UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

ANTHONY FACIONE and ERIN 

FACIONE,

Plaintiffs,

v.

CHL MORTGAGE PASS-THROUGH

TRUST 2006-J1, MORTGAGE PASSTHROUGH CERTIFICATES, SERIES

2006-J1,

Defendants.

 /

Case No. 14-12426

Honorable Nancy G. Edmunds

ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS PLAINTIFFS’ AMENDED

COMPLAINT [10] AND DENYING AS MOOT DEFENDANTS’ MOTION TO DISMISS

PLAINTIFFS’ ORIGINAL COMPLAINT [7]

Plaintiffs’ suit arises out of the foreclosure and February 11, 2014 sheriff’s sale of

residential property located at 28600 Coyote Court, New Hudson, Michigan, 48165 (the

“Property”) to the Bank of New York Mellon (“BNYM” or “Defendant”) f/k/a the Bank of New

York, as Trustee for the named Defendants. Plaintiffs allege that the mortgage and note

associated with the Property were not properly transferred to BNYM and, as a result,

BNYM did not possess the authority to legally foreclose on the Property under Michigan’s

foreclosure by advertisement statute. Plaintiffs seek relief in the form of a judgment setting

aside the sheriff’s sale and declaring that their interest in the Property is superior to all

others. 

Currently before the Court is BNYM’s motion to dismiss Plaintiffs’ amended complaint.

(Dkt. # 10). For the reasons stated below, this Court GRANTS BNYM’s motion.

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I. FACTS

On August 19, 2005, Plaintiffs entered into a mortgage loan transaction with Golden

Mortgage Corporation (the “Lender”). As security for the loan, Plaintiffs executed a

promissory note in the amount of $478,400 in favor of the Lender, which was subsequently

transferred to Flagstar Bank, FSB. (Def.’s Mot. Ex. A). The note was secured by a

mortgage on the Property providing Mortgage Electronic Systems (“MERS”) with the

authority to act “solely as a nominee for Lender and Lender’s successor’s and assigns.” 

(Id. at Ex. B). On December 31, 2012, MERS executed a written assignment of the

mortgage to BNYM as trustee for the Defendant. Significantly, the assignment took place

prior to the sheriff’s sale and provided BNYM with “all [MERS’] right, title, and interest . . .

. ” in the mortgage. (Id. at Ex. C). 

On August 15, 2013, Bank of America, N.A. (“BANA”), the loan servicer, notified

Plaintiffs that it was accelerating the outstanding balance due on the loan. (Compl. ¶ 17).

Approximately three months later, on November 19, 2013, BNYM commenced foreclosure

proceedings against Plaintiffs, publishing notice of the proposed sheriff’s sale in the

Oakland County Legal News. (Compl. Ex. E). On February 11, 2014, the Property was sold

at a foreclosure sale to BNYM for $586,595.37. The statutory redemption period expired

on August 11, 2014, at which point legal title vested in BNYM.

On June 6, 2014, BNYM removed this case from the Oakland County Circuit Court to

this Court on the basis of diversity jurisdiction. BNYM filed a motion to dismiss Plaintiffs’

original complaint on September 12, 2014. Rather then file a response to BNYM’s motion,

Plaintiffs’ opted to file an amended complaint pursuant to Rule 15(a)(1)(B) of the Federal

Rules of Civil Procedure. In their amended complaint, Plaintiffs contest the assignment of

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mortgage and seek to have title to the Property quieted in their favor. Plaintiffs further

allege that the foreclosure proceedings instituted by BNYM were illegal under Michigan law.

On October 8, 2014, BNYM filed a motion to dismiss Plaintiffs’ amended complaint. As

such, the Court need not address BNYM’s first motion, and hereby denies it as moot. (Dkt.

