united states district court district of rhode island -- moll brief

8/7/2019 United States District Court District of Rhode Island -- Moll Brief

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UNITED STATES DISTRICT COURTDISTRICT OF RHODE ISLANDROBERT E. MOLLVS. Civil Action No: 1:10-cv-4-S-LDAMORTGAGE ELECTRONICREGISTRATION SYSTEMS, INC.,DOMESTIC SAVINGS BANK,CREDIT NORTHEAST,COUNTRYWIDE HOME LOANSERVICING, BANK OF AMERICA,N.A., BANK OF AMERICA SERVICINGCORP., and FEDERAL NATIONALMORTGAGE ASSOCIATION

PLAINTIFF'S OBJECTION TO DEFENDANTS' MOTION TO DISMISS

The purpose of this memorandum of law is to rebut the position taken by the Defendantsin their Motion to Dismiss that the Plaintiff cannot seek relief from this Court based upon hisclearly stated and well supported claims of false, fraudulent and statutorily deficient documents.and lor reasons contrary to case law, because they are allegedly in default on their mortgagepayments and that there is no valid reason for delaying foreclosure. This is patently untrue andcontrary to the law.

Further, the relief sought by the Plaintiff has been characterized as "sweeping" and basedupon an unconnected series of arguments about MERS that appear to be based upon complaintsavailable on the internet and not on the facts of their loan. The Defendants'gratuitous commentsare well noted but erroneous in all regards. The relief sought by the Plaintiff was set forthclearly in their his complaint. The arguments relative to MERS are all well supported anddocumented by case law, law review articles and other scholarly articles that seem to be


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published on a daily basis. The fact that the internet is used as a platform from which todownload these documents is freely admitted. For MERS, a company that operates anelectronic secret morlgage society, it seems ironic that it would be concerned about the use of theinternet to obtain information about its actual nature and purpose.

The Defendants suggest that the Plaintifls ability to challenge wrongful assignrnents andother entries in the actual land evidence records in Cranston Town Hall in Cranstono RhodeIsland is not supported by w-ell settled Rhode Island and Federal Law, and also chafes against theequitable principles that Rhode Island Courts and all Court have traditionally applied whenanalyzinga litigant's request for equity and equitable relief.

The Plaintiff has averred and corectly pleaded several claims upon which relief may begranted by this Court. They have been precise in asking fhe Courf, inter alia, to rule that theDefendants MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., DOMESTICSAVINGS BANK, CREDIT NORTHEAST, COUNTRYWIDE HOME LOAN SERVICING,BANK OF AMERICA. N.A., BANK OF AMERICA SERVICING CORP.. and FEDERALNATIONAL MORTGAGE ASSOCIATION be removed from their record title and that they bedeclared the sole owner of the subject real estate and be provided r,vith other appropriate relief

:under the clear a4d concise provisions of the Rhode Island Declaratory Judgment Act, Chapter31 of Title 9, and of the Quieting Title Act Contained in Chapter 16 of Title 34, and of theMarketable Title Act contained in Chapter 13.1 of Title 34. The facts alleged as applied to eachof the aforesaid acts are sufficient to defeat the Defendants' Motion to Dismiss under Rule12(bX6) of the Federal Rules of Civil Procedure.

The Defendants' Motion asks this Court to ignore the right of the Plaintiff under theLaws of the State of Rhode Island relative to their rights in their property to bring the aforesaid


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actions. The Motion asks this Court to ignore the plain language set forth in the Rhode IslandGeneral Laws $34-11-1, $34-l\-22,534-16-l etseq., $34-13.1-1 et. seq., and $34-9-1 et. seq.By design, the entire MERS system is complex beyond simple description, to the general public,public officials, coutts and judges alike. It is wrought by misdirection, confusion and the randomappointment of Presidents and Vice Presidents, who are not employees or actual officers, whomay allegedly act on its behalf. in its haste to allow the securiti zation of loans and ihenforeclose, many times for an unnamed and unknown beneficiary of a moftgage loan, MERS andits members, like Domestic, Countrywide and BAC have overlooked. important aspects of statelaws throughout the country and particular to this case, the Laws of the State of Rhode Island.

As a result of MERS' failure to comply with the General Laws of the State of RhodeIsland and with well settled case law in the State of Rhode Island and the adoption of the MERS'system by these Defendants, the Plaintiffs request this Court deny the Motion to Dismiss or inthe alternative, allow lor the full development,of the factual issues which drive all MERS casesin the State of Rhode Island and abstain from ruling on the Motion to Dismiss at this stage of thecase. For the purpose of this objection the Plaintiff hereby incorporates the facts that areoutlined within the Complaint, verified by Plaintiff, which must be taken as true.

STANDARD OF REVIEWThe Federal Courts, when reviewing a Rule 12(bX6) Motion, have consistently held that

it must take all allegations pled in the Plaintiffls Complaint as true. The Plaintiff has set forth amultitude of facts that if taken as true, satisfy the dictates of Federal Rule 12(b)(6) for all of thesame reasons they satisfy the Rhode Island Superior Court Rule 12(b)(6). In particular, thePlaintiff has offered un-contradicted evidence, provided to them by BAC as servicer for FNMA,that it does not hold the operative promissory note. Even in light of the Supreme Court's holding


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in Ashcroft v. Iqbal, 129 S.Ct. 1937,1951 (2009) and Bell Atlantic Corp. v. Twombl)', 550 U.S.544 (2007), this complaint, when viewed by the Court, with all factual assertions being taken astrue, "plausibly suggest an entitlement to relief." Ashcroft, 129 S.Ct. at 1950.

Further, dismissal of a complaint is disfavored and should only be granted inextraordinary cases: "A court ruling on a motion to dismiss construes the complaint in the lightmost favorable to the Plaintiff, taking all well-pleaded allegations as true and giving Plaintiff thebenefit of all reasonable inferences." Figueroa v. Rivera , 147 F .3d,77 , 80( 1st Cir. 1998).Dismissal under Rule 12(b)(6) is appropriate only if "it appears beyond doubt that the plaintiffcan prove no set of facts in support of his claim which would entitle him to relief." Conley v.Gibson, 355 U.S. 41,45-46(1957). The Motion to Dismiss should be denied in respect toanylall of the counts because the facts and causes of actionhave been pleaded with specificityand not as mere conclusions.

In regard to the Motion to Dismiss under Rule 12(b)(6) of the Rhode Island Rules ofCivil Procedure, the standard is that it must be "clear beyond a reasonable doubt that the plaintiffin this case is not entitled to relief from the defendant under any set of facts that could be provenin support of Plaintiff s claim." Hendrick v. Hendrick.755 A.2d 791 (R.1. 2000) (quoting Brunov. Criterion Holdings.lnc.,736 A.2d99,99 (1999.) The Defendants are asking this court tomake findings of fad and law and to find, beyond a reasonable doubt, that the Plaintiff has notplead facts suffrcient to make out a cause of action. In a 12(b)(6) Motion, the Couft's review islimited. "It is well settled in Rhode Island that the role of a Rule l2(bX6) Motion is to test thesufficiency of the complaint." Gammell-Roach v. Howland, PB 09-3501 (zuSUP). See TosteFarm Corp.v. Hadbury. Inc.,798 A.2d 901, 905 (R.I. 2002) (quoting R.I. Employment Sec.Alliance. Local40l. S.E.l.U.. AFL-CIO. v. State Dep't of Employment and Training, 788 A.2d


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465,467 (R.I. 2002); See also Pellegrino v. R.l. Ethics Comm'n.,788 A.2d 1119, 1123 (R.I.2002) (stating that "[t]he standard of granting a motion to dismiss is a difficult one for themovant to meet"). The complaint must give fair and adequate notice of the plaintiff s claim, butin most cases, it need not contain a high degree of factual specificity. See Hyatt v. VillageHouse Convalescent Home. Inc., 880 A.2d821,824 (R.1. 2005). In Gammell Judge Silversteinwrote that "The Court should grant such a motion only when it is clear beyond a reasonabledoubt that the [non-movant] would not be entitled to relief under any set of facts that could beproven in support of the claim." See PB 09-3501. Clearly, the facts set forth in the complaint andthen further explained in Plaintiff s initial memorandum do support i claim for relief and thisCourt should not hnd beyond a reasonable doubt that those facts, as alleged, do not set forth aclaim for the relief requested. The Plaintiff, mindful that this matter is being ruled upon by theFederal Court, have referenced the Rhode Island Rule and cases peftaining thereto because thismatter was originally filed in the Superior Courl of the State of Rhode Island and later removedto the Federal Court by the Defendants based upon Diversity Jurisdiction.

DISCUSSIONThe Plaintiff has alleged clearly and concisely that they dispute the legal authority of

MERS to have assigned the original mortgage to FNMA and further contested the standing ofBAC and FNMA to notice and/or conduct a foreclosure on his property because it did not havethe Promissory Note when it noticed the foreclosure on the Plaintiffs properly. Domestic Banknever instructed MERS to assign this mortgage. This Motion to Dismiss by the Defendantsstates that the Plaintiff has not posited a colorable claim. This is simply not true.

The Plaintiff alleges that BAC, MERS or FNMA, andlor any of their agents, are withoutauthority under the provisions of Rhode Island General Laws $34-11-l to make any recording


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on his record title in Cranston, Rhode Island and that the private MERS system exists inderogation of the Rhode Island Recording Statute. Defendants improperly filed said recordingsagainst Plaintifls title by and through the unauthorized actions of Defendants' agents. ThePlaintiff further alleges that FNMA and BAC do not have standing to foreclose because it doesnot have legal or beneficial interest in the morlgage and note. They allege that the purportedassignment to FNMA from MERS, signed by Allison Dalton West, an attorney at Harmon LawOffice, a law firm located in Newton Highlands, Massachusetts, is not an actual/legalassignment by MERS.I Allison Dalton West is not an actual Vice President, employee or agentof MERS. Her services are limited to signing documents to reverse engineer titles to allowservicers and lenders to foreclose when they have no actual standing to do so.

