On July 27, the Sixth Circuit affirmed a district court’s decision to dismiss a public nuisance lawsuit filed by the City of Cleveland against 22 financial institutions. In the lawsuit, the City claimed that defendants’ financing, purchasing, and pooling of subprime mortgages led to a foreclosure crisis in Cleveland. The court noted that intervening causes of the injuries alleged by the City included the homebuyers’ voluntary choice to enter into a subprime mortgage and default on their loans, homeowners’ failure to maintain their properties, criminal conduct by drug dealers, and looters. The court also noted that properties not subject to subprime loans had entered into foreclosure as well. Let’s hope Cleveland didn’t spend stimulus money on this one.