not subject  to tolling doctrines.   See  Hardin v.
                                                           ___  ______
            City  Title &  Escrow Co.,  797  F.2d 1037,  1041 (D.C.  Cir.
            _________________________
            1986).   We need not  address the correctness of  this ruling
            because, for reasons  we shall explain, equitable  tolling is
            not warranted on the facts of this case.

            4.  Massachusetts law provides  that "actions of  tort . .  .
            shall be  commenced only  within three  years next  after the
            cause of action accrues."   Mass. Gen. Laws ch. 260,   2A.

            5.  Massachusetts  law provides  that  "[a]ctions arising  on
            account of violations of any  law intended for the protection
            of  consumers, including  but not  limited to  . .  . chapter
            ninety-three A .  . . [and] chapter one hundred and forty D .
            .  .  whether for  damages,  penalties  or  other relief  and
            brought  by any person .  . . shall  be commenced only within
            four years  next after the  cause of action accrues."   Mass.
            Gen. Laws ch. 260,   5A.

                                         -9-
                                          9

            accrued   no  earlier  than  September  1,  1991.    Finally,

            plaintiffs' claim  for breach  of contract  is governed  by a

            six-year  limitations period.6   Thus, the contract  cause of

            action must have accrued no earlier than September 1, 1989. 

                      A cause of action generally accrues at the  time of

            the  plaintiff's injury,  or,  in  the case  of  a breach  of

            contract, at the  time of the breach.   See Cambridge Plating
                                                    ___ _________________

            Co., Inc.  v. Napco, Inc.,  991 F.2d  21, 25 (1st  Cir. 1993)
            _________     ___________

            (discussing  Massachusetts  law).     Therefore,  plaintiffs'

            claims  arose when Dime  allegedly induced them  to sign loan

            contracts by misrepresenting and/or omitting facts about  the

            terms of the  mortgage, charged them excessive  closing fees,

            and  serviced  their  loans improperly  by  giving inadequate

            answers to  telephone inquiries  about negative  amortization

            and by  having the  Saloises sign  corrective documents  that

            improperly altered their loan.

                      The  district court  examined  each of  plaintiffs'

            claims and  concluded that  virtually all  federal causes  of

            action  accrued when plaintiffs entered their respective loan

                                
            ____________________

                      With regard to  RICO claims, the Supreme  Court has
            held that "the federal policies  that lie behind RICO and the
            practicalities of RICO  litigation make the selection  of the
            4-year statute  of limitations  for Clayton  Act actions,  15
            U.S.C.    15b, the  most appropriate  limitations period  for
            RICO actions."  Agency Holding Corp.  v. Malley-Duff & Assoc.
                            ____________________     ____________________
            Inc., 483 U.S. 143, 156 (1987).
            ____

            6.  Massachusetts law  provides that "[a]ctions of contract .
            . . shall . . . be commenced only within six years next after
            the cause of action accrues."  Mass. Gen. Laws ch. 260,   2.

                                         -10-
                                          10

            contracts7  and, in any  event, no later  than mid-1988, when

            the Saloises signed  the corrective documents.   The district

            court  also concluded that, with the exception of plaintiffs'

            claims  based on  Mass. Gen.  Laws ch.  167E, see  infra, the
                                                          ___  _____

            state claims accrued no later  than either the point at which

            the corrective documents  were signed or  the point at  which

            plaintiffs called  Dime and were provided  inaccurate answers

            about deferred interest.  Although  there may be a dispute as

            to  when,  exactly, some  of the  causes of  action accrued,8

            plaintiffs do not  dispute that their claims  accrued outside

            the relevant limitations periods.  Accordingly, the viability

            of  plaintiffs'  claims  depends  on  whether  principles  of

            equitable tolling apply.