The Defendants would have this Court conclude that the Plaintiff is not entitled to reliefbased upon the complaint. In support thereof, the Defendants claim that a default on a notesomehow renders a title clearing action anullity; this is simply not true. The Plaintiff is notclaiming that the note should be forgiven and he is not admitting that it has not been satisfied.The Plaintiff has claimed that the assignment from MERS to FNMA is void and that theforeclosure sale that was noticed was done so in violation of Rhode Island General Laws $34-11-22 andthat the assignment violates Rhode Island General Laws $34-l l-1, and is therefore, voidunder Rhode Island General Law $34-11-1 et seq. The fact that the Plaintiff accepted loanproceeds from a lender willing to give him a loan is imelevant as to whether or not the Plaintiffhas made out a cause of action. This is what the Defendants would have this Court believe.

The Plaintiff contends that MERS was without authority under the provisions of RhodeIsland General Laws $34-11-1, et seq to make any recording on his land record. Furthermore,MERS did not properly file said recordings against his property due to the unauthorized actions' Harmon Law is the law flrm that represented FNMA in the foreclosure that was cancelled in 20 I l.


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of its alleged agents. These contentions and allegations have been pled with great specificityand most certainly are sufficient to warrant a denial of the Defendants' Motion to Dismiss.

The Defendants' rely upon unconfirmed and continually challenged developments inRhode Island case law which provides no supporl for their arguments. The facts of AnthonyBucci and Stephanie Bucci v. Lehman Brothers Bank. FSB. a Federal Savings Bank. MERS &Aurora Loan Services. LLC., (Providence Superior Court. C.A. PC-2009-3888), 2009 R.l.Super. Lexis ll0 (August25,2009), are not at issue in this case and this Court should not use itto determine whether the facts "in this case" make out a cause of action. As Judge Silversteinwrote in Bucci, his holding was "limited to the case at bar." Id. [emphasis added] The facts ofBucci should not even be an issue in this case but the Defendants have based much of theirargument on those facts. Id. Bucci does not control what this Court or any other Court in thecountry must do in a MERS case. In fact, this case is nothing like Bucci, despite the best effortsof MERS to paint it as such. In Bucci, MERS was named in the mortgage as the mortgagee andnominee of the Lender. Id. In the case at bar, MERS is not foreclosing but has allegedlyassigned the mortgage when it did not own the note. At best in this case, MERS held bare legaltitle to the mortgage, in a nominee capacity. All evidence points to the fact that FNMA does nothold the note related to this mortgage transaction and it is settled by way of trial testimony in

,Bucci that MERS nevff holds the note. Id. Given this fact, MERS could not assign the mortgagewithout the note, and additionally, without the note, MERS had nothing to transfer.

Despite the Defendants' efforts to overwhelm the senses by utilizing a plethora ofrepetitive cases in order to support their contention that MERS has the ability to assign themortgage, the Plaintiff will try to save the courl's time by efficiently identifying the irrelevancyof these cases to the current case; quite simply in Kiah v. Aurora Loan Servs.. LLC,2010 WL


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4781849, at *1 (D. Mass. Nov. 16, 2010), Basilla v. GMAC Mortgage, No. 09-J-519, Order(Mass. App. Ct. Dec.4,2009), Mortgage Elec. Reeistration Sys.. Inc. v. Azize,965 So.2d 151,153 (Fla. Dist. 2d Ct. App. 2007) and US Bank" N.A. v. Fl),nn. 27 Misc. 3d 802, 806 O{.Y.Sup.Ct. 2010) the foreclosing party either had possession of the note or the assignee's rightswere dependent upon ownership of the note.

Further, the Bucci matter is currently on appeal to the RI Supreme Court and has been forwell over one and one half years . Counsel for the defendants would have this Court believe thatwith one fell swoop, MERS was embraced by the RI Superior Court; it was not. JudgeSilverstein's ruling speaks for itseli but importantly, he wrote in his conclusion that "MERS, izthe case at bar, [emphasis added], has standing to foreclose." Id. Judge Silverstein made it clearthat each case involving MERS tumed on its own facts. In fact, the Presiding Justice of theProvidence Superior Court adopted and published Adrninistrative Order # 2010-14 entitled "lNRE: MoRTGAGE ELECTRoxic nPcTSTRATIONS SYSTEMS ("MERS") in recognition ofthe fact that the holding in Bucci did not address all issues pertaining to MERS and that due tothe sheer number of MERS cases pending in the Superior Court, it was necessary to establish a"MERS" Calendar with all cases being assigned to a single iustice. While it has been pendingin the Supreme Court, case law has continued to evolve throughout the United States which mayvery well have lead Judge Silverstein to reach a different conclusion. In any event, the Bucci'sare not before the court in this case as this case is about the Plaintiff Moll and should bedetermined based on the facts at bar in this case. This would be in line with the holding inBucci. Id.

On page 14 of the Defendants' memorandum it references a portion of Judge Silverstein'swritten decision in the Bucci case. Judge Silverstein did not understand the argument set forth


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by the Plaintiff in Bucci as it was never alleged that "servicers" could not be employed to collectobligations secured by real estate mortgages. The entire Bucci transcript is devoid of any suchstatement or suggestion. Judge Silverstein went on to write that "Clearly, the fRhode Island]General Assembly envisioned a role for mortgage servicers in the lending industry." R.L SuperLEXIS 110 at *18-19. Respectfully, this Plaintiff suggests that Judge Silverstein seriouslyg; ';,, "..-i.!overstated what role the legislaturehad, actually legislated for "servi ""rt" und.ffi.W;a*{.#,.,r,i-t$if-"*%""!%,'r.,iill,jri.his own opinion, seriously overstepping his role as a Judge and tryingto beccilqs affi6r

A: ''Legislator so as not to start a MERS title epidemic of massive prop-o,14i- fq. fact, the transcript'U ,,, .,,,'1, 'w'of the Bucci hearing reveals that Judge Silverstein was very corr=64'1re{,,g.,$ut what would happento the real estate rnarket and title industry if he ruled uguir,s-t b-ilSt'u'Tni, counsel was counsel in

:tthe Bucci case and was specifically ask UV lfee.f,,.1]uerffi,,,.;uhat I thought about causing a title' %'.,and foreclosure catastrophe. My response *gAffibnA::'lfrry comment was driven by the law"''+ r'ii,lt' ':r!and his was driven by economics. .,,,-:i' "l,[) ;i, "' t''In regard to this particula$ #Hyincorrectly motivated the Bucci decision, which has

not been cited in any sfunil#t'A*ffir the County and which has not been used by any other.t'',, w liJudge in Rhode Isla4gffn any manner favorable to MERS or any bank or servicer or note holder,*rn, " 'r''this Court shor:l{,-cansid#the following: the General Assembly mentions servicers of mortgage' '.':* fi!; r",,rysumer protection statute s.

'.;":' .M*". $ 19-9-9 provides Mortgage Servicers the right to provide borrowers with!r,payoff statements. This makes sense since the entities collecting the funds, particularly in the

MERS system, where the note holder wants to remain anonymous and hidden. This statute isself-limiting and in no way supports the holding in Bucci nor the requested relief in this case.

R.I.G.L. $34-26-8 offers definitions of what a mortgage servicer is in Rhode Island


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among other related definitions. The "Mortgage Servicer" is defined as the last person to whomthe mortgagor has been instructed by the morlgagee to send payment on the mortgage. This doesnot at all square the MERS paradigm and is not at all in line with the facts in this case. MERS isthe mortgagee in this case and MERS was the morlgagee in Bucci. MERS, by its own rules andby its own testimony, has nothing to do with the payment of mortgage notes. Applying thesefacts to this statute, it would appear that in a MERS case. there can be no servicer since MERSwould not be able to give the needed collection instructions to the Mortgagor relative topayment. It is clear that Judge Silverstein simply ignored the clear language of the statute andinterposed his own beliefs in his decision. This statute provides no proof for his statement that"the [Rhode Island] General Assembly envisioned a role for mortgage servicers in the lendingindustry." Actually, his statement could be found to be true were it not used to suppoft his own"absurd result" by finding that MERS had standing to foreclose. In the Bucci transcript, it isclear that Judge Silverstein was looking for a way to find that MERS could foreclosure because"the legislature had not said that it could not."

What is more imporlant is that the legislature did not say that it could foreclose. Hemixed MERS rights, or lack thereof, with the very, very limited role that the Legislature hascarved out for mortgage servicers. The Plaintiffs respectfully suggests to this Court that theBucci rationale and holding were wrong and have no precedential value in this case. This Courtis always mindful of the concept that "expressio unius est exclusio alterius" which means theexpression of one thing is the exclusion of another. (Law Dic). The Rhode Island GeneralAssembly clearly expressed what mortgage servicers could do and Judge Silverstein ignored theaforesaid legal tenant.

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The argument espoused by the Plaintilf regarding foreclosure rights provided for by theGeneral Assembly and as set forth contractually in the MERS mortgage is clear and concise andleads to a logical result as opposed to the inational and unjust result that shall occur if JudgeSilverstein's distorted and flawed interpretation is embraced.

R.I.G.L. $5-79-1 is another non-applicable statute to the case at bar and to Bucci. Itsimply provides that a mortgage servicer is not to be considered a foreclosure consultant.R.I.G.L. 34-18-17.1 simply provides that in a mechanic's lien case, a loan servicer is not anecessary pafiy. Again, this has no impact on the case at bar and does nothing to support thestatement made by Judge Silverstein in Bucci. Finally, R.i.G.L. 544-5-7 relates to the paymentof municipal taxes and tax assessments. Again. this has no impact on the case at bar or supportthe statement made by Judge Silverstein in Bucci.

