Newman v. JP Morgan Chase Bank, N.A.

81 F. Supp. 3d 735, 2015 U.S. Dist. LEXIS 10660, 2015 WL 321442
CourtDistrict Court, D. Minnesota
DecidedJanuary 26, 2015
DocketCiv. No. 14-2944 (MJD/JSM)
StatusPublished
Cited by3 cases

This text of 81 F. Supp. 3d 735 (Newman v. JP Morgan Chase Bank, N.A.) is published on Counsel Stack Legal Research, covering District Court, D. Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Newman v. JP Morgan Chase Bank, N.A., 81 F. Supp. 3d 735, 2015 U.S. Dist. LEXIS 10660, 2015 WL 321442 (mnd 2015).

Opinion

ORDER

MICHAEL J. DAVIS, Chief Judge.

The above matter came before the Court on the Report and Recommendation of United States Magistrate Judge Janie S. Mayeron dated November 17, 2014. Plaintiff objects to the recommendation that this Court grant Defendants’ motion to dismiss.

Pursuant to statute, the Court has conducted a de novo review of the record. 28 U.S.C. § 636(b)(1); Local Rule 72.2(b). Based on the Court’s de novo review and upon all of the files, records and proceedings herein, the Court will adopt the Report and Recommendation.

IT IS HEREBY ORDERED that:

1. Defendants’ Motion to Dismiss [Docket No. 3] is GRANTED;
2. This matter is dismissed with prejudice.

LET JUDGMENT BE ENTERED ACCORDINGLY.

REPORT AND RECOMMENDATION

JANIE S. MAYERON, United States Magistrate Judge.

The above matter came before the undersigned on defendants’ Motion to Dismiss [Docket No. 3]. Jonathan L.R. Drewes, Esq. appeared on plaintiffs behalf. Curtis D. Ripley, Esq. appeared on defendants’ behalf. This matter has been referred to the undersigned Magistrate Judge for a Report and Recommendation by the District Court pursuant to 28 U.S.C. § 636(b)(1)(A), (B), and Local Rule 72.1.

I. BACKGROUND

Plaintiff seeks to invalidate the foreclosure óf the mortgage on his home. Plaintiff asserts two claims against defendants: failure to comply with Minn.Stat. § 580.02 and an injunction to prevent defendant JP Morgan Chase from proceeding with an eviction it initiated against plaintiff in Hen-nepin County, Minnesota.

For the reasons, described below, the Court recommends that defendants’ Motion to Dismiss be granted and plaintiffs claims be dismissed with prejudice.

[737]*737A. Plaintiff’s Complaint

Plaintiff sued JP Morgan Chase Bank, N.A. (“Chase”) and Federal National Mortgage Association (“Fannie Mae”) (collectively, “defendants”) in state district court on June 18, 2014. Notice of Removal, Ex. 1 (Summons and Complaint) [Docket No. 1-1]. Based on diversity jurisdiction, defendants removed the suit to Federal District Court pursuant to 28 U.S.C. 1332(a). Notice of Removal [Docket No. 1]. Defendants moved to dismiss the Complaint in lieu of answering. Motion to Dismiss [Docket No. 3].

The facts bearing on defendants’ motion to dismiss are as follows. Plaintiff executed a mortgage in favor of Washington Mutual Bank, FA (“WAMU”) on November 28, 2006, for property located in Hennepin County, Minnesota (“Property”). Complaint, ¶¶ 1, 6. The mortgage was recorded with the Hennepin County Registrar of Titles on January 5, 2007. Id., ¶ 6. On September 25, 2008, the Federal Deposit Insurance Corporation (“FDIC”) was appointed as WAMU’s receiver. Id., ¶ 7. That same day, Chase and the FDIC entered into a Purchase and Assumption Agreement (“PAA”). Affidavit of Curtis Ripley in Support of Motion to Dismiss (“Ripley Aff.”), Ex. l(PAA) [Docket No. 6-1]. Pursuant to the PAA, the FDIC transferred WAMU’s mortgage assets to Chase. Id. On October 29, 2008, Chase recorded an affidavit from the FDIC with the Hen-nepin County Registrar of Titles. Complaint, ¶ 7, Ripley Aff., Ex. 2 (recorded Affidavit of Robert C. Schoppe, Receiver in Charge for FDIC as Receiver for Washington Mutual Bank). This Affidavit stated “[a]s authorized by Section ll(d)(2)(G)(i)(II) of the Federal Deposit Insurance Act, 12 U.S.C. § 1821(d)(2)(G)(i)(II),1 the FDIC, as receiver of Washington Mutual, may transfer any asset or liability of Washington Mutual without any approval, assignment or consent with respect to such transfer.” Ripley Aff., Ex. 2, ¶3. “As a result, on September 25, 2008, JP Morgan Chase became the owner of the loans and loan commitments of Washington Mutual by operation of law.” Id., ¶ 5.

