July 8, 2011

Today, a state court Judge in Tennessee declined to rule on a Motion to Dismiss and Motion to Stay Discovery filed by Bank of New York as trustee of a securitized mortgage loan trust, which Motions were filed against the borrowers’ Amended Complaint for Declaratory and Permanent Injunctive relief. The sale had been cancelled with the original pro se Complaint was filed. FDN attorneys Jeff Barnes, Esq. and Andrew Farmer, Esq., who filed the Amended Complaint, represent the borrowers. Mr Barnes argued the Motions in open court in Tennessee today.

The Judge has sent the case to a Special Master to oversee and coordinate discovery, including depositions and written discovery, after Mr. Barnes raised the threshold issues related to standing, real party in interest, chain of title to the mortgage loan, MERS, and issues surrounding securitization including compliance with the PSA. It is believed that this is the first case in the State of Tennessee to raise these issues, and there is no decisional law from the appellate courts in Tennessee as to any of the issues raised, including any case law as to MERS.

This represents progress for borrowers in Tennessee, and demonstrates that at least one court is not going to dismiss a borrower’s challenge to a foreclosure simply on Motion to Dismiss of the Defendant foreclosing party and its agents (here, MERS and ReconTrust as the trustee sale company).

Jeff Barnes, Esq.,