The Plaintiff has submitted more than sufficient facts to prove that he is entitled to relief.The facts set forth hereinabove are clear and concise. The Plaintiff claims that at the closing ofthe loan which is at the heafi of this matter. the promissory note executed in favor of DornesticBank and the Morlgage executed in favor of MERS in some mysterious fashion, weredisconnected.2 He furlher contends that they remain disconnected. MERS never contends thatit is the holder of the promissory note in this case so it can never be called a holder. If it is not aholder, it does not have the rights of a mortgagee that does hold the note.j To be clear, in Bucci,MERS testified under oath that it was not a holder. MERS, therefore, admits in this case and/or

t As in this case, "lf the obligation is a negotiable note, UCC $3-2-3 is generally understood to make the right ofenforcement of the promissory note transferrable only by delivery of the instrument itself to the transferee."i See Restatement (Third) of Propefty, Mortgages $5.a((c)1l


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any other case in Rhode Island that it do not satisfy the standing requirement to either assign orforeclose. Id.

In fuither support of this principle, the recent decision of the US Bankruptcy Court forthe District of Massachusetts, In re Thomas, clearly stated MERS purpose; "MERS, which is aregistry system that tracks the beneficial ownership and servicing of mortgages, was never theholder of the note, and therefore lacked the right to assign it." Case No.l0-40549-MSH (BankrD. Mass. February 9,2011). MERS purpose isto track the exchanges of the beneficial ownersand servicing of mortgages; their power cannot exceed that of their specific role, meaningtracking beneficial ownership does not confer upon them the powers of a beneficial owner, nordoes tracking servicing allow MERS to assume the title of "mortgage servicer".

The issue of whether or not MERS has standing to assign has not been addressed in anyCourt in the State of Rhode Island. It can be deduced, however, from a careful reading of Bucci,that in order for MERS to transfer property in the State of Rhode Island, it must be connected tothe beneficial owner of the Note. Id. In this case, it is clear that there is no such connection. TheDefendants go on to reference cases from other jurisdictions that have ruled that MERS hasstanding to foreclose/assign but does not elaborate on the f-acts of those cases. If it did elaborate,this Court would learn that the facts of those cases were not in line with the facts in Bucci andnot in harmony with the facts in this case. In fact a majority of courts in the Country have ruledthat MERS does not have standing to bring a foreclosure action in its own name. This is true inthose cases and in this case because MERS does not own the note. The crash of the secondarymortgage market and MERS's role in causing that catastrophe have brought to light the true roleof MERS and it is no longer defined as a innovative tool of real estate commerce but as adestructive influence on the entire mortgage industry from the perspective of the consumer.

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In reality, the current trend in the country is that MERS does not have standing toforeclose or to assign morlgages. See In Re Wilhem, Case No.08-20577-TLM (Bankr. Idaho,2009),In re Foreclosure Cases, 521 F . Supp. 2D 650 (S.D. Oh. 2007),ln Re Ha)'es, 393 Bankr.259 (Bankr. D. Mass. 2008) In Re Mitchell, Case No. BK-S-07-16226-LBR (Bankr. Nev.31311109).In re Vargas,396 B.R. 511 (Bankr. C.D. CaI.,2008). In all of these cases, MERS'mortgages and assignments have been found to be, one way or another, unenforceable. Fufiher,of particular interest are the lollowing cases all decided by Judge Arnold Schack. ln all of thesecases, he was particularly attentive to the actions of MERS and the Lenders. Based upon thatclose attention, he rendered each of the following compelling decisions: JP Morgan Chase Bank.N.A. v. George,20I0NY Slip Op 50786" Kings 2010: US Bank v. Maynard,2007 NY Slip Op.33766,Kings2007;'2008NYSlipop31l70,Kings2008;Countrvwide Home Loans. Inc. v. Persaud, 2008 NY Slip Op 30076, Kings 2008; DeutscheBank National Trust Co. v. Marai, 2008 NY Slip Op 50176, Kings 2008; US Bank v. Guichardo.2009NY Slip Op 50i51. Kings 2009; IndyMac Bank. FSB v. Bo),d^2009 NY Slip Op 50094,Kings 2009; Deutsche Bank National Trust CompanLv. Auguste. 2008 NY Slip Op 31991,Kings 2008; Wells Fargo Bank National Association v. John Relses,2008 NY Slip Op 51211,Kings 2008; Bank,pf NY v. Myers. 2009 NY Slip Op 50159, Kings 2009; Deutsche BankNational Trust Co. v. Bailey, 2009 NY Slip Op 50191, Kings 2009; Wells Fargo Bank. N.A. v.Hunlg,2010 NY Slip Op 50637. Kings 2010; LaSalle BankNA v. Smith.2010 NY Slip Op50470, Kings 2010; HSBC Bank USA. NA v. Vasquez,2009 NY Slip Op 51814, Kings 2009.This is but a sampling of scores of cases where MERS' standing is being denied. See NortonBankruptcy Law Advisor, John R. Hooge, Issue No.S (August 2010). Although New York'sforeclosure law is different from the Rhode Island Law, the concerns set forlh by the Courl in all

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of these cases should be heard by Courls in Rhode Island. If the documents do not supportstanding, then no foreclosure is appropriate. That is even more true in a State like Rhode Islandwhere there is no Court intervention or role until foreclosure is noticed or has taken place.

In addition, the Plaintiff draws the Court's attention to the case Mortgage ElectronicRegistration S)'stems. Inc.. as Nominee for WMC Moftgage vs. Frank S. Johnston and Ellen L.Johnston, et al., State of Vermont, Rutland Superior Court, Docket No, 420-6-09 Rdcv.(September I , 2009). In this very recent case, the Vermont Superior Courl wtote a nineteen ( 1 9)page decision regarding many of the issues related to this matter. The decision of the JohnstonrCourt was detailed, persuasive and in direct contravention of Huggins, 357 B.R. 180 (Bankr. D.Mass. 2006). Further, in August of this year, the Maine Supreme Court ruled that "MERS is notin fact a'modgagee'within the meaning of our foreclosu:e statute, l4 M.R.S. $$ 6321-63 25, andtherefore had no standing to institute foreclosure proceedings..." Mortgaqe ElectronicRegistration Systems. Inc. v. Saunders, 2010 ME 79 -Mu Supreme Judicial Court 20rc.5 Whilethe Defendants claim that the trend in courts is to find MERS has standing, that is certainly notthe case in our own backyard. The Plaintiff asks this Court to give great weight to thesethoughtful decisions rendered by sister New England States in denying the relief sought by theDefendants. This is a well plead case that should proceed through discovery and to trial.

The Def-endaats imply in their memorandum that under Rhode Island Law and the termsof the Mortgage, MERS had the ability to hold and assign the Mortgage; this is untrue. TheDefendants cite Bucci as precedent and support for this statement. C.A. PC-2009-3888. It hasalready been pointed out that Bucci is on appeal to the RI Supreme Courl. It should also benoted again that the Rhode Island Superior Court Chief Justice has established a MERS Calendar

1 See Johnston Aflached.s See Saunders Attached

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that is held once a month by Mr. Justice Rubine to hear MERS cases. It is clear that the RhodeIsland Judiciary as a whole, has not adopted the decision of Judge Silverstein as the definitivelaw in the State of Rhode Island.

Further, Judge Silverstein made it clear in his written opinion that his decision waslimited "to the case at bar." Id. By no means did he put his seal of approval on MEforeclose in all cases and he did not address at all the issue in this case includingu.ytret

lifs*;:'"'t4\:=MERS can assign a Mortgage. Counsel for the Defendants relies in part on@eW@d

%1,h"Woild follow therefore, that if there is a disconnection between the note and."il:r:,-

mortgag$;.a conveyance cannot take place. Given that there is proof of disconnection betweenthe note and mortgage, the Plaintiff s claim in this matter makes out a cause of action under thelaws of the State of Rhode Island.

Hugsins, 357 B.R. 180 (Bankr. D. Mass. 2006). In reality, tne Huqfirll"C,gu"f clearly limited its=4 ii.'..::'ii"ruling to foreclosures. Id. The Huggins' Court did addre ,.,'i ,of MERS being able toassign and the Court's comments do not support MERS? rl*% this case. The Husgins

. .ir ' -Court discussed at length the case of LaSalle=Bank l{btjff%LAssociation v. Lamv, Slip Copy, 12't',;,rl: iil,,.'1k,.,,,t1i,,;Misc.3d 1191(A)2006WL2251721 N.;_;N)ll'l,fn the Lamy case, the court denied a

A;. ,/jit' 'rir.,;foreclosure action by an "assignee of , F,ffit the grounds that MERS had no ownershipinterest in the underlying note andWitqge but rather acted as a nominee and thus did not havethe power or right to "assiHM;P. . ds the Lamv holding has more applicability to this case''r;; W w *nthan does Hugeins. fn facg'Se*pueeus Court wrote that "there was no disconnection between

t:: lltmortgage ^d:ffiA. pc-zoo9-3888. Again, by simple deductive reasoning, it can beconcluded tW if''W.$Z had been a disconnection in Husqins, the decision would have been

?tSa 't;?+ "..::,4oart on the hrildins in In re' o?" "1*'w.W '"'ink/

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Under Rhode Island Law and pursuant to the oft quoted and still relevent United StatesSupreme Court case of Carpenter v. Longan, 83 U.S. 27I (1872), where the United States Courl- --r- -reasoned that "the note and morlgage are inseparable; the former as essential, the latter as anincident. As assignment of the note canies the mortgage with it, while an assignment of thelatter alone is a nullity." Id at 274. In this case, where there is a mere assignment of themortgage without the assignment of the note, the assignment is a nullity. The mortgage does notgo from MERS to FNMA because of the lack of the note. The Defendants do not believe thatLongan is still good law. Id. They are wrong. Furthermore, a very recent landmark case out ofthe Commonwealth of Massachusetts, our neighboring and similar non-judicial foreclosure state,has confirmed that "where a note has been assigned but there is no written assignment of themortgage underlying the note, the assignment of the note does not care with it the assignment ofthe morlgage." U.S. Bank National Assoc. v. Ibanez, SJC 10694 (January 7,2011). The IbanezCourt, which is being considered by courts around the country as a guide for ruling on casesinvolving morlgage assignments, explained that "the pady foreclosing must prove that theassignment was made by a party itself that held the mortgage and the obligation the mortgagesecures" (i.e. the note). See lb.ar.rez. citing In re Parrish. 326 B.R. 708,720 (Bank. N. D. Ohio2005). ("lf the claimant acquired the note and mortgage from the original lender or from anotherparty who acquired it from the original lender, the claimant can meet its burden of proof throughevidence that traces the loan from the original lender to the claimant.") It is clear therefore, thatwith every transfer of the note, there needs to be an assignment of the morlgage that correspondsto the transfer of the note in order for the party claiming to have standing to properly foreclose.It is alticipated that the Defendants will spin lbanez, but the holding and dicta are pure and do

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not need to be kneaded like dough to have it rise to the level of a National guide to real estateconveyancing and foreclosure.