# 7).

II. LEGAL STANDARD

A. Motion to Dismiss Pursuant to Fed. R. Civ. P. 12(b)(6)

The Sixth Circuit recently noted that under the United States Supreme Court's

heightened pleading standard laid out in Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007)

and Ashcroft v. Iqbal, 556 U.S. 662 (2009), “a complaint only survives a motion to dismiss

if it contains sufficient factual matter, accepted as true, to state a claim to relief that is

plausible on its face.” Estate of Barney v. PNC Bank, Nat'l Assoc., 714 F.3d 920, 924-25

(6th Cir. 2013) (internal quotations and citations omitted). The court in Estate of Barney

goes on to state that under Iqbal, “[a] claim is plausible when the plaintiff pleads factual

content that allows the court to draw the reasonable inference that the defendant is liable

for the misconduct alleged.” Id. (internal quotations and citations omitted). Furthermore,

“[w]hile the plausibility standard is not akin to a ‘probability requirement,’ the plausibility

standard does ask for more than a sheer possibility that a defendant has acted unlawfully.”

Iqbal, 556 U.S. at 678. “[W]here the well-pleaded facts do not permit the court to infer more

than the mere possibility of misconduct, the complaint has alleged—but it has not

‘show[n]’—‘that the pleader is entitled to relief.’ ” Id. at 679 (quoting Fed. R. Civ. P. 8(a)(2)). 

If the plaintiffs do "not nudge[ ] their claims across the line from conceivable to plausible,

their complaint must be dismissed." Twombly, 550 U.S. at 570. Finally, the Court must

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always keep in mind that “on a motion to dismiss, courts are not bound to accept as true

a legal conclusion couched as a factual allegation.” Id. at 555.

Moreover, “documents attached to the pleadings become part of the pleadings and

may be considered on a motion to dismiss.” Commercial Money Ctr., Inc. v. Ill. Union Ins.

Co., 508 F.3d 327, 335 (6th Cir.2007) (citing Fed.R.Civ.P. 10(c)).“A court may also

consider matters of public record in deciding a motion to dismiss without converting the

motion to one for summary judgment.” Id. at 336. In addiiton documents not attached to the

pleadings may still be considered part of the pleadings when the “document is referred to

in the complaint and is central to the plaintiff's claim.” Greenberg v. Life Ins. Co. of Va., 177

F.3d 507, 514 (6th Cir.1999) (internal quotation marks and citations omitted).

III. ANALYSIS 

The crux of Plaintiffs’ amended complaint revolves around the claim that BNYM did

not have legal authority to foreclosure on the Property because the mortgage was never

properly transferred. Not only is the very premise of Plaintiffs’ argument unsupported by the

record, their claims are legally deficient under the vast body of precedent governing this

area of the law.

A. Plaintiffs Failed to Exercise Their Redemption Rights

It is well established that “once the redemption period following foreclosure of a

property has expired, . . . the former owner’s rights in and title to the property are

extinguished. At that point, the former owner loses [the ability] to assert claims with respect

to the property.” Luster v. Mortg. Elec. Registration Sys., Inc., No. 11-CV-14166, 2012 WL

124967, at *2 (E.D. Mich. Jan. 17, 2012) (Rosen, C.J.) (citing cases). Here, there is no

dispute that Plaintiffs redemption period expired on August 11, 2014. Because Plaintiffs

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failed to timely exercise their redemption rights, they cannot now collaterally attack any

aspect of the foreclosure or sheriff’s sale. See Overton v. Mortg. Elec. Registration Sys.,

Inc., No. 284950, 2009 WL 1507342, at *1 (Mich. Ct. App. May 28, 2009).

Once the statutory redemption period expires, “‘[t]he law in Michigan does not allow

an equitable extension of the period to redeem from a statutory foreclosure sale in

connection with a mortgage foreclosed by advertisement . . . in the absence of a clear

showing of fraud, or irregularity.’” Luster, 2012 WL 124967 at *2 (quoting Schulthies v.

