United States District Court, D. Arizona
A. TEILBORG SENIOR UNITED STATES DISTRICT JUDGE.
the Supreme Court’s decision in Americold Realty
Trust v. Conagra Foods, Inc, 136 S.Ct. 1021 (2016)
(holding that a trust takes on the citizenship of its
members), this Court called for supplemental briefing on
jurisdiction. (Doc. 2046). Both Trustees (U.S. Bank as
Trustee for Structured Asset Securities Corporation Series
2006-GEL3 and Bank of New York Mellon As Trustee for SAMI II
2006-AR3) and Plaintiffs appear to take the position that the
Trustees were not sued to “reach” the assets of
the trusts (unlike Navarro Savings Assn. v. Lee, 446
U.S. 458 (1980)), but instead argue the Trustees are
literally the Defendants, and that the status as Trustee is
irrelevant. (For example, Plaintiffs state “Plaintiffs
did not sue any trusts.” (Doc. 2048 at 1)). In other
words, both briefs imply that any judgment Plaintiffs might
obtain against U.S. Bank, as Trustee, or Bank of New York
Mellon, as Trustee, would be paid by U.S. Bank or Bank of New
York Mellon personally, and not out of the res of the
respective trusts. Further, they both imply that the banks
are paying their own legal fees; not that the either Trust is
paying the legal fees of its Trustee. If these
representations are true, the Court would agree that U.S.
Bank’s citizenship and Bank of New York Mellon’s
citizenship is the relevant citizenship for diversity
purposes and not the citizenship of the Trust (i.e. all the
members/certificate holders of the Trust).
Plaintiffs have made no claims of breach of fiduciary duty
against U.S. Bank or Bank of New York Mellon, which is the
typical claim made against a Trustee personally. Instead,
Plaintiffs must be alleging that they can make direct claims
against U.S. Bank or Bank of New York Mellon as the de facto
“manager” of Plaintiffs’ loans as a Trust
asset. Assuming this is true, the Court is unclear why U.S.
Bank was named “solely in its capacity as
Trustee”, because in reality, it is being named solely
in its capacity as a Bank. The same would be true for Bank of
New York Mellon.
the Court cannot do any fact investigation on its own, the
Court is left to accept the parties’ representations.
Based on these representations, the Court will accept that
the Trusts, and their respective assets, are not at issue in
this case. The Court will also accept these representations
to establish that the Banks, and not the Trusts or their
assets, are the real parties in interest.
Summary Judgment Standard
judgment is appropriate when a moving part shows that there
is no genuine dispute as to any material fact and that the
moving party is entitled to judgment as a matter of law. Fed.
R. Civ. Pro. 56. Initially, the movant bears the burden of
pointing out to the Court the basis for the motion and the
elements of the causes of action upon which the non-movant
will be unable to establish a genuine issue of material fact.
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
The burden then shifts to the non-movant to establish the
existence of material fact. Id. The non-movant
“must do more than simply show that there is some
metaphysical doubt as to the material facts” by
“com[ing] forward with ‘specific facts showing
that there is a genuine issue for
trial.’” Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (quoting
Fed. R. Civ. Pro. 56(e) (1963) (amended 2010)). A dispute
about a fact is “genuine” if the evidence is such
that a reasonable jury could return a verdict for the
nonmoving party. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 248 (1986). The non-movant’s bare
assertions, standing alone, are insufficient to create a
material issue of fact and defeat a motion for summary
judgment. Id. at 247-48.
Count I of the Amended Complaint
the Court of Appeals reversal (In re Mortgage Elec.
Registration Sys., Inc., 754 F.3d 772 (9th Cir.
2014) at Doc. 1820) of this Court’s dismissal of the
consolidated amended complaint in this case, there is one
Count remaining. The remaining Count is a cause of action
under A.R.S. § 33-420(A). Another Court in this district
has summarized this cause of action as follows:
…A.R.S. § 33-420(A)  penalizes persons claiming
an interest or lien in real property for knowingly recording
a document that is “forged, groundless, contains a
material misstatement or false claim or is otherwise
A. A person purporting to claim an interest in, or a lien or
encumbrance against, real property, who causes a document
asserting such claim to be recorded in the office of the
county recorder, knowing or having reason to know that
the document is forged, groundless, contains a material
misstatement or false claim or is otherwise invalid is
liable to the owner or beneficial title holder of the real
property for the sum of not less than five thousand dollars,
or for treble the actual damages caused by the recording,
whichever is greater, and reasonable attorney fees and costs
of the action.