                                
            ____________________

            7.  The  Freemans  and  the Learys  entered  into  their loan
            contracts  with Dime  no later  than November  18,  1986, and
            April  15, 1987, respectively;  the Saloises executed  a note
            and mortgage on June 16, 1987, and  executed corrective notes
            on  February  29,  1988,  and  June  1,  1988.     Plaintiffs
            telephoned Dime  sometime in the  second year of  their loans
            when  deferred  interest  began to  appear  on  their monthly
            statements.  This must have occurred  no later than mid-1989.
            See infra note 8.
            ___ _____

            8.  Although the  district court  concluded  that the  events
            giving rise to  plaintiffs' claims all must  have taken place
            no later than mid-1988, we  conclude that the phone calls may
            have taken  place as late  as mid-1989.  Construing  facts in
            the light most favorable to plaintiffs, we assume that it was
            the Saloises who placed the calls, and that it was the end of
                ________                                           ___
            the "second year of their loan" when they did so, which means
            the calls may not have been  made until June 16, 1989.   Even
            using  this later date as the benchmark, however, plaintiffs'
            causes of action accrued at  least six years and almost three
            months  prior to  the date  plaintiffs  filed their  original
            complaint.

                                         -11-
                                          11

                      1.  Federal Claims
                      __________________

                      Although, under  federal law, equitable  tolling is

            applied to statutes of limitations "to prevent unjust results

            or  to  maintain  the  integrity   of  a  statute,"  King  v.
                                                                 ____

            California, 784  F.2d 910, 915  (9th Cir. 1986),  courts have
            __________

            taken  a narrow view  of equitable exceptions  to limitations

            periods, see Earnhardt v. Puerto Rico,  691 F.2d 69, 71  (1st
                     ___ _________    ___________

            Cir. 1982).  Indeed,  equitable tolling of a federal  statute

            of limitations is  "appropriate only  when the  circumstances

            that cause a plaintiff to miss  a filing deadline are out  of

            his hands."  Heideman v. PFL, Inc.,  904 F.2d 1262, 1266 (8th
                         ________    _________

            Cir. 1990), cert. denied, 498 U.S. 1026 (1991).    
                        _____ ______

                      The  federal  doctrine  of  fraudulent  concealment

            operates   to  toll  the  statute  of  limitations  "where  a

            plaintiff has been injured by fraud and 'remains in ignorance

            of it  without any fault or want of  diligence or care on his

            part.'"   Holmberg v.  Armbrecht, 327  U.S.  392, 397  (1946)
                      ________     _________

            (quoting  Bailey  v.  Glover, 88  U.S.  (21  Wall.) 342,  348
                      ______      ______

            (1874)); see  Maggio v.  Gerard  Freezer & Ice Co.,  824 F.2d
                     ___  ______    __________________________

            123, 127 (1st Cir. 1987).  For plaintiffs to be successful in

            their  argument, we must determine that "(1) sufficient facts

            were  [not] available  to  put  a  reasonable  [borrower]  in

            plaintiff[s'] position on  inquiry notice of the  possibility
                                                              ___________

            of fraud,  and (2)  plaintiff[s] exercised  due diligence  in

            attempting  to  uncover  the  factual  basis  underlying this

                                         -12-
                                          12

            alleged fraudulent conduct."  Maggio, 824 F.2d at 128.  Thus,
                                          ______

            allegations  of  fraudulent  concealment  do not  modify  the

            requirement that  plaintiffs must  have exercised  reasonable

            diligence.   See Truck Drivers  & Helpers Union v.  NLRB, 993
                         ___ ______________________________     ____

            F.2d 990, 998 (1st Cir. 1993) ("Irrespective of the extent of

            the effort  to conceal,  the fraudulent concealment  doctrine

            will  not save  a charging  party who  fails to  exercise due

            diligence,  and is  thus charged  with notice of  a potential

            claim.").  In  simpler terms, fraud  may render reasonable  a

            plaintiff's  otherwise unreasonable  conduct,  but there  are

            limits:  plaintiffs must still exercise reasonable  diligence

            in discovering that they have been the victims of fraud.

                      In this case, the inquiry is over before it begins.

            Regardless whether negative amortization was inevitable  with

            Impact  Loans, the documents contained all of the information

            necessary to determine the interaction of Dime's formula with

            prevailing interest  rates.   It  was attorney  consultation,

            rather  than  newly-discovered   information,  that  prompted

            plaintiffs'  lawsuit.  Therefore, sufficient facts -- indeed,

            all  the  facts --  were  available  to place  plaintiffs  on
            ___

            inquiry notice  of fraudulent conduct.  Moreover,  even if we

            regard   plaintiffs'  consultation   with   an  attorney   as

            "discovered"   information  that   revealed  Dime's   alleged

            concealment,   it  cannot  be   said  that   plaintiffs  were

            reasonable in waiting until 1994 to consult an attorney, when

                                         -13-
                                          13

            it was  clear as early as 1988 that  their loans had begun to

            accrue deferred interest.9   As the district  court observed,

            "The loan documents notified plaintiffs of the possibility of

            negative amortization, when it would  apply, and how it would

            work,"  so  that  even "[i]f  [Dime]  had  misrepresented the

            nature of  the loans,  the loan  documents plaintiffs  signed

            would have put them on notice of the fraud."  Salois  v. Dime
                                                          ______     ____

