MERS — Mortgage Electronic Registration Systems



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MERS Analysis post Kansas




California BKR Judge throws MERS out, sanctions lawyer: They were passing around the Deed Like it Was whiskey Bottle at a Frat Party



MERS residential Membership Application Kit
Contains the following items:
  • Brochure: “Process loans, not paperwork”
  • Membership application
  • Terms and Conditions
  • Fee Schedule
MERS® Commercial Membership Application Kit
Contains the following items:
  • Brochure: “Minimize Risk, Save Money, Reduce Paperwork”
  • Membership application
  • Terms and Conditions
  • Article: “MERS: Every Commercial Loan Needs a Mom”
MERS® eRegistry Membership Application Kit
Contains the following items:
  • Brochure: “Speed, Liquidity, Security”
  • Flyer: “Getting Started With the MERS® eRegistry”
  • Addendum to MERS Membership Agreement
  • Fee Schedule
  • Legal Opinion on the MERS® eRegistry
You may also contact one of our regional representatives for more information: 

  • Northeast Region (CT, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VT, WV)
    Laurinda Clemente
    Tel: 301-530-8989
  • Southeast Region (AL, FL, GA, KY, LA, MS, NC, SC, TN, VA)
    Ron Crowe
    Tel: 205-477-5643
  • Central Region (AR, IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, OK, SD, TX, WI)
    Mark Roberge
    Tel: 630-377-1666
  • Western Region (AK, AZ, CA, CO, HI, ID, MT, NM, NV, OR, UT, WA, WY)
    Bob Pathman
    Tel: 818-932-9800

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  6. Cease and Desist Order against Citi and Wells Fargo.
    There is currently a Cease and Desist Order against Citi Mortgage. Below is the complaint that I sent to Office of Comptroller and Currency.

    There is currently a Cease and Desist Order by the Office of the Comptroller of the Currency against Mortgage Electronic Registration System. I am writing because I want something done about the Banks and MERS, because they continue to perform illegal transactions. I recently had a document that was posted to County Public Records by Citi Mortgage and MERS. It was a Deed of Trust for a transaction that was done back in 2005. Something was not right about them just now posting this document after so many years. I goggled the person that signed the document, Geraldine Ann Belinksi, Vice President. I found another Deed of Trust online that had the same person’s name on it, but this time it stated that she is the Assistant Secretary. I immediately got on the phone and called the office that was listed on the document, Citi Mortgage, 1000 Technology Drive, O’Fallon, Mo. I located the office where this individual worked and discovered that she is a mere processor. This has gotten out of hand and I am very skeptical that any of the transactions and documents that I have through Citi Mortgage are legal and binding. Why are they allowed to continue Robo Signing documents? I can be reached at 443-677-2799. Thanks James A. Smith

    I did not call MERS to verify that she worked there. I call Citi and they stated that she was a processor. This is response that I received from Citi regarding the complaint

    “Our records indicate Geraldine A. Belinski is a Certified Appointed signor for Mortgage Electroic Registration Systems Inc.”

    My question is, does MERS have employees that work in Citi facilities? I do not believe this. I called and verified that she worked there and they stated she was a processor. How can I verify that they are lying, because Im sure that OCC will believe what Citi’s response was.
    James Smith 443-677-2799.

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    Commonwealth Property Advocates, LLC, Plaintiff–Appellant, v. BAC Home Loans Servicing, LP, formerly known as Countrywide Home Loans Servicing, L.P.; Recontrust Company, a Texas corporation, Defendants–Appellees.

    Commonwealth Property Advocates, LLC, Plaintiff–Appellant, v. First Horizon Home Loan Corporation; Mortgage Electronic Registration Systems, Inc., Defendants–Appellees.

    Nos. 10–4182, 10–4193, 10–4215.

    — December 23, 2011

    Before LUCERO, BALDOCK, and HARTZ, Circuit Judges.*
    E. Craig Smay, Esq., E. Craig Smay P.C., Salt Lake City, UT, for Plaintiff–Appellant.Mark Louis Callister, J. Tayler Fox, James D. Gilson, Callister, Nebeker & McCullough, Salt Lake City, UT, Joann T. Sandifer, Husch Blackwell LLP, St. Louis, MO, for Defendants–Appellees.


    Plaintiff Commonwealth Property Advocates, LLC, acquired title to three pieces of real property in Utah from three defaulting borrowers. Plaintiff then filed three suits in diversity against various Defendants which held interests in the property, seeking to prevent foreclosure. Plaintiff argued Defendants had no authority to foreclose because the notes in each case had been securitized and sold on the open market. Because the security follows the debt, Plaintiff argued, once Defendants sold the security they could not foreclose absent authorization from every investor who had purchased an interest in the securitized note. Defendants in all three cases filed motions to dismiss pursuant to Fed.R.Civ.P. 12(b)(6), and the district court granted those motions. Plaintiff appealed, and we now consolidate these cases for purposes of opinion. Exercising jurisdiction pursuant to 28 U.S.C. § 1291, we affirm.


    The following facts are found in Plaintiff’s complaints and the attached exhibits. In appeal 10–4182, the original borrower received two loans totaling $309,000 from American Sterling Bank, secured by real property in Bountiful, Utah. Each security interest was memorialized by a promissory note and a deed of trust naming as beneficiary Defendant Mortgage Electronic Registration Systems (“MERS”) in its capacity as nominee for American Sterling.1 Each deed of trust also contained a provision giving MERS “the right to foreclose and sell the Property” and to take other actions on behalf of the lender. The complaint alleges that “[t]he obligations on the Notes were pooled and sold by Lender ․ as securities to numerous investors unknown.”2 The original borrower defaulted and MERS served a notice of default on the property. Subsequently, Plaintiff acquired title to the property by way of quitclaim deed. Plaintiff filed suit against MERS alleging “causes of action” for (1) “stay of pending sale,” (2) “estoppel/declaratory judgment,” (3) declaratory judgment, (4) quiet title, and (5) “refund, fees and costs.” Defendant MERS moved to dismiss for failure to state a claim, and the district court granted the motion. Plaintiff appealed.

    In appeal 10–4193, the original borrower received $1,135,400 from GreenPoint Mortgage Funding to acquire real property in Sandy, Utah. In exchange, the borrower executed a promissory note in favor of GreenPoint. The borrower also executed a deed of trust in favor of Meridian Title Company. The trust deed named MERS as both the beneficiary and GreenPoint’s nominee and expressly gave MERS the right “to foreclose and sell the property.” Defendant BAC Home Loans Servicing later became the servicer of the note, and Defendant ReconTrust was named as substitute trustee. According to the complaint, “the obligation under the Note was pooled and sold by Lender ․ as securities to numerous investors unknown.” When the original borrower defaulted, ReconTrust served a notice of default and intent to sell. Plaintiff acquired title to the property via quitclaim deed about seven weeks later. Plaintiff then filed suit against BAC Home Loans and ReconTrust asserting four “causes of action” labeled (1) “estoppel/declaratory judgment,” (2) declaratory judgment, (3) quiet title, and (4) “refund, fees and costs.” Defendants filed a motion to dismiss for failure to state a claim, and the district court granted the motion. Plaintiff then filed a “motion to reconsider” pursuant to “Rules 59 and 60, FRCP” because the district court “appears to have overlooked the applicable statute and the facts as admitted herein.” The district court denied this motion as well, concluding Plaintiff had not shown obvious error or introduced new, previously undiscoverable evidence. Instead, the court said, Plaintiff’s motion “raise[d] new arguments not addressed in the briefing to the court and rehashe[d] arguments already considered by the court.” The court entered its order denying the “motion to reconsider” on October 1, 2010. On October 29, 2010, Plaintiff filed a notice of appeal, stating that “defendant [sic] appeals ․ the decision of the District Court herein entered October 1, 2010.”

    In appeal 10–4215, the original borrower executed two promissory notes totaling $1,250,000 in favor of Defendant First Horizon Home Loan Corporation. The borrower secured these notes by two deeds of trust in property in Alpine, Utah. The trust deeds named Meridian Title Company as trustee. Both deeds of trust designated MERS as the beneficiary and as First Horizon’s nominee, and both gave MERS the right to foreclose and sell the property on First Horizon’s behalf. First Horizon pooled the obligations on the notes and sold them as securities to various investors. First Horizon also substituted eTitle as the trustee, but did not initially record the substitution. The original borrower defaulted on the loan, and trustee eTitle filed a notice of default. The original borrower then quitclaimed the property to Plaintiff. Plaintiff sued First Horizon and MERS, asserting “causes of action” for (1) “stay of pending sale,” (2) “estoppel/declaratory judgment,” (3) declaratory judgment, (4) quiet title, and (5) “refund, fees and costs.” The district court granted Defendants’ motion to dismiss, and Plaintiff appealed.

    Plaintiff’s complaints are difficult to construe, but they appear to raise three substantive claims for relief.3 First, under the heading of “Estoppel/Declaratory Judgment,” Plaintiff alleges Defendants failed to provide information regarding the interests of “persons to whom the Note and/or Trust Deed may be assigned” when requested to do so by Plaintiff. Plaintiff alleges the failure to provide this information subjects it “to risks, abuses, and prejudice” and “render[s] impossible proper discharge of the obligation on the Note.” Thus, Plaintiff seeks to estop Defendants from asserting that the notes are in default or that they hold the power of sale under the trust deeds. Plaintiff also requests a declaratory judgment that Defendants “lack any [enforceable] interest in the trust deed.” In 10–4215, Plaintiff makes several additional allegations under this cause of action. Plaintiff alleges Defendants violated a number of Utah statutory provisions, Utah Code Ann. §§ 57–1–22(3)(a); 57–1–22(1)(a); 57–1–23; and 57–1–21(4). Plaintiff also alleges, “First Horizon is attempting to foreclose on the subject property without being the Beneficiary of record for the first position Trust Deed.”

    In its second substantive claim, Plaintiff seeks a declaratory judgment that Defendants “lack any interest under the Trust Deed which may be enforced by ․ sale of the subject property.” Plaintiff alleges that, because Defendants transferred the notes to subsequent assignees, Defendants “lacked authority to declare a default” or to sell the subject property and distribute any proceeds. The complaints allege that because the investors in each securitized note were not assigned the corresponding trust deed, “the obligation under the Note has ․ become unsecured, and the Note and Trust Deed, may not be foreclosed.” Plaintiff further claims it is “a bona fide purchaser for value of the subject property without notice of any claim” by persons to whom Defendants assigned the notes.

    Plaintiff’s third claim, seeking to quiet title, rests upon two grounds. First, Plaintiff asserts that Defendants’ failure “to retain any interest in the obligation under the Note voided any title or power they might have under the Trust Deed, and rendered said Trust deed unenforceable by them.” Second, Plaintiff alleges that “[r]ecordation of the plaintiff’s deed to the subject property prior to the recordation of any assignment of the Trust Deed, renders any such assignments void and unenforceable against the subject property” under Utah Code Ann. §§ 57–3–102 and 57–3–103. Plaintiff seeks to quiet title in its favor, thus “freeing title to the subject property of the lien of the Trust Deed and leaving any obligation under the Note unsecured․”4

    Plaintiff appears to raise only one issue on appeal.5 Plaintiff argues securitization of a note renders the holder of the underlying trust deed and its nominees unable to foreclose absent authorization by every investor holding an interest in the securitized note. Plaintiff contends that any authorization to foreclose contained in the trust deeds is invalidated by Utah Code Ann. § 57–1–35. This claim appears to relate to Plaintiff’s second and third substantive claims for relief, both of which challenged Defendants’ authority to foreclose, but which sought different forms of relief (a declaratory judgment and quiet title). Although Plaintiff’s complaints appeared to raise several other claims, Plaintiff has not raised those claims on appeal. An appellant’s opening brief must set forth “appellant’s contentions and the reasons for them, with citations to the authorities and parts of the record on which the appellant relies.” Fed. R.App. P. 28(a)(9)(A). Consequently, “[a]n issue or argument insufficiently raised in the opening brief is deemed waived.” Becker v. Kroll, 494 F.3d 904, 913 n. 6 (10th Cir.2007). Because Plaintiff has only appealed with respect to Defendants’ authority to foreclose, we will not address the remaining claims.6


    We first address Defendants’ arguments challenging our jurisdiction. In appeal 10–4193, Defendants argue we cannot consider the merits of the 12(b)(6) motion because Plaintiff appealed only the denial of its “motion to reconsider.” In appeal 10–4215, Defendants argue Plaintiff lacks standing to sue, because Plaintiff’s injury is self-imposed and because Plaintiff is seeking to assert a third party’s rights.


    We may construe Plaintiff’s motion to reconsider as relevant to appeal 10–4193 either as a motion to alter or amend the judgment under Fed.R.Civ.P. 59(e) or as motion for relief from the judgment under Fed.R.Civ.P. 60(b). If a motion is timely under both rules, how we construe it depends upon the reasons expressed by the movant. Jennings v. Rivers, 394 F.3d 850, 855 (10th Cir.2005). A Rule 59(e) motion is the appropriate vehicle “to correct manifest errors of law or to present newly discovered evidence.” Phelps v. Hamilton, 122 F.3d 1309, 1324 (10th Cir.1997) (quoting Comm. for the First Amendment v. Campbell, 962 F.2d 1517, 1523 (10th Cir.1992)). A Rule 60(b) motion is appropriate for, among other things, “mistake, inadvertence, surprise, or excusable neglect” and “newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial.” Fed.R.Civ.P. 60(b)(1),(2). The district court did not construe Plaintiff’s motion as either a Rule 59 or Rule 60 motion, but simply denied it. Plaintiff’s motion was filed within fourteen days of the district court’s order, meaning it was timely under Rule 59(e). The motion appears to be properly characterized as a Rule 59(e) motion, because Plaintiff claimed the district court “overlooked the applicable statute and the facts.” We accordingly construe it as a Rule 59(e) motion. “[A]n appeal from the denial of a motion to reconsider construed as a Rule 59(e) motion permits consideration of the merits of the underlying judgment, while an appeal from the denial of a Rule 60(b) motion does not itself preserve for appellate review the underlying judgment.” Hawkins v. Evans, 64 F.3d 543, 546 (10th Cir.1995). Because we construe Plaintiff’s motion as one brought under Rule 59(e), we may consider the merits of the district court’s underlying dismissal.


    Defendants next challenge Plaintiff’s standing as relevant to appeal 10–4215. The doctrine of standing has both a constitutional and a prudential component. To have standing under Article III, Plaintiff must assert an injury that is (1) concrete, particularized, and actual or imminent, (2) fairly traceable to the Defendants’ challenged action, and (3) redressable by a favorable ruling. Horne v. Flores, 557 U.S. 433, ––––, 129 S.Ct. 2579, 2592, 174 L.Ed.2d 406 (2009). Defendants First Horizon and MERS argue Plaintiff’s alleged injuries are not “fairly traceable” to any conduct by Defendants because Plaintiff’s injuries “resulted from [Plaintiff’s] own decision to knowingly purchase a trust deed-encumbered property from a defaulting borrower, not the result of any conduct by [Defendants].” Defendants cite Nova Health Systems v. Gandy, 416 F.3d 1149, 1156 n. 8 (10th Cir.2005), in which we characterized an abortion provider’s “injury” as self-inflicted because it resulted from the provider’s decision to adopt stricter parental notification procedures than the challenged statute required. This case differs from Gandy because the asserted injury—an unauthorized foreclosure—was initiated by Defendants, not Plaintiff. Unlike the plaintiff in Gandy, Plaintiff has brought no additional injury upon itself. Plaintiff’s decision to purchase the encumbered property in no way deprived it of the right to challenge an allegedly unauthorized foreclosure.7 Thus, Plaintiff has Article III standing.

