A state court already flagged the scheme. Now it's a federal RICO case
A Florida man says a web of shell companies rigged a foreclosure sale — and hid a bank's superior mortgage to pull it off.
Willie L. Brown filed a federal lawsuit on February 17, 2026, in the United States District Court for the Middle District of Florida, alleging that five entities worked together to stage a fraudulent foreclosure on a Jacksonville home, pocket the proceeds, and leave him holding the bag. The case is Brown v. American Holding 33092, LLC, et al., Case No. 3:26-cv-00328-JEP-LLL.
Here is what is alleged to have happened.
The property sits at 2212 Sotterley Lane, Jacksonville, Florida 32220. According to Brown, U.S. Bank National Association held a mortgage on it. That matters, because whoever holds the superior lien essentially controls the property's fate. But the defendants, Brown says, had other plans.
The property was shuffled through a chain of entities — Sotterley Holdings 32220, LLC, Clay County Holdings 32073, LLC, the 2212 Sotterley Lane Land Trust, and Association of Poinciana Owners Village Two, LLC — without any real money changing hands. The land trust then executed a mortgage that said there were no other encumbrances on the property. That, according to Brown, was flatly untrue.
Facing an impending foreclosure by U.S. Bank National Association, the defendants allegedly decided to beat the bank to the punch. American Holding 33092, LLC, a New Mexico company, filed its own foreclosure action in Duval County Circuit Court. Waivers of service were signed four days before the case was even filed. There was, Brown alleges, effectively no real litigation.
A final judgment of foreclosure was entered on April 11, 2024. The sale was set for May 30, 2024, advertised in the Jacksonville Daily Record, and conducted online through the Clerk's auction website. Brown, trusting that the judicial process was legitimate, submitted the highest bid of $60,100.00. The Clerk certified the sale that same day. A Certificate of Title followed on June 10, 2024.
Then the trouble started.
American Holding 33092, LLC moved to collect $18,285.00 from the proceeds. Sotterley Holdings 32220, LLC claimed the remaining surplus of $41,815.00 on behalf of itself and all defendants and previous co-owners. Brown, meanwhile, says he never received physical possession of the property.
When Brown began digging, he found what he describes as serious red flags. He filed a motion to vacate the sale. On October 31, 2024, the state court agreed he had standing as a non-party injured by a potentially fraudulent judgment. The court found an irregularity in the documentation of the parties of record and potentially deceptive conduct of the parties. It flagged the failure to list the primary mortgage, the pre-filing waivers of service, and the failure to conduct the foreclosure as a foreign corporation. The court stayed all further disbursements and gave Brown the green light to conduct discovery.
Brown is now pursuing ten counts in federal court, including violation of the Racketeer Influenced and Corrupt Organizations Act, conspiracy to violate the same act, fraudulent misrepresentation, fraudulent inducement, civil conspiracy, negligent misrepresentation, unjust enrichment, fraudulent conveyance, slander of title, and equitable restitution. He is seeking compensatory damages, treble damages, punitive damages, full restitution of his $60,100.00, prejudgment and post-judgment interest, attorney's fees, and any other relief the court deems appropriate. He has demanded a jury trial.
So why should mortgage professionals care?
This case, if the allegations hold up, describes a playbook that exploits the very system mortgage professionals depend on. The judicial foreclosure process exists to protect lenders, servicers, and buyers. When shell entities can allegedly manufacture a foreclosure, hide a superior lien, and run a public auction that looks entirely legitimate, the integrity of the whole process comes into question. Title professionals, servicers, and anyone who participates in or relies on foreclosure sales should take note.
The use of multiple LLCs across state lines, a land trust to mask true ownership, and serial transfers with no real consideration are described here as tools to circumvent the safeguards the foreclosure system is supposed to provide. For an industry built on the reliability of title records and the transparency of the foreclosure process, these are not abstract concerns.
No determination has been made on the merits of this case. The matter is in its earliest stages, and the allegations have not been proven in court.
