County's Claim Relied on Requirement That Doesn’t Exist Under Iowa Law

Jason Lobo
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Reston, Virginia, August 22, 2012— MERSCORP Holdings, Inc. today announced that U.S. District Judge Mark W. Bennett of the U.S. District Court for the Northern District of Iowa, Western Division, ruled yesterday in favor of Mortgage Electronic Registration Systems, Inc. (MERS) and other defendants, dismissing a recording fee suit filed by the Plymouth County, Iowa.

In pdf Plymouth County, Iowa v. MERSCORP (169 KB) , Judge Bennett dismissed a five-count, class action suit on behalf of Plymouth County and all other similarly situated counties in the State of Iowa. The suit – alleging civil conspiracy and unjust enrichment – sought relief under the provisions of Iowa’s Recording Statutes.

Judge Bennett held in his August 21, 2012, Order that “it could not be plainer that none of the statutes upon which the County relies imposes a requirement on a party assigning a mortgage or receiving such an assignment to record the assignment.” He found that that “each…claim depends upon an alleged requirement to record mortgage assignments and seeks as relief…or damages for failure to do so." "There is, however, no such requirement in Iowa law,” he wrote.

“We have consistently held that there is no basis for these suits, and the Iowa court has affirmed this by pointing clearly to the absence of any statutory requirement to record mortgage assignments,” said Janis Smith, MERSCORP’s Vice President for Corporate Communications. “Iowa is the third state to rule on a claim like this, and all have granted our motions to dismiss.”

Judge Bennett concluded that “What the County seeks, on its own behalf and of the putative Class of Iowa Counties, under the guise of construction of recording statutes, is an extension of those statutes that completely changes the meaning of the statutes, but the courts have no power to grant such an extension.”

“Use of the MERS® System to register mortgage loans fulfills the purpose of the recording statutes. MERS mortgages are recorded in the public land records and MERS members pay recording fees when the mortgage is recorded, ” Smith added. “The statutes’ intent is to assure that liens are discharged when an underlying loan is paid off to give subsequent purchasers and lenders notice of recorded liens and to allow creditors to give notice of their secured interest in the property. MERS’ business model is consistent with these purposes.”

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit


MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products. It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.