502 F. App'x 624

8th Cir.

2013

Sheila IVERSON, Jack W. Simmer, Sheri L. Simmer, Daniel R. Wiedewitsch, Colleen R. Wiedewitsch, Pamela Owens, formerly known as Pamela Rhea McDuffie Jenkins, Daniel D. Johannsen, Claudia Nelimark, Arthur Peterson, Belinda N. LeClair, Mark B. LeClair, Jeffrey Robert Busch, and Leanne M. Block, Plaintiffs-Appellants v. WELLS FARGO BANK, N.A., Mortgage Electronic Registration Systems, Inc., MERSCORP, Inc., HSBC Bank USA, N.A., and Shapiro & Zielke, LLP, Defendants-Appellees.

No. 12-2142

United States Court of Appeals, Eighth Circuit

Submitted: March 11, 2013. Filed: April 19, 2013.

515 F. App‘x 624

Before MURPHY, SMITH, and GRUENDER, Circuit Judges.

PER CURIAM.

Thirteen homeowners (“Homeowners“) challenge the impending foreclosure of their home mortgages. We affirm the district court‘s¹ dismissal for failure to state a claim.

The Homeowners filed suit in Minnesota state court against Wells Fargo Bank, N.A., HSBC Bank USA, N.A., MERSCORP, Inc., Mortgage Electronic Registration Systems, Inc., and Shapiro & Zielke, LLP (“Shapiro & Zielke“). The Homeowners alleged that each defendant played a role in the invalid assignment of their home mortgages and improper initiation of non-judicial foreclosure proceedings. The defendants removed the case to federal court based on the purported fraudulent joinder of Shapiro & Zielke and then filed motions to dismiss all claims. The district court denied the Homeowners’ motion to remand and granted the motions to dismiss.

“We review de novo the district court‘s grant of a motion to dismiss under Rule 12(b)(6), construing all reasonable inferences in favor of the nonmoving party.” Retro Television Network, Inc. v. Luken Comm‘ns, LLC, 696 F.3d 766, 768 (8th Cir. 2012). We affirm the district court‘s decision to deny remand based on fraudulent joinder and to dismiss the claims against Shapiro & Zielke. See Murphy v. Aurora Loan Servs., LLC, 699 F.3d 1027, 1031-32 (8th Cir. 2012).

As to their claims against the remaining defendants, on appeal the Homeowners have abandoned all but a claim to quiet title under Minnesota Statute section 559.01. See Murphy, 699 F.3d at 1032 n. 3; Marksmeier v. Davie, 622 F.3d 896, 902 n. 4 (8th Cir. 2010). The vast majority of the bases for this claim are tied to the “show-me-the-note” theory, “which argues [that] the holder of legal title to a mortgage cannot foreclose if he is unable to produce the underlying promissory note.” Murphy, 699 F.3d at 1030. The Minnesota Supreme Court, as we have previously recognized, has denied the viability of this attempt to challenge a non-judicial foreclosure. See id. at 1030-31; see also id. at 1033 (affirming dismissal of portions of a quiet-title claim because the alleged defects in the defendants’ ability to foreclose were “regurgitations of the ‘show-me-the-note’ theory“). The quiet-title claim in this case is a carbon copy of the quiet-title count in the Murphy plaintiffs’ complaint. As in Murphy, “two of the quiet-title theories do not rely on the failure of the fore-closing party to produce the note,” and accordingly they avoid the taint of the soundly rejected “show-me-the-note” theory.² Id. at 1033. Nonetheless, the district court properly dismissed these claims for “alleg[ing] mortgage invalidity on the basis of various assertions that are wholly unsupported by facts.” In Karnatcheva v. JPMorgan Chase Bank, N.A., 704 F.3d 545 (8th Cir. 2013), this court held that identically worded claims were deficient under federal pleading standards because they were nothing more “than labels and conclusions, based on speculation.” Id. at 548. Accordingly, we affirm the district court‘s dismissal for failure to state a claim.

remaining three theories for relief under section 559.01 did not rely on the “show-me-the-note” theory, this court dismissed them for falling short of federal pleading requirements. Id. at 548 (“We therefore affirm the district court‘s dismissal of the plaintiffs’ three theories for quiet title ... because the plaintiffs’ pleadings, on their face, have not provided anything to support their claim that the defendants’ adverse claims are invalid, other than labels and conclusions, based on speculation that transfers affecting payees and assignments of the notes were invalid.“). The Homeowners in this case have failed to distinguish the pleadings in their suit to quiet title from those of the plaintiffs in Karnatcheva, and accordingly we affirm the district court‘s dismissal for the same reasons.

The Homeowners filed three additional claims against the defendants but have waived these claims on appeal because their brief only presents arguments contesting the district court‘s dismissal of their quiet-title claim. See Marksmeier v. Davie, 622 F.3d 896, 902 n. 4 (8th Cir. 2010) (“Although Marksmeier‘s brief states that he is also appealing the district court‘s grant of summary judgment on his state-law claims, the brief does not contain argument on those state-law claims. Accordingly, he has waived this issue on appeal, and we decline to consider whether the district court‘s grant of summary judgment as to the state-law claims was proper. See Fed. R. App. P. 28(a)(9)(A) (mandating that appellant‘s brief include contentions, reasons for them, and citations to authorities and parts of record on which appellant relies).“). Even if the Homeowners had briefed us on these remaining claims, we would nonetheless affirm the district court‘s dismissal. All three are virtually identical to claims we found lacking in Karnatcheva, and the Homeowners have neglected to offer a basis for distinguishing this precedent. See 704 F.3d at 546-47 (dismissing slander-of-title claim and two claims seeking declaratory judgments “to determine whether the defendants had ‘any true interest in or right to foreclose on their properties‘” and “to determine whether the notes were properly accelerated by the correct party“).

This is one in a series of unsuccessful quiet-title claims brought by the Homeowners’ counsel, William Butler. See Butler v. Bank of America, N.A., 690 F.3d 959, 962 n. 3 (8th Cir. 2012) (describing Butler‘s “pattern” of filing lawsuits to challenge the validity of foreclosure proceedings). Accordingly, the Lenders/Servicers filed a motion for sanctions. The district court granted this motion, imposing a $75,000 sanction under Rule 11 and awarding attorneys’ fees under 28 U.S.C. § 1927. Butler appeals the award. We review the district court‘s decision under an abuse-of-discretion standard. Runfola & Assocs., Inc. v. Spectrum Reporting II, Inc., 88 F.3d 368, 375 (6th Cir. 1996). For the reasons this court set forth in another of Butler‘s myriad quiet-title suits, Dunbar v. Wells Fargo Bank, N.A., Nos. 12-2076, 12-2369, 2013 WL 978223 (8th Cir. Jan. 14, 2013), we conclude that the district court did not abuse its discretion in awarding sanctions and attorneys’ fees.

Notes

The Honorable Michael J. Davis, Chief Judge, United States District Court for the District of Minnesota.

See Compl. ¶ 62(f) (“The Notices of Pendency, Powers of Attorney, and Mortgage Assignments were not executed by an authorized individual.“), (g) (“The Assignments of Plaintiffs’ Mortgages were invalid.“).

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