Hilton v. Wells Fargo Bank, N.A. ex rel. Nomura Asset Acceptance Corp., 539 B.R. 10

Background

Hilton executed a $67,000 Note and Mortgage in 2004; the Note was endorsed in blank and transferred among several banks that later ceased operations. Multiple assignments of the Mortgage were recorded from MERS (nominee for First National Bank of Arizona) to various entities, culminating in an assignment to Wells Fargo (via GMAC/Nomura-related documents).
Hilton filed an adversary complaint in his Chapter 13 bankruptcy to challenge Wells Fargo’s mortgage lien, alleging invalid assignments, irregular signatories, and separation of the Note from the Mortgage (breaking the chain of title).
Wells Fargo moved for summary judgment, submitting the original Note (endorsed in blank), a Mortgage, confirmatory assignments, a Pooling and Servicing Agreement (PSA) and a Mortgage Loan Schedule purporting to show Wells Fargo’s ownership or the Trust’s ownership from 2005.
Hilton opposed, contending discovery was incomplete, the servicer’s affidavit and business records were insufficiently authenticated, and factual disputes existed about possession of the original Note, the validity of the allonge, and the assignments.
Chief Bankruptcy Judge Littlefield granted Wells Fargo summary judgment; Hilton appealed. The district court affirmed, applying Rule 56 standards, Rule 56(d) discovery requirements, and standing/PSA precedent.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether summary judgment was premature because Hilton lacked adequate discovery	Hilton: court should have ruled on his motion to preclude and allowed more discovery under Rule 56(d)	Wells Fargo: Hilton failed to satisfy Rule 56(d) affidavit requirements; additional discovery would not create a triable issue	Denied — Hilton did not meet Rule 56(d) standards; summary judgment timely
Admissibility/authentication of servicer affidavit and business records	Hilton: servicer affidavit and attached business records lacked foundation and cannot support summary judgment	Wells Fargo: servicer acted for Wells Fargo; affidavit properly introduced the documents	Denied — affidavit and attached documents were properly introduced and relied upon
Whether genuine issues exist about possession/negotiation of the original Note and chain of title	Hilton: factual disputes about prior possession, validity of allonge and assignments create triable issues	Wells Fargo: documentary record (Note endorsed in blank, mortgage schedules, assignments) establishes ownership/possession; not a foreclosure so timing of possession is immaterial	Denied — record shows possession/assignment sufficient; no triable fact on ownership
Whether Hilton may challenge enforceability based on alleged PSA violations or broken chain	Hilton: assignments and PSA noncompliance void or invalidate the mortgage	Wells Fargo: Hilton lacks standing to enforce or challenge the PSA; Rajamin forecloses non‑party PSA claims; documents show transfer to trust	Denied — Hilton lacks standing to assert PSA-based invalidity; court relied on documentary evidence to uphold enforceability

Key Cases Cited

Rajamin v. Deutsche Bank Nat’l Tr. Co., 757 F.3d 79 (2d Cir. 2014) (non‑party borrowers generally lack standing to enforce PSA obligations)
Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (summary judgment burden-shifting framework)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (standard for genuine issue of material fact)
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (U.S. 1986) (nonmovant must do more than raise metaphysical doubt)
Zervos v. Verizon N.Y., Inc., 252 F.3d 163 (2d Cir. 2001) (clearly erroneous standard for factual findings on appeal)
Asbestosis Claimants v. U.S. Lines Reorg. Trust (In re U.S. Lines, Inc.), 318 F.3d 432 (2d Cir. 2003) (de novo review of legal conclusions on bankruptcy appeals)
Miller v. Wolpoff & Abramson, L.L.P., 321 F.3d 292 (2d Cir. 2003) (requirements for Rule 56(d) affidavits)