A landmark decision was made this week in Culhane v. Aurora in the United States Court of Appeals For the First Circuit without a complete set of facts set out before what appears to be its clueless judges.
The case decision, an APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS was to some degree based on the merits of standing answering the question: “Whether a mortgagor has standing to challenge the assignment of her mortgage — an assignment to which she is not a party and of which she is not a third-party beneficiary — is a matter of first impression for this court.”
While the Court held: “We conclude that a nonparty mortgagor, like the plaintiff, has standing to raise certain challenges to the assignment of her mortgage,” it then turned to the “Validity of the Assignment” and did so under the false impression that the entity they assumed to be the major player – was indeed just a straw man; an asset-less shell without employees and certainly no members.
“The plaintiff’s claim hinges on the asseveration that MERS did not legitimately hold the mortgage at the time of assignment and, therefore, had nothing to assign to Aurora. [. . .] Here, moreover, MERS had the authority twice over to assign the mortgage to Aurora.” ?? Um, maybe NOT…..
Chief Judge Sandra Lynch, Judge Souter and Judge Selya apparently didn’t have all the facts in front of them in this case. But by now, if they are reading any of the foreclosure blogs, they’d certainly find the MERS issues suspect – to say the least. And wouldn’t ya think by the time the parties got up to the United States Court of Appeals, the clerks would have pulled every record and file on Mortgage Electronic Registration Systems, Inc. (all 3 of them) that they could find that pertained to its authentic existence before allowing their bosses to render a decision?
Granted the securitization Ponzi scheme is intentionally convoluted, fraught with fraud and the road is paved with corruption, but the decision the 3 judges of the United States Court of Appeals For the First Circuit rendered may be in error because, honey – “the old gray mare, she ain’t what she used to be, ain’t what she used to be, ain’t what she used to be. The old gray mare, she ain’t what she used to be, many long years ago.” No, MERS ain’t what she used to be…
It’s hard to tell if this information might have made a difference – but there were 3 Mortgage Electronic Registration Systems, Inc. formed over the years. The trademark “MERS” was absorbed by MERSCORP, Inc. in the name change of MERS (II) in 1999.
These documents are posted on the blog sites: www.deadlyclear.com and www.doctelportal.com (in its Library). There were 3 separate and distinct MERS entities. These are individual corporations. MERS 1 and 2 are gone – eaten up by MERSCORP, INC. The MERS 3 corporation in the mortgages in merely an acronym, straw man, no assets, no employees no members – just a shell and the courts have never been challenged with determining the difference. It appears that the court in Landmark might have understood this – but not many attorneys have taken the time to research the MERS vs. MERS®.
LANDMARK v. KESLER: The relationship that MERS has to Sovereign is more akin to that of a straw man than to a party possessing all the rights given a buyer…[. . .] What meaning is this court to attach to MERS’s designation as nominee for Millennia? The parties appear to have defined the word in much the same way that the blind men of Indian legend described an elephant–their description depended on which part they were touching at any given time.
In a Hawaii case, during limited discovery American Savings Bank (ASB) admitted that they were members of MERSCORP, Inc – NOT Mortgage Electronic Registration Systems, Inc. and discovery like this could be a game changer.
Court decisions are only as good as the material set forth before the judge. If the court hasn’t been asked to clarify the difference or determine the definition – it will likely avoid the conflict. Unfortunately, every rock has to be uncovered and every skirt lifted to find out how these guys rigged the system …and, as we all know too well, discovery is very hard to get to – that needs to change in order to obtain justice.
If the fact that MERS is not the membership party; and, MERSCORP, INC. is the actual entity and who did not contract with the homeowners – then let’s look at these issues within the Justices’ Decision after they have defined MERS as Mortgage Electronic Registration Systems, Inc.:
“Various entities involved in the residential mortgage lending business can become “members” of MERS. As such, they pay an annual fee and agree to the rules of membership. Lender members may name MERS as mortgagee in mortgages that they originate, service, or own.”
Nope – NOT true. The membership is not with “MERS the acronym” of Mortgage Electronic Registration Systems, Inc. The membership is with MERSCORP, INC., a separate corporation as of 1999, who did not contract with the borrower. MERS in the mortgages as of 1999 is merely a trade name, strawman – shell entity.
“Various entities involved in the residential mortgage lending business can become “members” of MERS. As such, they pay an annual fee and agree to the rules of membership. Lender members may name MERS as mortgagee in mortgages that they originate, service, or own. [. . .] There is one condition: the party for whom MERS serves as nominee must be a member of MERS. The upshot of this arrangement is that MERS holds the legal title to the mortgage as mortgagee of record, but it does not have any beneficial interest in the loan.”
