October 13, 2025

On September 16, 2025, a trust filed a class action in the U.S. District Court for the Northern District of New York challenging the constitutionality of New York’s Foreclosure Abuse Prevention Act (“FAPA”). The complaint asserts that FAPA’s retroactive application unlawfully altered the statute of limitations for mortgage foreclosure actions, rendering thousands of loans unenforceable and extinguishing lenders’ secured property rights. It alleges violations of the Takings Clause, the Contracts Clause, and the Due Process Clause of the U.S. Constitution, and contends that retroactivity deprived mortgage holders of vested interests without adequate justification or compensation.

This new federal filing follows ongoing litigation before the New York Court of Appeals in Article 13 LLC v. Ponce de Leon Federal Bank, where Friedman Vartolo LLP (“FV”), on behalf of the American Legal & Financial Network (“ALFN”), submitted an amicus brief urging the Court to find that FAPA applies only prospectively. FV’s brief argues that any retroactive application of FAPA would contravene the Due Process Clause of the New York Constitution and destabilize long-standing property and contract rights. Oral arguments in Ponce de Leon are scheduled for October 16, 2025, at 2:00 PM EST available Here.

 Together, the class action and the pending Article 13 appeal exemplify how the challenges to FAPA’s retroactivity clause (and the financial harm it creates) continue to be the subject of complex litigation. Additionally, until the New York Court of Appeals issues a decision, cases like these may continue to generate uncertainty across New York’s mortgage and secondary markets.