            Savings Bank, No. 95-11967-PBS, slip op. at 14 (D. Mass. Nov.
            ____________

            13, 1996).10  

                      Plaintiffs argue that  whether they were reasonably

            diligent in ascertaining their claims  is a matter of fact to

            be determined by  a jury.   Even  if we accept  all facts  as

                                
            ____________________

            9.  Once deferred interest  began to accrue, after  the first
            year of the  repayments, the bases of all  of the plaintiffs'
            present claims  had come to  their attention.  That  they did
            not seek legal advice  in 1988 (or, in any event,  before the
            running of the  relevant statutes of limitations) seems to be
            more  a  matter   of  happenstance  than  lack   of  relevant
            information.   We think  the district court  stated the issue
            well: "No facts are alleged as to what prompted plaintiffs to
            consult an  attorney, if not their loan documents and monthly
            statements.  . .  .   If the  plaintiffs' loan  documents and
            statements prompted them to  consult an attorney in  1994 and
            1995, unprompted  by any new  disclosure, there is  no reason
            they  could  not  have consulted  an  attorney  several years
            earlier."   Salois v.  Dime Savings  Bank, No.  95-11967-PBS,
                        ______     __________________
            slip op. at 15 (D. Mass. Nov. 13, 1996). 

            10.  In addition, we note that, under Massachusetts law, "one
            who signs  a writing  that is  designed to serve  as a  legal
            document . .  . is presumed to  know its contents."   Hull v.
                                                                  ____
            Attleboro Savings Bank, 33 Mass.  App. Ct. 18, 24 (1992); see
            ______________________                                    ___
            Lerra  v. Monsanto  Co., 521  F. Supp.  1257, 1262  (D. Mass.
            _____     _____________
            1981); Connecticut Jr. Republic v. Doherty, 20 Mass. App. Ct.
                   ________________________    _______
            107, 110  (1985).   Thus, as a  matter of  Massachusetts law,
            plaintiffs were  on notice of  their claims when  they signed
            their loan documents in 1986 and 1987.

                                         -14-
                                          14

            plaintiffs  present  them,  however, nothing  in  the  record

            supports the conclusion that plaintiffs exercised  reasonable

            diligence as  a  matter of  law.   Cf.  Sleeper   v.  Kidder,
                                               ___  _______       _______

            Peabody  & Co.,  480  F.  Supp. 1264,  1265  (D. Mass.  1979)
            ______________

            (noting  that although the  issue of reasonable  diligence is

            factually  based, it  may be  determined as  a matter  of law

            where  the  underlying  facts  are  admitted  or  established

            without dispute),  aff'd mem., 627 F.2d 1088 (1st Cir. 1980).
                               __________

            Thus, the district  court's dismissal  of plaintiffs'  claims

            was proper.11

                      2.  State Claims
                      ________________

                      The   foregoing  analysis   likewise  disposes   of

            plaintiffs'  argument for  tolling  on  the  basis  of  state
                                                                    _____

            fraudulent concealment doctrine.  Massachusetts law  provides

            that, "[i]f a person liable to a personal action fraudulently

            conceals the cause  of such action from the  knowledge of the

            person  entitled  to  bring  it,  the  period  prior  to  the

            discovery of  his cause of  action by the person  so entitled

                                
            ____________________

            11.  Plaintiffs  also contend that  there are issues  of fact
            regarding  whether Dime  was a  fiduciary  to plaintiffs  and
            whether Dime fraudulently concealed information, and that the
            existence of  such factual  issues precludes  dismissal.   To
            this   we  note  that,   first,  simply  alleging  fraudulent
            concealment  or the  existence of  a fiduciary duty  does not
            suffice to avoid dismissal.   See General Builders Supply Co.
                                          ___ ___________________________
            v. River Hill  Coal Venture, 796 F.2d 8, 12  (1st Cir. 1986).
               ________________________
            Second,   plaintiffs'  claims   may   be  dismissed   without
            determining  these   issues  because,  even   if  plaintiffs'
            allegations regarding  fraud and  fiduciary duties are  true,
            plaintiffs   still   fail   the   ultimate   test,  that   of
            reasonableness in discovering and pursuing their claims.

