SALEM, Oregon — A Marion County jury has ordered foreclosure companies and legal operators to pay more than $8 million to an Oregon couple in their 70s whose home was seized and auctioned off while they were still living inside it.
The verdict penalizes loan servicer American Advisors Group, foreclosure trustee Clear Recon Corp, and law firm Aldridge Pite LLP for willful financial abuse and unlawful trade practices. Wallace and Barbara Owen bought the house on Skyline Road South in Salem in 2015, using it continuously as their primary residence. But in 2021, American Advisors Group claimed the couple had vacated the property. The lender treated the unverified vacancy as a default on Wallace Owen's reverse mortgage. They never sent an inspector to check the front door.
The machinery of foreclosure moved rapidly anyway.
Clear Recon hired Georgia-based law firm Aldridge Pite to issue legal notices. Those notices never arrived. Postal tracking records later confirmed that the mailings never even crossed state lines from Georgia, yet Clear Recon pushed ahead with the auction in September 2022. Lantern Gate Properties bought the house and promptly filed an ejectment lawsuit in local court to force the septuagenarians out onto the street.
The auction price generated more than $175,000 beyond the balance owed on the reverse mortgage. By law, that excess cash belonged to the Owens to fund their living expenses. Instead, Clear Recon and Aldridge Pite impounded the money. The firms told the retired couple that they would release the cash only if the homeowners signed away their right to sue.
Wallace and Barbara Owen refused to sign. They hired defense attorneys to resist the eviction suit, audit transaction records, and expose the sham default.
| Entity | Legal Status | Verdict Determination |
|---|---|---|
| Clear Recon Corp | Foreclosure Trustee | Liable under Oregon Unlawful Trade Practices Act |
| Aldridge Pite LLP | Foreclosure Counsel | Liable for statutory violations & notice failures |
| American Advisors Group | Loan Servicer | Liable by default for financial abuse of a vulnerable person |
| Lantern Gate Properties | Auction Buyer | Subject to ongoing dispute over legal title and ejectment |
Jurors determined that Clear Recon willfully staged the foreclosure sale knowing Wallace Owen was not in default, made deceptive statements regarding the surplus funds, and unlawfully withheld the couple's money. While Lantern Gate Properties insisted it bought the title in good faith at a public auction, the Marion County court entered default liability against American Advisors Group for elder financial exploitation. The ruling clears the path for final judgment entries as the Owens fight to invalidate the auction deed and terminate the pending eviction proceedings in state court.