McNellis et al v. Mortgage Electronic Registration Systems Inc et al

Filing 19

ORDER denying 8 Motion for TRO; denying 9 Motion for Preliminary Injunction, signed by Judge Ronald B. Leighton.(DN) Modified on 8/12/2011 (DN). (Copy mailed to plaintiffs.)

HONORABLE RONALD B. LEIGHTON

1
2
3
4
5
6

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT TACOMA

7
8
9

JOSEPH E. McNELLIS & PAMELA A.
McNELLIS,

10

Plaintiffs,

11
12

v.

13

MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC., et al.,

14

No. CV11-5475RBL
ORDER DENYING MOTIONS FOR
TRO AND PRELIMINARY
INJUNCTION
[Dkt. #s 8 & 9]

Defendants.

15
16

This matter is before the court on the Plaintiffs’ Motions for a Temporary Restraining

17

Order [Dkt. #8], and for a Preliminary Injunction [Dkt. #9]. Plaintiffs seek to restrain and enjoin

18

the Defendants from pursuing foreclosure on their Property. Plaintiffs’ Complaint and Motions

19

claim a variety of improprieties and violations in the manner in which the Defendants acquired

20

and seek to foreclose on their Note and Deed of Trust.

21

Plaintiffs claim to be the party of record ownership of Property commonly known as

22

3404 10TH Street NW, Gig Harbor, WA, 98335. They claim they had a clear chain of title until

23

1986. They admit that, in 2008, they executed a $264,000 Promissory Note and Deed of Trust on

24

the Property, and attach a copy of the Deed of Trust to the Complaint. [Dkt. #1, Ex. B].

25

Plaintiffs contend they are not registered or licensed to issue negotiable instruments.

26

Plaintiffs allege a variety of improper subsequent transfers of the Deed of Trust, and

27

claim that the Note was unilaterally altered after it left their possession, making their signatures

28

upon it “moot.” They claim the Deed of Trust was also altered and is also “moot.”

ORDER - 1

1

They claim their obligations, if any, have been discharged by the Defendants’ conduct.

2

Plaintiffs also allege (and provide evidence suggesting) that they were informed they were in

3

default on their loan in November 2010, and that they were notified of the Defendants’ intent to

4

sell the property at a Trustees sale in December 2010.

5
6

Plaintiff’s Complaint [Dkt. #1] and Motions [Dkt. #s 8 and 9] additionally contain the
following general and conclusory contentions:

7

•

They have not defaulted on the subject loan, and no default can be proven.

9

•

Defendants have produced no valid security interest in the Property.

10

•

They will be irreparably harmed by foreclosure.

11

•

They are likely to prevail on the merits of their complaint.

•

The balance of hardships favors them.

•

Enjoining the foreclosure is in the Public Interest.

8

12
13
14
15
16
17

Discussion.
The purpose of a TRO is “preserving the status quo and preventing irreparable harm just
so long as is necessary to hold a hearing [on the preliminary injunction application], and no

18

longer.” Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers, 415
19
20

U.S. 423 (1974); see also Reno Air Racing Ass’n v. McCord, 452 F.3d 1126, 1130-31 (9th Cir.

21

2006). To obtain a TRO or a preliminary injunction, the moving party must show: (1) a

22

likelihood of success on the merits; (2) a likelihood of irreparable harm to the moving party in

23

the absence of preliminary relief; (3) that a balance of equities tips in the favor of the moving

24

party; and (4) that an injunction is in the public interest. Winter v. Natural Res. Def. Council,
25
26
27
28

Inc., ___ U.S. ___, 129 S. Ct. 365, 376 (2008).
Traditionally, injunctive relief was also appropriate under an alternative “sliding scale”
test. The Lands Council v. McNair, 537 F.3d 981, 987 (9th Cir. 2008). However, the Ninth
ORDER - 2

1

Circuit overruled this standard in keeping with the Supreme Court’s decision in Winter.

2

American Trucking Ass’ns Inc. v. City of Los Angeles, 559 F.3d 1046, 1052 (9th Cir. 2009)

3

(holding that “[t]o the extent that our cases have suggested a lesser standard, they are no longer

4

controlling, or even viable”).

5

***

6

The Plaintiffs have failed as a matter of law to establish their right to a Temporary

7

Restraining Order or a Preliminary Injunction. The court will assume Plaintiffs have established

8

the element of irreparable harm, as evidenced by their respective Affidavits of hardship. [Dkt. #s

9

10, 11, 12, &13]. But they have not met, and cannot meet, their burden of establishing that the

10
11

remaining factors weigh in favor of preliminary injunctive relief.
Because the Plaintiffs are proceeding pro se, the Court extends some latitude to their

12

pleadings. Nevertheless, the bulk of Plaintiffs’ arguments appear to rest on the purely

13

conclusory allegation that the Defendants have failed in some manner to properly initiate the

14

foreclosure. They suggest that these vague imperfections lead to the result that the Plaintiffs are

15

somehow not obligated to repay the money they admit they borrowed. Moreover, as this Court

16

has concluded previously, courts “have routinely held that [a defendants’] so-called ‘show me

17

the note’ argument lacks merit.” Freeston v. Bishop, White & Marshall, P.S., 2010 WL 1186276

18

(W.D. Wash. 2010) (quoting Diessner v. Mortgage Electronic Registration Systems, 618 F.

19

Supp. 2d 1184, 1187 (D. Ariz. 2009) (collecting cases)).

20

The Plaintiffs have not established any remote likelihood of success on the merits of their

21

claims. It appears from Plaintiffs’ own filings that they have not paid on the mortgage since

22

sometime before November 2010. But the Plaintiffs have not articulated, much less

23

demonstrated, what the defendants did wrong, and they have failed to argue or demonstrate how

24

any such error would have the effect of discharging Plaintiffs’ obligation to repay their debt.

25

Nor have the Plaintiffs met their burden of establishing that the balance of equities tips in

26

their favor. They have alleged hardship (a separate element) but have not even addressed how

27

they equities are in their favor. On the other hand, the plaintiffs have apparently been in

28

ORDER - 3

1

possession of a home they have not paid for, for some period of time. The balance of equities

2

weighs in favor of Defendants.

3

The final factor is the public interest. While it is true that the public has an interest in

4

ensuring that foreclosures are done properly, Plaintiffs have made no showing whatsoever that

5

any impropriety occurred in this case. On the other hand, it is abundantly clear that the public

6

has a broad interest in resolving the unfortunately vast array of in-default loans adversely

7

affecting every bank in the country. Enjoining facially legitimate foreclosure sales is not in the

8

public interest; in fact, just the opposite is true.

9
10

The Plaintiffs have not met their burden to obtain injunctive relief. Their Motions [Dkt.
#s 8 & 9] for such relief are therefore DENIED.

11

IT IS SO ORDERED.

12

Dated this 12th day of August, 2011.

13
14
15
16
17

A
RONALD B. LEIGHTON
UNITED STATES DISTRICT JUDGE

18
19
20
21
22
23
24
25
26
27
28

ORDER - 4