Jackson County v. MERSCORP, Inc.
915 F. Supp. 2d 1064
W.D. Mo.2013Background
- Jackson County filed a putative class action on April 23, 2012, in Missouri state court, later removed to federal court.
- Defendants include MERSCORP, MERS, Bank of America, Citimortgage, and others related to MERS and mortgage servicing; John Doe Defendants 1-100 also named.
- Plaintiff seeks relief on its own behalf and on behalf of similarly situated Missouri counties and the City of St. Louis, alleging issues with recording deeds of trust and recording fees.
- Allegations center on Defendants’ use of the MERS System to track mortgages and transfer interests without recording assignments or paying fees, allegedly harming county records and fees collected.
- Plaintiff asserts five causes of action: unjust enrichment, civil conspiracy, prima facie tort, declaratory judgment, and injunctive relief, and seeks to pierce the corporate veil.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing and injury in fact sufficient for Article III standing | Plaintiff contends injury in fact through lost recording fees and inaccurate records. | Defendants contend lack of standing due to no valid action or injury. | Plaintiff has standing; injury and redressability shown. |
| Private right of action under Missouri recording statutes | Missouri statutes encourage recording; plaintiff not relying on statutory violation for its claims. | No private right of action exists under recording statutes. | Not dispositive; court analyzes independent claims; no private duty to record found. |
| Count I: Unjust Enrichment | Defendants benefited from initial recording and avoided fees by not recording subsequent transfers. | No duty to record assignments; no direct conferment of benefit to defendants; no unjust enrichment under Missouri law. | Count I dismissed for lack of duty to record and failure to allege conferment/retention of a benefit under unjust circumstances. |
| Count II: Civil Conspiracy | Conspiracy to perpetuate scheme by not recording assignments and avoiding fees. | Conspiracy requires underlying tort or wrongful act; no viable underlying claim. | Count II dismissed because underlying unjust enrichment claim fails. |
| Count III: Prima Facie Tort; Counts IV–V: Declaratory Judgment and Injunctive Relief | Prima facie tort supports injunctive relief and declaratory relief. | Prima facie tort requires malicious intent; no viable underlying claims exist; declaratory and injunctive relief are remedial only. | Count III dismissed for lack of malicious intent; Counts IV and V dismissed as improper remedies |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility standard for pleadings)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (plausibility standard for complaints)
- Erickson v. Pardus, 551 U.S. 89 (U.S. 2007) (notice pleading standard reference)
- Steel Co. v. Citizens for a Better Environment, 523 U.S. 83 (U.S. 1998) (standing is not defeated by anticipated failure to state a claim)
- Rice v. Hodapp, 919 S.W.2d 240 (Mo. 1996) (elements of prima facie tort; intent to injure required)
- Montgomery County v. MERSCORP, 904 F. Supp. 2d 436 (E.D. Pa. 2012) (unjust enrichment viability depends on statutory duty to record)
- Fuller v. Mortgage Electronic Registration Systems, Inc., 888 F. Supp. 2d 1257 (M.D. Fla. 2012) (no duty to file mortgage assignments; unjust enrichment not established)
- Plymouth County ex rel. Raymond v. MERSCORP, Inc., 287 F.R.D. 449 (N.D. Iowa 2012) (uncharged to record assignments; unjust enrichment theory falters)
- Sierra Club v. U.S. Army Corps of Engineers, 645 F.3d 978 (8th Cir. 2011) (standing framework cited)