UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

DARON POWERS AND MEGAN POWERS,

Plaintiffs, Case Number 14-14335

Honorable David M. Lawson

v.

BANK OF AMERICA, N.A. and DOES 1-5,

Defendant.

_____________________________________/

OPINION AND ORDER DENYING PLAINTIFFS’ MOTION FOR A TEMPORARY

RESTRAINING ORDER AND FOR A PRELIMINARY INJUNCTION, AND

GRANTING AN EQUITABLE STAY OF THE PLAINTIFFS’ REDEMPTION PERIOD

This case arises from the foreclosure of the mortgage on the home of the plaintiffs, Daron

Powers and Megan Powers. The non-judicial foreclosure proceeding has progressed through the

sale stage, and the redemption period is about to expire. The plaintiffs presently are representing

themselves. They filed a complaint in state court, and Bank of America has removed it to this Court. 

Presently before the Court is the plaintiffs’ emergency motion for a temporary restraining order and

preliminary injunction to prevent an eviction authorized by a state court, which is imminent. This

Court does not have the authority to interfere with the process of a state court in the present

circumstances. However, the plaintiffs have raised serious questions about the validity of the

foreclosure and the conduct of the Bank that warrants closer examination by this Court. In order to

give this case the attention it deserves and retain the opportunity to provide the plaintiffs with

meaningful relief, should it turn out that they are entitled to it, the Court will exercise its equitable

prerogative and extend the redemption period while this lawsuit is pending.

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 1 of 11 Pg ID 655
I.

The Court had referred this case to Magistrate Judge Mona K. Majzoub for all pretrial

matters. Judge Majzoub held a hearing on the plaintiffs’ emergency motion, during which it became

apparent that because of the magistrate judge’s limited powers, coupled with the procedural rules,

the timing of the proceedings, and the emergent nature of the remedies sought, the reference should

be withdrawn and the Court should take up the motions itself. 

According to the complaint and motion papers, the plaintiffs purchased a condominium

located at 7054 Deerwood Trail #32, in West Bloomfield, Michigan in September 2005. They paid

$380,000 for the condominium, making a $141,300 down payment. The plaintiffs obtained a

$238,700 loan from the defendant for the balance of the purchase price, which was secured by a

mortgage. The promissory note and mortgage required the plaintiffs to make monthly payments of

$1,355.32 from November 1, 2005, through October 1, 2035. The plaintiffs were also required to

make monthly escrow deposits in the amount of $530.69. The defendant has been the mortgagee

and the loan servicer since the plaintiffs obtained the loan. According to the defendant, the Federal

Home Loan Mortgage Corporation (Freddie Mac) was the loan “investor.” 

It is undisputed that from the inception of the loan through December 2009, the plaintiffs

made timely payments, including several payments of $2,500 near the inception of their loan, which

included additional principal payments of $613.99. Sometime in late 2009, however, the plaintiffs

called the defendant to discuss a loan modification under the government’s Home Affordable

Modification Program (HAMP). On December 23, 2009, the defendant agreed to a three-month trial

period during which the plaintiffs would make reduced payments on their loan in the amount of

$1,316.85, including escrow payment, beginning February 1, 2010. Under the trial plan, the

-2-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 2 of 11 Pg ID 656
plaintiffs would make the reduced payments while their application for the HAMP loan was

reviewed. Although the plaintiffs were told that official approval could take three months (or

sometimes longer), the frequently asked questions (FAQ) section of the trial program notice says

that the defendant will “process your modification request as quickly as possible,” but “[i]t may take

up to 45 days . . . to review [the] documents once they are received.” Importantly, however, the

HAMP trial plan did not reduce the amount actually due each month under the plaintiffs’ original

mortgage; instead, the plaintiffs were told (again through the FAQ) that “[t]he difference between

the amount of the trial payment and your normal monthly payment will be added to your loan

balance.” If the plaintiffs’ application were approved, the defendant would waive any late fees and

roll the past due balance into the plaintiffs’ modified loan. 

In February 2010, the plaintiffs began making modified loan payments under the trial

modification agreement. The plaintiffs made those modified payment for three months, and then

continued making them faithfully for an additional thirteen months, not having heard from the Bank

about a decision on their modification request. The Bank accepted all those payments. At the

November 20, 2014 hearing, plaintiff Daron Powers explained that although he was aware the trial

modification documentation called for only three payments, he telephoned the Bank on a monthly

basis and was told by various representatives that he should continue to make the modified payments

because his application was still being reviewed. According to the plaintiffs, on or around June

2011, Daron Powers was informed that their loan had been removed from the trial modification

program after nine months. The plaintiffs then resumed making the regular payments in the original

amount.

-3-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 3 of 11 Pg ID 657
The plaintiffs made four payments of $1,746.24, until September 2011, at which time the

Bank stopped accepting payments. At the November 20, 2014 hearing, the defendant acknowledged

that it is standard practice for it to stop accepting payments on an account once the Bank determines

that the borrower is in default. Daron Powers noted that he received a statement or invoice from the

defendant indicating that the plaintiffs owed several thousand dollars as a result of unpaid (or

underpaid) loan payments. A review of the plaintiffs’ account history shows that their 16 HAMP

trial payments were being applied to their account based on their original loan payment amounts,

which caused the plaintiffs to slowly accrue a large, unpaid balance on their loan. By September

2011, the plaintiffs’ account was five months in arrears, at which time the defendant determined that

the plaintiffs were in default under their loan agreement.

On April 25, 2012, nearly seven months after the plaintiffs’ last payment was refused, the

defendant sent the plaintiffs a letter indicating that their loan was not eligible for HAMP. See dkt.

