Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_12-cv-01218/USCOURTS-azd-2_12-cv-01218-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Petition to Quiet Title

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Wayne McIntosh, 

Plaintiff, 

v. 

Wells Fargo Bank, N.A.; CitiBank, N.A., 

Defendants.

No. CV-12-1218-PHX-GMS

ORDER 

 Pending before the Court is Defendant’s Motion to Dissolve the Temporary 

Restraining Order (“TRO”) in this matter. (Doc. 13). For the reasons discussed below, the 

motion is denied.

BACKGROUND 

On January 12, 2007 Plaintiff executed a Deed of Trust (“DOT”) in connection 

with a loan that he used to purchase a house on 4901 East Butler Drive in Paradise Valley 

(“the Property”). (Doc. 12-1, Ex. A). On November 13, 2008, First American Title 

Insurance Company (“First American”), at that time the Trustee of the DOT, noticed a 

Trustee Sale of the Property. Defendants aver that the sale was continued to May 29, 

2012; nothing in the current record explains the underlying reason that that sale was 

continued or documents this fact. On March 26, 2010, Mortgage Electronic Registration 

Systems, Inc. (“MERS”) acting at that time as beneficiary to First American, assigned all 

beneficial interest in the Deed of Trust to Citibank, N.A. as successor Trustee to U.S. 

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Bank National Association, as Trustee for MASTER Adjustable Rate Mortgages Trust 

2007-HF, Mortgage Pass-Through Certificates, Service 2007-HF1 (“Citibank”). (Doc. 12 

at 3; Doc. 12-1 at H). 

Plaintiff filed for bankruptcy in 2011, and in connection with his bankruptcy was 

informed that he had to obtain Citibank’s approval for a plan restructuring his mortgage. 

(Doc. 18).1

 After Plaintiff contacted Citibank, a person purporting to be Citibank’s 

general counsel, Stephen M. Smith, wrote Plaintiff a letter stating that “I have not been 

able to find any evidence that Citi is the servicer or investor on your loan.” (Doc. 18-1). 

Plaintiff responded by sending Citibank a $5.00 check and a quitclaim deed for the 

property, which Citibank returned with a note stating that it could not cash the check 

“Due to You [sic] Account Has Been Paid in Full.” (Doc. 18-1). 

At some point prior to May 14, 2012, Wells Fargo, N.A. (“Wells Fargo”) and 

Citibank took some action in relation to the previously-noticed trustee’s sale. Plaintiff 

filed this action in Maricopa County Superior Court on May 14, 2012, and a TRO was 

issued on May 25, 2012, preventing the sale. (Doc. 1-1 at 56). Defendants removed to 

this Court on June 7, 2012. (Doc. 1). Defendants now seek dissolution of the TRO. (Doc. 

13).2

DISCUSSION

I. Legal Standard 

A plaintiff must establish four elements in order to be granted preliminary 

injunctive relief, including “that he is likely to succeed on the merits, that he is likely to 

suffer irreparable harm in the absence of preliminary relief, that the balance of equities 

tips in his favor, and that an injunction is in the public interest.” Winter v. Natural Res. 

Def. Council, 555 U.S. 7, 22 (2008), see FED. R. CIV. P. 65. (emphasis in original). The 

 

1

 On April 9, 2012, Plaintiff’s bankruptcy was dismissed. (See BK-11-18706-RJH 

Bankr. D. Ariz.). 

2

 There are other motions pending as well, upon which the Court will rule in due 

course. 

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Ninth Circuit considers all of the elements except for irreparable injury using a sliding 

scale approach, where “the elements of the preliminary injunction test are balanced, so 

that a stronger showing of one element may offset a weaker showing of another.” 

Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011). The 

element of irreparable injury is not subject to balance; the moving party must 

“demonstrate that irreparable injury is likely in the absence of an injunction.” Winter, 555 

U.S. at 23 (emphasis in original). Therefore, should the moving party demonstrate a very 

high likelihood of irreparable injury, the likelihood of success on the merits may be 

relaxed. In such cases, an injunction may be granted when “serious questions going to the 

merits were raised and the balance of hardships tips sharply in the plaintiff's favor.” Wild 

Rockies, 632 F.3d at 1134–35 (quoting The Lands Council v. McNair, 57 F.3d 981, 987 

(9th Cir. 2008)). 

“Serious questions are ‘substantial, difficult and doubtful, as to make them a fair 

ground for litigation and thus for more deliberative investigation.’” Republic of the 

Philippines v. Marcos, 862 F.2d 1355, 1362 (9th Cir. 1988) (en banc) (quoting Hamilton 

Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2d Cir. 1952) (Frank, J.)). “Serious 

questions need not promise a certainty for success, nor even present a probability of 

success, but must involve a ‘fair chance of success on the merits.’” Republic of the 

Philippines, 862 F.2d at 1362 (quoting Nat’l Wildlife Fed’n v. Coston, 773 F.2d 1513, 

1517 (9th Cir. 1985)); see also Bernhardt v. L.A. County, 339 F.3d 920, 926-27 (9th Cir. 

2003). 

II. Analysis

Defendants allege that this is a run-of-the mill “show me the note” claim, and must 

therefore be dismissed. (Doc. 13 at 4). See Hogan v. Washington Mut. Bank, N.A. 277 

P.3d 781 (Ariz. 2012). Defendants are correct that “the deed of trust statutes impose no 

obligation on the beneficiary to ‘show the note’ before the trustee conducts a non-judicial 

foreclosure.” Id. at 783. Plaintiff here, however, is not demanding that Defendants 

produce the so-called “wet-ink” note. Plaintiff doubts that Citibank remained the trustee 

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only because Citibank’s general counsel wrote him a letter stating affirmatively that the 

account has been paid in full and therefore would not affirm a negotiated restructuring of 

the loan worked out in Plaintiff’s bankruptcy. Hogan reaffirmed that “a deed of trust, like 

a mortgage, may be enforced only by, or in behalf of, a person who is entitled to enforce 

the obligation the mortgage secures.” Hogan, 277 P.3d at 782. Unlike many plaintiffs 

who seek relief under a show-me-the note theory, Plaintiff here did not seek to evade his 

obligation to pay his mortgage, but rather to refinance it through bankruptcy. 

 The fact that Citibank’s general counsel affirmed that Citibank had no interest in 

Plaintiff’s loan in December, only months before Citibank and Wells Fargo re-initiated 

the trustee’s sale, presents “fair ground for litigation and thus for more deliberative 

investigation” regarding who owns the DOT. Republic of the Philippines, 862 F.2d at 

1362. The record here is incomplete—there are no documents regarding the continuance 

of the foreclosure sale or the notice of the May 29, 2012 sale, nearly four years after the 

sale was originally noticed. The Court notes that the Citibank letter is “just that; a letter, 

and nothing more,” and that Mr. Smith “does not declare that his statements are made 

under penalty of perjury.” In re Veal, 450 B.R. 897, 903 (9th Cir. BAP 2011). 

Nevertheless, the letter does serve to raise serious questions regarding the note, and 

therefore supports continuing the TRO. 

 Regarding the other elements of the Winter test, it is well-established that losing a 

home qualifies as irreparable harm, and the public and private equities here weigh in 

favor of keeping the TRO in place while the underlying questions of this lawsuit are 

resolved. 

/ / / 

/ / / 

/ / / 

/ / / 

 

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IT IS THEREFORE ORDERED that Defendants’ Motion to Dissolve the TRO 

(Doc. 13) is denied. 

 Dated this 31st day of August, 2012. 

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