    One element of prudential standing is “the general prohibition on a litigant’s raising another person’s legal rights.” Elk Grove Unified Sch. Dist. v. Newdow, 542 U.S. 1, 12, 124 S.Ct. 2301, 159 L.Ed.2d 98 (2004). Defendants in 10–4215 argue Plaintiff is attempting to assert the rights of a third party, the original borrower on the mortgage. Defendants cite Shire Development v. Frontier Investments., 799 P.2d 221, 222–23 (Utah Ct.App.1990), for the proposition that “a plaintiff lacks standing to sue about a contract to which he is not a party.” Plaintiff has not, however, asserted any contractual rights. Instead, Plaintiff alleges Defendants have no legal or contractual authority to foreclose. Because Plaintiff is the current owner of the real property, a foreclosure would injure Plaintiff directly. Therefore, Plaintiff also has prudential standing, and we may proceed to the merits.


    We review a Rule 12(b)(6) dismissal de novo, accepting as true all well-pleaded factual allegations in the complaint and viewing them in the light most favorable to the plaintiff. Smith v. United States, 561 F.3d 1090, 1098 (10th Cir.2009). In evaluating a motion to dismiss, we may consider not only the complaint, but also the attached exhibits and documents incorporated into the complaint by reference. Id. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ “ Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). When reviewing a 12(b)(6) dismissal, “we must determine whether the complaint sufficiently alleges facts supporting all the elements necessary to establish an entitlement to relief under the legal theory proposed.” Forest Guardians v. Forsgren, 478 F.3d 1149, 1160 (10th Cir.2007). Dismissal is appropriate if the law simply affords no relief. See United States ex rel. Sikkenga v. Regence Bluecross Blueshield of Utah, 472 F.3d 702, 712 (10th Cir.2006) (observing that dismissal under 12(b)(6) was appropriate where a federal statute provided no remedy for the alleged conduct).

    Our first task is to determine exactly what cause or causes of action Plaintiff is asserting. Plaintiff’s “causes of action” listed in its complaints are actually forms of relief. Because Plaintiff asserted no federal claims and brought this case in diversity, its claims for relief must be grounded in state law. Plaintiff, however, asserted no common law basis for its claims and waived its only claims based on Utah statutes.8 The claim Plaintiff pursues on appeal is simply that Defendants had no authority to foreclose because they transferred the debt. The most analogous state law cause of action appears to be an action for wrongful foreclosure. See Timm v. Dewsnup, 990 P.2d 942, 945 (Utah 1999) (remanding for the trial court “to address the merits of [plaintiff’s] claim for the wrongful foreclosure of the trust deed property”). The elements of this cause of action are unclear, but “[a] party may have an apparently valid trustee’s sale set aside for irregularity, want of notice, or fraud if there is evidence sufficient to overcome the presumption of its validity.” Occidental/Neb. Fed. Sav. Bank v. Mehr, 791 P.2d 217, 221 (Utah 1990). We construe Plaintiff’s properly preserved claim as one for wrongful foreclosure under Utah law. Our next question is whether the facts alleged are sufficient to support a claim for relief.

    Utah law relating to trust deeds gives a trustee the power to sell the trust property if the borrower breaches an obligation relating to the secured property. Utah Code Ann. § 57–1–23. In addition, the beneficiary may elect to have the foreclosure conducted according to the “law for the foreclosure of mortgages on real property.” Id. The trustee may exercise the power of sale even “without express provision for it in the trust deed.” Id. Thus, under § 57–1–23 the only trustee Defendant in this case, ReconTrust, had apparent authority to foreclose. Additionally, all the trust deeds in this case said “MERS (as nominee for Lender and Lender’s successors and assigns) has the right: to exercise any or all of [Lender’s] interests, including, but not limited to, the right to foreclose and sell the Property.” This language appears to give MERS the right to foreclose on behalf of not only the lenders but also the lender’s successors and assigns.9 As the district court said, “By the clear language of the deeds of trust, MERS has the authority to foreclose and sell the property on behalf of both the original lender and the ‘lender’s successors.’ “

    Nevertheless, Plaintiff argues the trust deed provisions giving MERS this right are invalid because they conflict with Utah Code Ann. § 57–1–35. Plaintiff also appears to argue § 57–1–35 deprived ReconTrust of the power to foreclose as a trustee. Section 57–1–35 says: “The transfer of any debt secured by a trust deed shall operate as a transfer of the security therefor.” Plaintiff argues this provision invalidates MERS’s and ReconTrust’s authorization to foreclose, because the sale of the note in the subsequent securitization scheme also transferred the security. Plaintiff claims Defendants can no longer foreclose because they no longer hold the security interest in the real property. According to Plaintiff, “upon sale of a loan, in a securitization or otherwise, original ‘nominees,’ such as MERS, lose any right to exercise any power under the trust deed ․ absent some further agreement with the new owner of the debt.”10 Under Plaintiff’s theory, the “new owners” of the debt are the investors who purchased interests in the securitized debt. Plaintiff argues MERS can only foreclose if each investor provides MERS with written authorization to do so.

    The Utah Supreme Court has never addressed the effect of § 57–1–35 on the power to foreclose. While these appeals were pending, however, the Utah Court of Appeals addressed Plaintiff’s arguments and interpreted § 57–1–35. Commonwealth Prop. Advocates v. Mortg. Elec. Registration Sys., Inc., 263 P.3d 397 (Utah Ct.App.2011), cert. denied, Utah State Courts Appellate Docket No. 20100888 (Dec. 14, 2011). Commonwealth involved a suit brought by Plaintiff in Utah state court making almost identical claims and arguments to those it has put forth here.11 The deed of trust in Commonwealth was identical to the trust deeds in these cases, and it gave MERS authority to foreclose on behalf of the lender and its assigns. 263 P.3d at 399. The Utah Court of Appeals concluded the trust deed provided sufficient authority to foreclose. The court cited approvingly a number of federal district court opinions (including the district court’s opinion on appeal in 10–4215) that dismissed Plaintiff’s claims because the trust deeds authorized MERS to foreclose. Id. at 402. The state court said: “We also agree with the federal district court’s related rulings ․ that [Plaintiff] has failed to explain how the securitization of the Note could have revoked this language in the Deed of Trust.” Id.

    The state court then addressed Plaintiff’s reliance on § 57–1–35. The court said, “The plain language of this statute simply describes the long-applied principle in our jurisprudence that when a debt is transferred, the underlying security continues to secure the debt.” Id. at 403. The court went on:

    [W]e interpret section 57–1–35 as ensuring the basic presumption that “[a] transfer of an obligation secured by a mortgage also transfers the mortgage unless the parties to the transfer agree otherwise,” see Restatement (Third) of Prop.: Mortgages § 5.4. The plain language of the statute does nothing to prevent MERS from acting as nominee for Lender and Lender’s successors and assigns when it is permitted by the Deed of Trust. Therefore, contrary to [Plaintiff]’s liberal citation of section 57–1–35, we do not interpret the statute as preventing, implying, or somehow indicating that the original parties to the Note and Deed of Trust cannot validly contract at the outset “to have someone other than the beneficial owner of the debt act on behalf of that owner to enforce rights granted in [the security instrument]”․

    Id. (quoting Marty v. Mortg. Elec. Registration Sys., 2010 WL 4117196 (D.Utah Oct.19, 2010)). The court went on to “reject [Plaintiff]’s assertion that Utah Code section 57–1–35 prohibits the original parties to the Note and Deed of Trust from agreeing to have someone other than the beneficial owner of the debt act on behalf of that owner and its successors and assigns to enforce rights granted in the trust deed.” Id. at 404 (internal citations and brackets omitted). The court upheld the district court’s entry of summary judgment against Plaintiff.12 Id. at 405.

    The Utah Court of Appeals’ decision in Commonwealth effectively disposes of these three cases. “When exercising diversity jurisdiction, we apply state law with the objective of obtaining the result that would be reached in state court.” Butt v. Bank of Am., N.A., 477 F.3d 1171, 1179 (10th Cir.2007). If the state’s highest court has reached an issue, “[t]he federal court must defer to the most recent decisions of the state’s highest court .” Wankier v. Crown Equip. Corp., 353 F.3d 862, 866 (10th Cir.2003). Where the state’s highest court has not addressed the issue, we still follow the state’s intermediate court decisions absent “convincing evidence that the highest court would decide otherwise.” Webco Indus., Inc. v. Thermatool Corp., 278 F.3d 1120, 1126 (10th Cir.2002) (citing B.F. Goodrich Co. v. Hammond, 269 F.2d 501, 505 (10th Cir.1959). According to the Supreme Court, “Where an intermediate appellate state court rests its considered judgment upon the rule of law which it announces, that is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise.” West v. Am. Tel. & Tel. Co., 311 U.S. 223, 237, 61 S.Ct. 179, 85 L.Ed. 139 (1940)

    We have no reason to believe the Utah Supreme Court would reach a different result than did the Utah Court of Appeals. The court of appeals’ decision is based on a straightforward reading of the statute. Even assuming Plaintiff is correct that securitization deprives Defendants of their implicit power to foreclose as holders of the trust deeds, the trust deeds explicitly granted Defendants the authority to foreclose. Contrary to Plaintiff’s contention, § 57–1–35 in no way prohibits such an authorization. The statute merely says the transfer of a debt operates as the transfer of the security. It says nothing about who is or is not authorized to foreclose on a trust deed. As the Utah Court of Appeals said: “[T]he Deed of Trust explicitly gave MERS the right to foreclose on behalf of ‘Lender and Lender’s successors and assigns.’ The statute does not prohibit parties from contracting for these arrangements․” Commonwealth, 263 P.3d at 403. The state court’s decision is consistent both with the statute and with numerous federal district court cases that have addressed the same arguments. See id. at 402 (citing cases). The Utah Court of Appeals has reinforced its decision in an even more recent appeal by Plaintiff. Commonwealth Property Advocates, LLC v. U.S. Bank Nat’l Ass’n, ––– P.3d ––––, 2011 WL 6091684 (Utah Ct.App. Dec.8, 2011) (per curiam) (“Because [Plaintiff’s] complaint in this case relies on the same erroneous principle raised in MERS that securitization of the note separated it from the trust deed, MERS is dispositive.”). We see nothing to suggest the Utah Supreme Court would reach a different conclusion. In fact, on December 14, 2011, the Utah Supreme Court chose not to grant certiorari in Commonwealth. Thus, we defer to the Utah Court of Appeals’ decision. Because Plaintiff’s diversity jurisdiction claims have no legal basis under Utah law, the district court properly dismissed all three complaints under Fed.R.Civ.P. 12(b)(6). Accordingly, the judgments in appeals 10–4182, 10–4193, and 10–4215 are AFFIRMED.

    BOBBY R. BALDOCK, Circuit Judge.

  42. There is no such proof that Steve Nagy or Stephen L. Nagy even worked for those companies. So unless you have absolute proof he did in fact work for them, put it up. Not just word of mouth from the attorney’s handling the matters for them. Be careful there.

  43. Esq. Cox’s memo for UCL Study Committee


    (NOTE Steve Nagy left those companys in Dec. of 2007–information obtained from discovery in the DE bankruptcy case for New Century)

  45. A compendium of MERS decisions —

    one can learn from them


    complaint is after the press release in this document

  47. Goerge Babcock hits home run against Mers Cases.Over 700 families still in thier homes.RI-MA-CT 401-724-1904 A true american

    Case 1:1 0-cv-00024-M -LOA Document 27 Filed 08/16/11 Page 1 of 2 PageiD #: 121

    . In re: Mortgage Foreclosure Cases
    Misc. No. 11-mc-88-M-LDA
    I. At the request of the Chief Judge, all mortgage foreclosure cases currently venued
    in the United States District Court for the District of Rhode Island are assigned to Judge John J.
    McConnell, Jr. and to Magistrate Judge Lincoln D. Almond and all mortgage foreclosure cases
    filed here in the future will be assigned to Judge John J. McConnell, Jr. and to Magistrate Judge
    Lincoln D. Almond.
    2. A list of pending mortgage foreclosure cases currently subject to this Order is
    attached hereto as Exhibit A.
    3. All mortgage foreclosure cases (currently filed and to be filed in the future) are
    subject to this Order.
    4. All mortgage foreclosure cases are hereby STAYED and shall remain so until
    further order of the Court. Any deadlines for filings on any issue are hereby suspended. Counsel
    are permitted to file Notices of Appearance.
    5. The Court will establish a Master Docket (11-mc-88-M-LDA) captioned In re:
    Mortgage Foreclosure Cases strictly for the purpose of case management by the Court. Counsel
    shall continue filing all papers in their individual cases only; counsel shall not file anything in the
    Master Docket unless instructed to by the Court.
    Case 1 : 1 0-cv-00024-M -LOA Document 27 Filed 08/16/11 Page 2 of 2 Page I D #: 122
    6. For efficient communication with the Court and administration of these cases,
    counsel shall meet and confer and select liaison counsel (see Manual for Complex Litigation
    (Fourth) § 10.22 (2004)), two for all plaintiffs and two for all defendants. The parties shall notify
    the Court on or before September 2, 2011 oftheir selections.
    7. The Court will require all parties in all mortgage foreclosure cases to engage in
    directed and serious settlement discussions prior to the lifting of the stay in any individual case.
    8. The Court is considering the appointment of a Master pursuant to Fed. R. Civ. P.
    53 in order to assist with pre-trial matters and facilitate settlement in the individual cases. Any
    party wishing to be heard on this matter, including on the suggestion of candidates for
    appointment as Master, shall file such comments on or before September 2, 2011.
    9. The Court will hear argument on the standing issue in Plaintiffs’ Objections to the
    Reports and Recommendations in Fryzel v. Mortgage Electronic Registration Systems, Inc., et
    al. (C.A. No. 10-352-M) and Cosajay v. Mortgage Electronic Registration Systems, Inc., et al.
    (C.A. No. 10-442-M) on September 13, 2011 at 10:00 a.m. in Courtroom 3. Any party subject
    to this Order that is not a party to the aforementioned two individual cases wishing to file an
    amicus brief on the standing issue shall do so by September 2, 2011. Only counsel in the
    aforementioned two individual cases will be allowed to present oral argument.
    John J. McConnell, Jr.
    United States District Judge
    August 16, 2011
    Case 1 :10-cv-00024-M -LOA Document 27-1 Filed 08/16/11 Page 1 of 2 PageiD #: 123
    1. 10-024 Tracy v. Deutche Bank
    2. 10-068 Medeiros v. Option One
    3. 10-160 McLaughlin v. American Home
    4. 10-215 Rezendez v. Option One
    5. 10-268 Pool v. MERS
    6. 10-352 Fryzel v. MERS
    7. 10-442 Cosajay v. MERS
    8. 10-481 Aceto v. American Brokers
    9. 11-004 Moll v. MERS
    10. 11-007 Cerbo v. Argent Mtg.
    11. 11-022 Tavares v. MERS
    12. 11-028 Archibald v. MERS
    13. 11-046 Aceto v. MERS
    14. 11-097 DelDeo v. Option One
    15. 11-123 Boudreau v. Option One
    16. 11-124 Rodriguez v. MERS
    17. 11-170 Schofield v. US Bank
    18. 11-189 Lehoullier v. E. Loan
    19. 11-219 Wu v. Wells Fargo
    20. 11-232 Curl v. Ameriquest Mortgage
    21. 11-237 DiGiorgio v. MERS
    22. 11-241 Neves v. Ameriquest
    23. 11-256 Tavares v. MERS
    24. 11-257 Grena v. MERS
    25. 11-262 Collupy v. MERS
    26. 11-272 Kaskel v. MERS
    27. 11-278 DiNezza v. MERS
    28. 11-283 Hillier v. MERS
    29. 11-284 Rivera v. Option One
    30. 11-285 Fasulo v. MERS
    31. 11-286 Pries v. MERS
    32. 11-288 Averv. MERS
    33. 11-289 Barboza v. MERS
    34. 11-290 MacKay v. MERS
    35. 11-291 Dolan v. MERS
    36. 11-295 Azevedo v. America’s Wholesale Lenders
    37. 11-296 Menta v. MERS
    Case 1:1 0-cv-00024-M -LOA Document 27-1 Filed 08/16/11 Page 2 of 2 PageiD #: 124
    38. 11-300 Pagliaro v. MERS
    39. 11-305 Sullivan v. MERS
    40. 11-306 Forrest v. Wells Fargo
    41. 11-307 Dumouchelle v. Equity Concepts
    42. 11-309 Robles v. MERS
    43. 11-311 Williams v. MERS
    44. 11-312 Boisseau v. National City Bank
    45. 11-316 Jacques v. New Century Mortgage
    46. 11-317 Kinder v. MERS
    47. 11-318 Vargas v. MERS
    48. 11-319 Currier v. MERS
    49. 11-320 Nowling v. MERS
    50. 11-321 Lanning v. MERS
    51. 11-324 Gallagher v. MERS
    52. 11-330 In v. MERS
    53. 11-332 Picard v. MERS
    54. 11-333 Ciccone v. Aurora Loan Services
    55. 11-334 D Knight Real Estate v. MERS
    56. 11-338 Berrillo v. MERS
    57. 11-346 Lopez v. MERS
    58. 11-347 Benjamin v. MERS
    59. 11-353 Santana v. HSBC Bank
    60. 11-358 Guerra v. MERS
    61. 11-363 Mandarelli v. MERS
    62. 11-366 Femminella v. W AMU
    63. 11-369 Newberry v. MERS