                                         -15-
                                          15

            shall be  excluded in  determining the time  limited for  the

            commencement of the action."   Mass. Gen. Laws ch. 260,   12.

            Specifically, a statute of limitations may be tolled "if  the

            wrongdoer,  either through  actual fraud  or in  breach of  a

            fiduciary  duty of  full disclosure,  keeps  from the  person

            injured  knowledge of  the facts  giving rise  to a  cause of

            action and the means of  acquiring knowledge of such  facts."

            Maggio, 824  F.2d at  131 (emphasis  omitted) (quoting  Frank
            ______                                                  _____

            Cooke, Inc.  v. Hurwitz, 10  Mass. App. Ct. 99,  106 (1980)).
            ___________     _______

            Here,  an analysis  of whether  Dime  concealed the  means of

            acquiring  the  facts  giving  rise  to  their  claims  would

            parallel  a reasonable diligence  inquiry, which, as  we have

            already concluded, plaintiffs fail.   Yet we need not rely on

            that  analysis  because,  again, Dime  did  not  conceal from

            plaintiffs  the facts themselves and therefore cannot be said

            to  have  kept   plaintiffs  from  acquiring  the   requisite

            knowledge.

                      But plaintiffs persist, focusing on the possibility

            of a fiduciary  relationship between themselves and  Dime and

            arguing that  Massachusetts  limitations  periods  should  be

            tolled because Dime's breach of an alleged fiduciary duty  to

            them  is sufficient to constitute fraud.  Although plaintiffs

            do  not develop  this  line  of  analysis,  presumably  their

            argument  is  that, even  if  Dime did  not  actively conceal

            information, it  nonetheless committed fraud  because it owed

                                         -16-
                                          16

            plaintiffs a special  duty of disclosure.  Under  this theory

            as well,  however, "[a]  plaintiff must be  able to  show not

            only that  crucial facts were withheld by  defendants owing a

            duty of full disclosure, but also that he lacked the means to

            uncover  these facts."    Maggio,  824 F.2d  at  131.   If  a
                                      ______

            plaintiff  has failed to "undertake  even a minimal effort to

            pursue  the investigative  opportunities  available to  him[,

            then]  not even  the  combination  of  fiduciary  duties  and

            section  12  are sufficient  to  excuse a  delay  in bringing

            suit."  Id.  In this case, we need not determine whether Dime
                    ___

            was  a  fiduciary  to  plaintiffs because,  even  if  such  a

            relationship  existed, the fact remains that no revelation of

            information occurred  subsequent to plaintiffs'  discovery of

            negative  amortization in 1988.   Because plaintiffs  had the

            "means to uncover" the relevant  facts as early as 1988, and,

            indeed, possessed the  facts themselves in 1988,  their state

            law  claim based  on the  existence  of a  fiduciary duty  in

            combination with fraudulent concealment fails.

                      Finally,  the  district   court  dismissed  one  of

            plaintiffs'  claims  based  on  the  Massachusetts   Consumer

            Protection Act, Mass.  Gen. Laws ch. 93A, on  the basis that,

            although Dime may  have been in violation of  Mass. Gen. Laws

            ch.  167E,      2(B)(9)  and  (10)  --  which   prohibit  the

            alteration of a payment  amount more than once a year and the

            alteration of the interest rate more than every six months --

                                         -17-
                                          17

            plaintiffs  had  not   alleged  that  Dime  was   subject  to

            regulation by the Massachusetts Commissioner of Banks.12  The

            court  was correct.   Dime,  a  federally-chartered bank,  is

            regulated  by the federal  Office of Thrift  Supervision, and

            DRES-MA,  a non-bank  subsidiary, was incorporated  under New

            York law.   The  Massachusetts statutes  on which  plaintiffs

            rely  apply only to Massachusetts-chartered banks.  See Mass.
                                                                ___