The Defendants reach beyond Bucci and allege that the Plaintiff somehow agreed thatMERS would serve as nominee of some future unknown nominees, as long as they weremembers of MERS. See C.A. PC-2009-3888. They didn't have to be members of MERS whenthe agreement was allegedly made, but as long as they became nominees at some time in the

Ifuture, they agreed to the aforesaid arrangement. The complaint is clear that the Plaintiff did notagree to allow MERS to assign the mortgage or to foreclose on them. Whether or not MERScould assign or foreclose is a question of law. In fact, that very question is on appeal to theRhode Island Supreme Court. These Defendants, and all HlgnS cases that have been removedto the Federal Coutl, seek to avoid a ruling by the RI Supreme Court in the Bucci matter. See Id.The Defendants argue that Rhode Island Courts and other Courts have regularly rejectedarguments, such as those advanced by the Plaintiff, which seek to challenge MERS' standing.Given the fact that the Plaintiffs attorney represented the Bucci's in the Superior Court trial inaddition to over one-hundred persons in cases similar to Bucci, it can be stated first hand that RIhas ruled only once regarding this issue and that was long before the discovery of RoboSigningand reverse title engineering. The handful of cases cited by the Defendants in it memorandumare easily distinguished from the case at bar.

In regard to Trent v. Mortgage Elec. Resistration Sys. Inc.,288 Fed. App'x 571,572(1lth Cir. 2008), this Court should consider that it was an action brought under the FloridaDeceptive and Unfair Trade Practice Act. The case was centered around collection tacticsemployed by servicers. but it did support the position of this Plaintiff that MERS holds only legaltitle and not the note. It did not support the allegation that MERS is the nominee of every

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subsequent holder of the promissory note. In regard to In re Mortgage Elec. Ree. S)'s. MDLDocket No. 09-2119-JAT (D. Ariz. January 28,2011), the line of cases cited within do notsupport the allegation of the Def-endants. In those cases, based upon Arizona Law, which is notin line with the Rhode Island Statutory scheme of foreclosure, the Plaintiffs did not prevailbecause they failed to allege facts that MERS was not the nomine of the current owner of thenote. That was a necessary parl of the complaint in order to survive a Motion to Dismiss. In thecase at bar, the Plaintiff has plead that the note and mortgage were bifurcated or split at theclosing and that they remain split even to this day. In fact. the Defendants have admitted thatFNMA does not own the note. This admitted fact. which violates the holding of the SJC inlbanez is sufficient to defeat the Defendants' Motion to Dismiss. See SJC 10694 (Janu ary 7 ,2011). Also, the Plaintiff s in these cases failed to plead lack of default which was required underArizona law. The remainder of the cases discuss the pafiiculars of Arizona law and the failure ofthe Plaintiffs to follow the law in their pleadings. Finally, these cases are not in line with theholding in Bucci whereiu Judge Silverstein clearly stated that the note and mortgage wereconnected based upon trial testimony. See C.A. PC-2009-3888. In reality, Bucci stands for theproposition that the parly foreclosing must have both the note and mortgage. which is completelycontrary to Arizona law. Id. Therefore these cases shor.rld not be given any weight by this Court.If the Defendants want to rely on Bucci, they should understand exactly what it says; the noteand mortgage have to be as one in order to.foreclose in the State of Rhode Island.Id.

The Simon v. Bank of America, N.A. 2010 WL 2609436, 30 at *11 (D. Nev June 23,2010) case dealt with generalized claims of fraud against Bank of America and the courtconcluded that the facts were not plead in a sufficient manner to support the claim for the Tort ofWrongful Foreclosure under Nevada law. In fact, the Simon Courl pointed out in several areas

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of its opinion that the Plaintiff s pleadings were defective to satisfy the requirements of NevadaLaw. Id. Rhode Island does not recognize the tort of Wrongful Foreclosure which renders theSimon case analysis of little use to this Court.

In regard to Ciardi v. The Lending Co.. Inc., 2010 WL WL2079735 at *3 (D. Ariz. May24,2010), the Court pointed out that the Plaintiffs failed to "...allege any facts supporting theirassertion that the promissory note and the deed of trust have been bifurcated." It was for thatreason that the Plaintiffs argument failed, however that is not true in the case at bar. ThisPlaintiff has stated facts in support of his bifurcation contention taking it outside the realm of theCiardi case. See Id. In regard to Cervantes v. Countr)'wide Home Loans. Inc., 2009 WL3157160 (D. Ariz. Sept. 24, 2009), that case involved a complaint related to TILA, RESPAviolations, Fair Housing, Fraud and the Arizona Consumer Fraud Act; nothing in the Cervantescase is similar to the case at bar. Further. unlike the Moll complaint, the Cervantes court pointedout that no facts supporting the bifurcation argument were included in the complaint. Id.

The Plaintiff asks this Court to review the case of Barry Alton Parker v. U.S. BankNational Association. as Trustee on behalf of the Holder of the Adjustable Rate Morlgage Trust2007-1. et al. Defendants. Case No.09-10186, Adversary Proceeding No. 09-1022. (Bankr. D.Vt. September 29, 2010.) In this case, the United States Bankruptcy Court, in a SummaryJudgment ruling, denied the Bank's Motion For Summary Judgment and found that there was aquestion of fact as to whether or not the Bank lacked standing to enforce a mortgage note wherethere was an insufficient record concerning the transfer requirements of the controlling PSA. Inessence, the Courl found that a claim by a Plaintiff that there are defects in the chain of title, ismaterial to the appropriate disposition of a foreclosure case, similar to the more profound rulingof the SJC in lbanez. See S.TC 10694 (January 7,2011).

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In the matter of Roman Pino v. The Bank of New York Mellon, District Court of Appealof the State of Florida, No. 4D10-378 at *5 (4th Dist. January 2011), the Appellate Courtconcluded "that this fwhether documents filed by the Bank were fraudulent] is a question of greatpublic importance, as many, many mortgage foreclosures appear to be tainted with suspectdocuments." One of the arguments central to the Plaintiffs'complaint is that certain documentswere executed without authority and although they have not alleged fraud, the facts they allegeare analogous to the Pino case. See Id. The question before this Court may very well be whetherthat the assignment at issue is a fraud. This is a matter of grave national concern and should betried to the end and not dismissed before it can be fully explored.

The arguments made by the Defendants relative to MERS' status as nominee have alreadybeen addressed hereinabove. In Bucci, Judge Silverstein did not rule that MERS could assignmortgages that it held in a nominee capacity. Judge Silverstein went to great lengths to point outthat in Bucci, he found facts sufficient to conclude that the note and mortgage were notbifurcated. See Id. He found it so important to make that point that it is likely that if he hadfound a disconnection between the note and mortgage, his decision would have been converse tothat being used as a crop thrasher by the Defendants. Simply put, Bucci supports the Plaintiflsclaim in this case; to wit, when the note and mortgage are separated, no assignment may takeplace and, it follows, that no foreclosure can take place. See Id. The Defendants include the caseof In re Tucker, No. 10-61004, slip op. (Bankr. W.D. Mo. Sept. 19,2010) in its memorandum.As set forth in Tucker, "under Missouri law, the holder of a note that is in default is generallyentitled to foreclose under the deed of trust, regardless of whether the deed of trust has actuallybeen assigned to such holder." Id. at 3. This is not the state of the law in Rhode Island and istotally inapposite to the holding in the Ibanez case. See SJC 10694 (January 7,2071). Also, in

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the Tucker case, MERS held the beneficial interest in the mortgage. Based upon its testimony inBucci, MERS holds only legal title in Rhode Island. thus Tucker does not apply to the case atbar. See C.A. PC-2009-3888; No. l0-61004, slip op. The same holds true for the case of Book v.Mortgage Electronic Registration S)'s., No. 3:08-cv-821, slip. op (D. Conn. Mar.26,2009), andits application to the case atbar. In Book, MERS'motion to dismiss was granted based uponlack of subject matter jurisdiction and the issue of MERS' ability to assign mortgages was neveraddressed. Id. In regard to Linkhart v. US Bank. NA,2070 WL 1996895, at *2 (S.D. Cal. May17,2010), the Court stated that the Complaint offered almost no factual allegations; that cannotbe said of this complaint. If anything. there is an overabundance of stated facts that bear on theissues before this Court. Further, Linkhart and the California Statute at issue are nothing likeTitle 34 of the General Laws of the State of Rhode Island. See Id. In Rhode Island, the partyforeclosing must hold the mortgage and the note. This is directly in line with the holding inIbanez. See SJC 10694 (January 7.2011).