(Emphasis added.) The broader statutory section, A.R.S.
§ 33-420, is entitled “False documents; liability;
special action; damages; violation; classification.”
David A. Kester v. CitiMortgage, CV 15-365, Doc. 37
(D. Ariz. March 31, 2016).
Robinsons’ and Silva’s Fact Specific
member case at issue in this Order (CV 10-630) involves two
properties previously owned by the Robinsons and Ms. Silvas
(see footnote 1). Beyond having both been named as
Plaintiffs in this suit, it does not appear that the
Robinsons and Ms. Silvas have any relation to each other, nor
do their respective properties. Thus, even this member case
is in actuality two completely separate cases.
their first supplement regarding jurisdiction (Doc. 2001-1),
Plaintiffs stated that there are six defendants in the
Robinson/Silvas member case: 1) U.S. Bank, National
Association, as Trustee for Structured Asset Securities
Corporation Series 2006-GEL3; 2) Wells Fargo Bank, N.A.; 3)
The Bank of New York Mellon, as Trustee for SAMI II 2006-AR3;
4) ReconTrust Company, N.A.; 5) MERSCORP Holdings, Inc.; and
6) Mortgage Electronic Registration Systems, Inc.
Holdings, Inc. and Mortgage Electronic Registration Systems,
Inc. (hereinafter “MERS”) moved for summary
judgment at Doc. 1979; Plaintiffs responded at Doc. 2011; and
MERS replied at Doc. 2040. This Motion seeks summary judgment
against both the Robinsons and Silvas.
Fargo Bank, N.A. and U.S. Bank, National Association, as
Trustee for Structured Asset Securities Corporation Series
2006-GEL3 moved for summary judgment at Doc. 1923, Plaintiffs
responded at Doc. 2009 and these Defendants replied at Doc.
2037. This Motion seeks summary judgment against the
America, The Bank of New York Mellon, as Trustee for SAMI II
2006-AR3, and ReconTrust Company, N.A. moved for summary
judgment at Doc. 1921, Plaintiff responded at Doc. 2021, and
Defendants replied at Doc. 2035. This Motion seeks summary
judgment against Silvas. With regard to this motion, based on
Plaintiffs’ jurisdictional statement (which does not
list Bank of America), the Court is unclear whether Bank of
America is actually a Defendant to the Silvas’
complaint. However, Plaintiff’s response to this motion
for summary judgment includes Bank of America as if it is a
Consolidated Amended Complaint (Doc. 1424 at 17) Plaintiffs
also made a claim on behalf of the Robinsons against
America’s Servicing Company. However, Plaintiffs’
statement of jurisdiction (Doc. 2001-1) does not mention
America’s Serving Company as a Defendant in this case.
America’s Serving Company currently has no motion for
summary judgment pending. Nonetheless, the Robinson
Plaintiffs repeat their allegation against America’s
Serving Company in their response (Doc. 2009 at 4) to Wells
Fargo’s and U.S Bank as Trustee’s motion for
summary judgment. Further, at footnote 5 of Doc. 2009,
Plaintiffs state without citation that America’s
Servicing Company is a dba of Wells Fargo. Thus, perhaps this
is not a separate Defendant even though the consolidated
amended complaint makes specific allegations against it.
Scope of the Mandate (Forgery)
Plaintiffs’ claims, this Court previously recounted,
[Plaintiffs’] amended complaint was dismissed on
October 3, 2011. (Doc. 1602). Plaintiffs appealed dismissal
of Counts I-VI to the Ninth Circuit Court of Appeals. The
Court of Appeals reversed the dismissal of Count I and
affirmed the dismissal of Counts II-VI. In re Mortgage
Elec. Registration Sys., Inc., 754 F.3d 772, 786 (9th
Cir. 2014). Specifically, the Court of Appeals held that: (1)
A.R.S. § 33-420 applies to Notices of Trustee Sale,
Notices of Substitution of Trustee, and Assignments of a Deed
of Trust, documents which Plaintiffs alleged to be fraudulent
in the CAC; (2) Plaintiffs’ claims are not timebarred;
(3) Plaintiffs have standing to sue under A.R.S. §
33-420; and (4) Plaintiffs pleaded their robosigning claims
with sufficient particularity to satisfy Federal Rule of
Civil Procedure 8(a). In re Mortgage Elec. Registration
Sys., Inc., 754 F.3d at 781-784.
