Smith et al v. JPMorgan Chase Bank NA et al
ORDER denying 7 Ex Parte Motion for TRO and Permanent Injunction. Signed by Judge David G Campbell on 4/18/11. (cc: All Parties) (MAP)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA
Phillip A. Smith; and Amy R. Smith,
JPMorgan Chase Bank; Washington Mutual
Bank, FA; Green Tree Servicing, LLC,
Plaintiffs Phillip and Amy Smith own real property located in Flagstaff, Arizona.
They have filed an ex parte motion for a temporary restraining order (“TRO”) and a
permanent injunction, seeking to enjoin a foreclosure sale of the property scheduled for
April 19, 2011. Doc. 7. For reasons stated below, the motion will be denied.
To obtain preliminary injunctive relief such as a TRO, the plaintiffs must show
that they are likely to succeed on the merits, that they are likely to suffer irreparable harm
in the absence of preliminary relief, that the balance of equities tips in their favor, and
that injunctive relief is in the public interest. Winter v. Natural Res. Def. Council, 555
U.S. 7, 129 S. Ct. 365, 374 (2008). The test includes a sliding scale. If the plaintiffs
show that the balance of hardships will tip sharply in their favor, they need not make a
strong showing of likelihood of success on the merits – the existence of serious questions
will suffice. Alliance for Wild Rockies v. Cottrell, 622 F.3d 1045, 1049-53 (9th Cir.
2010). Serious questions exist when the plaintiffs show a “‘fair chance of success on the
merits.’” Republic of the Philippines v. Marcos, 862 F.2d 1355, 1362 (9th Cir.1988) (en
banc) (quoting Nat’l Wildlife Fed’n v. Coston, 773 F.2d 1513, 1517 (9th Cir.1985)). For
purposes of deciding the motion, therefore, the Court must determine whether Plaintiffs
have shown a likelihood of success on the merits or the existence of serious questions.
Plaintiffs assert that their claims for quiet title and declaratory relief (see Doc. 1 ¶¶
96-102, 105-08) raise significant legal issues, and that they are likely to prevail on those
claims because “their Note was ‘securitized’ – pooled and then re-sold to third-party
investors, likely in the form of certificates evincing ownership in an investment vehicle
rather than in the form of ownership of a specific promissory note.” Doc. 7-1 at 4.
Plaintiffs, however, cite no legal authority showing that the securitization of their Note
renders the scheduled foreclosure sale unlawful or otherwise improper. Plaintiffs claim
that Defendants must prove who actually owns the Note (id. at 5), but courts in this
District and others “consistently have rejected this ‘show me the note’ legal theory.”
Nichols v. Bosco, No. CV-10-01872-PHX-FJM, 2011 WL 814916, at *3 (D. Ariz. Mar. 4,
2011) (citing Diessner v. MERS, 618 F. Supp. 2d 1184, 1187 (D. Ariz. 2009)). Noting
that Defendants may be able to establish their legal rights during the discovery phase of
the litigation, Plaintiffs themselves recognize that they are not likely to prevail on their
declaratory relief claim. Doc. 7-1 at 5. Plaintiffs state that they seek only to establish
that Defendants have the legal right to pursue the foreclosure sale (id.), but this is an
insufficient basis for a TRO or other form of injunctive relief.
Because the Court concludes that Plaintiffs have failed to show a likelihood of
success on the merits or the existence of serious questions, the Court will not issue a TRO
or a permanent injunction.
The Court need not address the other requirements for
IT IS ORDERED that Plaintiffs’ ex parte motion for temporary restraining order
and permanent injunction (Doc. 7) is denied.
Dated this 18th day of April, 2011.
cc: All parties
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