  48. This is great information. Does anyone have similare citations to Nevada law regarding same?

  49. I think that everyone is missing the #1 problem MERS has in CA.
    MERS is a Non-Authorized Agent and cannot legally assign the Promissory Note, making any foreclosure by other than the original lender wrongful, for the following reasons.

    1) Under established and binding Ca law, a Nominee can’t assign the Note. Born V. Koop 1962 200 C. A. 2d 519[200 CalApp2d Page 527, 528
    2) On most Notes, the term Nominee is not included and MERS never takes ownership, making it unenforceable and unassignable by MERS.
    Ott v. Home Savings & Loan Association, 265 F. 2d 643 [647,648
    3) Ca Civil Code §2924, et seq. is exhaustive and a Nominee is never included as an acceptable form of “authorized agent” in a judicial or non-judicial foreclosure.
    Finally, GOMES V. COUNTRYYWIDE HOME LOANS, INC., 192 Cal.App.4th 1149, IS FLAWED!
    a) The Gomes case simply failed to address and apply the established and binding definition of a nominee.
    b) The first thing the Deed of Trust does is (i) take away MERS right to payments and (ii) take away the right to enforce the Note.
    c) REGARDLESS WHAT A BORROWER AGREES TO, a borrower cannot legally grant MERS the right to assign the note or any of the rights of the note owner.



  51. @ Allan Hennessey

    I think it is great that such a company exists that wants to help people like me who are stuck in the middle of this forclosure/mortgage fraud. And I have come across several other companies or individuals who claim to want to help.

    However, after I went to the website you talk about and downloaded the info PDF, I learned that this company is not any better than any of the others out there that claim to want to help the homeowner, but in order to get that help the homeowner must pay a “fee” that ranges between a minimum of $2000.00 or a “fee” of $6000.00 for 100% of all they offer.

    While I believe the one should be paid for any work performed, I find it hard to believe that any of these people or companies ever actually pay out an amount even close to what they have taken from the homeowner. The company you list claims to be a “non profit” organization, but the fees they are charging are the same if not more that other companies who are “helping the homeowners” and readily admit they are a strictly “for profit” company.

    Lets do some math – say 100 homeowners pay any of these people/companies the $5000.00 fee. That means that person/company will be making $500,000.00 on just 100 familes/people!!!!!!!!!!!!!!!!! Doesn’t that seem a bit rediculous especially considering that most of these companies/people are not even attorneys and state they are not giving legal advise or any legal help? Really, $500,000.00 from just 100 distressed, scared, homeowners?

    Lets do some more math – since we all know 100’s of 1000’s of people are losing their homes, lets assume that this “not for profit” company is hired by 10,000 homeowners. Let’s see, at $5k a pop that would be $50,000,000.00, yes that is Fifty Million! How in the world can anyone claim that they are doing this for the “homeowners who need help” because they “care”? Are you serious? Seems like someone is just jumping on the “let’s see if we can get rich from these stupid homeowners” bandwagon.

    What a great business idea: Offer to help, while disclosing that any help given is not to be considered legal advise or help, while also disclosing that no guarantee’s on acutal outcome can be made to anyone as each homeowners situation is different, all the while charging $5000.00 or more each time, knowing that if the homeowner loses the home anyway, oh well, too bad for them, the business is perfectly safe and has no obligation to return any of the money since the “no guarantee” disclosure has been made, and honestly, it was a long shot to begin with.

    Can someone please tell me how this is any different that the securitized mortgage fraud that started all of this to begin with? I wouldn’t be surprised if these companies/people offering to help are owned and managed by the same exact brokers that signed us up with these nightmare mortgages to begin with. They really are getting us coming and going!




    As far as I am concerned, these companies/people are no better than the people perpetrating this fraud to begin with. The only thing they are interested in is how much money can the make from us. Haven’t we paid enough already? Haven’t we?

    Is there anyone out there that with the knowledge that will help us that is willing to actually give us a viable option of being able to get that help at a price that we can pay? So far, I have contacted several people and/or compaines claiming they can help me, but it always ends the same way. “Our fee will be $5000.00”, at which point the feelings of hopelessness, fear, anger, and depression return. All the while thinking, if I only had access to $5000.00, I could start to sleep again.

    So please, stop giving us false hope and post the fees associated with the help you are offering at the same time you are posting the advertiesment for the business and services. At least that way, we know from the get go if it is something we can even consider looking into.

    I don’t think I can take one more time of “hey, maybe we can get help” only to find out the help is 100%unattainable beause we can’t afford the fee!

    Allan, I do not know if you are affiliated with the company you posted about and do not want to assume so. Please do not take what I have said personally if you are not affiliated with them in any way. If you are, then you may take it however you want, because your species of snake is no better that the one you are offering to help us with.

  52. lISTED BELOW IS ONE OF THE DIRECTORS OF MERS . name ,business address,type of business , ,phone numberS. This address is listed on the corporate document..
    However anyone can look this information up ,now that you have a starting point.
    I encourage everyone fighting MERS & those wanting to just fight for others to start mailing him letters. Find the directors and Ceo residential address if they are in your are.Start harassing them,fight back !!
    NACA is a very aggressive organization that does just that,they have rally’s that literally go to their homes ,school, clubs,businesses .Trust me they dont like it,especially the family members…..
    I have talked to several people at one of the rally’s ,everyone of them had their loans moded through NACA. NACA has events ,look to see if one is in your area,contact NACA they will direct you !. If so gather all of your documents that you would need for a mod.Take it to the event. Mods are approved that day!!!

    Business Name: Green Point Mortgage Funding
    Contact Person: S A Ibrahim
    Title: CEO
    Gender: –
    Address: 100 Wood Hollow Dr
    Novato, CA 94945
    Office Phone: (415) 878-5000
    Office Fax: (415) 878-3572, ( 415) 878-2082
    Office Email: –
    Web Address:
    Estimated Staff: –
    Industrial Classification: 616201 – Real Estate Loans

  53. Mortgage Claim Center Outreach is a non-profit organization established to reach out to homeowners in all 50 states and assist those who have been victimized by the national mortgage fraud crisis through recovery of damages and other remedies.

    Watch this shocking CBS original 60 minutes special that features shocking admissions by Banking Agents, to committing thousands of Felony Criminal Acts per day, that resulted in the losses of homes for thousands of American Family Homeowners.


    You may have also missed the EPIC Documentary “INSIDE JOB” that was released in theaters in 2010.

    This documentary outlines the fraud of the banks, detailing why foreclosures are so high and how they are stealing american dreams.

    This sets the stage for you to do something about it. “If you are not raging mad by the end of this movie, you werent paying attention”.

    Watch it instantly HERE

    Inside Job’ is the first film to provide a comprehensive analysis of the global financial crisis of 2008, which at a cost over $20 trillion, caused millions of people to lose their jobs and homes in the worst recession since the Great Depression, and nearly resulted in a global financial collapse. Through exhaustive research and extensive interviews with key financial insiders, politicians, journalists, and academics, the film traces the rise of a rogue industry which has corrupted politics, regulation, and academia. It was made on location in the United States, Iceland, England, France, Singapore, and China.

    The Nations leading experts estimate that virtually all mortgage loans originated between 2001-2008 are Void and unenforceable. See part of the reasons why now!

    Secure your claim(s) against the bank today by reading our Brief on Mortgage Fraud and how to beat it.
    You can read this document here

    Questions? Feel free to call and speak with one of our friendly claim specialists today!

    Mortgage Claim Center Outreach
    A WASHINGTON Non-Profit Organization
    3820 S. Pine
    Tacoma, WA 98409

  54. Christine,

    If you’re not behind on your payments. I suggest consulting with an attorney about suing for Quiet Title.

    Good Luck

  55. NG
    NEIL G

    I have a MERS mortgage from 2004. It originated with CTX, MERS being the nominee. They have tried to foreclose on us already, but we were able to pay the past due amount. Currently, Central Mortgage is the servicer. The Grant/Deed shown on the loan documents is not the same they tried to foreclose under, nor is the loan number. We are both currently out of work and my husband just hit his 99 week limit. I am concerned we are going to have problems again very soon. We are not currently late, but don’t see how next month payment will be made. Can you give me any info on how or if our MERS mortgage is Void due to it being from 2004, clearly prior to MERS being to legally conduct business in this state? What do we do? Please help!

  56. NG
    NEIL G

    Call in Rhode Island, MA & CT for help with your case. George Babcock Gets it!

  58. Title Issues:

    Recording date 11/02/10 page 0862 Notice of pendency of action was filed in Sacramento County with the recorders office. The civil case 2010-00072319 was dismissal without prejudice, it now becomes an aiding and abbetting, illegal foreclosure, eviction and sale.

    GMAC relied on MERS, which is a software that EDS (at one time a General Motors company)created for the mortgage industry. In order to be valid the assignment must be recorded California Civil Code 2932.5

    I can file suit under the fair debt reporting act.

    Recording date 10/22/10 Buyer Name Lorenz William H. price 160, 000.
    Document # BK-PG 20101022-1257 document type: Grant Deed
    Seller Name GMAC Mortgage LLC
    The only one time a attorney actually signed for gmac was Jennifer Vizgirdas, from the LPS Default title and closing. A division of LSI Title Agency Inc.

    Legal Description Lot 95 Map Ref MAP5 MB 125
    City/Muni/Twp Elk Grove

    Prior transfer:

    Recording date 02/16/2010 Buyer Name GMAC Mortgage LLC price 184, 500.
    Document # BK-PG 20100216-1086 document type: Trustee’s Deed
    Seller Name Lawson Timothy L, Lawson Genevieve P

    Legal Description Lot 95 Map Ref MAP5 MB 125
    City/Muni/Twp Elk Grove

    Foreclosure Record:

    Recording date 01/11/2010 Notice of Sale, (aka Notice of Trustee’s Sale)
    Auction location 720 9th Street Sacramento CA
    Document # BK-PG 20100111-0257

    Foreclosure Record:

    No one has the right to claim ownership of something and foreclose in the same month, date and year.

    Recording date 10/09/2009 Document type: Notice of Default
    Beneficiary Name Proffer Financial
    Trustor Names Lawson, Timothy L; Lawson Genevieve P
    Trustee Names ETS Services LLC
    Was signed by a Trustee Sale Officer Geoffrey Allen with ETS Services.

    Recording date 10/09/2009 Document type: Substitution of Trustee
    MERS Mortgage Electronic Registration Systems Inc. as nominee for Proffer Financial was the original beneficiary under the said deed of trust dated 5/15/2006 and recorded on 5/24/06 as instrument no in book 20060524 page # 0324 of official records in Sacramento County.
    Was signed by an Assistant secretary Cindy Sandoval from MERS.

    Recording requested by LSI Title Company Inc.
    Beneficiary Name ETS Services LLC
    2255 North Ontario Street, Suite 400
    Burbank, CA 91504

    Document type: Substitution of Trustee:
    Recording date 09/01/06
    Beneficiary Indymac Bank
    Recording requested by: T.D Service Company
    1820 E First Street, Suite 300
    Santa Ana, CA 92708
    From Commerce Title Insurance Co.
    Was signed by an Assistant Secretary Gina Arreola in Orange County, CA
    Recorded July 18, 2006 book no 20050729 at page # 0899 in the official records of Sacramento County.

  59. The more American homeowners lose, the greater some bankers profit. Logic dictates that banks would want to mitigate their losses and resolve troubled loans with borrowers. But the reverse is true for those bankers who bet against the bonds backed by American families’ homes and who make even more as the bond values plummet. Unwittingly, millions of American families became racehorses on the subprime racetrack. By saddling the horses with as much debt as possible on terms that made the load increasingly overwhelming to burden, there was little chance of anyone crossing the finish line. Even so, bankers gussied up the horses and took wagers from unwitting MBS investors such as pension funds and smaller banks all under the noble pretense of providing homeownership opportunities for all. And in the backroom, Goldman Sachs, Deutsche Bank and Paulson & Co. were betting billions that homeowners and MBS investors would fail spectacularly.
    Now millions of families are falling apart under the burden of failing in a game they could never have won. Admirably but foolishly, some of the families borrowed from friends and family, took on second and even third jobs, and ran themselves to exhaustion trying to find a stride to the finish line. But the incline on the track increased with each interest rate adjustment, and the track at points became as steep as that of a mountain pass in the Rockies. At this point, government officials feigned assistance by designing a program in which they promised to level off the track by temporarily reducing interest rates, but only if the nearly-exhausted families could prove their worthiness through a three month “trial”.
    However, when the incline remained intense even after the first three months, they were cheered on. “Just make it a few more months and then you will reach the Promised Land”. That was the message, yet the Promised Land remained an illusion for 9 out of 10. The survivors did not fare much better. They were only allowed to continue the impossible journey if they were saddled with even more debt and forced to remain in the race an additional ten years. Ultimately, there will be few if any survivors. Instead, the wreckage is immense, with families crushed, divorced, homeless, and/or staying in the basements and garages of friends and family. They are drained physically, mentally and financially.
    Equally bamboozled, the pension funds and smaller banks lost billions on their bets. Much like a nerd who thought he was making friends with the football team, M&T Bank ponied up $82 million to Deutsche Bank in February 2007 to invest in Gemstone VII, a bond issue backed by subprime loans. Internal emails from Deutsche traders at the time referred to subprime loans as “the plague” and stated “these bonds are going much, much lower.” Still, they pretended to befriend M&T, took their money and betrayed them. Ten months later M&T had lost 98% of their investment, whose value had dropped to just $1.9 million.
    Tragically, American International Group insured many of the wagers made by Deutsche, Goldman, Paulson and others. In late 2008, AIG had insufficient funds to cover the wagers and the federal government bailed out AIG, including $800 million earmarked to pay Deutsche Bank for their winning bets that American families had failed. Thus, in a true molestation of American capitalism, the families who had struggled and lost were made to pay those who made the twisted bets against them.
    To make sure they did not get caught, these Wall Street titans infiltrated the enforcement positions at the Treasury Department and Securities & Exchange Commission. Most notably, SEC enforcement Chief Robert Khuzami was lead attorney at Deutsche Bank and signed off on Gemstone VII and hundreds of millions of soured subprime bonds. As a result, they get to keep their ill-gotten loot by paying protection money disguised as campaign contributions, gifts through lobbyists and a paltry fine here and there.
    So, when your servicer tells you they lost your paperwork for the fifth time, denies you a modification even though you have made a year’s worth of “trial” payments perfectly on time, or even denies a short sale and proceeds to foreclose and then sell your home as REO for a lot less money, recognize that your banker may succeed the most when you lose the most.

