State Ex Rel. Bowen v. Bank of America Corp.

Plaintiff filed a whistleblower action against defendants for allegedly violating the False Claims Act (FCA) (Gov. Code, § 12650 et seq.) by failing to report reconveyance fees as escheated property under the California Unclaimed Property Law (UPL) (Code Civ. Proc., § 1500 et seq.). Given the uncertain and unliquidated nature of defendants’ obligation to refund the reconveyance fees at issue herein, we conclude the fees were not subject to escheat. Accordingly, the demurrer was properly sustained without leave to amend on the ground that the complaint fails to state a cause of action. We affirm the judgment of dismissal.

BACKGROUND

This case involves three distinct statutory schemes: (1) Civil Code section 2941, subdivision (j), which requires lenders to refund reconveyance fees under certain circumstances; (2) the UPL, which requires banks and other financial institutions to report and deliver abandoned or escheated property to the state; and (3) Government Code section 12651, subdivision (a)(7), which prohibits reverse false claims violations, which are defined as “[k]nowingly mak[ing], us[ing], or causing] to be made or used a false record or statement to conceal,…