SFR Investments Pool 1, LLC v. PHH Mortgage Corporation
2:22-cv-00507
| D. Nev. | Apr 29, 2022Background
- SFR Investments Pool 1, LLC moved for a preliminary injunction to stop PHH Mortgage Corporation from foreclosing on 4575 Dean Martin Drive, Unit 812, Las Vegas, NV.
- Defendants removed the case to federal court on March 22, 2022.
- Central factual dispute: whether and when the mortgage note was accelerated (and any subsequent deceleration) — timing could be dispositive.
- The court concluded there are unresolved factual disputes that raise "serious questions going to the merits" and that the status quo must be preserved.
- Court found SFR would suffer irreparable harm (loss of a unique property), granted a preliminary injunction enjoining PHH and its agents from foreclosing, and required SFR to post a $5,000 bond.
- Court denied PHH’s motion to dismiss without prejudice, set discovery deadlines (one deposition per party; documents on acceleration/deceleration allowed), and set a dispositive motion deadline.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Merits / likelihood of success (acceleration/deceleration of note) | Raises factual disputes about when the note became wholly due and whether deceleration occurred | Argues acceleration/deceleration is not disputed or that acceleration was effective | Court found serious questions and unresolved factual disputes; merits cannot be resolved on current record |
| Irreparable harm | Loss of the property is irreparable because it is unique | Monetary relief would suffice; injunction unnecessary | Court found irreparable harm and enjoined foreclosure |
| Balance of equities & public interest | Equities tip to SFR; public interest favors valid foreclosure process | Injunction threatens lender's security and rights | Court held equities tip to SFR and public interest supports preserving status quo pending resolution |
| Security under Rule 65(c) | Bond should be reasonable/minimal to allow injunction | Court should require security to cover costs and possible loss in property value | Court exercised discretion and set bond at $5,000 |
Key Cases Cited
- 555 U.S. 7 (Winter v. Natural Resources Defense Council) (preliminary injunction standard and need for clear showing of entitlement)
- 632 F.3d 1127 (Alliance for the Wild Rockies v. Cottrell) (serious-questions test as alternative pathway to preliminary injunction)
- 758 F.3d 1069 (Wells Fargo & Co. v. ABD Ins. & Fin. Servs., Inc.) (reciting Winter factors for injunctions)
- 340 F.3d 810 (Clear Channel Outdoor, Inc. v. City of L.A.) (consideration of serious questions on the merits)
- 167 F.3d 1228 (Barahona-Gomez v. Reno) (preliminary injunction preserves status quo and prevents irreparable loss)
- 572 F.3d 1067 (Johnson v. Couturier) (district court discretion over amount of security under Rule 65(c))
- 742 P.2d 1029 (Dixon v. Thatcher) (recognizing uniqueness of real property for irreparable harm analysis)