  60. The following is our response to a letter from GMAC As for the UD, the attorney that represented us Jonathan Stein, is now a part of a lawsuit filed by the AG for his part in a scam company US Loan Auditors that ripped off homeowners. It is very hard to cloud the title in a UD, when you can’t show the proof u need, they are very one sided (the banks). It only took gmac 6 weeks to sell that house because it was in mint condition for a foreclosure. Prior to the auction date 2/5/10 there was never any big yellow signs posted at the house.

    gmac is not listed anywhere on the property profile for 8704 Milo Ct. Elk Grove CA 95624, yet GMAC shows up on my credit report when they were not involved in the transaction.

    gmac failed to explain why we were denied a loan modification in Sept. of ’09. gmac already knows what type of loan this was, it qualified for a 30% principle reduction.

    There still is no mention of the illegal foreclosure, gmac did not assign the mortgage and used mers to foreclose. Mers has no legal rights in the State of CA. gmac still has not produced the original loan docs, because they were destroyed by the banks to cover up their crimes. I have seen house of cards and plunder the crime of our time. Where does the ceo live? We would like to park our trailer at his house since we don’t have one anymore.

    I am preparing to file a lawsuit against greenpoint, aurora, lehman brothers, gmac for aiding and abetting, illegal foreclosure, eviction and sale of our property. 9 out of 10 foreclosures are legal, ours was the 1 of many that were done illegally.

    Call in Rhode Island, MA & CT for help with your case. George Babcock Gets it!

  62. Here is a what if for all you out there….what if every county in every state required MERS to disclose the chain of ownership on every mortgage from origination to date and then billed them for recording fees, failure to record fees, etc.? I would think given property laws in most every state that this is something that would be more than feasible The fact that the MERS system somehow managed to allow title laws to be broken does not make it right, if a serial killer has a 10 year killing spree he does not get a pass on any murder simply because he got away with it without getting caught, does he? Is there a statute of limitations on tax evasion, fraud and conspiracy? If there is, that may well be why it is taking so long to get it fixed. Maybe they are all waiting for the clock to run down so they cannot be prosecuted and will never have to pay. How many millions of dollars would be pumped into our counties’ if we just stand up and tell them it is time to pay the piper???????

  63. This article tells of MERS successes, and if I understand it correctly, it underscores its (MERS) constitutional right to due process.



  65. NG

    CFC §1590. Nothing in this chapter shall make it unlawful for any person or corporation to engage in the business of……… acting as trustee under deeds of trust given solely for the purpose of securing obligations for the repayment of money other than corporate bonds.

    I think this is the MERS loophole.

  66. NG,

    Please email me at

  67. Fighting MERS in CA,

    Thank you for your reply, I wanted to E-mail you separately so we could have this conversation in private so as not to muddy up this fine website, but it only redirected me to the Fighting MERS in CA website.

    Anyway, if you read section 1503 of the Financial code, it states that no foreign corporation (excluding banks or financial institutions (neither of which MERS is) can do trust business in CA regardless of status, then gives a few exemptions (neither of which are applicable). I would argue that no matter what their status, California does not allow them to be an assignee (section 106) according to California law unless they are a national bank or a financial lending institution. One of the exemptions is that they are allowed to be a trustee, but that is not what they are assigned on a MERS mortgage form 3005.

    The section in 1500 which creates the ability for any corporation to operate in trust business is not as simple as paying fines and catching up with money. This is not a retroactive statute like section 2105. I doubt highly that they have done this at all. I see no one has attacked this from this level at all.

    Section 1501.2 has some exemptions…ie..any natural person, a member of the bar, a non-profit corporation acting as trustee, or someone appointed by a court, which are not applicable either.

    MERS I am pretty positive, since they haven’t bothered to even do their due diligence in most states and has just filed for California status, I would assume that they may have a certificate of non-avoid-ability at this point, but having a certificate of authority to act in the trust business has not even been thought of, nor do I believe that that can be retroactively applied. Since they didn’t have that certificate prior to July, that all contracts prior to that point are VOIDABLE.

  68. NG, thanks for drawing more attention to this, but beware!

    You are correct in theory, but MERS will very likely cite one of these two cases:
    United Medical Management Ltd. v. Gatto 49 Cal.App.4th 1732 (1996), or an unpublished case as of today Perlas v. Mortgage Elec. Registration Systems, Inc., 2010 WL 3079262 * 7

    Both of which are based upon this case:
    “A nonqualified corporation subject to a misdemeanor prosecution and on conviction to a heavy fine for doing business without complying with the law, is permitted to qualify, be restored to full legal competency and have its prior transactions given full effect.” (Tucker v. Cave Springs Min. Corp. (1934) 139 Cal. App. 213, 217 [33 P.2d 871].

    So beware and DEMAND filing of receipts and that Certificat of Relief from Voidability!

    For more updated information visit my website at:

  69. Fighting MERS in CA,

    Thank you so much for your response to MERS and not being a California Corporation.

    The issues you raised were for those Corporations in California that have been previously suspended. They have the right to bring their account up to date. However, in MERS situation, they were never a California Corporation until July of this year. They cannot retroactively go back and claim their status because they were never suspended, they were never an entity in the first place.

    I hope that helps you.


    On July 21, 2010 MERS registered with the California Secretary of State.
    MERS registration in California is not retroactive until its complete, as of October 18th, 2010

    This may not be the case for the following reasons:
    1. As a result of MERS intentional failure from obtaining a certificate of qualification from the California Secretary of State as a “Beneficiary”, including filing returns and paying taxes, MERS is not allowed the right to defend a lawsuit when named as or defending its actions in a “Beneficiary” capacity, pursuant to California Revenue & Taxation Code Section §§ 23301, 23301.6, 23304.1.

    “A suspended corporation is not allowed to exercise the powers and privileges of a corporation in good standing, including the right to sue or defend a lawsuit while its taxes remain unpaid”
    PERFORMANCE PLASTERING v. RICHMOND AM. HOMES, 153 Cal.App.4th 659 (2007) 63 Cal.Rptr.3d 537

    2. MERS must first produce a Certificate of Relief from Voidability for the time prior to July 21, 2010, California Revenue & Tax Code 23305.1 and file with this Superior Court Clerk receipt of payment to the California Secretary of State for taxes and penalties, California Corporations Code §2203(c).

    “UMML qualified to transact intrastate business, but failed to pay the necessary fees, penalties and taxes. The trial court correctly dismissed the complaint without prejudice.”
    United Medical Management Ltd. v. Gatto, 49 Cal. App. 4th 1732 – Cal: Court of Appeals, 2nd Appellate

    For more flaws, visit

  71. Is anyone in New Mexico initiating a class action lawsuit against MERS? I have MERS on my first mortgage (1st TN Home Loans and also 2nd mortgage: Countyrwide, and now allegedly Bank of America. One of the court documents lists a bank I never heard of, as allegedly owning my home: Bank of New York-Mellon Bank. I need a real estate lawyer that will start a class action lawsuit so I can get quiet title to my home here in New Mexico! Anyone out there know anything? Patrick OConnell,

  72. For those of you in California with a MERS Mortgage, please see California financial code section 1503.

    Mers is neither a financial institution or a lending institution and as it’s business model requires the borrower to assign it’s role under the deed of trust which makes MERS an assignee. This is an unlawful act in California under the financial code if it is not registered within the state. Therefore, if you have a mers mortgage prior to July 2010, your mot gage is void under California law.

    Please contact me if you for see problems with your mortgage.


  74. I forgot to mention that this exposes MERS to:

    Damages – the value of the home lost
    Punitive damages – possibly Treble damages for Fraud.


    “the court cannot conclude that MERS falls within any of the five enumerated examples of “foreign lending institutions,” and the court declines to address sua sponte whether MERS otherwise satisfies subsection (d).”. . . “the enforcement of any loans by trustee’s sale, judicial process or deed in lieu of foreclosure or otherwise. . .”

    “Accordingly, section 191(c)(7) does not exempt MERS’s activity.”
    CHAMPLAIE v. BAC, No. 2:09-cv-01316-LKK-DAD (E.D.Cal. 10-22-2009) ( PACER Document 38, pages 23, 24)
    Surprisingly this case is really difficult to find on Lois Law, Pacer is easier.

    As a result of this ruling, MERS:
    1) Illegally entered into all of the Deeds of Trust in California and are voidable if not VOID.
    2) Illegally assigned the Notes and Deeds back to the lenders
    3) Illegally substituted the Trustee
    4) Has no legal standing in Court, because they are not registered with the Secretary of State, nor are they exempt from registering according to this new case.

  76. I forgot to mention, MERS is listed on the original mortgage as “trustee/mortgagee”. They signed an assignment of mortgage to US Bank trustee for C-BASS Mortgage Loan Asset-Backed Certificates Series 2006-CB5. The signer on the assignment was none ofther than Marti Noriega listing her postion as Vice President of MERS and she in fact works for Litton Loan Servicing. Also notarized by Melissa Bell. Both these names bring up red flags on a google search.

  77. Plaintiff: US Bank National Association as Trustee for the C-BASS Mortgage Loan Asset-Backed Certificates Series 2006-CB5. I did an SEC search on C-BASS and cannot find the 2006-CB5 anywhere. Any suggestions? A search on the internet produces THOUSANDS of foreclosures on that name, but I can’t seem to locate any information on it.


    vs. CASE NO.: 09-142-CA
    ________________________ 1
    THIS CAUSE came before the Court on Defendant’s Motion to Dismiss Amended
    Complaint. A hearing was held on Plaintiff s motion on April 7, 2010; Plaintiff s counsel
    appeared telephonically; Defense counsel appeared in person. The basis for the motion is
    Defendant’s assertion that Plaintifflacks standing. Having considered the evidence and
    arguments presented and the applicable law, and otherwise being fully advised in the premises,
    the Court finds as follows:
    Amended Complaint Never Filed
    , :
    …… fT!
    Defense counsel provided the Court a copy of the Amended Complaint to Foreclose
    Mortgage and the exhibits attached thereto in consideration of the instant motion. However,
    there is no amended complaint in the Court file, and the Clerk of Court has confirmed that no
    amended complaint has been filed. There are only minor differences in the two complaints. The
    original complaint includes a second count to enforce a lost note; the amended complaint does
    not. A copy of the mortgage is attached as an exhibit to Count I of the original complaint. The
    Page 10f5
    amended complaint has attached to it not only the mortgage but also the note and the assignment.
    Even considering those additional exhibits as if they had been properly tiled, Defendant correctly
    argues that Plaintiff lacks standing.
    Standing is a threshold issue. Peace River/Manasota Regional Water Supply Authority v.
    IMC Phosphates, 18 So.3d 1079 (Fla. 2nd DCA 2009); Hillsborough County v. Florida
    Restaurant Ass’n, Inc., 603 So.2d 587 (Fla. 2nd DCA 1992); Miller v. Publicker Industries, Inc.,
    457 So.2d 1374 (Fla. 1984). It is necessary and proper for this Court to address the issue of
    standing. In Re Hwang, 396 B.R. 757 (U.S.B.C., 2008) (“Hence, ‘a defect in standing cannot be
    waived; it must be raised, either by the parties or by the court, whenever it becomes apparent’ . “);
    Bellistri v. Dcwen Loan Servicing, LLC, 284 S.W.3d 619 (Missouri Court of Appeals, 2009)
    (“Lack of standing cannot be waived and may be considered by the court sua sponte.”). Counsel
    argued at the hearing that Plaintiff has standing based on (1) WM Specialty Mortg., LLC v.
    Salomon, 874 So.2d 680 (Fla. 4th DCA 2004), (2) its possession of the original note, and (3) the
    assignment to Plaintiff. These arguments are without merit as explained below.
    WM Specialty Mortg., LLC v. Salomon
    This case stands for the proposition that the actual, physical delivery ofa note and
    mortgage prior to the execution of an assignment may vest Plaintiff with standing based upon an
    equitable transfer. In Wm Specialty, however, the assignment specifically stated that the
    mortgage was physically transferred prior to the execution of the assignment; that is not the case
    here. Unlike Wm Specialty, there is no indication in the assignment that the note and mortgage
    were physically transferred to Plaintiff prior to its execution. To the contrary, there is every
    indication that the note had not been transferred to Plaintiff prior to the execution of the
    assignment by virtue of the second count to enforce a lost note in the original complaint.
    Therefore, there is nothing in WAf Specialty that confers standing upon Plaintiff.
    Possession of the Original Note
    “While U.S. Bank alleged in its unverified complaint that it was the holder of the note
    and mortgage, the copy of the mortgage attached to the complaint lists ‘Fremont Investment &
    Loan’ as the ‘lender’ and ‘MERS’ as the ‘mortgagee.’ When exhibits are attached to a
    complaint, the contents of the exhibit control over the allegations of the complaint … Because the
    exhibit to U.S. Bank’s complaint conflicts with its allegations concerning standing and the
    Page 201’5

