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A surge of real estate foreclosure cases flowing from Ohio state courts to the federal dockets has prompted two Ohio federal court districts to use special masters to manage the flow. In the Northern District of Ohio, which has used special masters since June 2006, foreclosure cases have jumped to 558 for the first half of 2007 from 385 last year. That compares with 35 in 2004 and 220 in 2005, according to court clerk’s data. The Southern District of Ohio, which adopted a special master system in May to handle cases filed after February 1, count 205 foreclosure cases through June 30 and less than 10 cases each in 2004, 2005 and 2006, according to court data. The cases were “sufficiently unique and sufficiently numerous” to justify a special track for them, said the Southern District’s Chief Judge Sandra S. Beckwith. The courts’ special masters, who oversee the sale of the property in the cases, are paid $500 per case in each district. “Ohio is somewhat unique in having so many foreclosures, so this special process was justified,” Beckwith said. Beckwith also said the increases in cases will impact the district court’s clerk office staffing and could affect the district’s eligibility for an additional judgeship. Kevin Williams, an attorney with Columbus, Ohio-based Manley Deas Kochalski, said Ohio state courts are struggling with foreclosure case volume. The firm is filing 100 to 150 cases per month in the two Ohio federal districts, Williams said. “They appear to be freer from some staffing or financial constraints than some common pleas courts in Ohio have been,” Willams said. Mortgage cases with more than $75,000 in dispute, and in which there is diversity of citizenship because the bank is based in a state other than the mortgage holder, can be filed in federal court, Williams said. His firm started filing federal foreclosure cases in the Northern District more than two years ago, he said, to see how it would work. “After we reached a certain volume of cases, judges started to pay attention to it,” Williams said.

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