In the case of Nicholson v. OneWest Bank, 2010 WL 2732325, slip op. (N.D. Ga. Apr.20,2010), the Court stated clearly that OneWest held the note and security deed and given thosefacts, OneWest was able to foreclose. Nicholson actually supports the Plaintiffs claim and is inline with the holding in Bucci that the note and mortgage must be a unit in order for a foreclosureto take place. See Id.; CA PC-2009-3888. No furlher comment is needed regarding this casesince it favors the Plaintiffs.

The case of Croce v. Trinit)'Mortgage Ins. Corp.,2009 WL 3172119, at *3 (D. Nev.Sept. 28, 2009) stated that "courts around the country have held that MERS has standing as anominee beneficiary in connection with non-judicial foreclosure proceedings." In Rhode Island.MERS has testified that it holds only legal title and it does not own the beneficial interest in the

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mortgage. In fact, in Bucci, it was testified to that MERS represented the beneficial owner of themorlgage. Croce and Bucci represent two quite opposite legal conclusions, and neither of theseconclusions offer any guidance on the issues raised in this case. See 2009 WL 3I72I19; C.A.PC-2009-3888.

In regard to MERS v. Azize, 965 So. 2d 151 (Fla. Dist. Ct App. 2nu Dist. 2007), the Courtruled MERS could foreclose because it was holder of the moftgage and the note. In RhodeIsland, MERS testified that it only holds legal title to the mortgage and never holds the note.This renders Azize,which has been seriously abrogated by scores of decisions to the converse, oflittle consequence in the ultimate determination of this case. Id. The same holds true for USBank. NA. v. Flynn, 27 Misc. 3d 802, 806 G\f.Y. Sup. Ct. 2010). where MERS again holds noteand mortgage. It does not address the issue at bar and is at odds with the state of the law inRhode Island. In MERS v. Moslev,2010 Ohio,2886 (Ohio App. 8t" Dist., July 26,2010),thesituation again involved a MERS foreclosure when it was determined that MERS held both thenote and mortgage. The facts of this case cannot be squeezed to fit into an analysis of any of theaforesaid cases. In Rhode Island, MERS does not own the note and cannot, therefore, validlyassign a mortgage; that is black letter law.

In regard to Jackson v. MERS, 770 N.W . 2d 487, 503 (Minn. 2009), the Court did notuphold the MERS system, it simply upheld a statute adopted by the State of Minnesota, Minn.Stat. $$580.02 and 580.04. However the dissent in this case, penned by Justice Page, offers acrystal clear picture as to why MERS and the MERS system should not find favor with theCourts:

"Finally, it is apparent with the benefit of hindsight that the ability oflenders to freely and anonymously transfer notes among themselvesfacilitated, if not created, the financial and banking crisis which ourcountry finds itself. It is not only bonowers but also other lenders who22


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rightfully are interested in who has held a particular promissory note thathas become worthless may have an interest in knowing the hands throughwhich that note passed. Under the MERS system, however, the identityof those previous holders is as shielded from the lender's view as theborrower's. As a result, of the court's holding, namely, that mortgagetransfers between MERS members need not be recorded before amofigage can be foreclosed by adverlisement, neither borrowers norlenders will ever be able to hold anyone in the chain of transfersaccountable. That is not sound public policy." Id.

This dissent, written in August of 2009 foreshadowed the holding in Ibanez. See SJC10694 (January 7 ,2011). The secret society of MERS can no longer be allowed to operate withimpunity and in disregard for the law set forlh in the Constitution of these United States ofAmerica. Query? What would Thomas Jefferson have to say about MERS? I ask the Court torespectfully consider the following:

I believe that banking institutions are more dangerous to our liberlies thanstanding atmies. If the American people ever allow private banks tocontrol the issue of their currency. first by inflation, then by deflation, thebanks properly until their children wake-up homeless on the continenttheir fathers conquered. The issuing power should be taken lrom the banksand restored to the people, to whom it properly belongs. 6The recitation of the terms of the mortgage is their undoing. It is clear that Domestic was

not the mortgagee as it had nothing to assign. It is clear that MERS never had the note. MERShas admitted that in the trial of the Bucci matter. See C.A. PC-2009-3888. It is beyond question,therefore. that the note and mortgage were bifurcated. The legal title to the morlgage was inMERS and the beneficial interest in the morlgage was in Domestic. As discussed earlier herein,under Rhode Island Law and pursuant to tlie United States Supreme Court case of Longan, where

6 Quote frorn Thomas .Iefferson, 3rd President. cited fromhttp://www.foundersquotes.com/Thomas_JeffersorVi-believe-that-banking-institutions-are-more-dangerous-to-our-liberlies-thanstanding-armi es/

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the United States Supreme Court reasoned that "the note and mortgage are inseparable; theformer as essential, the latter as an incident. 83 U.S. at274. As assignment of the note carriesthe mortgage with it, while an assignment of the latter alone is a nullity." What could be moreclear in this case? MERS had nothing to assign. The attempted assignment of a mortgage,without the note, is a nullity. The Defendants then claim that the Plaintiff s allegation that thevalidity of the assigrunent cannot be challenged based upon a California case from 2009. InPhillips v. Wells Fargo Bank. N.A.2009 W .L 3756698 at *4 (S.D. Cal. Nov. 6, 2009), the Courlheld that an allegation of an unauthorized signature was unsupported by factual allegations.

The Defendants state that Bucci recognized that the original lender is not the only entitythat may foreclose. See C.A. PC-2009-3888. fhis is not what the mortgage says. The complaintclearly sets forlh exactly what the mortgage says. Rhode Island General Laws $34-11-21 readsas follows:

$ 34-11-21 Statutory rnortgage condition. - The following conditionshall be known(Condition)

Provided, neveftheless, a.nd this conveyance is made upon the expresscondition, that if the mofigagor or his or her heirs, executors,administrators or assigns shall pay to the moftgagee or his or her heirs,executors, administrators, or assigns the principal and interest of thatcertain promissory note bearing even date with this deed and secured bythis deed, and shall perform every other obligation secured by this deed,at the time provided in the promissory note or in this deed, and shall alsopay all taxes and assessments of every kind levied or assessed uponor in respect of the mortgaged premises, then this deed, as also thepromissory note, shall become and be absolutely void to all intentsand purposes whatsoever.History of Section.(P.L. 1927, chi 1056, $ 13; G.L. 1938, chi 436, $ 12;G.L. 1956, $ 34-11-21.)

It is clear that 34-11-21, unchanged by the legislature for over 50 years, contemplated themortgagee and the lender being the same pafty. ln essence, if the mortgagor/borrower paid the

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moftgagee/lender, then the note would be discharged. There is no question that legislature didnot contemplate a time when the note and mortgage would be severed. The same can be said of34-ll-22 which reads as follows:

S 34-ll-22 Statutory power of sale in mortgage. - The followingpower shall be known as the "statutory power of sale" and may beincorporated in any mortgage by reference:

(Power)But if default shall be made in the performance or observance of any ofthe foregoing or other conditions. or if breach shall be made of thecovenant for insurance contained in this deed. then it shall be lawful forthe mortgagee or his. her or its executors. administrators. successors orassigns to sell. together or in parcels, all and singular the premiseshereby granted or intended to be granted, or any part or parts thereof, andthe benefit and equity of redemption of the morlgagor and his, her or itsheirs, executors, administrators, successors and assigns therein. at publicauction upon the premises. or at such other place. if any. as may bedesignated for that purpose in this deed, or in the published notice ofsale first by mailing written notice of the time and place of sale bycertified mail. return receipt requested. to the moftgagor. at his or her orits last known address" at least twenty (20) days for mortgagors other thanindividual consumer mortgagors. and at least thirty (30) days forindividual consurner mortgagors, prior to first publishing the notice,including the day of the rnailing in the computation; second, bypublishing the same at least once each w-eek for three (3) successiveweeks in a public newspaper published daily in the city in which themortgaged premises are situated; and if there be no publicnewspaper published daily in the city in which the mortgaged mortgagedpremises are situated in the city of Central Falls, in a public newspaperpublished daily in the city of Pawtucket; (2) if the mortgagedpremises are situated in the town of Norlh Providence, in a publicnew-spaper published daily in either the city of Providence or the city ofPawtucket; (3) if the mortgaged premises are situated in any of the townsof Cumberland, Lincoln, Smithfield or North Smithfield. in a publicnewspaper published daily in either the city of Pawtucket or Woonsocket:(4) if the morlgaged premises are situated in the county of Providenceelsewhere than in the above-named cities and towns, in a public

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newspaper published daily in the city of Providence; (5) if the mortgagedpremises are situated in the county of Newport, in a public newspaperpublished daily in the city of Newport; but if there be no such publicnewspaper so published, then in some public newspaper publishedanywhere in the county of Newport; (6) if the mortgaged premises aresituated in any of the counties of Bristol, Kent or Washington. in a publicnewspaper published daily in the city or town in which the mortgagedpremises are situated; but if there be no public newspaper so published. insome public new-spaper published daily in the county in which themorlgaged premises are situated or in a public newspaper published dailyin the city of Providence; provided however if the mortgaged premisesare situated in the town of New Shoreham then in addition to publicationin a public newspaper published daily as required above. it shall alsobe published in a public newspaper published in the town of NewShoreham, and, in the event there is no public newspaper published in thetown of New Shoreham, then in a public newspapff distributed in thetown of New Shoreham: with power to adjourn such sale from time totime, provided that publishing of the notice shall be continued, togetherwith a notice of the adjournment or adournments, at least once eachweek in that newspaper; and in his, her or its or their own name or nalnes.or as the attorney or attorneys of the moftgagor, for that purpose by thesepresents duly authorized and appointed with full power of substitutionand revocation to make, execute and deliver to the purchaser orpurchasers at that sale a good and sufficient deed or deeds of themorlgaged premises in fee simple. and to receive the proceeds of suchsale or sales, and from such proceeds to retain all sums hereby securedwhether then due or to fall due thereafter" or the parl thereof thenremaining unpaid, and also the interest then due on the proceeds, togetherwjth all expenses incident to the sale or sales. or for making deedshereunder, and for fees ofcounsel and attorneys, and all costs or expensesincurred in the exercise of such powers, and all taxes, assessments, andpremiums for insurance. if any, either theretofore paid by the mortgageeor his or her executors, administrators or assigns, or then remainingunpaid, upon the morlgaged premises, rendering and paying the surplusof the proceeds of sale, if any there be. over and above the amounts so tobe retained as aforesaid, together w-ith a true and particular account of thesale or sales" expenses and charges, to the moftgagor, or his, her or itsheirs, executors, administrators. successors or assigns; which sale or salesmade as aforesaid shall forever be a perpetual bar against the mortgagorand his, her or its heirs, executors, administrators, successors and assigns,