Nope – NOT true. Again, the membership is with MERSCORP, INC. – not Mortgage Electronic Registration Systems, Inc. The members would use and belong to the MERSCORP, INC. system – MERS®, not the acronym.
Nope – NOT true. There is a distinct difference between the the MERSCORP, INC’s MERS® system and MERS the acronym. MERSCORP, Inc. absorbed the 2nd (of 3 companies named the same); and it was the 2nd Mortgage Electronic Registration Systems, Inc. that owned the trademark which was then applied to the system within MERSCORP, INC. – NOT Mortgage Electronic Registration Systems, Inc. in the mortgages. MERS® makes the assignments and tracks the loan – not the acronym strawman MERS.
“To expedite the execution of assignments, MERS designates “certifying officers.” These “certifying officers” are typically employees of member firms. MERS authorizes these persons, through formal corporate resolutions, to execute assignments on its behalf.”
MERS does not designate certifying officers; MERS® the system owned by MERSCORP, INC. does the certification within its membership guidelines.
“After making the loan, Preferred (a MERS member)…”
Nope – NOT true. Preferred is an member of the MERSCORP, INC. system MERS® – NOT MERS the acronym. Mortgage Electronic Registration Systems, Inc. has no members.
“In an assignment dated April 7, 2009, MERS transferred the mortgage to Aurora.”
The question here is can a straw man, trade name entity contract? It owns nothing, has no employees. It does not keep the records. It does not own the system – it does virtually nothing but appear in the mortgages as a fake nominee.
“We reject this thesis: there is no reason to doubt the legitimacy of the common arrangement whereby MERS holds bare legal title as mortgagee of record and the noteholder alone enjoys the beneficial interest in the loan. ‘
The question here is can a straw man, trade name entity, with no assets , no employees hold bare legal title?
“Thus, MERS’s role as mortgagee of 7 record and custodian of the bare legal interest as nominee for the member-noteholder, and the member-noteholder’s role as owner of the beneficial interest in the loan, fit comfortably with each other and fit comfortably within the structure of Massachusetts mortgage law.”
Nope – NOT true. MERS held nothing because MERS, the acronym was a shell. The MERS® system held and tracked the notes and it was under MERSCORP, Inc. by 1999.
Nope – NOT true. By 2006 when this loan was originally written – the MERS® system had long been absorbed into MERSCORP, INC. In fact it was actually a name change of the Mortgage Electronic Registration Systems, Inc. (II) to MERSCORP, INC. and the newly formed MERS (III) occurred shortly after the name change. So, why didn’t they change the name in the mortgages? Probably because confusion is the better part of valor…?
“While MERS’s practice of appointing employees of member firms as certifying officers can be disparaged on policy grounds, such policy judgments are for the legislature, not the courts.”
Nope – NOT true. It was not MERS’ practice – it was MERSCORP, INC. a separate entity that certified the officers.
“This is all basic, bedrock, foundational law, MERS cannot sign documents as there is no MERS, anything they signed and filed is without foundation and is manufactured to wreak a deception upon the Court to gain advantage to which the entity is not entitled to, and under the equitable principles of Keystone Driller, 290 US 240, at 245, the doors to the court house are to be shut in limine, their cause cannot be heard, and they shall gain nothing.” (Thanks again, Jan)
Courts have distinguished the roles of trade names, for example AMERICA WHOLESALE LENDER v. PAGANO stating,“We conclude that, because a trade name is not an entity with legal capacity to sue, the corporation has no standing to litigate the merits of the case.”
AMERICA WHOLESALE LENDER v. SILBERSTEIN also found;
“An assignee, however, may not commence an action solely in a trade name either, regardless of the entity to which the trade name applies, because a trade name is not an entity with the legal capacity to sue. Nor could Countrywide cure the jurisdictional defect by substituting a party with the legal capacity to sue on behalf of the trade name. The named plaintiff in the original complaint never existed. As a result, there was no legally recognized entity for which there could be a substitute.” [. . .]
[. . .] Furthermore, because America’s had no standing to bring an action, no action in this case ever was commenced, as it was void ab initio. In the absence of standing on the part of the plaintiff, the court has no jurisdiction.
No, MERS ain’t what she used to be…
Now, the final thoughts deal with how would these mortgage-backed securities decisions affect the Wall Street investments of the judges that over see them. Chief Justice Lynch probably should have considered recusing herself – her financial disclosure statement portfolios have been loaded with bank and Wall Street stocks and mutual funds. The same could be said for Judge Selya whose financial disclosure statements indicate he too is heavily invested in Wall Street.
Decisions that go badly for MERS takes the helium out of the balloon – just like it would deflate the portfolios belonging to the judiciary.
Whether or not you are represented by an attorney understanding the legal system is an asset. The more you learn, the less likely you are to be taken advantage of or scammed. Knowledge is power!