The plaintiff-appellees in this consolidated interlocutory appeal are defaulted mortgagors of Rhode Island real estate. They have brought suit to prevent foreclosure or eviction, on the shared ground that ostensible assignments of their mortgagees’ legal titles are invalid, leaving the assignees without the right to foreclose. In most cases, the assigning mortgagee was the Mortgage Electronic Registration System, Inc. (MERS).
I
Although at the time of briefing there were nearly 700 cases in the district court subject to the challenged orders (not all of them subject to this appeal), they began in the state courts with a trickle, from which some of them were removed to federal court based on diversity jurisdiction. In 2011, a magistrate recommended dismissal in two of those cases on the ground that the mortgagors had no standing to challenge the assignments of the original mortgagees’ interests, see J.A. 226-27, 264-65, but the district court has not to this day acted on the recommendations,
The orders imposing a stay did not in terms forbid non-judicial foreclosure by mortgagees acting under a power of sale mortgage contract as authorized by Rhode Island law, but when one of them took that action in a case on the docket, the court issued an order in that case providing that the stay “prevents defendants from foreclosing on properties that are subject of a pending complaint in the In Re: Mortgage Foreclosure Master Docket.” J.A. 367. When a new docket-wide order was then issued continuing the “stay” in effect in all cases, it was clear from the sequence of the orders that the stay was meant to bar power of sale foreclosures otherwise requiring no prior judicial approval, or any other foreclosure or possessory action for that matter. This consolidated appeal by some of the defendant mortgagees followed, objecting to that order and to the failure of the mandatory mediation order to set limits of time and expense.
II
The first contested issue here is over the jurisdiction of this court to review what the district court calls the stay order, although on the face of the record jurisdiction seems obvious. 28 U.S.C. § 1292(a)(1) provides a court of appeals with authority to entertain appeals from “interlocutory orders of the district courts ... granting ... or refusing to dissolve ... injunctions,” and the sequence of orders already quoted shows that the “stay” “prevents [mortgagees] from foreclosing.”
In attempting to support their contrary position that the stay is not an injunction, the mortgagors rely repeatedly on the district court’s choice of a word in calling the order a “stay,” which they describe as one that merely “halts and delays” foreclosure or eviction by process outside this litigation. Appellee’s Br. 4. But these are not substantial arguments. The nature of an order is the product of its operative terms and effect, not its vocabulary and label. See Gulfstream Aerospace Corp. v. Mayacamas Corp.,
The only remaining question is timeliness of the appeal under Federal Rule of Appellate Procedure 4(a), requiring a notice of appeal to be filed within 30 days of an order such as this. Although the court issued two generally applicable
As for our jurisdiction to consider an interlocutory appeal to review the mortgagees’ objection to the want of time and expense limits on the reference for mandatory mediation, the briefs have addressed the applicability of the collateral order doctrine under Cohen v. Beneficial Indus. Loan Corp.,
Ill
With this analysis of jurisdiction as a preface, the merits of the appeal can be resolved with economy. On each issue the standard of review is abuse of discretion, Peoples Fed. Sav. Bank v. People’s Un. Bank,
As for the injunction, Fed.R.Civ.P. 65(a)(1) provides that a preliminary injunction may be imposed “only on notice to the adverse party,” a requirement that has been held to include a hearing followed by findings that the party to be favored has a substantial likelihood of success in the pending action, would otherwise suffer irreparable harm and can claim the greater hardship in the absence of an order, which will not disserve the public interest if imposed. See TEC Eng’g Corp. v. Budget Molders Supply, Inc.,
The mortgagors’ attempts to excuse these lapses have no merit. While they say that the mortgagees have had opportunities for hearings and were in fact heard at every mediation session, they fail to point to any indication from the court that the Special Master was authorized to consider the propriety of the global injunction or, in particular, to address the mortgagors’ standing to object to assignments and general probability of success in attempting to block foreclosures by the assignees. Indeed, the district court’s refusal to address the mortgagors’ jurisdictional standing, despite the magistrate’s conclusion that they have none, is candidly shown in the court’s express instruction to the Special Master to avoid the issue. In an order dated January 7, 2013, the judge referred to a class of potentially dispositive matters open to the master’s consideration, being
those that relate to a specific case, based on case-specific facts that are not shared with the collective docket.... [T]he parties should note that they all are fact specific to a given case and do not raise claims common to the complaints.... The Court will not grant relief from the stay at this time for any legal issues related to the common claims made in any Complaint, raised in any common defense, or those intertwined with the “global” issues of standing, jurisdiction and the like. The narrow exception from the stay is not intended to provide a “back door” mechanism for litigating the substantive claims or defenses.
Order, In re: Mortgage Foreclosure Cases, No. 11-mc-88-M, at 1-2 (D.R.I. Jan. 7, 2013). The terms of this order confirm the mortgagees’ claims that generally applicable findings (including the mortgagors’ class-wide probability of success) have not been made even implicitly (let alone expressly, as required by Fed.R.Civ.P. 52(a)(2)), and they provide beyond any question that the mortgagees may not presently address the subjects of required Rule 65(a)(1) findings on grounds common to all parties.
Nor is there any substance to the mortgagors’ suggestion that the Rule 65 failure is cured by record documentation supporting the injunction; we have not been directed to any documents supporting the injunction requirement of probable success, for example. Finally, it is enough to say that there is likewise nothing to the mortgagors’ claim that the “openness” of the injunction and mediation plan is any answer to Rule 65. The issuance of an unauthorized injunction does not validate it.
In sum, the imposition of the injunction was error for failing to satisfy Rule 65. As a consequence, the terms of the mandatory mediation, which the injunction protects from mootness, need not be addressed in detail except to note its failure to conform to the standard of reasonable trial court discretion as explained in In re All. Pipe Corp.,
Although it would be open to this court simply to vacate the injunction and mediation orders, we fear that the practical effect of requiring such immediate action on a docket currently the size of this one
The district court will schedule a hearing at the earliest reasonable date to determine whether the existing injunction against foreclosure and possessory action should be continued. The burden of demonstrating entitlement to any injunctive relief will rest on the mortgagors as it would have if a timely hearing had been held in compliance with Rule 65, and the district court’s conclusions must be stated as Rule 52 requires. Although this court has not held that a jurisdictional issue must always be resolved before issuing a mediation order, see In re Atl. Pipe Corp.,
If the district court determines that the currently consolidated cases, or some of them, are to remain on the docket, a second hearing should then be scheduled promptly to decide whether the mediation order should be continued and, if so, what time and cost limits should be set and what the allocation formula should be. Given the extent of the current docket, it will doubtless be difficult to confine time and cost with assurance, but at the very least such limits as the court does set (though not immune to revision, see ibid.), will require formal, periodic reconsideration if any further mediation is not concluded within them. The amicus brief has called our attention to a Special Master’s estimate that all current cases will have been treated with to some degree by Autumn of 2013, an estimate that may be considered in presently setting a time limit, though of course we do not mean to rule out augmenting the Special Master’s personnel and acting faster if that can reasonably be done at this point.
The consolidated cases under appeal are remanded for further proceedings consistent with this opinion. The parties will bear their own respective costs.
It is so ordered.
Notes
. See Culhane v. Aurora Loan Seivices of Nebraska,
. One of these cases was subsequently dismissed for reasons not pertinent here. The other remains in mediation. We note that the issue raised is not about a mortgagor's general standing to challenge foreclosure, but about standing to challenge a mortgagee’s assignment of its interest.