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Nevada Real Estate Agent Bates Losing Streak Grows to Six Losses

FOR IMMEDIATE RELEASE
Jason Lobo
Phone: 703.652.1660
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Reston, Virginia, September 19, 2012—MERSCORP Holdings, Inc. today announced that a three-judge panel of the United States Court of Appeals for the Ninth Circuit recently affirmed dismissals of two False Claims Act (FCA) suits against Mortgage Electronic Registration Systems, Inc. (MERS) and other defendants in Nevada and California. Nevada resident and real estate agent Barrett R. Bates appealed both U.S District Court losses.

In pdf State of Nevada, ex rel. Barrett Bates et al. v. MERS et al. (222 KB) , U.S. District Judge Robert C. Jones dismissed Bates’ suit filed under the Nevada False Claims Act, which alleged that the defendants made false representations in naming MERS as a beneficiary in recorded mortgage documents to avoid paying recording fees. Here, the Appellate Court Panel agreed with the dismissal and held that because “Defendants had no ‘obligation' to record assignments or other documents relating to securing property, Bates failed to state a claim of liability” under Nevada law.

The same Appellate Court Panel also affirmed a lower court ruling against Bates in pdf Barrett Bates, State of California ex rel. v. MERS et al. (226 KB) , in a FCA suit. During the district court proceedings, Bates claimed that during the course of his work as a realtor in 2009 he discovered that the defendants were making false statements, again to avoid recording fees. He reasoned that because of this discovery, he could file suit under the California False Claims Act (CFCA).

“In ruling on the motions to dismiss, the district court reasoned that because Bates’s allegations ‘are substantially similar to information already in the public domain,’ his action is barred by the CFCA,” the Panel ruled. “Because Bates has failed to demonstrate that the district court erred in dismissing his claims as jurisdictionally barred, we affirm the district court’s decision.”

The Ninth Circuit Court of Appeals covers appeals from Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington. Circuit Judges Mary M. Schroeder and Consuelo M. Callahan and District Judge Edward R. Korman joined in the opinion.

“We are pleased to have these meritless cases resolved and behind us,” MERSCORP Holdings Vice President of Corporate Communications, Janis L. Smith, said. “The reality is recording mortgages that name MERS as the mortgagee is consistent with the intent of state recording statutes. And, all MERS mortgages are recorded in the public land records and the associated recording fees are paid.”

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

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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.

Court Says Counties are Not Deprived of Recording Fees

FOR IMMEDIATE RELEASE
Jason Lobo
Phone: 703.652.1660
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Virginia, September 18, 2012— MERSCORP Holdings, Inc. today announced that U.S. District Judge Susan O. Hickey of the U.S. District Court for the Western District of Arkansas, Hot Springs Division, yesterday dismissed a recording fee suit filed by the Circuit Clerk of Hot Spring County, Arkansas, ruling in favor of Mortgage Electronic Registration Systems, Inc. (MERS) and other defendants.

In pdf Brown v. MERS (310 KB) , Judge Hickey dismissed the class action suit filed on behalf of Hot Spring County and all of the circuit clerks in Arkansas. The plaintiff alleged that the defendants used MERS to deprive Arkansas counties of recording fees and claimed the defendants had a duty to record every mortgage transfer.

Citing long-standing Arkansas law, Judge Hickey held that “Arkansas’s statutes ‘do not require assignments to be recorded.’ In fact, existing law is to the contrary.” She further described the original intent behind mortgage land recording: “The purpose of recording is simply to give constructive notice to subsequent purchasers.”

Judge Hickey additionally dismissed the notion that counties are deprived of recording fees. “Because they had no duty to record their mortgages, Defendants have not deprived Plaintiff of her proposed class of anything to which they are entitled,” she ruled.

Other courts have also dismissed county recorder fee suits in Iowa, Florida and Kentucky.

“As clearly described in this ruling, recording statutes are intended to give subsequent purchasers and lenders notice of recorded liens and to allow creditors to give notice of their secured interest in the property,” said Janis Smith, MERSCORP Holdings’ Vice President for Corporate Communications. “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.”

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

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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.

Relies on Recent Decision from the Idaho Supreme Court in Trotter v. Bank of New York Mellon

FOR IMMEDIATE RELEASE
Jason Lobo
Phone: 703.652.1660
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Virginia, September 17, 2012—MERSCORP Holdings, Inc. today announced that Judge Lynn G. Norton of the Elmore County District Court recently ruled in favor of Mortgage Electronic Registration Systems, Inc. (MERS) and Fannie Mae, while dismissing the borrowers’ third-party complaint against MERS related to a completed foreclosure sale involving a MERS deed of trust.

In pdf Fannie Mae v. Lopez (836 KB) , although they were months in arrears on their mortgage loan payments, the borrowers claimed that the foreclosure sale of their property was invalid under Idaho law because MERS was not the beneficiary under the Deed of Trust and therefore MERS could not validly assign it to EverHome Mortgage Company (EverHome), the foreclosing party. The borrowers claimed that without a valid assignment, EverHome lacked the authority to appoint the successor trustee who conducted the trustee sale, selling the property to Fannie Mae.