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and all persons claiming the premises, so sold, by, through or under himor her. them or anv of them.History of Section.(P.L. 1927, chi 1056, g t4;p.L. 1932. chi 1952, g l;P.L. 1934, chi 2120, g 1;G.L. 1938, chi 436. S 13; p.L. 1940, chi 944, $1;P.L. 1943, chi 1325, $ 1,P.L. 1955, chi 3589, g t; G.L. 1956, g 34-tl_22;P.L.1988, chi 138, g l;P.L. 1989, chi 154, $ l;p.L. 1992,chi224,$2;P.L. 1993, chi 377, S 1; P.L. 1994, chi 372, S 1; p.L. 2003, chi 233, gI, P.L. 2003, chi 358, $ l.)It is obvious that even in 2003, the legislature identified the mortgagee and the lender as

the same party. There is no evidence at all that the legislature envisioned the lender andmoftgagee being separate parties and when this section of the law is read together with theinstant mortgage, it is abundantly clear that the mortgagee and lender are the same pafiy. This isnot to say that the morlgage could not be assigned and that the note could not be negotiated. It isevidence, however, that supports the Plaintiffs argument that the note and mortgage must traveltogether from beginning to end, and that did not take place in this case.

Finally, when 34-Il-24 is read together with the previous two statutes. it is crystallinethat the mortgagee and lender have been identified by the legislature as one in the same. Thestatute reads as follows:

$ 34-11-24 Effect of assignment of mortgage. - An assignment ofmortgage substantially fbllowing the fbrm entitled "Assignment ofMoftgage" shall. when duly executed, have the force and effect ofgranting, bargaining, transfbrring and making over to the assignee, hisor her heirs, executors, administrators, and assigns, the mortgagedeed with the note and debt thereby secured, and all the right, titleand interest of the mortgagee by virtue thereof in and to the estatedescribed therein, to have and to hold the morlgage deed with theprivileges and appurtenances thereof to the assignee, his or her heirs,executors. administrators and assigns in as ample manner as the assignorthen holds the same, thereby substituting and appointing the assignee andhis or her heirs. executors, administrators and assigns as theattorney or attorneys inevocable of the mortgagor under and with all thepowers in the mortgage deed granted and contained.History of Section.(P.L. 1927, chi 1056, S 15; G.L. 1938, chi 436, g 14;G.L. 19s6. $ 34-11-24.)

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Clearly, the language that states that an assignment of the morlgage canies with it thenote assumed that the morlgagee and note holder were the same party. When these threeportions of the General Laws are read together with the form of mortgage in this case, there canbe no other conclusion than that the mortgagee and lender are identified as the same party. Thisbeing the case, it is impossible for a MERS modgage, where it does not own or possess the note,to be assigned or foreclosed upon in the State of Rhode Island.

The Defendants offer no valid case law to support their position because there is none;Bucci. does not supporl this position and it is the well founded argument of the Plaintiff thatJudge Silverstein took on the role of "super legislator" when he ruled otherwise. See C.A. PC-2009-3888. His role was to interpret the law, not make law when existing statutes are clear ontheir face. Both Nevada cases Wa)'ne v. Homeq Servicing, 2008 WL 4642595 (D.Nev. October16, 2008) and Elias v. HomeEq Servicing,2009 WL 481270 (D. Nev. February 25,2009) relyupon Nevada State law which concerns assignments in respect to Deeds of Trust, which aredifferent from assignments concerning Mortgages in is the case in Rhode Island. In addition, inWa)'ne, the servicer held the note and in Elias the couft found the foreclosing party had standingto do so confirmeC in the record deed of trust, notices of fbreclosure, and trustee's deed uponsale. Id. Finally, in Bankers Trust (Del.) v.236 Beltway Inv., 865 F. Supp. 1186 (E.D. Ya.1994)the foreclosing party stated very specific facts suggesting that the servicer had standing toforeclose including the fact that the servicer in that case administered the mortgage, collected allpayments directly from borrowets, and was responsible for the foreclosures on defaultedmortgages, unlike in the cunent case where the alleged servicer performs none of theseresponsibilities. Id.

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MERS would have this Court believe that it is a universal agent for any member of itselectronic data registry and that the Plaintiffs' somehow agreed to that plan. The Plaintifls didnot agree to that claim and MERS cannot serve as nominee of every MERS member as it alleges.The words "Lender's successors and assigns" are metely terms of ar1 in a mortgage and deed andthey do not actually purport to convey to some unnamed and unknown third party that may ormay not exist in the future, the rights that it has under a promissory note.

The Defendant's allude to the argument state in their memorandum, that "MERS is fullydisclosed in the Mortgage as mofigagee and nominee of the lender and the nominee of thelender,s successors and assigns in the promissory note". however this conclusory statement isfalse in light of a decision rendered on February 12,201l, where the Bankruptcy Court from theEastem Division of New York addressed this very issue. In the case In re Aeard, Feb. 201'I,Case No. 810-77338-reg (Bankr. E.D.N.Y. February ll, 2011) the.ludge analyzed the MERSMembership Rules, the affidavits of MERS Officers and Directors, William Hultman and R.K.Arnold, and the agency and nominee arguments that they consistently put forward, much as ithas in this case. The Court held that MERS does not have the authority that it claims. MERShas asserted for years that it has authority to act as agent for each and every MERS member thatclaims ownership of a note and mortgage registered on its system. The Court pointed out thatthis alleged authority is based not in the statutes or case law, but rather derives from the termsand conditions of the MERS membership agreement. See Id. This attorney has argued thatMERS has always attempted to circumvent the law and to interpose its construct ott cities andtowns across Rhode Island, and the Agard decision states unequivocally that this position is true.Id.

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The Court was clear that it was in agreement with the reasoning and holdings in the casesof Bank of New York v. Alderazi,900 N.Y.S.2d 821.824 (N.Y. SUp. Ct.20l0) and LaSalleBank. N.A. v. Boulete, No.41583107,2010 WL 3359552 at* 2 (N.Y.Sup. Aug.26.2010)where the trial courts concluded in general, that MERS, as a nominee, possesses few or nolegally enforceable rights beyond those of a principal whom the nominee serves. Specifically, itstated as follows:

MERS . . . recorded the subject mortgage as "nominee" for FFFC. Theword "nominee" is defined as "[a] person designated to act in place ofanother. usu. in a very limited w'ay" or "[a] party who holds bare legaltitle for the benefit of others." (Black's Law Dictionary 7076 [8th ed2004D. "This definition suggests that a nominee possesses few or nolegally enforceable rights beyond those of a principal whom the nomineeserves." (Luntlmark Nutional Bank v. Kesler, 289 Kan 528. 538 [2009]).The Supreme Coutl of Kansas. in Landmark Ncttional Bank, 289 Kan at539. observed that:The legal status of a nominee, then. depends on the context of therelationship of the nominee to its principal. Various courts haveinterpreted the relationship of MERS and the lender as an agencyrelationship. See 1lz re Sheridan,2009 WL631355. at *4 (Bankr. D.Idaho. March 12.2009) (MERS "acts not on its own account. Its capacityis representative."); Mortgage Elec. Regis'tralions Syslents, Inc. 1,.Southwest, 2009 Ark. 152 _,301 SW3d 1,2009 WL 723182 (March19, 2009) ("MERS. by the terms of the deed of trust, and its ownstated purposes. was the lender's agent"): La Salle Nat. Bank v. Lamy, 12Misc.3d 1191[A], at *2 [Sup Ct. Suffblk Cour-rty 2006]) . . ("A nomineeof the owner of a nole and morlgage may not effectively assign the noteand mortgage to another for want of an ownership interest in said noteand morlgage by the nominee.").

The Court wrote that the mortgage. in naming MERS a "nominee" and/or mortgagee ofrecord, did not bestow authority upon MERS to assign the mortgage. See Id. This statement is onall fours with the instant complaint. The Court went on to comment that according to MERS, inaddition to the alleged authority granted to it in tlie Mortgage itself, the documentation ofMorlgage compofts with all the legal requirements of agency when read in conjunction with theoverall MERS system. MERS' argument in the AggLrd case and the case at bar, and all of the

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MERS cases pending before this Court at the present time, require that this Court disregard thespecific words in the Assignment of Mortgage or, at the very least, interpret the Assignment inlight of the overall MERS System of tracking the beneficial interests in mortgage securities. SeeCase No.810-77338. Additionally. in the Agard case and in all of the cases before this Court,MERS wants the Court to look beyond the four corners of the mortgage itself and take intoconsideration the alleged agency agreements entered into by the lenders participating in theMERS system, including their agreement to be bound by the terms and conditions ofmembership. This request of the Court is far beyond what is prudent.

MERS has wrongly asserled that each of its member lenders agrees to appoint MERS toact as its agent and MERS memorandum in this case asks the Court to do just that. There is not,however, any proof of any type that contains an explicit reference to the creation of an agency ornominee relationship. The MERS membership agreement does not replace the common law orthe statutes which govern real estate conveyance in the State of Rhode Island. The rules ofmembership in MERS do not grant any clear authority to MERS to take any action with respectto the mortgages held by MERS members, including but not limited to, executing assignments.This is exactly what is at issue in the case at bar.

