Federal law does not preempt New York Attorney General Andrew Cuomo from suing First American Corp. and its eAppraiseIT unit for allegedly bowing to pressure from Washington Mutual to inflate property valuations during the housing boom, a state appeals court ruled Tuesday.

The 2007 lawsuit — part of a broader investigation by Cuomo into the mortgage securitization process that led to Fannie Mae and Freddie Mac adopting new rules for appraisals — has been held up by First American’s claim that federal regulators have jurisdiction.

The New York State Supreme Court for New York County ruled that neither federal statutes nor the regulations and guidelines implemented by the Office of Thrift Supervision preempt Cuomo’s lawsuit.

Washington Mutual, which was acquired by JP Morgan Chase in September 2008 after being placed in receivership, was not named in the lawsuit. First American and eAppraiseIT have denied allegations that they assigned work to appraisers who were willing to inflate valuations in order to win business from WaMu.

A spokesman for eAppraiseIt told Bloomberg News that that the company expects to be vindicated at trial, noting that the appeals court decision made no determination as to Cuomo’s allegations.

As of June 1, CoreLogic and First American Financial Corp. are separate, independent publicly traded companies, with eAppraiseIT part of CoreLogic.


What’s your opinion? Leave your comments below or send a letter to the editor.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription