Heidig v. PNC Bank N.A. C/O Trustee Corps.
3:16-cv-00576
D. Nev.Oct 20, 2016Background
- In 2005 the Heidigs obtained a $258,000 mortgage from SOMA secured by a deed of trust on their Reno residence; they later defaulted.
- Plaintiffs allege gaps in the assignments/securitization chain (missing assignment from SOMA to National City Mortgage and missing original endorsement certifications), so defendants lack standing to foreclose.
- Plaintiffs participated in Nevada Foreclosure Mediation; the Mediator and a state court found missing assignment/certification issues and denied a Certificate of Foreclosure.
- Defendants nonetheless recorded a new Notice of Trustee’s Sale scheduling a foreclosure sale for October 21, 2016.
- Plaintiffs filed an ex parte TRO to stop the sale; the court denied ex parte relief, ordered service and expedited response (none filed), and then granted a temporary restraining order enjoining the October 21 sale pending a hearing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to foreclose / chain of title defects | Missing assignment(s) and missing original endorsement certifications mean defendants lack chain of title and cannot validly foreclose | Defendants proceeded with foreclosure and scheduled sale (no timely opposition filed on TRO) | Court found "serious questions going to the merits" on wrongful foreclosure due to alleged chain-of-title defects and enjoined the sale |
| Requirement of Foreclosure Mediation Program (FMP) certificate | Because of defects, no valid FMP certificate exists; foreclosure cannot proceed | Implicitly that foreclosure may proceed despite prior mediation findings | Court relied on Nevada law that an FMP certificate is required and noted prior mediation denial supports injunction |
| Irreparable harm from sale | Loss of home is irreparable and cannot be remedied after sale | Sale can be rescheduled (less persuasive) | Court held loss of home is irreparable and balance of equities tips sharply to plaintiffs |
| Scope/duration of relief | Requested TRO preventing the October 21 sale and any trustee’s sale | No timely opposition to the expedited TRO motion | Court granted a temporary injunction limited to enjoining the October 21 sale pending a hearing within 14 days |
Key Cases Cited
- Winter v. Nat. Res. Def. Council, 555 U.S. 7 (2008) (standard for preliminary injunctions requires likelihood of success, irreparable harm, balance of equities, and public interest)
- Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423 (1974) (TROs are intended to preserve the status quo only as long as necessary)
- Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127 (9th Cir. 2011) (serious questions on the merits plus hardship tipping sharply toward plaintiff can support injunctive relief)
- Edelstein v. Bank of N.Y. Mellon, 286 P.3d 249 (Nev. 2012) (Nevada requires a Foreclosure Mediation Program certificate for valid nonjudicial foreclosure)
- Cal. Indep. Sys. Operator Corp. v. Reliant Energy Servs., Inc., 181 F. Supp. 2d 1111 (E.D. Cal. 2001) (TROs governed by same standards as preliminary injunctions)