First American Title Insurance Company v. Winfrey et al.

On December 19, 2018, the United States District Court for the Eastern District of California handled the case First American Title Insurance Company v. Winfrey et al. The plaintiff, a major title insurer, sued Cheryl and Darrell Winfrey, alleging they orchestrated a scheme to file fraudulent reconveyances of deeds of trust with county recorders. These false documents purported to release existing mortgage liens, clouding titles and causing financial losses to the insurer which had underwritten the properties’ titles. The defendants failed to respond, leading the plaintiff to seek a default judgment. On that date, a magistrate judge issued findings and recommendations to grant the motion for default judgment, awarding damages and declaratory relief.

The magistrate judge recommended granting the plaintiff's motion for default judgment, awarding approximately $93,000 in damages and declaratory relief that the fraudulent reconveyances were void.

Whether the defendants committed fraud and civil conspiracy by filing false reconveyances, and whether the plaintiff was entitled to a default judgment for monetary damages and declaratory relief to clear the clouded titles.

The case highlighted the vulnerability of land recording systems to fraudulent document filings and underscored the critical role of title insurance in protecting property owners and lenders from sophisticated equity-stripping schemes.