Barron, 167 N.W.2d 784, 785 (Mich. Ct. App. 1969)). Plaintiffs’ amended complaint alleges

no facts suggesting the existence of fraud in connection with BNYM’s foreclosure by

advertisement. Moreover, as the Michigan Court of Appeals observed in Whitfield v.

OCWEN Berkeley Fed. Bank & Trust, No. 221248, 2001 WL 1699782, *2 (Mich. Ct. App.

Dec. 28, 2001), “the type of fraud sufficient to set aside a foreclosure sale must generally

relate to the foreclosure procedure or sale itself.” As mentioned, the entirety of Plaintiffs’

claim is focused on BNYM’s assumption of the mortgage. In other words, even assuming,

arguendo, that the complaint could be reasonably construed as raising a fraud claim–which

it cannot–Plaintiffs have failed to allege any defects with respect to the foreclosure sale

itself. 

B. Plaintiffs Have no Effective Means of Challenging the Assignment 

As a last ditch effort, Plaintiffs attempt to argue that a recent Sixth Circuit decision, 

Slorp v. Lerner, Sampson & Rothfuss, 13-3402, 2014 WL 4800100 (6th Cir. 2014) supports

their ability to challenge the assignment of mortgage between MERS and BNYM. While

Slorp does reaffirm the widely understood principle that “a non-party homeowner may

challenge a putative assignment’s validity on the basis that it was not effective to pass legal

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title to the putative assignee”, it does not expand the narrow grounds upon which such a

challenge may be based. Id. at *4-5. 

As the court originally explained in Livonia Props. Holdings, LLC, v. 12840-12976

Farmington Rd. Holdings, LLC, 399 Fed. App’x. 97, 102 (6th Cir. 2010), while “there is

ample authority to support the proposition that a litigant who is not a party to an assignment

lacks standing [under Michigan law] to challenge that assignment” an obligor: 

may assert as a defense any matter which renders the assignment absolutely

invalid or ineffective, or void. These defenses include nonassignability of the

instrument, assignee's lack of title, and a prior revocation of the assignment,

none of which are available in the current matter. Obligors have standing to

raise these claims because they cannot otherwise protect themselves from

having to pay the same debt twice. 

Id. (citations omitted). The court then rejected the borrower’s challenge to the assignment’s

validity: 

In this case, [the borrower] is not at risk of paying the debt twice, because

[the assignee] has established that it holds the original note. [The assignee]

has produced ample documentation that it was in possession of the note and

had been assigned all rights therein prior to the initiation of foreclosure

proceedings. The district court reviewed the copies in exhibits and the

originals produced by [the assignee] and was satisfied that they were

authentic. Without a genuine claim that [the assignee] is not the rightful

owner of the loan and that [the borrower] might therefore be subject to double

liability on its debt, [the borrower] cannot credibly claim to have standing to

challenge the [assignment]. 

Id. Following Livonia, Michigan courts and the Sixth Circuit have “rejected challenges to

mortgage assignments, but have recognized that such challenges may be permitted where

the borrower has a valid claim that he will face double liability.” Carmack v. Bank of New

York Mellon, 534 F. App'x 508, 512 (6th Cir. 2013) (citing Bank of N.Y. Mellon Trust Co.,

Nat'l Ass'n v. Monsivaes, No. 310696, 2013 WL 2495045, at *3 n. 4 (Mich. Ct. App. June

11, 2013); Famatiga v. Mortg. Elec. Registration Sys., No. 304726, 2013 WL 1137186, at

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*2 (Mich. Ct. App. Mar. 19, 2013).