Aside from its inappropriate reliance on the RI Statutory definition of "mortgagee",MERS'position that it can be both the mortgagee and an agent of the mortgagee is absurd. Thishas been argued in every MERS case before this Court. In this case, MERS argues that it wasthe agent sf Domestic and FNMA, but there is no evidence of an agency between Domestic andMERS. There is no evidence that Domestic instructed MERS to assign to. The very assignmentin this case proves this absurdity. MERS, not as nominee of any party, but acting on its ownbehall by way of an attorney in Massachusetts, allegedly assigned the rights of an unknown

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party to FNMA. They were building a mystery. There is no agreement in place betweenDomestic and MERS or BAC or FNMA to lead to any other conclusion. The documentation onrecord should lead this court to conclude that no such other agreements actually exist.

The Agard Court went even further and considered a situation where MERS was actingon behalf of the entity which held the note at the time of the assignment. Id. in that situation, theCourt held that MERS did not have authority, as "nominee" or agent, to assign the Mortgageabsent a showing that it was given specific directions by its principal. Id. In this case, there is noevidence that Domestic, gave such specific instruction to MERS.

Finally the Agard Courl found that the MERS'theory that it czur act as a "common agent"for undisclosed principals is not supported by the law. Id. The Court concluded that therelationship between MERS and its lenders and its distortion of its "alleged" nominee status wasappropriately described by the Supreme Court of Kansas as follows: "The pafties appearto havedefined the word fnomineel in much the same way that the blind men of Indian Legenddescribed an elephant--their description depended on which part they were touching at any giventime." Landmark Nat'l Bank v. Keslqr,216P.3d 158 (Kan. 2010).

Recently the United States Bankruptcy Courl for the District of Oregon outlined in theirIn Re McCoy opinion the limited power that MERS has in the role of "nominee", statingspecifically that "non-judicial foreclosure may be authorized if (a) MERS is the beneJiciaryfemphasis added] and (2) there have been no unrecorded assignments of MERS interests." CaseNo. l0-63814-fra13 (Bankr. D. Or. February 7.2011). In McCoy, MERS countered by arguingthat they were a beneficiary because the deed of trust declared them so, however the courtrefused to recognize them as so and found that the term beneficiary was defined "not merely asthe person named as such, but as 'the person named or otherwise designated in the trust deed as

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the person to whose benefit a trust deed is given, or the person's successor in interest... "' .Id. at3. Therefore, since MERS was solely the nominee and not the beneficiary, they were never in aposition of power to foreclose, and as such, were never in a position to assign the power toforeclose. Id.

The Defendants argue that the Plaintiff is not a party to the assignments ho'+not the state of the law in Rhode Island. Livonia Property Holdings. LLC, involvd;a

'.:f,i. t::|affitv without avalid claim involves a loss of due process rights protected by Article L Qgclion 2 of the Rhode''"., ri ,1{, W"Island State Constitution, and the 14th Amendment Due ProceS'S4,h$.q".{tnd the 5th Amendmentof the United States Constitution as it applies to ,rr. S "i.i'Jl%niu u. r'a.-l.rgton noua,lir,z.t',-'l'"=-'l'lr:Holdings. LLC, Case No. 10-1782 (App. 6thCir. O"%a"ffi.,,.4,8'i4010). When a mortgagor loses his'.1 .,r:riiirr,,,,. k,,ijlr,,property without due process to a stranger !O ltle3ftses a constitutionally protected right and- i:. ,r:1,: '{j'thus strict scrutiny applied to the jtd4ffi,_,a,1-.riv.e,yt of the foreclosure process. That level ofscrutiny does not apply to a comme$ctiat forelosure such as Livonia. Id. In Livonia, the original

.'notes and endorsements weprat:q ly produced, the foreclosing party was in possession of the*,'fu i:i,,, "i ""tt'note, and the failure ,!r9.'"Wqfq4.,igterim assignments were waived. Id. There was no allegation:=,about fraud or ffiey1.,9}grelative to the assignment of the mortgage. In Livonia, the Courtdecided the base &+,Ibe basis of failure to meet particular restraining order standards peculiar tothaT'' ri!. Id. at 15,16. See also, Written Testimony of Adam J. Levitin, AssociateProfessoi*f Law, Georgetown University Law Center, Before the House Financial ServicesCommittee Subcommittee on Housing and Community Opportunity, "Robo-Signing, Chain ofTitle, Loss Mitigation, and Other Issues in Mortgage Servicing" (Nov. 18, 2010)

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Neither the holding nor the dicta of the Livonia Qourt impact the law applicable to titleIclearing cases under Rhode Island General Laws $34- 1614 brought by Rhode Island residential

mortgagors. This Court applies Rhode Island Law with regard to the definition of property rightsof Rhode Island residents which are defined by the statutes located within Title 34 of the RhodeIsland General Laws. These specific statutory examples are not similar to the operativeMichigan Statutes. Rhode Island conveyancing statutes are substantially different from 'Michigan and Ohio Statutes. Consider, for instance, the holding In re Jorge Canellas, (Bankr.M. FL. 2010) Case No. 6:09-bk-12240-ABB wherein the issue of standing to foreclose was atissue. The Canellas Coud, adopting the holding set forth in In re Jacobson, 402 B.R. 559,366(Bankr. W.D. Wash. 2009) stated unequivocally that "Only the holder of the Note and Mortgage,or its authorized agent, has standing to bring this motion.7" This was a Florida Court sitting in alien theory state, adopting the view of a Washington Bankruptcy Court, sitting in a title theorystate. Seealso, InreKermanJ.MinbatiwAlla,+248.R' 104(Bankr. S.D.NY,2010)inwhichthe Court ruled that the party seeking relief from stay to foreclose had to possess both thepromissory note and mortgage. Both of these cases supporl the claim of these plaintiffs aspleaded in their complaint and are far more persuasive than the holdings in Livonia and Bridee.

Michigan is a lien theory State and Rhode Island rs a title theory State. In Rhode Island,a moftgage deed transfers title subject to a conditional defeasance is there is consideration. Lientheory and title theory statutes in different states vary. For example, the Court in Livonia, atpage 18, disagreed with the Massachusetts' Lands Court's holdings in U.S. Bank Nat'l Assoc. v.Ibanez,No. 08-Misc-384283, 2009 WL 3297551 (Mass. Land Ct. Oct 14, 2009), which does notallow blank assignments. Although Ibanez is a Massachusetts case, the Michigan Court's7 In Canellas, U.S. Bank National Association, as Trustee of the Lehrnan Brothers Small Balance CornmercialMortgage Pass Through Certificates, was seeking relief fronr the automatic stay to foreclose on a moftgage.

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reasoning why it did not apply lbanez to Livonia was because "Massachusetts, unlike Michigan,is not a lien theory state. ...". This reasoning holds true when determining whether Livonia, hasany application to Rhode Island cases. It is clear that is does not. The Livonia Court noted thatunlike Massachusetts, Michigan does not follow the "title theory of mortgages." when itdistinguishedIbanez.RhodeIslandlawsharethesamebaseframeworkasIbanez.

Under Michigan mortgage law, a mortgage is not an estate in land, but,+;property intended to secure performance or payment of an obligation. PrimSiFinancid

In regard to Bridse V. Ames Capital Corp., No. 1:09 CV 2947,2070, WL 3834059 (N.D.Ohio Sept. 29,2010), this case too is easily distinguishable from the case atbar. It must first beestablished that like Michigan, Ohio is a lien theory state. As stated earlier herein, Rhode Island

contrary to Rhode Island Law which clearly establishes that aNt#,gag"a an estate in land. TheLivonia Court recognized this fact and refraining fromq$"fu'''ffi* logic to decide the case.

'i-'lThis Court must do the same with the instant case a:i.$ffigan law simply does not apply in thiscase. , ..i;.,.,=,,,!!'if.2"-''"'t'' 'iGiven the fact that Rhode Island an'in;i[-4;,f.Iriean Law are in no way the same relative tomortgage law, using Michigan's taW,,,Si:W2inaine a uniquely Rhode Island question of law would

"":,. .,-be inappropriate h ilt circ,Uql$atice'5. ,In fact, Livonia should not be considered in any way':.r ',t: -ibecause it offers no gpi ll in answering the questions before this Court. Id. In Rhode

t:+Island, a title tty;*oE;'**g1,y;i mortgagor does have the right to challenge the validity of anasli8nmenl ,*r;Yage because a mortgage is an estate in land and the mortgagee and thet""tn1,ng*{',,3l afties to that transaction. Application of the holding in Livonia to the facts ofthis case:would lead to an absurd result under Rhode Island Law. Id.

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is a title theory state. In a "title theory" jurisdiction a mortgage is viewed as a form title to theproperty. Premier Bank v. J.D. Homes of Olathe. Inc., 30 Kan. App. 2d 898, 50 P.3d 5 17 (2002).A "mortgage" is a conveyance of title to the property that is given as security for the payment ofa debt. Ankerman v. Mancuso,27l Conn.772,860 A.2d 244 (2004), and more specifically, amortgage is often considered a conditional conveyance vesting legal title in the mortgagee. withonly the equity of redemption remaining in the mortgagor. Johnson v. McNeil,20A2 ME 99, 800A.2d 702 (Me. 2002). Actually, a mortgage is in essence, a defeasible deed, requiring thegrantee to reconvey the property held as security to the grantor upon satisfaction oftheunderlying debt or fulfillment of established conditions. Pines v. Farrell ,577 Pa. 564,848 A.zd,94 (2004). Tlte Bfidge Coufi's finding that the Plaintiff therein was not a party to the assignmentwould not be true under Rhode Island Law. As the cases recited herein prove, in a title theorystate such as Rhode Island, and under these facts, the property owner "is a party" to theassignment because it is a real estate transaction wherein the property owner is the grantor. Thisbeing the case, the Bridee case and the cases referred to therein, do not apply to Moll.