            Gen. Laws ch. 167E,   1.13

            B.  Dime's Motion for Rule 11 Sanctions
            _______________________________________

                      Dime  argues  that  the  district  court  erred  in

            denying  its   motion  for   sanctions  against   plaintiffs'

            attorneys, and  that the  court  should have,  at a  minimum,

                                
            ____________________

            12.  The  district court noted that plaintiffs' ch. 93A claim
            based on Dime's alleged violation of Mass. Gen. Laws ch. 167E
               2(B)(9) was  not time-barred if  the owed  monthly payment
            amount  had changed  more than  once during  any of  the four
            years  prior  to  the date  plaintiffs  brought  this action.
            Plaintiffs'  complaint did  not foreclose  this  issue.   The
            court observed as well that the claim based on Dime's alleged
            violation  of Mass.  Gen. Laws  ch. 167E    2(B)(10)  was not
            time-barred because the  interest rate changed five  times in
            1995.

            13.  Plaintiffs argue  in addition  that DRES-MA,  as a  non-
            banking corporation, was prohibited under Mass. Gen. Laws ch.
            167,    37,  from engaging  in  banking activity,  regardless
            whether DRES-MA was a foreign or  domestic corporation.  This
            argument  fails because DRES-MA was a real-estate subsidiary,
                                                  ___________
            not a  banking  subsidiary.    As  such,  although  it  would
            presently be subject  to regulation under Mass. Gen. Laws ch.
            255,     2, that  statute  was  not  in  force  at  the  time
            plaintiffs' claims arose.

                                         -18-
                                          18

            conducted  a hearing  to  determine  whether plaintiffs  made

            reasonable inquiries prior to bringing their claims.14  

                      Rule 11 calls for the imposition of sanctions on  a

            party  "for  making  arguments  or  filing  claims  that  are

            frivolous, legally unreasonable,  without factual foundation,

            or asserted  for an  'improper purpose.'"   S. Bravo  Sys. v.
                                                        ______________

            Containment Tech.  Corp., 96  F.3d 1372,  1374-75 (Fed.  Cir.
            ________________________

            1996) (citing  Conn v. Borjorquez,  967 F.2d 1418,  1420 (9th
                           ____    __________

            Cir. 1992)).   In reviewing  the district  court's denial  of

            defendant's Rule 11  motion, we apply an abuse  of discretion

            standard.  See Cooter & Gell v. Hartmarx Corp., 496 U.S. 384,
                       ___ _____________    ______________

            405 (1990).   As we have noted before,  our review of denials

            of Rule  11 motions "calls  for somewhat more  restraint than

            review of  positive actions  imposing sanctions  and shifting

            fees."  Anderson v. Boston Sch. Comm., 105 F.3d 762, 769 (1st
                    ________    _________________

            Cir.  1997).   The trial  judge should  be accorded  not only

            "additional deference in  the entire area of  sanctions," but

            also  "extraordinary deference in denying sanctions."  Id. at
                                                                   ___

            768.

                      It  would  have  been preferable  for  the district

            court to have more extensively  set forth its rationale.  See
                                                                      ___

                                
            ____________________

            14.  The  district court  disposed of  Dime's  motion in  two
            sentences:  "While  I   agree  that  the  action   should  be
            dismissed, plaintiffs amended the complaint  to eliminate the
            frivolous  claims.    Moreover, while  the  claims  are time-
            barred, the  breach of contract  claims and the  [Mass. Gen.]
            Laws ch. 93A claims were colorable at least in part."

                                         -19-
                                          19

            Figueroa-Ruiz  v. Alegria, 905 F.2d 545, 549 (1st Cir. 1990).
            _____________     _______

            Nonetheless, "although the rationale for a denial of a motion

            for  fees  or  sanctions  under  Rule  11  . .  .  should  be

            unambiguously communicated, the lack of explicit findings  is

            not  fatal where  the record  itself,  evidence or  colloquy,

            clearly indicates one or more sufficient supporting reasons."

            Anderson, 105 F.3d at 769.  
            ________

                      Here, the  record contains  adequate rationale  for

            the denial of  the motion.  The court  noted that plaintiffs'

            breach of contract and Massachusetts Consumer  Protection Act

            claims were  time-barred but nonetheless  "colorable at least

            in part."  Although we reiterate that district courts  should

            provide specific findings  in support of Rule  11 rulings, we

            conclude that, in light of the record, the court did not here

            abuse  its discretion by holding that plaintiffs' claims were

            not without foundation in law or in fact.

                      Affirmed.
                      ________

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                                          20