New Jersey Superior Court Dismisses MERSCORP from Third Party Claims

Court Finds Company was not a Proper Defendant to Borrowers’ Action


CONTACT: Janis Smith
Phone: 703-738-0230
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Reston, Virginia, June 15, 2017—MERSCORP Holdings, Inc. (MERSCORP) announced today that third party claims against MERSCORP were dismissed by the Superior Court of New Jersey, Chancery Division, Warren County, in   pdf Bank of America, N.A. v. Lau. (228 KB)  The dismissal was based on the Court’s finding that MERSCORP, as the parent of Mortgage Electronic Registration Systems, Inc. (MERS), was not a proper defendant and that a “… parent-subsidiary relationship, generally is, by itself, insufficient to impute liability to the parent for alleged actions of its subsidiary.”

The defendants in this judicial foreclosure case, Joseph and Raquel Lau, filed a Counterclaim/Third Party complaint against numerous parties including MERSCORP and MERS asserting causes of action for failure to comply with the New Jersey Fair Foreclosure act, among other claims, and sought quiet title. MERS had served as the mortgagee of the Lau’s mortgage until assigning the mortgage lien to Bank of America in 2012.

“This Court finds Defendants’ allegations regarding actions taken by MERS are insufficient to establish liability as to MERSCORP,” said Judge Yolanda Ciccone, writing for the Superior Court, adding, “Moreover, this Court highlights that MERSCORP never had any rights in the mortgage, never assigned the mortgage, never received an assignment of the mortgage, … nor did MERSCORP in any way participate in the foreclosure.”

Claims against MERS and other defendants were also dismissed for “failure to state a claim upon which relief may be granted,” as the borrowers’ claims had already been dismissed in prior lawsuits.

“We are very pleased that the Court recognizes that MERSCORP is a separate entity from MERS with no interest in or ties to the mortgage or to the loan so that the third-party plaintiffs presented no basis for any recovery against MERSCORP,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.

For more information on MERSCORP Holdings and the MERS® System and our 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. Users of the MERS® System include 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.