May 19, 2014

A preliminary injunction has been entered precluding Bank of New York Mellon (BNYM), as trustee of a securitization trust, from attempting to continue with post-foreclosure proceedings in a situation where the MERS Assignment attempted to transfer the interests in the DOT to BNYM over a year after the original lender went out of business. The homeowner is represented by Jeff Barnes, Esq. and local Tennessee counsel John F. Higgins. Esq. Mr. Barnes drafted the Complaint, Affidavit, and Motion for a TRO and Preliminary Injunction, while Mr. Higgins argued the matters in court.

BNYM claimed to have acquired the right to enforce the DOT by virtue of two (2) MERS Assignments, the first of which attempted to assign the DOT 14 months after the original lender ceased business operations. MERS then, two years and 7 months thereafter, attempted for a second time to assign the DOT to BNYM. MERS listed the maximum principal indebtedness, for purposes of the Tennessee Recordation Act on this Assignment, as zero, thus arguably admitting that the loan had been paid off prior to the Assignment.

MERS also “substituted” the original trustee, and in the Appointment of Substitute Trustee claimed that the homeowner had executed the DOT “payable to the order of MERS”, which is a complete falsehood as MERS never, ever, lends money; does not extend credit; is never owed any money; and does not collect any money on mortgage loans as admitted by its own counsel in numerous reported decisions nationally.

The homeowner filed a Complaint for Wrongful Foreclosure, Injunctive Relief, and other relief. The Court originally granted a TRO against any further disposition of the property and today granted a preliminary injunction finding that (a) BNYM faled to respond to the allegation of the TRO Motion and (b) the MERS Assignments were attempts to transfer an interest years after MERS would have been permitted to do so.

This decision is important as it is based, in part, on the fact that the MERS Assignments were executed years after the original lender, for whom MERS claimed to be the “nominee”, was out of business. This decision thus shows that MERS has no authority to act as a “nominee” for a defunct entity.

Jeff Barnes, Esq.,


May 15, 2014

FDN Los Angeles, California-based attorney Douglas E. Klein, Esq. has obtained what can only be described as a miracle ruling from the California 4th Appellate District in the matter of Bert G. Cotton v. MERS, Number E054291 (Opinion filed April 10, 2014). Mr. Klein represents the homeowner, whose complaint seeking to invalidate a nonjudicial foreclosure (which had been filed by a prior attorney) was dismissed without leave to amend. Mr. Klein took the case over for the appeal, as the homeowner’s prior counsel had withdrawn from the case.

The case involves numerous entities, including MERS, WaMu, and JPMorgan Chase (JPM), which claimed that it had acquired “certain assets” of WaMu and now held the “servicing rights” to the loan. MERS substituted the original trustee in 2008 and assigned the Deed of Trust (DOT) to JPM in 2009. Significantly, the homeowner was only asked at the closing to sign the DOT; he was never asked to sign, and thus did not sign, a Note.

The Defendants filed demurrers (the California form of a Motion to Dismiss) the claims for wrongful foreclosure, declaratory relief, violations of California Civil Code sec. 2923.5 and 2924, conversion, and unfair competition under California Business and Professions Code sec. 17200. The trial court sustained the demurrer without leave (permission) for the homeowner to amend his complaint, and entered a judgment of dismissal.

The appeals court reversed the trial court decision, holding that it is error for a trial court to sustain a demurrer without leave to amend if the party seeking to amend demonstrates a reasonable probability that the defect alleged in the demurrer can be cured by amending the complaint; that such a showing can be made for the first time on appeal; and that it is not relevant whether the party seeking to amend will be able to prove the allegations, citing prior published decisions of the appeals court.

The homeowner, through Mr. Klein, requested that the appeals court take judicial notice of the Glaski decision, which it did, holding that judicial notice of California decisional law is mandatory.

The holding states that the issue that the homeowner seeks to raise is not whether the holder of the DOT authorized MERS and the trustee sale company (California Reconveyance Corporation) to foreclose, but rather whether any of the Defendants had any interest in the DOT to begin with. The Court noted that the Gomes decision does not preclude claims that challenge a foreclosure based on specific allegations that an attempt to transfer the DOT was void.

The Court ultimately concluded that the homeowner established a reasonable probability that he can amend his complaint to allege claims for wrongful foreclosure, unfair competition, and violations of statutes based on fraudulent practices in the foreclosure.

Bravo to Mr. Klein for obtaining this more than significant ruling in what appears to be a case of first impression (that is, there are no other appellate opinions on the specific issues in this appeal and this decision is thus the first on those issues).

At this time, the ruling has been stamped that it is not to be published in the official reports. However, the reported cases which support the decision have no such caveat, and Mr. Klein is making a request to the appeals court that the decision be published. As those who follow this website will recall, a similar situation occurred with the Glaski opinion when it was first released. After it was certified for publication on request of Glaski’s counsel, the banks fought hard to seek to “de-publish” it, which requests were, as we all know, denied by the appeals court. This decision is equally important and should be published especially as it relies in part on Glaski and other published decisions.

