Christopher HAYDEN; Denine L. Murphy, a/k/a Denine L. Hayden, Plaintiffs, Appellants, v. HSBC BANK USA, NATIONAL ASSOCIATION, as Trustee FOR WELLS FARGO ASSET SECURITIES CORPORATION MORTGAGE ASSET-BACKED PASS THROUGH CERTIFICATES SERIES 2007-PA3; Wells Fargo Bank, N.A., Defendants, Appellees.
No. 16-2274
United States Court of Appeals, First Circuit.
August 8, 2017
222
LYNCH, Circuit Judge.
Sean R. Higgins, Y. Frank Ren, and K&L Gates LLP, Boston, MA, on brief for appellees.
Before LYNCH, KAYATTA, and BARRON, Circuit Judges.
LYNCH, Circuit Judge.
In March 2007, Christopher Hayden and Denine Murphy (“the Haydens“) borrowed $800,000 from GN Mortgage, LLC (“the
The Haydens defaulted on their loan in 2008. They then filed several bankruptcy petitions and requested injunctive relief, thereby delaying foreclosure until 2016. After HSBC provided notice of a foreclosure sale in June 2016, the Haydens sued HSBC and Wells Fargo Bank, N.A. (“Wells Fargo“), the mortgage servicer, to enjoin the sale. They now appeal the district court‘s decision to deny their request for a preliminary injunction and to grant HSBC‘s and Wells Fargo‘s motion to dismiss under
We review the district court‘s order of dismissal for failure to state a claim de novo. Lemelson v. U.S. Bank Nat‘l Ass‘n, 721 F.3d 18, 21 (1st Cir. 2013) (citing Artuso v. Vertex Pharm., Inc., 637 F.3d 1, 5 (1st Cir. 2011)). The district court properly dismissed the Haydens’ claim that HSBC cannot foreclose on the property on their view that MERS‘s assignment of the mortgage to HSBC was invalid. As the district court found, this claim is foreclosed by precedent, which holds that MERS can validly assign a mortgage without holding beneficial title to the underlying property, see Culhane v. Aurora Loan Servs. of Neb., 708 F.3d 282, 291-93 (1st Cir. 2013), and that borrowers do not have standing to challenge a mortgage assignment based on an alleged violation of a trust‘s pooling and servicing agreement, see Butler v. Deutsche Bank Tr. Co. Ams., 748 F.3d 28, 37 (1st Cir. 2014) (citing Woods v. Wells Fargo Bank, N.A., 733 F.3d 349, 354 (1st Cir. 2013)).
Our decision in Dyer v. Wells Fargo Bank, N.A., 841 F.3d 550 (1st Cir. 2016), which was issued approximately six weeks after the district court issued its decision in this case, provides further support for this finding. Dyer reaffirmed Culhane‘s holding that a mortgage contract can validly make MERS the mortgagee and authorize it to assign the mortgage on behalf of the lender to the lender‘s successors and assigns. Id. at 553. Dyer also disposed of the claim that the Massachusetts Supreme Judicial Court‘s (“SJC“) decision in Eaton v. Federal National Mortgage Association, 462 Mass. 569, 969 N.E.2d 1118 (2012), renders Culhane noncontrolling where, as here, the foreclosing party holds both the note and the mortgage. See Dyer, 841 F.3d at 553-54 & n.2; see also Eaton, 969 N.E.2d at 1133 n.28 (“[A] foreclosing mortgage holder such as [the nominee‘s assignee] may establish that it either held the note or acted on behalf of the note holder at the time of a foreclosure sale by filing
The district court also properly dismissed the Haydens’ obsolete mortgage claim, which has no basis in the plain text of the statute or in precedent. Under Massachusetts‘s obsolete mortgage statute,
We agree that the Haydens failed to state a claim; substantially for the reasons articulated by the district court. Without adopting the district court‘s opinion, we summarily affirm. See 1st Cir. R. 27.0(c):
So ordered.