MERS Touts Huge Wave of Favorable Rulings

The past few months have seen a wave of more than four dozen favorable rulings for Mortgage Electronic Registration Systems Inc. At least two rulings didn’t bode well for the electronic registry.

Plaintiffs who originally obtained a $107,000 loan through American Mortgage Network Inc. in March 2006 filed a lawsuit against MERS and Fannie Mae to quiet title in their favor and declare a foreclosure sale null and void. Setha and Yoy Sam allege that an assignment of the mortgage interest is invalid, the note is current or satisfied, and proper notice of foreclosure was never filed.

A Rhode Island superior court judge on Dec. 20 denied the defendants’ motion to dismiss the case, noting in his decision that the if the allegations in the complaint are proven to be true, then they state a claim for relief.

The U.S. Court of Appeals, Eighth Circuit, affirmed a lower court dismissal of several claims in a lawsuit filed by several plaintiffs who had loans serviced by Aurora Loan Services LLC.

However, the wholesale dismissal of a quite title claim was reversed by the Eighth Circuit because assignments from MERS to Aurora were either unrecorded or executed by individuals lacking the legal authority to do so.

A recent ruling by the U.S. District Court for the Western District of Washington announced by MERS found that MERS involvement in a trust deed executed by Kevin E. and Sheena Kullman did not prevent the note-holder from initiating the non-judicial foreclosure process or cause injury to the borrowers — an element that is needed for a Consumer Protection Act claim. A recent decision in the case Bain v. Metropolitan Mortgage Group was cited by the judge.

A similar conclusion was reached by the same judge in Judy Lynott’s lawsuit against MERS; U.S. Bank, N.A.; and JPMorgan Chase, N.A.

“Here, plaintiff’s claims arise from a fundamental misunderstanding of the law,” the judge wrote in the Lynott decision. “U.S. Bank is the beneficiary of the deed because it holds plaintiff’s note, not because MERS assigned it the deed.”

On Dec. 14, a decision from the Supreme Court of the State of Nevada affirmed the trial court decision in favor of MERS in the case Ashley v. MERS, et al. On the same day, the same three-justice panel ruled in favor of MERS in Sanchez v. OneWest Bank, FSB, et al.

In White v. Citibank, N.A., a Georgia Superior Court judge found the borrower’s claim that the loan documents were defective and the assignment of the security deed executed by MERS was faulty to be “meritless.”

MERS announced that rulings were issued in its favor during November in the following cases.

The following MERS cases saw favorable judgments issued in October and prior.