Jeff Barnes, Esq.,


May 13, 2014

A Palm Beach County, Florida Circuit Judge has denied a Motion for Summary Judgment filed by New York Community Bank (NYCB). Jeff Barnes, Esq. represents the homeowner. Mr. Barnes filed the Brief in opposition to the MSJ and argued the matter in the Palm Beach County court.

NYCB was not the original lender. There is no endorsement of any kind on the Note. NYCB filed two “Allonges”, the first of which identified another bank which was not identified in the Complaint, the MSJ, or the Plaintiff’s Affidavit. Multiple stamps of different banks appeared on this Allonge.

The second Allonge was signed twice by one Christine Ackley, who simultaneously claimed to be the “attorney in fact” for the FDIC as assignor as well as the “authorized agent” for NYCB as assignee. No corporate resolution, conflict of interest waiver, or any other document was filed by NYCB authorizing Ms. Ackley to wear both hats on the same day in the same document for 2 different entities where she herself purported to represent both the transferor and the transferee.

The Affidavit filed by NYCB had no facts on personal knowledge as to how NYCB came to own or hold the Note as required by Florida case law.

Jeff Barnes, Esq.,


May 8, 2014

A Philadelphia, Pennsylvania Court of Common Pleas Judge has denied a Motion for Summary Judgment filed by Bank of America/BAC Home Loans Servicing, L.P. The loan was originated by America’s Wholesale Lender (AWL, a warehouse arm of the former Countrywide) and was allegedly transferred to BAC Home Loans Servicing, L.P which later “merged into” BOA.

The homeowner is represented by Jeff Barnes, Esq. and local Pennsylvania counsel Lawrence Granite, Esq. Mr. Barnes drafted all of the Briefs and argued the matter in person in the Philadelphia court. It is known that oral argument on summary judgment Motions is almost nonexistent in Philadelphia foreclosure cases. The Court itself ordered oral argument after the Briefs were filed.

BOA took the typical position of “we have the Note, endorsed in blank”, etc. The claimed “endorsement” bore the name/stamp of Michelle Sjolander, who has testified under oath in a deposition in another case that she never signs endorsements and never places them on promissory notes. The “endorsement” was also undated and had no other authenticating information.

The only date of any claimed transfer of the Note and Mortgage was the April 14, 2011 MERS Assignment. However, the Plaintiff’s designated representative, who was deposed by Mr. Barnes, testified that he did not even know if AWL was even in existence as of the date of the MERS Assignment. Further, none of the MERS cases cited by BOA dealt with the precise issue. The homeowner’s briefs set forth the national state of the law as to MERS, and also pointed out that BOA failed to negate the homeowner’s affirmative defenses, which alone preclude summary judgment.

The case now proceeds to full trial in June.

Jeff Barnes, Esq.,


May 5, 2014

The Dorchester County, South Carolina Court of Common Pleas entered an Order on the homeowner’s Motion for Summary Judgment in a judicial foreclosure case which, although denying the Motion, identified issues relating to the claimed transfer of the loan to a securitization where US Bank is the claimed “trustee”. ┬áThe homeowner is represented by Jeff Barnes, Esq. and local South Carolina Bill Sloan, Esq. Mr. Barnes took the deposition of the Plaintiff’s representative, wrote the brief, and argued the matter before the Court.

The homeowner alleged that the MERS assignment, executed by known robo-signer Jeffrey Stephan some 16 months after the original lender filed Bankruptcy, transferred nothing, and thus all subsequent transfers (including one to GMAC, which also filed Bankruptcy) were legal nullities. The Court found, in its written opinion, that there are genuine issues of material fact regarding ownership of the Note and mortgage and as to the subsequent transfers. The Court also noted that US Bank failed to provide its “additional evidence” to the homeowner prior to the hearing and reminded US Bank that is has a continuing duty to comply with the homeowner’s discovery requests under South Carolina law.

Separately, the United States Court of Appeals for the 9th Circuit reversed the U.S. District Court’s ruling which had granted summary judgment to Deutsche Bank and Ocwen Loan Servicing on the homeowner’s LIBOR-based claims, which included a claim that the homeowner would not have entered into the loan transaction had she known that the Defendants were manipulating the LIBOR rate. The Court found that the homeowner adequately alleged injury-in-fact necessary for Article III standing (to sue in Federal court).

The Court clarified that the injury occurred when the loan was made, not upon payment of LIBOR-affected interest. The Court thus remanded the case for further proceedings on the homeowner’s claims under the Sherman Anti-Trust Act and her state law claims for fraud and breach of the covenant of good faith and fair dealing. This is significant, as the opinion essentially lends support to a claim arising out of an intentional non-disclosure relating to what the monthly payment would really be, which a homeowner needs in order to make an informed decision as to whether to enter into the loan transaction or not before any loan documents are signed.

The case is Galope v. Deutsche Bank National Trust Company as Trustee Under the Pooling and Servicing Agreement, etc., 9th Circuit Case No. 12-56892 (opinion of March 27, 2014). The homeowner is represented by Lenore L. Albert, Esq. of Huntington Beach, California.

One word of caution: the case is stamped “Not for Publication”, so it can only be used if permitted by law in the particular jurisdiction where it is sought to be used. It is, however, a large step in the right direction.

Jeff Barnes, Esq.,