Contrary to Plaintiffs’ suggestion, Slorp does not alter the framework set forth in

Livonia and its progeny. In fact, the court specifically acknowledged that “Livonia Properties

discusses the . . . circumstances in which a homeowner may impede foreclosure by

attacking the assignment of the mortgage. That opinion says nothing about when a

homeowner may bring suit to seek redress for fraudulent or deceptive acts . . . . ” 2014 WL

4800100 at *5. Indeed, the primary question before the court in Slorp was whether the

plaintiff had “standing to bring [consumer protection], falsification, and conspiracy claims

against the defendants . . . .” Id. at *6. This “distinction makes all the difference.” Id. at *

5. Here, Plaintiffs have not, and seemingly cannot, state a claim sounding in fraud, and

make no attempt to compare BNYM’s actions with those alleged against the defendants

in Slorp. Rather, Plaintiffs’ suit is much more akin to the Livonia variety, alleging “technical

defects that prevented [BNYM] from establishing record chain of title under Michigan Law.”

Id. 

 In order to comply with Section 600.3204(3) of Michigan’s foreclosure statute, “a

record chain of title [must] exist prior to the date of the sale . . . evidencing the assignment

of the mortgage to the party foreclosing.” Mich. Comp. Laws. § 600.3204(3). In Livonia, the

Sixth Circuit held, in effect, that this section of the statute requires a record showing “a

clear chain of title from the original mortgagee to [the party foreclosing on the mortgage].”

399 F.App’x 97, 101. Here, as in Livonia, BNYM “has produced ample documentation that

it was in possession of the note and had been assigned all rights therein prior to the

initiation of foreclosure proceedings.” Id. at 102; See (Def.’s Mot. Ex. A, B, C). Indeed,

Plaintiffs fail to direct the Court’s attention to any public record that undermines the chain

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of title as recorded. See Carmack v. Bank of New York Mellon, 534 Fed. App’x. 508 (6th

Cir. 2013) (affirming the district court’s dismissal of the plaintiff’s claim under § 600.3204(3)

for failing to successfully challenge the record chain of title). 

Accordingly, the Court must, and does, grant BNYM’s motion to dismiss Count III of

the amended complaint. 

C. BNYM was Legally Permitted to Foreclose on the Property 

Plaintiffs’ complaint also implicates § 600.3204(1)(d)’s requirement that the foreclosing

party own the indebtedness secured by the mortgage. Mich. Comp. Laws. §

600.3204(1)(d). Because BNYM was the record holder of Plaintiffs’ mortgage at the time

the foreclosure was initiated, it was authorized to foreclose by advertisement under

Michigan Law. This authority was recognized by the Michigan Supreme Court in Residential

Funding Co., LLC v. Saurman, 805 N.W.2d 909 (Mich. 2011). The Saurman court observed

that the owner of record “own[s] a security interest lien on the [mortgaged] propert[y], the

continued existence of which [is] contingent upon the satisfaction of the indebtedness,” and

“[t]his interest in the indebtedness–i.e., the ownership of legal title to a security lien whose

existence is wholly contingent upon the satisfaction of the indebtedness–authoriz[s] [the

record-holder of the mortgage] to foreclose by advertisement under MCL 600.3204(1)(d).”

Id. at *5. 

Even assuming, arguendo, that BNYM did fail to strictly adhere to Section 600.3204's

requirements, Plaintiffs “must do more than rest [their] case on speculative, harm. [They]

must establish prejudice (such as double liability) resulting from [BNYM’s] failure to adhere

to the statute’s requirements.” Carmack, 534 Fed. App’x at 512; See also Kim v. JPMorgan

Chase Bank, N.A., 825 N.W.2d 329, 337 (Mich. 2012) (To establish an actionable defect

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under § 600.3204, a plaintiff “must show that [he] would have been in a better position to

preserve [his] interest in the property absent defendant’s noncompliance with the statute.”) 

Noticeably absent from Plaintiffs’ pleadings is any suggestion of prejudice stemming from

a defect in the foreclosure process. Indeed, “Plaintiff[s] [have] not presented any evidence

that [some third-party] is attempting to collect on the note, or intends to collect on the note.”

Cable v. Mortgage Electronic Registration Systems, No. 11-14877, WL 2374236, *4 (E.D.