Plaintiff defaulted on his mortgage payments 2 and Chase, “a party with no registered interest in the Subject Property,” foreclosed on the mortgage by advertisement. Complaint, ¶ 9. A sheriffs sale of the Property was held on April 15, 2014. Id. The Sheriffs Certificate of Sale and Foreclosure Record was recorded with the Hennepin County Registrar of Titles on April 23, 2014. Id.; see also Ripley Aff., Ex. 3 (Sheriffs Certificate of Sale and Foreclosure Record) [Docket No. 6-1]. The Property was sold to Chase at the sheriffs sale for $352,075.33. Ripley Aff., Ex. 3. After the sheriffs-sale, Chase transferred title of the Property to Fannie Mae by warranty deed. Ripley Aff., Ex. 4 (warranty deed).

Plaintiff did not redeem the Property during the statutory redemption period and failed to vacate the Property, claiming that he was the “rightful owner of the Subject Property.” Complaint, ¶24. In June, 2014, Chase commenced an eviction action in Hennepin County Housing Court. Id., ¶ 25. Plaintiff contended that Chase failed to comply with Minnesota’s foreclosure-by-advertisement statute, Minn.Stat. § 580.02, because there is no recorded assignment of the mortgage to Chase. Complaint, ¶¶ 16, 20. Consequently, Chase [738]*738was not entitled to foreclose. Id., ¶ 13. As relief, plaintiff sought a judgment declaring the sheriffs sale void and an injunction, enjoining “defendants and their successors-in-interest, from asserting claims of ownership, pursuing eviction, or purporting to transfer rights in the Subject property to third parties to which Defendants are not presently entitled.” Id., Prayer for Relief, ¶¶ 1, 2. .

B. Defendants’ Motion to Dismiss and Plaintiff’s Response

Defendants moved to dismiss the Complaint, contending that plaintiffs sole theory regarding the alleged violation of Minn. Stat. § 580.02 — that Chase foreclosed without recording an assignment from the FDIC — was meritless and rejected by the district court in Luzaich v. JP Morgan Chase, Civ. No. 13-1869 (DWF/JSM), 2014 WL 300824 (D.Minn. Jan. 28, 2014) (Order Adopting Report and Recommendation). Defendants’ Memorandum in Support of Motion to Dismiss (“Defs.’ Mem.”), pp. 5-6 [Docket No. 5]. In Luzaich, the district court concluded that even if the FDIC’s recording of an affidavit documenting Chase’s acquisition 'Of “all loans and all loan commitments” of WAMU did not fulfill the requirement of Minn.Stat. § 580.02,

the Court is persuaded that Chase was not obligated to record an assignment. Pursuant to the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, the mortgage was assigned to Chase by operation of federal law, which specifically authorizes the FDIC to transfer assets of a failed financial institution “without ... assignment.” 12 U.S.C. § 1821(d)(2)(G)(i)(II). Through operation of the Supremacy Clause, U.S. Const, art. VI, cl.

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Bluebook (online)
81 F. Supp. 3d 735, 2015 U.S. Dist. LEXIS 10660, 2015 WL 321442, Counsel Stack Legal Research, https://law.counselstack.com/opinion/newman-v-jp-morgan-chase-bank-na-mnd-2015.