The U.S. Court of Appeals for the Second Circuit on Wednesday partially reversed a Manhattan federal judge’s order dismissing a lawsuit that challenged New York City’s Third Party Transfer program, which transfers ownership of tax-delinquent properties through in rem foreclosure proceedings.

The panel, which included U.S. Chief Circuit Judge Debra Ann Livingston and Circuit Judges José Cabranes and Gerard E. Lynch, found that U.S. District Judge John Koeltl was correct in his finding that the plaintiffs in the proposed class-action suit lack standing to seek injunctive and declaratory relief and that the Tax Injunction Act had no direct application to the case.

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