Case Background
Wallace Owen and Barbara Owen purchased a residential property located at 5524 Skyline Road South in Salem, Oregon, on May 15, 2015. They established the home as their primary personal residence. On November 8, 2017, Barbara Owen officially conveyed her legal interest in the property to Wallace Owen. Both individuals continued to live together in the home and maintained it as their continuous residence. Both individuals passed the age of 65 in 2017, making them vulnerable individuals under state protection laws. At the time Barbara Owen conveyed her interest, Wallace Owen executed a reverse mortgage, using their residential property as collateral to secure the loan agreement. Reverse Mortgage Funding, LLC, held the legal title as the beneficiary of the trust deed, while American Advisors Group, Inc. operated as the designated servicer for the loan account.
Cause
In 2021, American Advisors Group, acting as the authorized agent for Reverse Mortgage Funding, asserted that Wallace and Barbara Owen had relocated from the property. Based entirely on this claim, the loan companies declared that the couple defaulted on their reverse mortgage terms. The loan companies did not inspect the property to verify if the couple had actually moved. The couple never abandoned the property and remained in continuous residence from the time of their original purchase.
American Advisors Group and Reverse Mortgage Funding hired Clear Recon Corporation to initiate foreclosure actions against the property. Clear Recon Corporation utilized the legal services of Aldridge Pite, LLP, to manage and send out the required foreclosure notifications. Aldridge Pite mailed foreclosure notices addressed to Wallace Owen from an office in Georgia. Postal tracking histories explicitly confirmed that these legal notices never reached the homeowners and never left the state of Georgia. Despite holding records that proved the delivery failures, Clear Recon Corporation went ahead and conducted a foreclosure sale in September 2022. Lantern Gate Properties, LLC, purchased the property at the foreclosure auction. Lantern Gate Properties then filed an ejectment lawsuit against Wallace and Barbara Owen to force them out of the house.
Injury
The wrongful foreclosure actions upended the lives of the elderly homeowners. The couple suffered the total loss of their long-term family home, which triggered substantial emotional trauma, personal frustration, profound worry, and anger. They also faced severe financial destabilization. The foreclosure sale generated an excess surplus of over $175,000 above the actual debt owed to Reverse Mortgage Funding. Clear Recon Corporation and Aldridge Pite actively withheld these surplus funds from the couple. The extended retention of these funds left the elderly couple without necessary money required to cover ordinary living expenses. The couple had to hire attorneys and pay extra fees to track down transaction records, confirm the sales figures, and defend their rights against eviction.
Damages Sought
Wallace and Barbara Owen filed legal counterclaims and third-party complaints to stop the eviction and seek financial recovery. They asked the Court to dismiss the eviction lawsuit with prejudice and clear the title to the property back into their names. The couple pursued actual compensatory damages to address the severe emotional distress, financial injuries, and unexpected attorney fees. They also demanded treble damages under state elder protection laws, seeking no less than $500,000 against each corporate entity involved in the foreclosure pipeline. Additionally, they sought the immediate return of the $175,000 sale surplus and substantial punitive damages to penalize the companies for deceptive trade practices.
Key Arguments and Proceedings
Legal Representation
Plaintiff(s): Lantern Gate Properties, LLC
· Counsel for Plaintiff(s): Robert Tyler of The Reynolds Law Firm, PC
Defendant(s): Wallace Owen | Barbara Owen
· Counsel for Defendant(s): Keith D Karnes | Hope A Del Carlo
Key Arguments or Remarks by Counsel
Claims
The attorneys for Wallace and Barbara Owen argued that the initial eviction lawsuit had no legal standing because the entire foreclosure foundation was invalid. They asserted that the loan companies manufactured a fake default by ignoring federal and state guidelines that required property inspections prior to acceleration. Counsel argued that Clear Recon Corporation and Aldridge Pite knowingly conducted an illegal sale because their own mail tracking systems showed that the homeowners never received the required default notices.
The homeowners' counsel raised distinct legal claims against the third-party corporations. They brought statutory claims under the Oregon Unlawful Trade Practices Act, asserting that Clear Recon Corporation and Aldridge Pite engaged in deceptive, unfair business patterns. They proved that the companies lied about the existence of the surplus money and used unfair leverage by demanding a full liability waiver before returning the couple's money. Counsel also raised claims for the Financial Abuse of a Vulnerable Person, arguing that all four corporations systematically stripped protected elderly citizens of their property rights, equity, and living funds.
