Conlin v. Mortgage Electronic Registration Systems, Inc. ("MERS") et al

Filing 12

ORDER denying 2 Motion for TRO; denying 9 Motion to Remand. Signed by District Judge John Corbett O'Meara. (WBar)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

MICHAEL J. CONLIN,
Plaintiff,
Case No. 11-15352
v.
Hon. John Corbett O’Meara
MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC. et al.,
Defendants.
______________________________________/

ORDER DENYING PLAINTIFF’S MOTION FOR TEMPORARY
RESTRAINING ORDER AND MOTION FOR REMAND
Before the court is Plaintiff’s motion for temporary restraining order, filed December 9,
2011. The court heard oral argument on December 14, 2011, and denied Plaintiff’s motion.
Plaintiff also filed a motion to remand on December 13, 2011; consistent with the court’s
determination that it has jurisdiction in this matter, Plaintiff’s motion to remand is also denied.
BACKGROUND FACTS
This case involves real property located at 1304 Belmar Place, Ann Arbor, Michigan.
Plaintiff obtained a refinancing loan for the property in the amount of $240,000 on April 8, 2005,
from Bergin Financial, Inc. As security, Plaintiff granted a mortgage on the on the property in
favor of MERS as nominee for Bergin. On March 15, 2008, the mortgage was assigned to U.S.
Bank.
Plaintiff defaulted on the loan and U.S. Bank proceeded with foreclosure by
advertisement. The property was sold at a sheriff’s sale on March 31, 2011. U.S. Bank
purchased the property for $159,200. Plaintiff did not attempt to redeem the property before the

six-month redemption period expired on September 30, 2011.
Plaintiff filed this action in Washtenaw County Circuit Court on October 28, 2011,
against MERS, U.S. Bank, and U.S. Bank’s foreclosure counsel, Orlans Associates, P.C., and
Marshall Isaacs. Defendants MERS and U.S. Bank timely removed this matter to this court on
December 6, 2011. Defendants allege that jurisdiction is based upon diversity, despite the fact
that Plaintiff, Orlans Associates, and Marshall Isaacs are Michigan citizens. Defendants contend
that Orlans Associates and Marshall Isaacs are not real parties in interest and were fraudulently
joined to defeat diversity, so that they should be disregarded for purposes of determining
jurisdiction.
Plaintiff seeks a temporary restraining order enjoining eviction proceedings that are
going forward in state district court. A hearing in the eviction case is set for December 15, 2011.
After this matter was removed, Washtenaw County Circuit Judge Shelton entered a temporary
restraining order enjoining the eviction proceedings. That order is without effect, given that the
case was removed before it was entered. Accordingly, Plaintiff seeks the same relief here.
LAW AND ANALYSIS
I.

Jurisdiction
This court has diversity jurisdiction in this matter only if it disregards Orlans Associates,

P.C., and Marshall Isaacs as fraudulently joined. A party is “nominal” and its citizenship is
disregarded for purposes of determining diversity if a plaintiff cannot establish a cause of action
against that party under state law. See Coyne v. American Tobacco Co., 183 F.3d 488, 493 (6th
Cir. 1999). In cases challenging mortgage foreclosures such as this one, a plaintiff does not have
a cause of action against foreclosure counsel, who serves as an agent for the bank. Here, Orlans

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Associates, P.C., and Marshall Isaacs served as agents for U.S. Bank. Plaintiff’s state law
claims, if any, are against the principal, U.S. Bank, not the agents. See Estate of Jerry Malloy v.
PNC Bank, 2011 WL 4485088 (E.D. Mich. Sept. 27, 2011) (Edmunds, J.) (no claim against
foreclosure counsel); Casey v. Auto Owners Ins. Co., 273 Mich. App. 388, 402-403 (2006)
(attorneys owe no legal duty to adverse party under Michigan law). Accordingly, the court finds
that Orlans Associates and Isaacs were fraudulently joined and that it has diversity jurisdiction.
See Malloy, supra, at *1; Yuille v. Trott and Trott, P.C., No. 11-10584, at 2-23 (E.D. Mich. Mar.
30, 2011) (Friedman, J.).
II.

Plaintiff’s Motion for Temporary Restraining Order
Plaintiff seeks an injunction staying the eviction proceedings in state court. Plaintiff

contends that he is likely to succeed on the merits of his claims because U.S. Bank “did not take
any interest in Plaintiff’s promissory note or mortgage during the purported assignment from
[MERS] . . . . Further, the Assignment of Mortgage may be fraudulent, not only because it
purports to assign a right that MERS cannot assign, but also because the signatures appearing on
the assignment document and other related documents belong to known ‘robo-signors,’”
including Defendant Marshall Isaacs. Pl.’s Mot. at ¶ 6.
Plaintiff has not demonstrated that the typical preliminary injunction requirements are
met, such as a likelihood of success on the merits or irreparable harm. In order for the court to
stay eviction proceedings, Plaintiff should make some showing that he is entitled to the property.
However, he has not disputed that he is in default on the note. Moreover, Plaintiff lacks standing
to challenge the foreclosure sale because the redemption period has expired, vesting title in the
purchaser. See Overton v. Mortgage Elec. Reg. Sys., 2009 WL 1507342 (Mich. App. May 28,

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2009) (“Once the redemption period expired, all of plaintiff’s rights in and title to the property
were extinguished.”); Moriarty v. BNC Mortgage, Inc., 2010 WL 5173830 (E.D. Mich. Dec. 10,
2010) (Duggan, J.) (finding that after the redemption period expired, plaintiff lacked standing to
challenge the foreclosure/sheriff’s sale). Finally, Plaintiff lacks standing to challenge the
assignment from MERS to U.S. Bank, because he was not a party to that assignment. See
Livonia Property Holdings, LLC v. 12840-12976 Farmington Road Holdings, LLC, 2010 WL
4275305 (6th Cir. 2010).
Plaintiff has failed to meet his burden of demonstrating that he is likely to succeed on the
merits of this case and that the other preliminary injunction elements weigh in his favor.
Accordingly, IT IS HEREBY ORDERED that Plaintiff’s motion for temporary
restraining order is DENIED.
IT IS FURTHER ORDERED that Plaintiff’s motion for remand is DENIED.

s/John Corbett O’Meara
United States District Judge
Date: December 16, 2011

I hereby certify that a copy of the foregoing document was served upon counsel of record
on this date, December 16, 2011, using the ECF system.

s/William Barkholz
Case Manager

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