In granting summary judgment in favor of Fannie Mae, Judge Norton found no merit in any of the borrowers’ MERS related claims. Norton first cited the pdf Trotter v. Bank of New York (67 KB)  decision in which the Supreme Court upheld the non-judicial foreclosure involving a MERS deed of trust and subsequent assignment. Here in Lopez, she found that the “language from the Deed of Trust unambiguously intends that MERS act as an agent of the Lender, or its assigns, in administering the deed of trust, that it holds ‘legal title,’ and therefore has the authority to appoint successor trustees and to initiate foreclosure proceedings.” Judge Norton further ruled that the use of MERS is not contrary to the Idaho Trust Deeds Act because “the statute does not invalidate acts that are done through a nominee such as MERS.”

“Challenging MERS’ role as trust deed beneficiary or mortgagee in Idaho is an ineffective approach to foreclosure when a borrower defaults on their loan,” MERSCORP Holdings Vice President of Corporate Communications, Janis L. Smith, said. “To possibly avoid foreclosure, struggling borrowers affected by the economy or any other unfortunate situation are better served by working with their mortgage servicers and seeking appropriate financial counseling. Borrowers can look up their servicer and the owner of their promissory note on our website at www.mersinc.org.”

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

###

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.

Cites Recent Oregon Court of Appeals’ Niday v. GMAC Decision

FOR IMMEDIATE RELEASE
Jason Lobo
Phone: 703.652.1660
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Virginia, September 12, 2012— MERSCORP Holdings, Inc. today announced that Chief Judge Ann Aiken for the U.S. District Court for the District of Oregon recently dismissed a borrower’s lawsuit against MERS and other defendants, which sought relief that the Court held was not justified under Oregon law.

In pdf Oliver v. Delta Financial Liquidating Trust (58 KB) , the borrower, who was not in default and not facing foreclosure proceedings, sued the defendants seeking a judgment from the Court that the defendants possessed no security interest in his property and that the borrower was entitled to clear title to his property free of the MERS lien. In his complaint, the borrower alleged that none of the defendants possessed an interest in the borrower’s property because when the promissory note was sold by the original lender to the successor lender, none of the defendants recorded this transfer in the county land records.

Judge Aiken cited to the recent Oregon Court of Appeals decision in Niday v. GMAC Mortgage LLC and found that under Oregon law a transfer of the note automatically transfers possession of the security interest [the deed of trust] in the property to the subsequent note owner. Aiken dismissed all claims against the defendants, ruling that failure to record note transfers in the county land records “fails to articulate a legal basis to remove the DOT [Deed of Trust] from the Property or otherwise allege any wrongful conduct that is redressable by this Court.” Judge Aiken noted “plaintiff cannot sustain a claim for potentially wrongful non-judicial foreclosure based on MERS’ role as beneficiary.”

“The Chief Judge’s ruling is consistent with Niday because that decision did not invalidate deeds of trust that identify MERS as beneficiary,” said Janis Smith, MERSCORP’s Vice President for Corporate Communications. “This ruling also emphasizes that Niday concerns only the requirements for non-judicial foreclosures and certainly does not relieve borrowers of the obligation to repay their mortgage debt.”

In Oregon, the issues of MERS’ role as trust deed beneficiary and whether all note transfers must be recorded before a non-judicial foreclosure can be commenced are now before the Oregon Supreme Court in Brandrup v. Recontrust Company. A decision may be issued in the spring of 2013.

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

###

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.

  • About Us

    About Us

    Today’s financial services industry depends on technological innovations to provide its customers with access to information, increased efficiency and reduced processing costs. MERSCORP Holdings, Inc. owns and operates the MERS® System, a national electronic registry system that tracks the changes in servicing rights and beneficial ownership interests in mortgage loans that are registered on the System.

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  • MERS® eRegistry

    MERS® eRegistry

    The MERS® eRegistry is essential to the eMortgage world. It is the legal system of record for identifying the Controller (holder) and Location (custodian) for the authoritative copy of a registered eNote. Lenders today are closing eNotes and selling them into the secondary market. Both Freddie Mac and Fannie Mae require that Lenders register their eNotes on the MERS® eRegistry.

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  • Information for Homeowners

    Information for Homeowners

    Homeowners today want information about their mortgage loans. Some are facing financial hardship and are struggling with mortgage payments. Information and helpful resources are available. 

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  • Neighborhood Benefits

    Neighborhood Benefits

    Title agents, government agencies and others looking for information about mortgage loans registered on the MERS® System can use Servicer ID or MERS® Link. This public access is often used by local municipalities to identify the servicer responsible for maintaining vacant or abandoned property.

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  • Media Room

    Media Room

    The MERSCORP Holdings, Inc. Media Room provides press contact information and facts about the company and its subsidiary, Mortgage Electronic Registration Systems, Inc. (MERS). These materials are provided to help national, regional and local media better understand the companies' business model and role in the U.S. housing finance system.

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