Doc. 2005 at 2.
specifically, the Court of Appeals held that Plaintiffs had
stated a claim that “the documents at issue are invalid
because they are ‘robosigned (forged).’”
In re Mortgage Elec. Registration Sys., Inc., 754
F.3d at 783. As this Court discussed at length in the
order denying class certification (Doc. 2005), this claim is
the only claim of the 18-page Count One that was remanded to
this Court. Indeed, the Court of Appeals confirmed that all
other theories potentially embedded in Count One were waived
by Plaintiffs because Plaintiffs did not raise them on direct
appeal. (Doc. 2047) Thus, Plaintiffs must survive summary
judgment on this single claim.
indicated above, the statute at issue creates a cause of
action when someone files a document that is: 1) forged; 2)
groundless; 3) contains a material misstatement or false
claim; or 4) is otherwise invalid. A.R.S. § 33-420(A).
However, the Court of Appeals’ mandate could be
construed as permitting Plaintiffs to prove only
“forgery” as the means by which this statute was
violated. (Doc. 1820). Indeed in a subsequent decision, the
Court of Appeals stated
“This court’s reversal of Count I was limited to
petitioners’ claims of robosigning and
forgery. To the extent petitioners now seek to challenge the
MDL Court’s dismissal of Count I as to allegations
beyond robosigning and forgery, that challenge is
waived because it was not raised in the appeal in MERS
(Doc. 2047 at 2) (emphasis added).
the Court will analyze “forgery” specifically
because it is possibly the only claim remaining before this
Court. The Court will then attempt to determine whether
Plaintiffs are claiming A.R.S. § 33-420 was violated by
Defendants in some other way.
MERS’ motion for summary judgment
MERS Motion as to the Robinsons - Forgery
has identified Jennifer Hamlin as the person who signed the
Robinsons’ assignment on behalf of MERS. With respect
to the allegations that Ms. Hamlin’s signature was
“forged”, Plaintiffs have failed to create a
disputed issue of fact. Specifically, each of the
Robinsons’ testified that they had no evidence that Ms.
Hamlin’s signature was forged. (Doc. 1979 at 11). Ms.
Hamlin testified that the signature was in fact hers.
(Id.) Finally, Plaintiffs’ own handwriting
expert testified that Ms. Hamlin’s signature on the
document was consistent with other examples of her signature.
(Id.; Doc. 1980-1 at 116). On this record, Plaintiffs
have no evidence of forgery and MERS is entitled to summary
MERS Motion as to Silvas - Forgery
has identified Christina Balandran as the relevant signer of
the Silvas’ assignment on behalf of MERS. (Doc. 1979 at
11). Ms. Silvas testified that she had no evidence that Ms.
Balandran did not actually sign the documents. (Id.)
Plaintiff’s expert did not examine Ms.
Balandran’s signature, and had no opinion on the
authenticity of her signature. (Id.). On this
record, Plaintiff has offered no evidence that Ms.
Balandran’s signature is a forgery. See
Celotex, 477 U.S. at 325 (moving party may discharge its
burden on summary judgment by showing there is an absence of
evidence to support the nonmoving party’s case).
Accordingly, MERS is entitled to summary judgment.
Plaintiffs’ allegations against MERS
Court having concluded there is no disputed issue of fact on
the only issue the Court of Appeals reversed, namely forgery,
the Court could enter judgment in favor of MERS. However, the
Court will address “robosigning” because it was
specifically mentioned by the Court of Appeals and arguably
within the scope of the mandate.
Plaintiffs response to MERS’ motion for summary
judgment, it would appear Plaintiffs believe
“robosigning” is, by and of itself, a way to
violate A.R.S. § 33-420. It is not. The statute lists
four distinct and specific ways it can be violated, and
Plaintiffs’ “robosigning” allegation must
fall within one of these four categories to even state a
define robosigning as, “the actual process where people
either forge signatures on high volumes of foreclosure
documents, or the actual person signing lacks knowledge of
the facts being attested to, and/or the documents are
pre-notarized (notarized in blank) or post-notarized (the
notary didn’t actually witness the signature).”
Doc. 2011 at 7-8. Only one of these means of robosigning,
namely forgery, overlaps with the ways to violate A.R.S.