    exhibit does not show that U.S. Bank has standing to foreclose the mortgage, U.S. Bank did not
    establish its entitlement to foreclose the mortgage as a matter of law. Moreover, while U.S.
    Bank subsequently filed the original note, the note does not identify U.S. Bank as the lender or
    holder.” BAC Funding Consortium Inc. v. Jean-Jacques, 2010 WL 476641 (Fla. 2nd DCA 2010).
    Likewise, a copy of the mortgage and two riders are attached to the complaint in the
    instant case. A copy of the mortgage, two riders, the note, and an addendum are attached to the
    amended complaint. The original note has also been filed. Every one of these exhibits and the
    original note identify an entity other than Plaintiff as “lender.” The mortgage identifies an entity
    other than Plaintiff as “grantee.” None of the documents identify Plaintiff as “holder.”
    Moreover, the language in these exhibits, including the note, indicates that Plaintiff does not
    have standing, and that language controls over contrary allegations contained in the complaint.
    Further, there are two endorsements on the note, each to a specific entity other than Plaintiff.
    Therefore, possession of the original note, in and of itself, does not vest Plaintiff with standing.
    Rather, Plaintiff must necessarily rely upon a valid assignment, which does not exist.
    The assignment attached to the amended complaint is from Mortgage Electronic
    Registration Systems, Inc. (hereinafter “MERS”) to Plaintiff, and that assignment is completely
    ineffective. As nominee for the lender, MERS serves in a very limited capacity. Specitically,
    MERS records the mortgage and tracks ownership ofthe lien. MERS has no substantive rights
    itself and, therefore, cannot assign what it does not have. “A nominee of the owner of the note
    and mortgage may not effectively assign the note and mortgage to another for want of an
    ownership interest in said note and mortgage by the nominee.” LaSalle Bank Nat. Ass’n v.
    Lamy, 824 N.Y.S.2d 769, 2006 WL 2251721 (Sup.2006).
    When a state agency found that MERS is a mortgage banker subject to license and
    registration requirements, MERS appealed to the Supreme Court of Nebraska and outlined its
    very limited role as nominee. “Subsequently, counsel for MERS explained that MERS does not
    take applications, underwrite loans, make decisions on whether to extend credit, collect mortgage
    payments, hold escrows for taxes and insurance, or provide any loan servicing functions
    whatsoever. MERS merely tracks the ownership of the lien and is paid for its services through
    membership fees charged to its members.” Mortgage Electronic Registration Systems, Inc. v.
    Nebraska Department of Banking and Finance, 704 N. W.2d 784 (Neb.2005). “MERS argues
    Page 3 of5
    that it does not acquire mortgage loans and … only holds legal title to members’ mortgages in a
    nominee capacity and is contractually prohibited from exercising any rights with respect to
    the mortgages (i.e., foreclosure) without the authorization of the members. Further, MERS
    argues that it does not own the promissory notes secured by the mortgages and has no right to
    payments made on the notes.” Id. Emphasis added. “Documents offered during the Department
    hearing support the limited nature ofMERS’ services.” [d. Based on the explanation from
    MERS itself and documents presented by MERS and reviewed by the Supreme Court of
    Nebraska, it is undisputed that MERS serves in a very limited capacity and holds no substantive
    rights. MERS is contractually prohibited from exercising any rights in a foreclosure case
    without the authorization of the lender, and that prohibition was confirmed by MERS itself.
    There is no evidence of any such authorization in the instant case.
    Other courts around the country have likewise recognized the limited role that MERS
    plays as nominee. “We specifically reject the notion that MERS may act on its own, independent
    of the direction of the specific lender who holds the repayment interest in the security instrument
    at the time MERS purports to act. .. Nothing in the record shows that MERS had authority to act.”
    Mortgage Electronic Registration Systems. Inc. v. Southwest Homes of Arkansas, 2009 WL
    723182 (Supreme Court of Arkansas, 2009). “MERS’s role in this transaction casts no light on
    the contractual issues raised in this case.” Id. “The relationship that MERS has to Sovereign is
    more akin to that of a straw man than to a party possessing all the rights given a buyer.”
    Landmark National Bank v. Kesler, 216 P.3d 158 (Supreme Court of Kansas, 2009). “MERS
    presents no evidence as to who owns the note, or of any authorization to act on behalf of the
    present owner.” In Re Vargas, 396 B.R. 511 (Bankr.C.D.Cal. 2008). “As noted above, MERS
    purportedly assigned both the deed of trust and the promissory note to Consumer … however,
    there is no evidence of record that establishes that MERS either held the promissory note or was
    given the authority by New Century to assign the note … Accordingly, the Court concludes that
    there is insufficient evidence that Consumer has standing to proceed with this litigation.” Saxon
    Mortgage Services, Inc. v. Hillery, 2008 WL 5170180 (N.D.Cal. 2008).
    Not only are there substantive deficiencies with an assignment from MERS, but the
    instant assignment was also untimely. The complaint was filed on January 7, 2009 and states,
    “The Plaintiff owns and holds the note and mortgage.” Complaint ~5. However, the assignment
    was not executed until May 20, 2009 – more than four months after the complaint was filed. As
    Page 4 of5
    stated above, there is no indication on the assignment that the note and mortgage were physically
    transferred prior to that date. “[T]he plaintiffs lack of standing at the inception of the case is not
    a defect that may be cured by the acquisition of standing after the case is tiled.” Progressive
    Exp. Ins. Co. v. McGrath Community Chiropractic, 913 So.2d 1281 (Fla. 2nd DCA 2005). “Ifon
    the date the Provider tiled the original statement of claim Mr. Joseph had not assigned benefits to
    the provider, only Mr. Joseph had standing to bring the action. It follows that the Provider would
    have lacked standing under these circumstances, and the case should have been dismissed.” Id.
    There is no evidence of record that establishes that MERS was authorized to assign
    anything to Plaintiff, and therefore, the assignment was invalid. Even if the assignment were
    valid, it was not executed until after the complaint was filed. Therefore, Plaintiff s standing at
    the inception of the case was based entirely on the complaint and the exhibits attached thereto. It
    appears on the face of those exhibits that an entity other than Plaintiff has standing, and those
    exhibits control over contrary allegations contained in either version of the complaint. Plaintiff
    lacks standing now based on the substantive deficiencies with an assignment from MERS.
    Plaintiff lacked standing at the inception of the case based on those substantive deficiencies and
    the timing of the execution of the assignment. Absent standing, there is no justiciable
    controversy between the parties, and this case must be dismissed. It is therefore
    ORDERED AND ADJUDGED that Defendant’s motion is granted, and this case is
    hereby dismissed. The Court reserves jurisdiction to address Defendant’s request for attorneys’
    DONE AND ORDERED in chambers on the ~~ day of April~~..Q. ,2010.
    Rob Crown
    Acting Circuit Court Judge
    cc: PlaintifflDefendant(s)
    Page 50f5

  79. [scribd id=32485526 key=key-27iah5cuktrlju6p5jyd mode=list]

    This is the lookup for MERS as Nominee Mortgages as they put it..

  80. My husband and I had a wonderful gift handed to us on May 3, 2010. Our house which was getting ready to go into foreclosure. Paid off in full, the amount that Citimortgage’s attorney. Castle, Meinhold and Stawarski of Denver Co stated. On May 21, we were told that Citimtge had the money and that everything was in the process of being completeed so that we would get the deed. On May 24, we recieved letters from Attorneys, stating that we needed to make arrangements to move out, House up for sale on Aug 18. We contacted Citi collections..they have no record of money. Loss mitigation has the money, and is now stating that there is a title issue to contact the attorney.

    We contacted the attorny on May 25, and the Attorney says that money is there, our foreclosure is on hold, and that they will not contact collections to stop the calls and they will NOT release the title. Now where do we go. I am now getting ready to send out demand letters to all parties involved demanding they release our title. This title dispute is NOT our fault, our house is paid off. Any help or ideas in regards to this would be helpuful. Please feel free to eamil me at…serious responses only. NO spam. Thanks

  81. I am seeking an attorney here in New Mexico: I want to obtain quiet title to my home/primary residence: I have the 1st & 2nd mortgagor listed in my county courthouse as MERS (Bank of America & 1st Horizon). I need to retain legal counsel to proceed with this actionable issue. Please contact me at my email: azpat0 at yahoo dot com Thank you Patrick OConnell

  82. 90 F.3d 600 (1st Cir. 1996)


    Maine National Bank, Plaintiff, Appellant,


    Roland HOUDE and Ora Houde, Defendants, Appellees.


    Maine National Bank, Plaintiff, Appellee,


    Roland HOUDE and Ora Houde, Defendants, Appellants.

    Nos. 95-1853, 95-1854.

    United States Court of Appeals, First Circuit

    July 24, 1996


    Page 601

    [Copyrighted Material Omitted]

    Heard March 8, 1996.


    Page 602

    Jaclyn C. Taner, Counsel, Washington, DC, with whom Ann S. DuRoss, Assistant General Counsel, Colleen B. Bombardier, Senior Counsel, Federal Deposit Insurance Corporation; Andrew Sparks, Paul E. Peck, John B. Emory and Drummond & Drummond, Portland, ME, were on briefs for plaintiff.

    Jeffrey Bennett, Portland, ME, with whom Melinda J. Caterine, Clare S. Benedict and Bennett and Associates, P.A. were on briefs for defendants.

    Before BOUDIN, Circuit Judge, CAMPBELL, Senior Circuit Judge, and LYNCH, Circuit Judge.

    LEVIN H. CAMPBELL, Senior Circuit Judge.

    The Federal Deposit Insurance Corporation (“FDIC”) appeals from an order, entered in the United States District Court for the District of Maine, dismissing its complaint to collect the amount due on a $275,000 promissory note executed in 1986 by defendants Roland and Ora Houde and made payable to the Maine National Bank, and to foreclose on the mortgage securing the Houdes’ indebtedness. The Houdes cross-appeal from the district court’s denial of four pretrial motions. For the reasons set forth below, we affirm the district court’s order.


    In November 1986, Roland and Ora Houde borrowed $275,000 from the Maine National Bank (“MNB”), a federally insured national banking association, to finance a business venture. They executed a note and allonge made payable to MNB (collectively the “Note” or “Houde Note”), and secured by a mortgage on property located in Maine. After MNB declared insolvency in January 1991, ownership of the Note passed to the FDIC as receiver, the FDIC says. The FDIC also says that it transferred the Houde Note briefly to the New Maine National Bank (“NMNB”), a bridge bank set up by the FDIC. After the dissolution of NMNB in July 1991, many of its assets were purchased by Fleet Bank and the rest, as recounted by the FDIC, passed to the FDIC as the duly appointed receiver for NMNB. The FDIC asserts that the Note was among the remaining assets transferred to it. All parties agree, in any case, that the original Note was in the possession of the FDIC at trial.

    The FDIC says that it hired Recoll Management Corporation (“Recoll”) to manage the receivership assets of NMNB. The FDIC maintains that Recoll took over management of the Note as well as other obligations owed by the Houdes. These other obligations included loans from MNB to Turcotte Concrete, a corporation of which Mr. Houde was a 50% shareholder, that were guaranteed by the Houdes. Turcotte Concrete filed for bankruptcy in 1991, and as part of the bankruptcy proceeding, Recoll, on behalf of the FDIC, negotiated an agreement in June 1993 resolving Turcotte Concrete’s debt (the “Conditional Amendment to Guaranty Agreements and Promissory Notes,” or “Conditional Agreement”). According to the FDIC, Recoll separately negotiated with the Houdes concerning their personal debt evidenced by the Note. The Houdes, however, contend that the Conditional Agreement resolving Turcotte Concrete’s obligations, by its own terms, released their personal obligations on the Note. On this theory, they have made no payments on the Note since June 1993.

    In July 1994, the FDIC sued the Houdes in Maine state court to collect the amount due on the Note and to foreclose on the mortgage securing the debt. The Houdes removed the action to the United States District Court for the District of Maine and then moved to dismiss or for summary judgment on the ground that their personal indebtedness on the Note had been discharged by the Conditional Agreement. The district court denied the motions in September 1994, concluding that there were genuine issues of fact as to the meaning and intent of the Conditional Agreement. In early 1995, the Houdes moved for judgment on the pleadings as well as for summary judgment, reiterating their claim that the Conditional Agreement


    Page 603
    unambiguously released them from the Note. In the Houdes’ Statement of Undisputed Material Facts submitted in connection with their summary judgment motion, the Houdes acknowledged that the FDIC had been appointed as receiver for MNB. The Houdes also moved to dismiss, or for a default judgment based on a claim that the servicing agreement between the FDIC and Recoll violated the Maine champerty statute. See 17-A M.R.S.A. § 516(1). The FDIC cross-moved for summary judgment. In May 1995, the district court denied these motions.

    A jury trial was scheduled for early June 1995. Shortly before trial, the FDIC filed a motion in limine seeking to preclude the Houdes from questioning the FDIC’s standing to recover on the Note. The Houdes opposed this motion. The district court denied the motion without addressing the merits of the standing issue. At trial, the parties stipulated that (1) the FDIC possessed the original Note, (2) the Houdes’ signatures on the documents were authentic, and (3) the Houdes had made no payments on the Note since June 1993. The FDIC offered in evidence the original Note which was payable to MNB and had not been indorsed to any other entity. The FDIC called as a witness James Golden, the FDIC account officer, who had only been the custodian of the Houde file for the two weeks prior to trial. Golden testified to the series of events occurring after the failure of MNB up until the time of trial: (1) the FDIC was appointed receiver of MNB, (2) the Note passed to NMNB, a bridge bank set up by the FDIC, (3) the FDIC dissolved NMNB, (4) the Note passed to the FDIC as receiver for NMNB. Golden testified that the Note was not among the NMNB assets that Fleet Bank purchased from the FDIC. The FDIC did not offer or have with it any public or business records evidencing the transfers to which Golden testified.

    The Houdes objected to Golden’s testimony and to the introduction of the Note in evidence, arguing that Golden’s testimony was inadmissible hearsay, as he had no personal knowledge of the transactions to which he testified. In addition, they argued that Golden’s testimony was not the best evidence of the transactions in question. The district court sustained the Houdes’ objection and struck Golden’s testimony. The FDIC then requested a short continuance to allow it to obtain documentation of the underlying transactions to which Golden had testified. The court denied a continuance, granting judgment as a matter of law in favor of the Houdes. The court stated that there was “no basis whatsoever on which a jury could conclude that the plaintiff is entitled to enforce this note.” [1] In response to the FDIC counsel’s indication that he would file a motion for reconsideration of the directed verdict later that afternoon, the court indicated that it would not reconsider its decision. The court issued a final judgment dismissing the FDIC’s action on June 8, 1995.


    The FDIC contends that the district court erred in finding that the evidence of the FDIC’s ownership of the Note was so inadequate that the FDIC’s claim to enforce the Note against its makers, the Houdes, fails as a matter of law. Alternatively, the FDIC argues that the district court abused its discretion in refusing to grant a brief continuance so as to enable the FDIC to procure records that would establish its requisite interest


    Page 604
    in the Note. The Houdes reply that the FDIC never presented competent proof of the various transactions through which it allegedly acquired lawful ownership and possession of the Note, Golden’s testimony having, in their view, been rightly stricken as hearsay. They argue that without such competent evidence, the FDIC’s case failed as a matter of law.

    The district court dismissed the case because it concluded that the FDIC had failed to meet its burden of presenting sufficient evidence to establish, prima facie, that it was a party entitled to enforce the Note. Without proper proof of ownership, the Note would not be admissible as a basis for the FDIC’s claim. The question, of course, would not be whether the FDIC’s right to enforce the Note was conclusively established but whether enough of a case was made out to go to the jury. See Fed.R.Civ.P. 50(a) (“If … there is no legally sufficient evidentiary basis for a reasonable jury to find for [a] party on [an] issue, the court may determine the issue against that party and may grant a motion for judgment as a matter of law against that party.”).