Defendant's reference Prough v. Foley to, 525 A.2d 919 (R.I. 1987) and DePetrillo v.Belo Holdines. Inc .,2009 WL 3794902 (R.I. Super. Ct. 2009)is unconvincing because neither

a

case is similar to the cuffent case. In Brough, the Plaintiff did not own the real estate andtherefore did not have an interest in the real estate, and DePetrillo did not concern a conveyanceof land but rather a lease. Id.

In their argument, the Defendants suggest that the Complaint fails to state a cognizableclaim for relief and argue lhat a request for declaratory relief is a remedy, however, and not anindependent cause of action. In supporl of this position, they cite the case of Harritos v. Cambio,1996 WL 936906 at *7 (RI. Super. Ct. Mar 13, 1996). The Harritos case was related to an

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appeal from a Summary Judgment entered on behalf of the Defendants. The facts of the caseare rather sordid and relate to personal relationships gone bad and the case does not involve anyfacts remotely similar to the case at bar. The Haritos'filed a 22 count complaint that sounded infraud, RICO, negligence, misrepresentation, breach of fiduciary duty, breach of contract, breachof warranty and conversion. The trial justice concluded that none of the claims were supportedby the evidence. Id. In supporl thereof, they cite several cases, none of which actually buttresstheir claim. The Defendants have cited the Superior Court Slip Decision in their memorandum,while interesting, the Superior Court's ruling was based upon the facts of the case, not upon theissue of whether or not a declaratory judgment action is a remedy or a separate cause of action.The Superior Court decision does not even mention declaratory judgment standards.

The second case cited by the Defendants in support of this particular argument is Buck v.Am. Airlines. Inc., 476 F.3d 29 (1st Cir. 2007) which involves abizane set of circumstancesrelated to the sale of airline tickets and has no application to this case. In fact, the Federal DistrictCourt for the District of Massachusetts concluded that the entire claim was preempted by FederalLaw and for that reason, never even got to the alleged substance of Buck's claims. In fact, in ahumorous note, Mr. Justice Selya, Senior Circuit Judge wrote that "The District Courl found thePlaintiffs' claims preempted and dismissed the suit for failure to state a viable cause of action.We too conclude that the plaintiffs are fruitlessly endeavoring to fly in unfriendly skies." Id. at31. Finally, the quote provided by the Defendant was gleaned from a footnote to the actualdecision in the Buck case. At footnote three, the Court wrote as follows:

"Although the plaintiffs state'declaratory judgment'as a cause of action,the provision that they cite, 28 U.S.C. $2201 (a) creates a remedy, not acause ofaction."

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The case at bar was brought under provisions of $9-30-1, et. seq. of the Rhode IslandGeneral Laws which does provide for a cause of action. This case is nothing like Buck and notgoverned by 28 U.S.C. 52201 (a). Id. Buck offers no support for the argument posited by theDefendants and wanants no further comment. Finally, the Defendants removed this case to theFederal Court, so asking the Court to dismiss a State Court action based upon a Federal Statute isgratuitous at best. Given the morlgage situation in the United States, this case, which is wellplead, deserves to be tried. In any event, the instant complaint contains actions to quiet title andnegligence and neither of those causes of action are bamed by Federal law.

The Defendants go on to suggest to this Court that the Plaintiffs cannot challenge theforeclosure because they have not complied with the Tender Rule. Sirnply put, there is noTender Rule in place in the State of Rhode Island. It is not codified and the case set forth belowcan be easily distinguished from the case at bar. In reliance on the matter of Hanle)r v. Bra)'ton,17 A.2d 857, 860 (R.1. 1941), the Defendants apparently claim that even if there is a title defectand there is a genuine issue as to who owns the operate note and moftgage related to real estate,the property owner must tender payment. To be clear, the word "tender" only appears once inthe Hanley case and not in conjunction with word rule. Id. At issue in this case is who owns thenote and mortgage and who is, if anyone, due payment. It is impossible for the "tender rule" tobe enforced because there is no one to tender payment. Further, there is nothing in Rhode Islandlaw that even suggests that a challenge to title in the Superior Courl carries with it a price ofadmission. It does not. At the core of this matter is whether or not the transfers of the Plaintiffsmortgage and note were lawful. This is a question of law and does not sound in equity. Sincethere is no foreclosure pending. the issue pertaining to the alleged tender rule is moot at thisstage of the proceedings. The Defendant's also quote Jo)zner v. Bank of America Home Loans,

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2010 WL 2953969 (D. Nev. luly 26,2010), forgetting for a moment that the State of RhodeIsland is not bound by Nevada law; again" there currently is no "Tender Rule" in Rhode Island,nor any Rhode Island statute or case that supports otherwise.

The Defendants have also cited the Federal Case of White v. BAC Home LoansServicins, LP,2010WL4352711 at *5 O{.D. Tex. Nov.2,2010) which concerns a WrongfulForeclosure action brought pursuant to the Texas Wrongful Foreclosure Act. There is nowrongful foreclosure act in the State of Rhode Island so on that basis alone, this case is self-distinguishing. Notwithstanding this fact, the correct assessment of the alleged tender rule wouldbe for this Courl to find that the precept that equitable relief requires equitable conduct is a limiton remedy, not right. See Id. Thus the failure of a party to tender in a mortgage does notprecluded them from filing suit when a foreclosure proceeding is wrongful. Rather. it operateson the back as a force which shapes the remedy and relief.

Finally, the Defendant's cite another irrelevant case Keen v. Am. Home mortgageServicing. Inc.,664 F. Supp. 2d 1086 (E.D. Cal. 2009) discussing the connection between tenderand rescission. First off" the tender issue in Keen concems the Right of Rescission and reliesupon 15 U.S.C. $1635(b),.specifically the "Return of money or property following rescission".

:::The Plaintiff would freely agree that rescission requires tender; however the current case doesnot concern rights during rescission, nor is it susceptible to the specific law upon which Keenrelies. Id.

It is true that that no completed foreclosure sale has taken place, but a statutoryforeclosure sale was noticed and was moving forward towards completion. The power of salehad been noticed by FNMA and BAC but was stopped at the last minute. It should also be

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understood that Rhode Island does not have a wrongful foreclosure statute so the cases citedwhich related to wrongful foreclosure are not relevant to this action.

Finally, in regard to the allegation that the Plaintiff failed to sufficiently plead theelements of negligent misrepresentation, this complaint, when viewed by the Court, with allfactual assertions being taken as true, "plausibly suggest an entitlement to relief. " Ashcroft v.Iqbal, 129 S.Ct. 1937,1951 (2009) and Bell Atlantic Corp. v. Twombly,550 U.S. 544QA\T.The Plaintiff has properly pleaded the elements required to make out a claim for NegligentMisrepresentation. At this point, he does not need to prove his case. He just needs to prove thatthey have pleaded a cause of action properly. The Plaintiffs' complaint clearly set lorth therequired elements of negligent misrepresentation under Rhode Island Law. l-o prevail on anegligent misrepresentation claim, Plaintiff must prove l) Defendant made a false representationof existing facts, 2) that the representation was false when made, 3) the defendant knew orshould have known that the information was to be relied upon by plaintiff in a businesstransaction, 4) that the defendant failed to exercise reasonable care in obtaining orcommunicating the information, 5) the plaintiff relied on the false representation, and 6) plaintiffsuffered some financial loss or harm as a proximate result of the representation. See FocusInvestment Associates. Inc. v. American Title Insurance Co.. gg2 F-. 2d 1231 (lst Cir. 1993);Forcier v. Cardello, 173 B.R. 973 (D.R.l. 1994): Restatement (Second) of Torts, 5522 (1997).The element of intent is not required to prove negligent misrepresentation and the existence ofintent changes the cause of action from negligent misrepresentation to fraudulentmisrepresentation. Based upon the foregoing, the l2(b)(6) Motion relative to the count ofnegligent misrepresentation should be denied. See also Aceves v. U.S. Bank. NA,No.8220922,

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(January 27,2011). (Court determined that bank's breach of promise could amount to cause ofaction due to Aceves reliance upon the promise and bank's misrepresentation.)

The Defendants are correct in asserting that nowhere in the loan documents is it expresslystated that a mortgagee must engage in post-default loan modification. In this case however,Moll was engaged with the Defendants in post-default negotiations regarding a short,fhi. On."

uian '*^. .il;that commenced, it is his contention that the Defendant is under a duty to act ,:r,#Wffiiij.i),,.'"this case, BAC asked for documents for review and then buried them while ffiW";\ls,e'dforward""tl'?,#i' 'riM:t:F"f'with an invalid foreclosure action. Moll reasonably relied upon the rppr.sqttulions made by the'i, ." "*w#

Defendants and when he found out that the foreclosure was going4oi*ar$, he was forced to filethe instant action. * .tf.-'..=t'u'

The Defendant's list a number of cases to,::,lFt"# ontention that the PlaintiffsImisrepresentation claim should be dismissed*,hdrlever.the cases cited are off point and

specifically concern negligence claims,lhe ' 'f;lse Claims Act, RICO, and fraud. TheDefendant's include parker v.Flyrns').,,!%A.2d 62UR.I. 2010) where the court treats themisrepresentation claim thengqe as a nhua claim, however the court specifically states that thereason for doing so ogJy-'Sp Plaintiff interchanged fraud and mi srepresentationthroughout their ?;!iThe Plaintiff has adequately plead the necessary elements of

CONCLUSIONFor all of the reasons set forth above the Plaintiff respectfully requests that court deny the

Defendant's motion to dismiss.

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united states district court district of rhode island -- moll brief

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