Mich. June 22, 2012) (Denying the plaintiff’s prejudice argument based on “mere conjecture

that he could be subject to double liability . . . . ”) Accordingly, Plaintiffs have failed to

establish that (1) BNYM was not the record-holder of the mortgage at time of the

foreclosure, or (2) in the alternative, that BNYM’s foreclosure subjected them to double

liability. 

Finally, Plaintiffs’ claim that “MERS was not authorized to assign the mortgage to

BNYM after the close date [of the trust]” is similarly unpersuasive. (Plfs. Resp. 2). This

argument has been considered–and rejected–by numerous courts and need not be

discussed at length here. See e.g. Moss v. Wells Fargo Bank, N.A. No-13429, 2012 WL

1050069, *6 (E.D. Mich. Mar. 28, 2012) (observing that “the plaintiffs have presented no

argument or authority to demonstrate on what basis they can challenge a breach of [the

trust] agreement, to which the plaintiffs are not parties.); Livonia Prop. Holdings, L.L.C. v.

12840-12976 Farmington Rd. Holdings, L.L.C., 717 F. Supp. 2d 724, 748 (E.D. Mich. 2010)

(same). Accordingly, Plaintiffs’ wrongful foreclosure claim under Count II of the complaint

must be dismissed. 

D. Plaintiffs Cannot State a Claim for Quiet Title 

Plaintiffs final count purports to state a claim for quiet title. As BNYM correctly points

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out, however, the Sixth Circuit has recently held that quiet title is a remedy, not an

independent cause of action. Goryoka v. Quicken Loans, 519 Fed. App’x 926, 929 (6th Cir.

March 18, 2013). Moreover, Plaintiffs have failed to establish the very interest this statutory

mechanism seeks to protect; namely, superior title. 

Under Mich. Comp. Laws § 600.2932(1) “Any person . . . who claims any right in, title

to, equitable title to, interest in, or right to possession of land, may bring an action . . .

against any other person who claims . . . [an inconsistent interest].” In order to prevail

under this section, a plaintiff must establish a substantive interest in the property superior

to any challengers. Beach v. Twp. of Lima, 802 N.W.2d 1, 8 (Mich. 2011). Plaintiffs bear

the burden of establishing a prima facie case of superior title. Stinebaugh v. Bristol, 347

N.W.2d 219, 221 (Mich. Ct. App.1984) (citation omitted). “Establishing a prima facie case

of title requires a description of the chain of title through which ownership is claimed.”

Sembly v. U.S. Bank, N.A., No. 11–12322, 2012 U.S. Dist. LEXIS 1440, *9 (E.D.Mich. Jan.

6, 2012).

As discussed throughout this Opinion and Order, Plaintiffs have failed to allege facts

even remotely suggesting that they hold superior title to the Property. Rather, Plaintiffs

make wholly conclusory allegations such as “Defendants have no legally substantiated

interest in the [Property] outside of a ‘wild’ instrument of assignment . . . . “ (Amend Compl.

¶ 25). “Ironically, Plaintiff's Complaint supports a finding that Defendant has superior title

to the Property based on the sheriff's sale and expiration of the redemption period.” Delap

v. U.S. Bank, N.A., No. 14-11970, 2014 WL 4473845, at *7 (E.D. Mich. Sept. 9, 2014).

Accordingly, the Court dismisses Count I. 

IV. CONCLUSION

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For the reasons set forth above, the Court hereby GRANTS BNYM’s motion to dismiss

the amended complaint. (Dkt. # 10). Accordingly, BNYM’s motion to dismiss the original

complaint (Dkt. # 7) is DENIED as moot. This order closes the case in its entirety. 

SO ORDERED.

S/Nancy G. Edmunds 

Nancy G. Edmunds

United States District Judge

Dated: November 21, 2014

I hereby certify that a copy of the foregoing document was served upon counsel of

record on November 21, 2014, by electronic and/or ordinary mail.

S/Carol J. Bethel 

Case Manager

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