    1. The FDIC’s Burden of Proof

    The FDIC argues that possession of the Note was a sufficient basis for it to be entitled to a presumption that it could enforce the Note. The FDIC points to federal law, set forth in FIRREA, [2] providing expressly that the FDIC succeeds by operation of law to a failed bank’s right and title in all its assets, see 12 U.S.C. § 1821(d)(2)(A), infra. FIRREA, however, does not spell out what the FDIC needs to prove in order to show its entitlement to sue on a transferred asset like the Note. The Supreme Court has recently held that matters left unaddressed in FIRREA are controlled by state law. O’Melveny & Myers v. FDIC, 512 U.S. 79, —-, 114 S.Ct. 2048, 2054, 129 L.Ed.2d 67 (1994). We look, therefore, to Maine law to supplement FIRREA in determining what the FDIC, as receiver of NMNB, needed to show for it to be found a party entitled to enforce the Note. See, e.g., RTC v. Maplewood Invs., 31 F.3d 1276, 1293-94 (4th Cir.1994) (holding that question of whether RTC is a holder in due course is governed by state law); see also FDIC v. Grupo Girod Corp., 869 F.2d 15, 17 (1st Cir.1989) (applying Puerto Rico law to determine whether the FDIC was a holder in due course); FDIC v. Bandon Assocs., 780 F.Supp. 60, 63 (D.Me.1991). But see FDIC v. World Univ. Inc., 978 F.2d 10, 13-14 (1st Cir.1992) (pre-O’Melveny case).

    The applicable Maine law, set forth in the Maine Uniform Commercial Code, Negotiable Instruments, 11 M.R.S.A. 3-1101 et seq., [3] provides that a note qualifying as a negotiable instrument can be enforced by “holder[s]” and “nonholder[s] in possession of the instrument who [have] the rights of [ ] holder[s].” See 11 M.R.S.A. § 3-1301. [4] The


    Page 605
    FDIC is plainly not a “holder” under Maine law because the Note was not indorsed to the FDIC and therefore was not “negotiated.” [5] See 11 M.R.S.A. § 3-1201 (“[I]f an instrument is payable to an identified person, negotiation requires transfer of possession of the instrument and its indorsement by the holder.”); [6] see also Calaska Partners Ltd. v. Corson, 672 A.2d 1099, 1104 (Me.1996) (holding that holder in due course status is not conferred when financial instruments are transferred in bulk to the FDIC).

    Not being a holder, the FDIC had to show, as a prerequisite to enforcing the Note against the Houdes, that it was a transferee in possession entitled to the rights of a holder. See 11 M.R.S.A. § 3-1203. Comment 2 following § 3-1203 provides:

    If the transferee is not a holder because the transferor did not indorse, the transferee is nevertheless a person entitled to enforce the instrument … if the transferor was a holder at the time of transfer…. Because the transferee is not a holder, there is no presumption … that the transferee, by producing the instrument, is entitled to payment. The instrument, by its terms, is not payable to the transferee and the transferee must account for possession of the unindorsed instrument by proving the transaction through which the transferee acquired it. Proof of a transfer to the transferee by a holder is proof that the transferee has acquired the rights of a holder. At that point the transferee is entitled to the presumption….

    (emphasis added). [7] Thus, in order minimally to be entitled to the presumption under Maine law that it could enforce the Note, the FDIC was required (1) to prove a sufficient transfer from a holder (here MNB, to which the Note was made payable by the Houdes) to the FDIC in its present capacity as receiver of NMNB, and (2) to produce the Note at trial.

    2. The Evidence At Trial

    The FDIC brought this action in its capacity as receiver for NMNB. The NMNB was allegedly a bridge bank set up pursuant to 12 U.S.C. § 1821(n) by the FDIC following the


    Page 606
    failure of MNB. The FDIC produced the Note at trial, and the parties stipulated that the signatures were authentic and that the instrument the FDIC possessed was the original. What remained, therefore, was for the FDIC to establish a proper transfer of the Note to it in its suing capacity (receiver of NMNB) from the Note’s holder, MNB.

    The first step in this transfer could rather easily have been established given the provisions of FIRREA. A transfer of all the holder’s (MNB’s) rights in the Note to the FDIC as receiver for MNB could be demonstrated simply by showing that the FDIC became the receiver of MNB. Once a receivership of a failed bank takes place, the transfer of the failed bank’s assets to the FDIC occurs by operation of law–the FDIC as receiver of a failed institution succeeding under federal law to:

    (i) all rights, titles, powers, and privileges of the insured depository institution, …

    (ii) title to the books, records, and assets of any previous conservator or other legal custodian of such institution.

    12 U.S.C. § 1821(d)(2)(A).

    The most serious problem in the instant case is what additional proof is needed to prove that enforceable title to the Note was transmitted to the FDIC in its subsequent and present capacity as receiver of the bridge bank, NMNB. Under the Maine negotiable instruments law, there has to be “[p]roof of a transfer to the transferee by a holder” of the Note, establishing “proof that the transferee [i.e., the FDIC as receiver of NMNB] has acquired the rights of a holder [MNB].” 11 M.R.S.A. § 3-1203, Comment 2, supra. As stated above, if the FDIC were suing in the capacity of receiver of MNB, nothing more would be required than a showing of such receivership, coupled with a production of the Note, for the FDIC to become entitled to the presumption that it was entitled to payment. But the FDIC is suing as receiver of a different entity, NMNB. There is no automatic transfer provided by federal law of the assets of the FDIC as receiver of a failed bank to a bridge bank, nor is there an automatic transfer from a bridge bank back to the FDIC upon the termination of the bridge bank. See 12 U.S.C. § 1821(n).

    A key question, therefore, is whether the record below properly established the formation of NMNB, the transfer of the Note to NMNB, the demise of NMNB and the appointment of the FDIC as its receiver, and the transfer of the Note from NMNB to the FDIC as receiver of that entity. The FDIC relied on the testimony of its witness, Golden, to show this. Golden testified, among other things, to the FDIC’s receivership of MNB, the creation of NMNB, the subsequent dissolution of NMNB, and the Note’s transfer to the FDIC as NMNB’s receiver. The court, however, struck Golden’s testimony. We agree with the court that Golden, having taken over the Houde file only two weeks before trial and not claiming direct personal knowledge of these events, could not testify to them over objection. See Fed.R.Evid. 602 (“A witness may not testify to a matter unless evidence is introduced sufficient to support a finding that the witness has personal knowledge of the matter.”) Although, as custodian of the Houde file, his testimony might well have been sufficient to authenticate business records, admissible under an exception to the hearsay rule, that may have proved the underlying transactions, see Fed.R.Evid. 803(6), the FDIC did not have any of the underlying documents with it at trial. Nor was the FDIC prepared to offer public records such as might establish the appointment of the FDIC as receiver of MNB and NMNB respectively. See Fed.R.Evid. 803(8), 901(b)(7) (indicating that public records are admissible as an exception to the hearsay rule and generally self-authenticating). Thus, the FDIC was without admissible evidence of its ownership of the Note. The FDIC conceded that it was unprepared at the time to present alternative evidence after Golden’s testimony was struck, although it said it could obtain the relevant evidence if the court would grant a brief continuance. Without such a foundation, the court declined to permit the Note to be received into evidence. Without the Note in evidence, the FDIC felt that it could not


    Page 607
    proceed. [8]

    Attempting to justify the lack of admissible foundation evidence, the FDIC now argues that because the Note was never indorsed and never made payable to anyone other than MNB, it plainly could not have been sold to a third party by the FDIC or the bridge bank. But while the absence of an indorsement on the Note strengthens the argument that no one acquired a title superior to that of the FDIC, it does not by itself meet the FDIC’s burden to “account for possession of the unindorsed instrument by proving the transaction through which the transferee acquired it.” 11 M.R.S.A. § 3-1203, Comment 2, supra.

    We note that the Houdes, in their Statement of Undisputed Material Facts submitted to the district court in conjunction with their earlier summary judgment motion, conceded that the FDIC was appointed receiver for MNB, that the FDIC created NMNB, that the FDIC appointed itself the receiver of NMNB, and that “[i]t was through these various transactions that the FDIC acquired the Note … at issue in this action.” The Houdes’ subsequent facile recanting of this admission might arguably be the sort of “fast and loose” play which leads a court to impose judicial estoppel. See Patriot Cinemas, Inc. v. General Cinema Corp., 834 F.2d 208, 212 (1st Cir.1987). However, the FDIC made no effort during the trial to offer the Houdes’ Statement in evidence in order to establish its own ownership of the Note, nor did it make an estoppel argument. [9] In a case such as this with well over a hundred docket entries, the district court can scarcely be expected to recall, sua sponte, a fact listed in one document submitted by the Houdes to the court. Moreover, although the FDIC mentions the Houdes’ admission in its appellate brief, it does not make a “judicial estoppel” argument, or indeed any other coordinated argument, as to why the admission should, at this late date, be binding on the Houdes. See United States v. Caraballo-Cruz, 52 F.3d 390, 393 (1st Cir.1995) (stating that “issues adverted to in a perfunctory manner, unaccompanied by some effort at developed argumentation, are deemed waived”) (internal quotations omitted). Given the FDIC’s failure to raise the matter in a timely fashion before the district court and to argue the matter on appeal, we regard it as having been waived.

    The FDIC also argues that this court should now take judicial notice of the failure of MNB and the taking over of its assets by the FDIC. This point was also not made at trial below, the district court never being asked to take judicial notice of these facts. It is true that the appointment of the FDIC as receiver of MNB was previously announced and relied upon as a matter of fact in two published opinions of this court issued prior to the district court proceeding under review, as well as in several prior opinions of the District of Maine, including opinions issued by the very judge who presided over the present trial. [10] Nonetheless,


    Page 608
    the FDIC’s judicial notice argument fails for several reasons. First, even assuming a court could take judicial notice of the failure of the MNB, no party in this case requested the court to take such action. While the district court might well have taken judicial notice of these well-known facts sua sponte, it was not required to do so unless requested. See Fed.R.Evid. 201(c), (d). Second, even assuming the district court, or this court on appeal, did take judicial notice of the failure of the MNB, the appointment of the FDIC as its receiver, and perhaps even the creation of the bridge bank, these facts would not relieve the FDIC from its burden of showing a transfer of the Note from the bridge bank to the FDIC as receiver for that institution. These are not matters for judicial notice.

    We conclude, therefore, with some regret, that there was no error in the district court’s ruling that, on the record as it stood, the FDIC had failed to meet its legal burden. We hold that the record justified the dismissal of the case as matter of law on the narrow but dispositive ground declared by the district court.

    3. The Denial of the FDIC’s Requested Continuance

    The FDIC argues that even assuming the FDIC as receiver of NMNB failed to make out a prima facie case showing the transactions by which it acquired the Note, the court’s refusal to grant the FDIC a continuance during which it could procure the necessary records and other evidence constituted an abuse of discretion. We review the district court’s refusal to grant a continuance solely for an abuse of discretion. See United States v. Neal, 36 F.3d 1190, 1205 (1st Cir.1994).

    Counsel for the FDIC first asked for a two-hour break and then asked, at 10:30 a.m., that the case be continued until the next day. The district judge indicated that he was not willing to recess the case because “[t]his case should have been prepared weeks ago.” In addition, the judge noted that even if he did allow the continuance, any documents or testimony the FDIC produced would not be admissible, over objection, because it would violate the court’s Final Pretrial Order, which required a designation of all exhibits and witnesses and a description of the witnesses’ testimony. The judge stated:

    I am not going to continue this case, … to do so means opening the entire case up, probably discharging this jury so that new procedures, pretrial procedures about these documents can be carried out in accordance with the prior order of the court. It would make a complete mockery of the systematic pretrial preparation of cases and the elaborate procedure that the Court has in place to see that these cases are properly tried.

    When reviewing a district court’s decision to deny a continuance, broad discretion must be granted and only “unreasonable and arbitrary insistence upon expeditiousness in the face of a justifiable request for delay” will necessitate reversal. United States v. Rodriguez Cortes, 949 F.2d 532, 545 (1st Cir.1991) (citing United States v. Torres, 793 F.2d 436, 440 (1st Cir.), cert. denied, 479 U.S. 889, 107 S.Ct. 287, 93 L.Ed.2d 262 (1986)); see also Morris v. Slappy, 461 U.S. 1, 11, 103 S.Ct. 1610, 1615, 75 L.Ed.2d 610 (1983). In determining whether a denial of a continuance constitutes an abuse of discretion, the court must consider the particular facts and circumstances of each case. See Torres, 793 F.2d at 440. The court should consider the reasons in support of the request, the amount of time requested, whether the movant has contributed to his predicament, the inconvenience to the court, the witnesses, the jury and the opposing party, and the likelihood of injustice or unfair prejudice attributable to the denial of a continuance. See United States v. Saccoccia, 58 F.3d 754, 770 (1st Cir.1995), cert. denied, — U.S. —-, 116 S.Ct. 1322, 134 L.Ed.2d 474 (1996).


    Page 609

    The FDIC argues that the district court’s refusal to grant a continuance led to injustice and unfair prejudice. It contends that the time needed to gather the necessary evidence would not have greatly inconvenienced the court, the jury or the Houdes, and that some of the documents would have been self-authenticating records admissible in court. This may be so, but it overlooks a number of factors pointing in the other direction, among them the presence of the jury and the court’s reasonable expectation that the FDIC would be prepared for trial. The FDIC contends that it was “surprised” that it had to put forth admissible evidence concerning its ownership of the Note. However, we see no reason for the FDIC to have been surprised. The Houdes had challenged the ability of the FDIC to enforce the Note as an affirmative defense in their answer and had later objected to the FDIC’s motion, which the court denied, to preclude them from challenging the FDIC’s standing to enforce the Note. The FDIC was plainly on notice that it was dealing with adversaries who refused to take a relaxed “common sense” approach on these technical but nonetheless requisite preliminaries. Indeed, the FDIC showed that it understood its burden by calling Golden and questioning him on the matters it did. Unfortunately, it seems not to have recognized the hearsay problem inherent in Golden’s testimony, nor to have taken the trouble to have with it the necessary supporting documents.

    The court was entitled to expect the FDIC to have special competence in actions such as this. This suit had been commenced ten months earlier and, as said, the FDIC knew the Houdes would challenge its standing to enforce the Note. It was the FDIC’s failure to have prepared its case for trial that led to the request for a continuance. While the court’s action was strict, and we can imagine some judges who would have assessed the situation more charitably to the FDIC, we cannot say that it abused its discretion in not giving the FDIC additional time to remedy its lack of preparation. See, e.g., Rodriguez Cortes, 949 F.2d at 545 (holding that district court did not abuse its discretion in denying motion for continuance in order to obtain witness to testify that time indicated on hotel registration card was incorrect when defendant had been in possession of the time card for six months and had ample time to obtain a witness). Given the costs of trials, especially before juries, and the adverse effects of delay in one case on other litigants seeking trials, judges must be allowed a considerable discretion in these matters. We find no abuse here.


    Because we find that the district court properly directed a verdict in favor of the Houdes and acted within its discretion in denying the FDIC’s request for a continuance, we need not reach the issues raised in the Houdes’ cross-appeal.




    [1]The district court ruled from the bench:

    There is a complete gap in the evidence between the time the bank [sic] was lawfully in the possession of Maine National Bank and the title to the document was in Maine National Bank, and the time that it ultimately came to rest in the possession of this plaintiff, and there is no formal proof, first of all that Maine National Bank ever went into receivership, if so, what happened with respect to any of the assets of that institution as a result of that, specifically what happened with respect to this note and mortgage. And there is no proof or evidence sufficient to permit a jury to reach a verdict in favor of the plaintiff with respect to what happened to that note, and what has been referred to as its many transitions in ownership among, apparently New Maine National Bank, Fleet Management Corporation, Fleet Bank and RECOLL Management Corporation, and ultimately its transfer back into the possession of FDIC. It is not even clear that the note ever left the possession of the FDIC in the first place, but all of that is completely in doubt.

    [2]FIRREA is the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, 103 Stat. 183, codified in various sections of 12 and 18 U.S.C.

