Massachusetts Top Court Hands Foreclosure Loss to U.S. Bancorp

U.S. Bancorp and Wells Fargo & Co., in a ruling that drove down bank stocks, lost a foreclosure case before Massachusetts’s highest court that will guide lower courts in that state and may influence others in bank disputes involving state real-estate law.

The state Supreme Judicial Court yesterday upheld a judge’s decision saying two foreclosures were invalid because the banks didn’t prove they owned the mortgages, which he said were transferred into two mortgage-backed trusts without the recipients’ being named.