502 F. App'x 616
8th Cir.2013Background
- Twenty-one homeowners sued JPMorgan Chase Bank, N.A.; Chase Home Finance, LLC; MERSCORP Holdings, Inc.; and MERS entities for unlawful foreclosure; Shapiro & Zielke, LLP was alleged to have assisted.
- The district court dismissed for failure to state a claim; the case had been removed from Minnesota state court with Shapiro allegedly fraudulently joined.
- On appeal, plaintiffs abandoned all but a quiet-title claim under Minn. Stat. § 559.01; the court addressed jurisdiction and pleading issues.
- The district court characterized part of the claim as premised on the rejected show-me-the-note theory.
- Karnatcheva and Murphy control pleading/standing standards; Jackson v. MERS rejected show-me-the-note; other theories were also insufficient under Rule 8.
- The Eighth Circuit affirmed the district court’s dismissal for failure to state a claim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction and removal proper? | Homeowners argue removal was improper; district court lacked jurisdiction. | Lenders contend fraudulent joinder and lack of diversity justify removal. | District court properly retained jurisdiction; remand denied. |
| Quiet-title claim viability under §559.01? | Quiet title survives despite show-me-the-note theory. | Show-me-the-note theory and related bases fail; pleading deficient. | Dismissal upheld; claim fails under Rule 8. |
| Impact of show-me-the-note and Karnatcheva/Murphy? | Some theories survive independent of note production. | Theories attacked title; rejected by Karnatcheva and Murphy. | Show-me-the-note rejected; overall theories insufficient. |
Key Cases Cited
- Karnatcheva v. JPMorgan Chase Bank, N.A., 704 F.3d 545 (8th Cir. 2013) (recognizes that related notices and assignments not foreclosed by Jackson and requires pleading under Rule 8)
- Murphy v. Aurora Loan Servs., LLC, 699 F.3d 1027 (8th Cir. 2012) (rejects show-me-the-note theory; pleading standards applied)
- Jackson v. Mortgage Electronic Registration Sys., Inc., 770 N.W.2d 487 (Minn. 2009) (rejected show-me-the-note theory)
- Brannum v. Mo. Dep’t of Corr., 518 F.3d 542 (8th Cir. 2008) (affirming district court on alternative grounds)