    [3]The Maine Uniform Commercial Code was amended in 1993, after the execution of the Note but before the execution of the Conditional Agreement and before the institution of the lawsuit in question. The earlier version of the Maine Uniform Commercial Code, Negotiable Instruments, was codified at 11 M.R.S.A. § 3-101, et seq. (repealed in 1993).

    Both parties have taken the position in this litigation that the Note is a negotiable instrument (the Houdes in their appellate brief, and the FDIC in motions submitted to the district court), and neither party has argued that the Note is not a negotiable instrument even though, with its variable interest rate, the Note is arguably not a negotiable instrument under the pre-1993 version of the Maine Uniform Commercial Code. See e.g., FSLIC v. Griffin, 935 F.2d 691, 697 n. 3 (5th Cir.1991), cert. denied, 502 U.S. 1092, 112 S.Ct. 1163, 117 L.Ed.2d 410 (1992); New Conn. Bank & Trust Co., N.A. v. Stadium Management Corp., 132 B.R. 205, 208-09 (D.Mass.1991). In the absence of an applicable statute, the FDIC’s initial burden would be subject to Maine common law. In discerning the common law requirements for the FDIC to show that it is entitled to enforce the variable interest rate Note, we would be inclined to look to the statutory requirements for enforcing negotiable instruments by analogy. As the parties have not argued otherwise and as it is hard to see how the outcome of this case would change in any event, we proceed on the assertion that the Note is a negotiable instrument under Maine law.

    [4]The version of the Maine Uniform Commercial Code in effect before 1993 also provided that holders as well as transferees with the rights of holders could enforce a

    negotiable instrument. See 11 M.R.S.A. § 3-201, Comment 8 (repealed 1993).

    [5]The federal holder in due course doctrine, which provides a buffer for the FDIC against certain defenses, does not give the FDIC the status of a “holder” in the instant situation. This Circuit has held that the federal doctrine is generally not applicable to the FDIC in its receivership capacity. See Capitol Bank & Trust Co. v. 604 Columbus Ave. Realty Trust (In re 604 Columbus Ave. Realty Trust ), 968 F.2d 1332, 1352-53 (1st Cir.1992) (stating that the federal holder in due course doctrine does not apply to the FDIC as receiver except in the case of a purchase and assumption transaction); see also FDIC v. Laguarta, 939 F.2d 1231, 1239 n. 19 (5th Cir.1991) (same). But see Campbell Leasing, Inc. v. FDIC, 901 F.2d 1244, 1249 (5th Cir.1990) (stating that the FDIC may enjoy federal holder in due course status whether acting in its corporate or receivership capacity); Firstsouth, F.A. v. Aqua Constr., Inc., 858 F.2d 441, 443 (8th Cir.1988) (providing FSLIC-Receiver with federal holder in due course status).

    We note that the continuing viability of the federal holder in due course doctrine is questionable. A circuit split has arisen as to whether the doctrine is still valid after O’Melveny & Myers, supra. Compare DiVall Insured Income Fund Ltd. Partnership v. Boatmen’s First Nat’l Bank of Kansas City, 69 F.3d 1398, 1402 (8th Cir.1995) and Murphy v. FDIC, 61 F.3d 34, 38 (D.C.Cir.1995) (holding that O’Melveny & Myers leaves no room for common law D’Oench doctrine) with Motorcity of Jacksonville v. Southeast Bank N.A., 83 F.3d 1317, 1327-28 (11th Cir.1996). This court has not yet expressed an opinion as to the effect of O’Melveny & Myers on the doctrine.

    In any event, the present case does not present a situation for which the doctrine was created. The federal holder in due course doctrine is designed to protect the FDIC from claims unascertainable from the books of the failed institution, a purpose unrelated to the present.

    [6]The term “negotiation” is similarly defined in the pre-1993 statute, 11 M.R.S.A. § 3-202 (repealed in 1993).

    [7]The result would not be different under the pre-1993 version of the Maine Uniform Commercial Code which provided:

    [T]he transferee without indorsement of an order instrument is not a holder and so is not aided by the presumption that he is entitled to recover on the instrument…. The terms of the obligation do not run to him, and he must account for his possession of the unindorsed paper by proving the transaction through which he acquired it. Proof of a transfer to him by a holder is proof that he has acquired the rights of a holder and that he is entitled to the presumption.

    [11]M.R.S.A. § 3-201, Comment 8 (repealed in 1993).

    [8]After a lengthy discussion in which the court indicated that there was insufficient evidence of foundation to allow the Note into evidence and that even if the FDIC were to provide additional documentation and witnesses to lay the proper foundation, it would be in violation of the court’s Final Pretrial Order, the court declined to grant a continuance. The following colloquy then took place:

    [FDIC’s Counsel]: Then, your Honor, we have no further witnesses.

    THE COURT: I take it the Plaintiff rest [sic] at this time?

    [FDIC’s Counsel]: Yeah.

    THE COURT: Does the defendant rest?

    [Houdes’ Counsel]: Defendant rest [sic] on the complaint and moves for directed verdict.

    [9]The FDIC did indicate to the court, several hours after the court directed the verdict for the Houdes, that it would file a motion for reconsideration of the verdict because “there were judicial binding admissions” submitted by the Houdes. The district judge indicated that he would not reconsider the decision because the FDIC should have been prepared to argue that point at trial. The FDIC did not submit a motion for reconsideration. Moreover, the FDIC makes no argument on appeal that the district court’s refusal to reconsider was an abuse of discretion.

    [10]See, e.g., United States v. Fleet Bank of Maine, 24 F.3d 320, 322 (1st Cir.1994) (reviewing a decision of the district court judge who decided the present case, the Court of Appeals stated: “In January 1991, the Maine National Bank … was declared insolvent and the Federal Deposit Insurance Corporation … was appointed its receiver.”); Bateman v. FDIC, 970 F.2d 924, 926 (1st Cir.1992) (reviewing a decision of the district court judge who decided the present case, Court of Appeals stated: “[I]n January 1991, the federal Comptroller of the Currency declared the [Maine National] Bank insolvent and appointed the FDIC as receiver.”); Mill Invs. v. Brooks Woolen Co., 797 F.Supp. 49, 50 (D.Me.1992) (acknowledgement of same district court judge that FDIC was appointed receiver of MNB); Cardente v. Fleet Bank of Maine, 796 F.Supp. 603, 606 n. 1 (D.Me.1992) (same).


  83. Two New California Cases against MERS,
    The courts have started to recognize that MERS is not registered or exempt with the CA Secretary of State to do business in California. This very likely makes any assignment of the Deed of Trust from MERS to any bank invalid, as well as any substitution of the trustee invalid.

    From a 9th circuit Federal Magistrate
    Section CCP §191(c)(7) does not exempt assignment of mortgages. Section (d)(3), which does apply to assignments, would only apply to MERS if it were a “foreign lending institution,” which is not claimed by defendant…..

    ….FN5 The Court is aware of decisions that have held differently. See Swanson v. EMC Mortg. Corp., 2009 WL 3627925, *9 (E.D.Cal. 2009) (finding that MERS properly acted as a beneficiary under Corporations Code sections 191(c)(7) and (d)(3)); Lomboy v. SCME Mortg. Bankers, 2009 WL 1457738, *3 (N.D.Cal. 2009) (same).

    However, neither decision addressed the threshold issues of
    (1) whether MERS’s activities solely constituted “creating evidences of debt or mortgages” under Section CCP §191(c)(7) or
    (2) whether MERS qualifies as a “foreign lending institution” under Section CCP §191(d)(3).
    Carter v. Deutshe, No. 3:09-3033 BZ (N.D.Cal. 1-27-2010)
    (page 6:2-9; footnote 5)

    Now the Eastern District Judge ruling has a 2 page explanation, but this quote is priceless from a 9th circuit judge.
    “Accordingly, section CCP §191(c)(7) does not exempt MERS’s activity.”
    Champlaie v. BAC, No. 2:09-cv-01316-LKK-DAD (E.D.Cal.10-22-2009)
    (pages 23, 24)

    You download everything here:

    It also includes evidence that the MERS registration that does come up when searching CA corporations is a fake, didn’t exist until June 2009, and has had it’s name changed since then, but not properly updated on the Ca Secretary of State websites. For current proof, you need to do a Statement of Information on the same Corp id#. The website url is on the bottom of the report pages.

  84. Just received notice that the state of Arizona is placing all MERS complaints into a giant multi litigation case. Don’t see where that is going to work to our advantage.

    Bankruptcy Court Nevada resoundingly says NO
    It is no secret that whether a MERS assignment is valid and legal or not depends on what part of the country you are in. The California courts have said yes and no depending on the circumstances; the Arizona courts apparently believe that whatever MERS does cannot be challenged; the Supreme Court of Kansas recently ate away at MERS’ purported authority; the Idaho Bankruptcy Court has held that purported assignments of the Note in a MERS assignment of mortgage is ineffective; and many state appeals courts have not spoken on the issue at all.

    The U.S. Bankruptcy Court for the District of Nevada is the only court we know of so far which has resoundingly rejected MERS’ authority to assign anything. In the matter of In Re Joshua and Stephanie Mitchell, Case No. BK-S-07-16226-LBR, the Court did not mince words:

    MERS does not have standing merely because it is the alleged beneficiary under the deed of trust. It is not a beneficiary, and, in any event, the mere fact that an entity is named beneficiary in a deed of trust is insufficient to enforce the obligation.

    Citing the standard MERS language in a Deed of Trust that it is both a nominee and a beneficiary and also citing MERS’ “Terms and Conditions” in its corporate documents whereby MERS affirmatively states that it has no rights to any payments on the mortgage loans, no servicing rights, and agrees not to assert any rights with respect to the mortgage loans or mortgaged properties, the Court then set forth the legal definition of a “beneficiary” and held:

    But is is obvious from MERS’ “Terms and Conditions” that MERS is not a beneficiary as it has no rights whatsoever to any payments, to any servicing rights, or to any of the properties secured by the loans. To reverse an old adage, “if it doesn’t walk like a duck, talk like a duck, and quack like a duck, then it’s not a duck”.

    The law is fairly standard in all states that if a state has not spoken on a particular legal issue in an appellate decision that the trial court considering the issue may look to the law of other states for guidance. The Ohio courts did just that in adopting the opinions of Judge Arthur Schack from New York as to standing issues in foreclosure cases. As there are MANY states which have not yet spoken on the issue of MERS alleged authority, continued litigation will be necessary, in the absence of any pronouncement from the United States Supreme Court, in order to resolve MERS’ alleged authority to assign mortgages/Deeds of Trust and Notes in those states which are to date silent on the issue, and as such, the defense as to the lack of MERS’ authority continues to be viable in foreclosure defense cases in those states where there is no opinion on the issue.

    Jeff Barnes, Esq.


  86. The CARDI v MERS dissention is posted on our website. http:.//

  87. George Babcock,

    That’s great news about the Cardi Injunction;
    in your post:

    Do you have:
    A link to the Case File?
    A Case File Number?
    Can you “post” the Case
    here on livinglies?

    I tried to look up the case at the court website:

    but it is organized by year with no other “search” facility that I can discern.

    I did however find the “Bucci” Case File:

  88. Check out the case of Cardi v. MERS/Indy Mac/One West. Providence RI Superior Court. Permanent Injunction $800,000.00 mortgage. Party foreclosing did not own note and Aurora claim to be actual party foreclosing. Bucci V. Lehman, an alleged loss regarding MERS was relied upon by Plaintiffs to win this case. Beautiful justice. Never surrender.

  89. What is the right way to go to resend your mortage ,is this this violation with MERS true?

  90. Having an extremely difficult go of things here in the non judicial state of Nevada. Other than a ruling by the Hon. Linda Riegle in Federal Bankcruptcy court District of Nevada that sided witht he homeowners in chapter 7, we hgave had NO luck with our District court judges that are throwing out all TROs and requests for injunctive relief due to RESPA, TILA and/or HOEPA violations. the judges here are ignoring constitutional law and denying even hearing the cases from homeowners filing TROs trying to get the lenders in court so that we can HAVE our day in court. We are being denied our due process. My personal story is I am 3 months behind and Indymac Bank a division of One West Bank is aggressively forclosing, will not negotiate under the Obama MakingHomes Affordable and only has to file their little notice and they can steal ones home. What is one to do? I sent in a RESPA request and asking for the pool agreements and assignments and who and how are they being paid from my payments etc etc. about 37 pages. Should I file it with the recorder where in it I assert the fraud and predatory lending and misrepresentation of a material fact and breach of covenants of good faith and rackateering and that I don’t believe I was given a loan but rather was made part of a credit product to which nothing was disclosed I also arrest they are not the party of interest and that i believe they have no damages by the alledged default etc. would that help coud the title so I can get them to pursue a judicial foreclosure? We are being so scammed here in NV. Our judges are elected and do not even have to be atttys! What are we to do if we can’t even get the judges to hear our complaints for RESPA TILA HOEPA predatory lending, fraud, misrepresentation of a material fact in a mortgage contract, tortous interference by the servicers, asking them to prove the bank has the real party of interest to foreclose, or proving damages?? Help?

  91. MERS may soon suffer more maceration in the “loan pool”.

    I really would prefer to see its demise so much more though
    by a THOUSAND THOUSAND paper cuts……………


    Mortgage transfers spur R.I. lawsuits

    By Christine Dunn

    A Providence lawyer, George E. Babcock, said his entire practice is now devoted to challenging the legal standing of a private mortgage registration service, the Mortgage Electronic Registration Systems, Inc., known as MERS, to foreclose under Rhode Island law…………

    Babcock said he wonders why local governments and county deed registries have never challenged the MERS system before, because by allowing lenders to bypass the process of recording mortgage transfers with government entities, “millions and millions” in fees to local government have been lost.

    But it took the foreclosure crisis to shine the light on MERS, which some have blamed for enabling the mortgage securitization craze and the questionable lending practices that preceded the housing bust.

    Despite being on the losing end of an Aug. 25 decision by Providence Superior Court Judge Michael A. Silverstein, which he has appealed to the Rhode Island Supreme Court, Babcock said he is still filing “two or three” MERS lawsuits a week for clients hoping to stop foreclosure proceedings. Babcock estimates he is pursuing a total of about 100 MERS cases.

    His clients who are the plaintiffs in the Aug. 25 Providence Superior Court decision, Anthony and Stephanie Bucci, are still in their Cranston home, according to Babcock. “I’m very confident in the appeal,” he said.

    The defendants in the case are Lehman Brothers Bank, FSB, a federal savings bank, MERS, and Aurora Loan Services, LLC.

    Judge Silverstein ruled that Rhode Island law “does not prohibit MERS from invoking the Statutory Power of Sale [foreclosure] ” because “statutes should not be construed to reach an absurd result.”

    To rule for the Buccis, Silverstein wrote, “would be an absurd result because named mortgagees and lenders would be precluded from employing servicers to service and collect obligations secured to real estate mortgages. Clearly, the General Assembly envisioned a role for mortgage servicers in the mortgage lending industry.”

    MERS lawsuits have been filed in a number of states, with varying results, and case law appears to be evolving.

    An Aug. 28 decision by the Kansas Supreme Court “completely undoes Judge Silverstein’s ruling,” Babcock said. “The tide has completely turned in favor of the homeowner.” ………………….

    (MERS lawyer)
    If the courts were ultimately to strip MERS of the right to foreclose, it could throw millions of titles into question and cause massive losses for lenders, Gladstone said.

