United States District for the District of Minnesota Dismisses Multiple Challenges to MERS

Court Issues Three Favorable Rulings Citing No Break in Chain of Title


CONTACT: Janis Smith
Phone: 703-738-0230
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Reston, Virginia, August 27, 2014—MERSCORP Holdings, Inc. today announced that the United States District Court for the District of Minnesota issued rulings in three cases that are favorable to Mortgage Electronic Registration Systems, Inc. (MERS). The court held that the foreclosing entities who were the named defendants in the cases established unbroken chains of title under Minnesota law by producing mortgages in which MERS was named the original mortgagee and subsequent assignments by MERS to the foreclosing entities. The plaintiffs lacked standing to challenge the assignments by MERS and, based upon the unbroken chains of title, the foreclosures were proper.

Each of the cases, pdf Smith v. Bank of America, N.A.  [Civil No. No. 13-2769(STN/JSM], pdf Her v. Wells Fargo Bank, N.A.  [Civil No. 13-2688 (DWF/JSM], and  pdf Jaakola v. The Bank of N.Y. Mellon (150 KB)  [Civil No. 13-2919(DSD/JSM], included a request for an order quieting title in the names of the plaintiffs.

In her Report and Recommendations, Magistrate Judge Janie Mayeron determined that the quiet title counts failed for several reasons. The record in each case showed “an unbroken chain of title through a recorded assignment of mortgage from MERS to [the foreclosing party].” Jaakola [Civil No. 13-2919(DSD/JSM]. Magistrate Mayeron held that because the chain of title was clear, there were no missing assignments, as the borrowers alleged, and the foreclosures were proper. Also, relying on precedent from this court and the Minnesota Court of Appeals, Magistrate Mayeron, referring to Pooling and Service Agreements (PSA), held that “documents governing mortgage-backed trusts often do not require a chain of written mortgage assignments when, as here, MERS is named the nominee of the lender and is listed as the Mortgagee.” Jaakola [Civil No. 13-2919(DSD/JSM)].

Magistrate Mayeron also held that the plaintiffs lacked standing to pursue their quiet titles claim because they suffered no injury as a result of the assignments by MERS or the application of trust terms to their mortgages.

The U.S. District Court for the District of Minnesota adopted Magistrate Mayeron’s Report and Recommendation in the Smith case on July 7, 2014 (J. Susan Richard Nelson), in the Her case on July 21, 2014 (J. Donovan W. Frank), and in the Jaakola case on August 15, 2014 (J. David S. Doty).

“These favorable rulings continue to support the acceptance under Minnesota law that an assignment by MERS is effective in Minnesota and that there is no break in title when MERS is named as original mortgagee and later assigns its interest,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.

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.