Defense
Lantern Gate Properties argued that it held the true legal title to the real estate as a good-faith buyer because it had paid valid consideration at a scheduled public auction. The company claimed it was fully entitled to immediate possession of the house and demanded compensation for ongoing delays. American Advisors Group and Reverse Mortgage Funding did not present an active defense at trial, and the Court found American Advisors Group liable by default for elder financial abuse. Clear Recon Corporation and Aldridge Pite contested the claims by arguing that they followed standard foreclosure procedures. They claimed that the surplus release required standard legal documentation and liability releases to ensure proper distribution, denying any intentional deception or statutory violations.
Jury Verdict
The jury, duly empaneled in the Circuit Court for the State of Oregon, Marion County, returned its verdict on January 30, 2026 in the matter involving Lantern Gate Properties, LLC as Plaintiff, Wallace Owen and Barbara Owen as Defendants and third-party Plaintiffs, and Clear Recon Corp, Aldridge Pite LLP, Reverse Mortgage Funding LLC, and American Advisors Group, Inc. as third-party Defendants.
Claims Against Clear Recon Corp — Unlawful Trade Practices Act (UTPA)
The jury found in favor of Wallace and Barbara Owen on all three UTPA claims against Clear Recon Corp. First, the jury found that Clear Recon Corp willfully conducted the trustee's sale of Wallace and Barbara Owen's home at a time when Wallace Owen was not in default on his reverse mortgage, thereby falsely representing that he had a status he did not have. Second, the jury found that Clear Recon Corp willfully made false or misleading representations concerning the nature of the transaction by representing that the surplus funds it held after the foreclosure sale could only be returned to the Owens if they signed a release. Third, the jury found that Clear Recon Corp willfully made false or misleading representations of fact concerning the Owens' cost for real estate or loan services by refusing to release the surplus funds upon demand.
Having found Clear Recon Corp liable under the UTPA, the jury awarded Wallace Owen actual damages of $108,000 and Barbara Owen actual damages of $216,000. The jury further found that Wallace and Barbara Owen clearly and convincingly proved that Clear Recon Corp was liable for punitive damages, and accordingly awarded punitive damages of $4,400,000 against Clear Recon Corp.
Claims Against Clear Recon Corp — Financial Abuse of a Vulnerable Person
The jury also found that Clear Recon Corp wrongfully took property from Wallace and Barbara Owen and committed financial abuse of a vulnerable person in its handling of the surplus funds. As a result of this finding, the jury awarded Wallace Owen economic damages of $400,000 and non-economic damages of $250,000 and awarded Barbara Owen economic damages of $400,000 and non-economic damages of $250,000.
Claims Against Aldridge Pite LLP — Unlawful Trade Practices Act (UTPA)
Turning to the claims against Aldridge Pite LLP, the jury found that Aldridge Pite willfully made false or misleading representations concerning the nature of the transaction by representing that surplus fund held after the foreclosure sale could only be refunded to the Owens if they signed a release. The jury further found that Aldridge Pite willfully made false or misleading representations of fact concerning the Owens' cost for real estate or loan services by refusing to release the surplus funds upon demand.
Based on these UTPA violations, the jury awarded Wallace Owen actual damages of $10,238 and Barbara Owen actual damages of $10,238. The jury found that Wallace and Barbara Owen clearly and convincingly proved that Aldridge Pite was liable for punitive damages and awarded punitive damages of $2,500,000 against Aldridge Pite LLP.
Claims Against Aldridge Pite LLP — Financial Abuse of a Vulnerable Person
The jury further found that Aldridge Pite engaged in financial abuse of a vulnerable person in its handling of the surplus funds. As a consequence, the jury awarded Wallace Owen economic damages of $250,000 and non-economic damages of $250,000 and awarded Barbara Owen economic damages of $250,000 and non-economic damages of $250,000.
Damages Against American Advisors Group, Inc. (AAG)
The Court had previously found American Advisors Group, Inc. liable by default to Wallace and Barbara Owen on their Financial Abuse of a Vulnerable Person claims. The jury was therefore tasked only with determining the amount of damages. The jury awarded Wallace Owen economic damages of $125,000 and non-economic damages of $125,000 and awarded Barbara Owen economic damages of $125,000 and non-economic damages of $125,000.
This verdict was signed and dated January 30, 2026, by the presiding juror, concluding the jury's findings in this matter.
Court documents are available upon request at [email protected]