    He attributed the MERS cases to “a movement, and it’s a small movement” of “people looking for ways to attack the mortgage holder” and stave off foreclosures.

    “They’re grasping at straws,” he said.

    He said a number of the MERS lawsuits are brought by people who are trying to drag out the foreclosure process and stay in their houses “without even paying a dime” on their mortgage.

  92. Foreclosure Fraud?

    The document you just posted at scribd?
    The Case File where MERS is referred
    to as a SHAM by the Florida judge. Is the
    case that went to appeals and was reversed?
    Or is this still a standing decision?

  93. Filmaker Micheal Moore decided to actually put MERS in his new film Capitolism: A Love Story. At one point in the movie while Moore in reviewing someone’s foreclosure documents, MERS APPEARS IN PLAIN SIGHT ON THAT 40 ft SCREAN! Intrestingly, Mr. Moore didn’t offer one word about the “Mortgage Machine” that has an address in his home town of Flint Michigan. Suspicious.

  94. Minnesota Statutes section 580.09 is for foreclosure of mortgages that do not have acceleration clauses. The statute allows the mortgage to survive a power of sale foreclosure for one installment. Since nearly every mortgage has an acceleration clause, so I’ve never seen 580.09 used.

    As co-chair of the Legislative Committee of the Real Property Section of the Minnesota State Bar Association, I helped review and edit the “MERS statute” referred to by the Minnesota Supreme Court in the opinion. The court got it right. I think the legislature did approve the MERS concept by passing the MERS Statute. The following is quoted from the opinion. The full text is at:

    As a result of questions raised about the MERS system, the Minnesota Legislature passed an amendment to the Recording Act that expressly permits nominees to record “[a]n assignment, satisfaction, release, or power of attorney to foreclose.” Act of Apr. 6, 2004, ch. 153, § 2, 2004 Minn. Laws 76, 76-77 (codified at Minn. Stat. § 507.413 (2008)). The amendment, frequently called “the MERS statute,” went into effect on August 1, 2004. Id., § 2, 2004 Minn. Laws at 76-77. The MERS statute provides that:

    An assignment, satisfaction, release, or power of attorney to foreclose is entitled to be recorded in the office of the county recorder or filed with the registrar of titles and is sufficient to assign, satisfy, release, or authorize the foreclosure of a mortgage if:

    (1) a mortgage is granted to a mortgagee as nominee or agent for a third party identified in the mortgage, and the third party’s successors and assigns;

    (2) a subsequent assignment, satisfaction, release of the mortgage, or power of attorney to foreclose the mortgage, is executed by the mortgagee or the third party, its successors or assigns; and

    (3) the assignment, satisfaction, release, or power of attorney to foreclose is in recordable form.

    Minn. Stat. § 507.413(a).

    … So while the MERS statute suggests legislative approval of MERS’ practices, the statute does not resolve the question of whether MERS has complied with the foreclosure by advertisement requirements set out in chapter 580. Therefore, to answer the certified question we must analyze the foreclosure by advertisement statutes.

    … Our case law establishes that a party can hold legal title to the security instrument without holding an interest in the promissory note. The cases demonstrate that an assignment of only the promissory note, which carries with it an equitable assignment of the security instrument, is not an assignment of legal title that must be recorded for purposes of a foreclosure by advertisement. In essence, any disputes that arise between the mortgagee holding legal title and the assignee of the promissory note holding equitable title do not affect the status of the mortgagor for purposes of foreclosure by advertisement.

  95. High court upholds mortgage lenders’ registry

    by Elizabeth Stawicki, Minnesota Public Radio

    August 13, 2009

    St. Paul, Minn. — The Minnesota Supreme Court has ruled 6-1 that the Mortgage Electronic Registration System, or MERS, did not violate Minnesota law by failing to disclose which lenders actually owned a homeowner’s mortgage.

    MERS was created by the nation’s largest mortgage lenders to streamline the foreclosure process.

    Five Hennepin County homeowners filed a lawsuit in January 2008, alleging that MERS violates Minnesota law by foreclosing without following two requirements — to identify all assignees of the mortgage in county land records, and list those assignees in the published foreclosure notice.

    Minnesota Legal Aid attorneys, acting on behalf of the plaintiffs, argued that homeowners facing eviction in foreclosures administered by MERS often didn’t know which lending institution held their mortgage, which prevented them from negotiating a deal.

    MERS argued that it should be able to foreclose in its own name without identifying the successive owners of the loan which are tracked on its private system. The Supreme Court agreed.

    Writing for the court majority, Justice Paul Anderson said as the mortgage banking industry has changed, certain problems have become evident, especially in the secondary mortgage market. But resolving those problems was beyond the court’s authority.

    Writing in dissent, Justice Alan Page said by allowing the identities of promissory noteholders to remain hidden, the court essentially eliminates a homeowner’s ability to assert a wide range of defenses to foreclosure.

    Amber Hawkins, one of the plaintiffs’ attorneys, said she’s disappointed in the court ruling.

    “As a result of the court’s decision, an agent with no responsibility or authority related to the loan can foreclose upon a homeowner through an expedited, non-judicial process without identifying who it is working for,” said Hawkins.

  96. Full briefs and arguments were submitted in RI Superior Court regarding MERS standing to foreclose. Decision due soon. Result will effect dozens of cases I have filed in RI. Russo v. MERS.

  97. I have caused a “mini-moratorium” on MERS foreclosures in RI. Most of the cases have deeper issues that just MERS’ involvement, but I am on MERS’ radar and I like it. The note and mortgage must be together or no foreclosure can take place. Follow the title and the UCC. I have had judges accept the argument but they still can’t see themselves clear to give a borrower a “windfall.” I guess we have to take one step at at time. I am on streaming radio tomorrow between 8 and 9 eastern. 790 am in RI.

  98. I have developed a new theory on how to attack MERS. Its has to do with the “nominee” label it attaches to itself in mortgages. In RI, there is no such thing in real estate law as a nominee. THere is not, therefore, any such estate as a nominee mortgagee. I have dozens of cases filed against MERS and several are postured for fulling hearing in the Superior Court. MERS counsel has promised that if I win it will appeal to RI Supreme Court. Clearly, the MERS monster is going to be exposed very soon. The UCC, the law of real property and traditional contract law will be its undoing absent legislative assitance. This is a very exciting time. MERS can be defeated.

  99. I was retained to assist California Continuing Education of Bar [CEB] in updating its 2 vol. text on Real Property Security and Foreclosure. Roger Bernhardt is principal author. Looking for case law allowing attacks on trustee sales; defending the resulting eviction actions– both in commercial and consumer context. Please send cases, briefs, etc to above address or email []. Our deadline is July 10. I will be on vacation last week in June, 2009. Sttreet address: 1297 B Street, Hayward CA 94541. /s/ GLEN L Moss.

  100. Trevino is a good case but till now I only were able to find its complaint (First Amended is the last verstion I saw)

    Now – I found a Judge’s opinion on it ! Where MERS’s motion is denied, and there are a few good pages of analysis

    all found within a good news-mailing list, following several cases on our subject from January 2008 till now

  101. Senate Testimony is definitely a good read although the assumptions about ownership of the loan are mistaken. Anyone who has a case where MERS is Plaintiff is in good position to eliminate the foreclosure even if it is in the past.

  102. correction on my part – I had re-read the Knighton, Norman v. MERS #08-40616 case (previous comment here, on link #2) and although it sounds all favorable to Plaintiff, his case is Dismissed, Affirmed is denial not the appeal, sorry for my mis-stating earlier.

    It is still an interesting account, dedicated to discussion, whether MERS’s fees charged to its members for MERS staying a permanent nominee on record is a violation of RESPA, it failed in that particular action and appeal due to not that well allegations built in Plaintiff’s complaint, it doesn’t meant that it can’t be redone and presented better in the future

  103. two more resourses found today available online regarding MERS:

    1 – legal analysis on MERS and loan securitization, written testimony before US Senate, by Christopher L Peterson, associate professor of Law, University of Florida.

    Several interesting points made, including
    – naming MERS no less but tax evasion tool,
    – analyzing existing anti-predatory system of law (as of 2007 when it was written) as outdated by at least a decade before MERS was created and found its way through the holes in legislation of pre-digital era
    – providing some good citations and basis for its resolutions


    2 – United States Court of Appeals for 5th Circuit AFFIRMS Plaintiff’s standing against MERS, fresh ruling, came out December 23rd, 2008, rooted from Texas case Knighton, Norman v. MERS #08-40616

  104. This article by one of the architects of MERS was definitely worth the $ 5.00 bucks.


    Mortgage assignments – headed for extinction?
    Mortgage Banking – July 1, 1993
    Phyllis K. Slesinger

    Word count: 1265.
    citation details

    It won’t happen tomorrow, and it won’t happen next week or even next year. But in the not too distant future, paper mortgage assignments may become as common as dinosaurs–outside Jurassic Park.

    The Mortgage Bankers Association of America (MBA) in conjunction with Fannie Mae and Freddie Mac is exploring “New Age Delivery.” The phrase represents a proposal for grounding the mortgage note for the life of the mortgage loan immediately after origination. Subsequent transfers of the loan, as well as transfers of servicing, will be registered in an electronic clearinghouse–essentially a computer. What we will have is a book-entry system for transfers of mortgages and servicing rights sponsored by participating mortgage investors. These will include not only Fannie Mae, Freddie Mac and GNMA, but also conduits, portfolio lenders and any other investors in mortgages.

    The proposed system is analogous to the system used to establish ownership of book-entry securities–including Fannie Mae MBS, Freddie Mac PCs and Ginnie Maes. The concept is still in the early stages of development, and we expect that it will be refined as it is discussed and analyzed further. Currently, it provides for the following:

    * Mortgage investors will establish a system for electronically registering ownership of and interests in mortgages. Submitting information to the resulting book-entry data repository (clearinghouse) will be recognized as the official means for establishing constructive notice of title to and interests in the registered mortgages. The repository could be an entity created from scratch, or it could be operated by an existing facility.

    * Lenders will provide closing agents with electronic closing instructions. Upon funding of a mortgage loan and recordation of the security instrument (mortgage or deed of trust) in the public land records with the clearinghouse probably designated as the mortgage of record, the title company, closing agent (independent closing agent/escrow agent/attorney), or lender will transmit electronic data to the clearinghouse to register a loan and have it assigned a permanent identification number (the data could be limited to borrower/original payee/loan amount/date, or could be very extensive to include property description/census tract and so on.

    * Immediately upon closing, the closing agent also will fax the clearinghouse an image of the note. The clearinghouse or the closing agent also will notify the warehouse lender that the loan had been originated and send the original note to the designated custodian. The warehouse lender then will electronically register its interest in the mortgage loan with the clearinghouse.

    * All future loan transfers or assignments to secondary market entities, as well as transfers of servicing, will be registered electronically through the book-entry system.

    * If mortgages designate the clearinghouse as the mortgagee of record in the manner that book-entry securities are listed in the name of a primary bank having a book-entry account with a Federal Reserve Bank on behalf of the true investor, the clearinghouse will receive important notifications affecting the mortgage lien; for example, notices of foreclosure of junior liens, notices of federal asset forfeiture actions, bankruptcy notices and notices of environmental actions affecting the underlying property.

    * Mortgage notes will remain with the original document custodian until payoff or foreclosure. Custodians will hold the notes on behalf of the registered owner. Custodians will release satisfied notes to closing agents who will record satisfactions.

    The book-entry concept is the logical outgrowth of several initiatives undertaken by the Inter-Agency Technology Task Force. This task force, in which MBA assists Fannie Mae, Freddie Mac and GNMA, is dedicated to streamlining mortgage banking functions. Activities focus on reducing paper in mortgage loan transactions, eliminating redundant data-entry activities by various industry sectors and establishing uniform formats for agency submissions to the extent feasible.

    The current systems for establishing and tracking mortgage ownership is extremely cumbersome and expensive. The generally accepted rules are that ownership of a mortgage note is established by possession of a note endorsed in blank, either directly or through a custodian holding notes on behalf of a third party, and by execution and delivery of a mortgage assignment, which may or may not need to be recorded. However, even where assignments need not be recorded to establish legal rights, the need for their execution, delivery, verification and storage is very costly. Therefore, the elimination of mortgage assignments has been targeted by the Inter-Agency Technology Task Force as a significant objective.

    Because mortgage assignments are creatures of state law, a logical question is whether registration of a mortgage interest in the book-entry clearinghouse will be sufficient under state law to establish enforceable legal rights. Although the proposed book-entry concept seems a drastic departure from existing practice, there is good reason to believe that the book-entry system will mesh with the existing legal framework. A tangible mortgage note and recorded mortgage will still be executed, and the note will be held by a third party consistent with current practice. What will differ is that an interested party must refer to the book-entry system, rather than an executed assignment, to determine on whose behalf the custodian is holding a note of any given time.

    It appears that to make the concept work without changing state law, mortgage investors will have to impose a contractual requirement for mortgage sellers and servicers to participate in the book-entry system and comply with clearinghouse rules. Investors can easily change mortgage eligibility requirements to condition loan purchases on registration of loans in the clearinghouse and recordation of the mortgage in the public land records in the name of the clearinghouse. Clearinghouse rules would be modeled after Article 8 of the Uniform Commercial Code, which addresses book-entry securities.

    Enforcing this contractual requirement will not harm borrowers. Although the public land records under New Age Delivery would not disclose the current mortgage servicer or owner of the mortgage, with the growth of the secondary market, the public land records under our existing system rarely disclose the borrower’s current servicer. In states where mortgage assignments don’t need to be recorded, the public land records may disclose only the original mortgagee notwithstanding successive transfers of equitable ownership and transfers of servicing rights. Instead, updated information regarding servicing transfers is delivered to borrowers in the manner provided for under federal law.

    Although the impact of New Age Delivery on borrowers will be minimal, the book-entry concept will definitely change the way many sectors of the mortgage finance industry to business. During June, MBA hosted a series of focus groups to present the book-entry concept to the various sectors that will be affected: mortgage lenders, of course; warehouse lenders; closing agents; and document custodians. The purpose of these meetings was to identify the costs and benefits of the concept, needed concept enhancements, work flow changes, and the level of receptivity of each industry segment. Our findings will be incorporated in a white paper will present the issues involved for general comment. This white paper should be available sometime this coming autumn.

    MBA and the Inter-Agency Technology Task Force welcome your comments on New Age Delivery and the whole loan book-entry concept. In order to have a meaningful white paper that will identify important concerns and constraints, as well as benefits, MBA needs to hear from you. In order to develop the best system, all the relevant issues must be identified and adequately aired so that a broad consensus can be reached. Preliminary indications are that the mortgage assignment is a very endangered species.

    Citation Details

    Title: Mortgage assignments – headed for extinction?
    Author: Phyllis K. Slesinger
    Publication: Mortgage Banking (Magazine/Journal)
    Date: July 1, 1993
    Publisher: Mortgage Bankers Association of America
    Volume: v53 Issue: n10 Page: p81(2)

  105. mers claim that they bought my former home at the sheriff sale. I found out later it weren’t true and they then start to say that they were the nominee and assigned. I were evicted on by mers at Oakland County Circuit ct. 9/24/2008 by judge Kumar. Mers on 9/4/2008 quit claim deed the house to wells fargo. A company that never had any invovlement with my home quit. On 11/24/2008 Wells Fargo conveant deed the property to an couple whom are now living in the home 28425 brooks lane southfield, mi 48034.

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