Roderick Robertson v. U.S. Bank
831 F.3d 757
| 6th Cir. | 2016Background
- In December 2005 Roderick and Letitia Robertson took a $192,000 mortgage; the note was endorsed and ultimately bundled into a trust with U.S. Bank as servicing/owner and MERS listed as nominee/beneficiary.
- The Robertsons defaulted in August 2011; MERS later assigned the deed to U.S. Bank and Wilson & Associates (trustee) scheduled a trustee’s sale for August 8, 2014.
- The Robertsons sent a notice of rescission alleging a Truth in Lending Act (TILA) § 1641(g) violation (failure to notify of assignment) and challenged U.S. Bank’s standing to foreclose.
- The Robertsons sued in state court the day before the sale; U.S. Bank removed to federal court; Wilson & Associates was dismissed; the district court granted summary judgment for U.S. Bank.
- On appeal the Robertsons argued: (1) Wilson & Associates waived removal; (2) U.S. Bank violated § 1641(g) entitling rescission under § 1635; (3) U.S. Bank lacked standing to enforce the note; and (4) U.S. Bank forfeited the right to foreclose by not pleading a counterclaim.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Removal waiver by Wilson & Associates | Wilson & Associates’ state-court filings waived removal and bind U.S. Bank | No clear/unequivocal waiver; later-served defendants (U.S. Bank) have independent removal windows | No waiver; removal proper; earlier defendant’s conduct doesn’t bind later-served defendant |
| TILA § 1641(g) notice -> rescission under § 1635 | Failure to notify assignment under § 1641(g) entitles rescission of loan | § 1641(g) addresses post-closing assignments and provides statutory damages/recoupment, not rescission; § 1635 rescission is limited to material disclosures at origination | Rejected: § 1641(g) violation (if any) does not give right to rescind under § 1635; remedy is damages/recoupment |
| Standing to enforce the note | U.S. Bank produced only hearsay and insufficient proof of ownership/standing | Endorsements/allonge and public records show transfer; documents are contracts/verbal acts (not hearsay) | U.S. Bank had enforceable possession via endorsements; documents admissible; standing established |
| Forfeiture of foreclosure right by not pleading counterclaim | U.S. Bank forfeited foreclosure by not asserting a compulsory counterclaim | Foreclosure is a non-judicial remedy in Tennessee; no need to file a counterclaim | Rejected: argument forfeited and substantively meritless because foreclosure may proceed non-judicially |
Key Cases Cited
- Regis Assocs. v. Rank Hotels (Mgmt.) Ltd., 894 F.2d 193 (6th Cir. 1990) (waiver of removal must be clear and unequivocal)
- Johnson Assocs. Corp. v. HL Operating Corp., 680 F.3d 713 (6th Cir. 2012) (discusses constructive waiver and removal conduct)
- Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527 (6th Cir. 1999) (last-served defendant rule on removal)
- Carpenter v. Longan, 83 U.S. 271 (1872) (equitable assignment: transfer of the note carries the security)
- Barnhart v. Peabody Coal Co., 537 U.S. 149 (2003) (statutory construction: associated group inference for exhaustive lists)
- Loftis v. United Parcel Serv., Inc., 342 F.3d 509 (6th Cir. 2003) (rule of unanimity and removal procedure)
- Univ. of Tex. v. Camenisch, 451 U.S. 390 (1981) (temporary injunction preserves positions and does not bind merits)
- Preferred Props., Inc. v. Indian River Estates, Inc., 276 F.3d 790 (6th Cir. 2002) (contracts/verbal acts are not hearsay)