#1-2 at 22 (describing an unavailable exhibit, purportedly attached to an “Audit Report”). At the

motion hearing, counsel for the defendant was unable to explain why it took over two years to

officially deny the plaintiffs’ HAMP application. The defendant Bank began foreclosure

proceedings on April 19, 2012. The foreclosure sale was scheduled for May 22, 2012, and the

defendant published the notice in the Oakland County Legal News on April 19, April 26, May 3, and

May 10, 2012. 

Sale of the property was adjourned for two years, until May 27, 2014, “while the parties

considered loss mitigation options.” According to Mr. Powers, it was during this time that he hired

Eva Jo Sparks, his “Forensic Mortgage Loan Expert.” Mr. Powers told the magistrate judge that

after Ms. Sparks informed him that the plaintiffs were not in default and that scenarios such as the

-4-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 4 of 11 Pg ID 658
one he faced were not uncommon for the defendant’s customers, he decided to file a lawsuit against

the Bank. The plaintiffs filed their first suit in December 2012 in the Oakland County, Michigan

circuit court; the matter was removed to this Court on January 15, 2013. Powers v. Bank of

America, NA, et. al, No. 13-10164. The case was dismissed without prejudice on the plaintiffs’

motion when they indicated that the parties had “entered into a trial loan modification program, and

no foreclosure action [was] pending.” 

The defendant and Mr. Powers both indicated that sometime in late spring or early summer

2013, the defendant offered the plaintiffs a modified home loan. No documentation has been

provided regarding the alleged modification. The plaintiffs, however, rejected the offer for two

reasons: (1) the Bank wanted them to admit that they were in default on the initial mortgage; and

(2) the plaintiffs were uncomfortable signing a new loan agreement without knowing who actually

owned the note. Mr. Powers was convinced that the plaintiffs had not defaulted on their loan, so he

considered the issue of ownership to be “a minor issue,” but he nevertheless agreed to acknowledge

default and accept the loan offer if the owner of the note would sign an affidavit acknowledging

ownership. The defendant declined the plaintiffs’ request, so the negotiation fell apart. 

Freddie Mac purchased the property at a sheriff’s sale on May 27, 2014, and on October 2,

2014, Freddie Mac sold the property and conveyed its interest by quit claim deed to Richard and

Louise Chambers. The deed was recorded on October 10, 2014. The plaintiffs’ redemption period

expires on November 27, 2014.

The plaintiffs filed a second complaint in the Oakland County, Michigan circuit court on

October 17, 2014. Defendant Bank of America removed the matter to this Court. The plaintiffs

filed their motions for a temporary restraining order and preliminary injunction on November 13,

-5-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 5 of 11 Pg ID 659
2014, and the defendant responded that same day with a motion to dismiss. The Court referred this

case to Magistrate Judge Mona K. Majzoub for general pretrial management. Magistrate Judge

Majzoub held a hearing on this matter on November 20, 2014. The Court withdrew the reference

earlier today. The plaintiffs’ motions are ready for decision. 

II.

Rule 65 of the Federal Rules of Civil Procedure authorizes the issuance of preliminary

injunctions and temporary restraining orders. The Court may issue a temporary restraining order,

sometimes without advance notice to a defendant, to preserve the status quo until it has had an

opportunity to determine whether a preliminary injunction should issue. See First Tech. Safety Sys,

Inc. v. Depinet, 11 F.3d 641, 650 (6th Cir. 1993). However, in this case, the defendant had notice

of the plaintiffs’ request for relief, and actually appeared at a hearing conducted by the magistrate

judge. Therefore, there is no need to consider a temporary restraining order as an option here. 

When considering whether to issue a preliminary injunction, the courts weigh these factors:

(1) whether the movant has demonstrated a substantial likelihood of success on the merits; (2)

whether the movant will suffer irreparable injury without the injunction; (3) would the preliminary

injunction cause substantial harm to others; and (4) will the public interest be served if the injunction

issues. Overstreet v. Lexington-Fayette Urban Cnty. Gov’t, 305 F.3d 566, 573 (6th Cir. 2002) 

(citation omitted). Although these factors are to be balanced, the failure to show a likelihood of

success on the merits is generally fatal. Ibid.; see also Gonzales v. Nat’l Bd. of Med. Exam’rs, 225

F.3d 620, 625 (6th Cir. 2000). 

-6-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 6 of 11 Pg ID 660
A.

The defendant notes that, as a practical matter, an injunction against the defendant will not

provide the plaintiffs with their desired remedy, because the plaintiffs seek only to prevent their

eviction. The defendant is correct. The defendant does not own the property, and it is not trying to

evict the plaintiffs itself. Richard and Louise Chambers currently own the property under the

sheriff’s deed. An injunction against the defendant will not stop an eviction action filed by the

current owners of the property.

The defendant also points out that under the Anti-Injunction Act, 28 U.S.C. § 2283, a federal

court “may not grant an injunction to stay proceedings in a State court,” subject to certain exceptions

that do not apply here. Courts in this district have repeatedly held that the Anti-Injunction Act bars

injunctions preventing state-court eviction proceedings. E3A v. Bank of America, N.A., No.

13-10277, 2013 WL 784339, *2 (E.D. Mich. Mar. 1, 2013); Ross v. Wells Fargo Bank, N.A., No.

13-11858, 2013 WL 5291671, *9 (E.D. Mich. Sept. 19, 2013). Although the Sixth Circuit has not

addressed this issue specifically, other circuits have reached similar conclusions. See, e.g., Bond v.

JPMorgan Chase Bank, N.A., 526 F. App’x 698 (7th Cir. 2013); Watkins v. Ceasar, 88 F. App’x 458

(2d Cir. 2004). The plaintiffs’ request for injunctive relief is barred by the Anti-Injunction Act.

B.

The redemption period expires on November 27, 2014. The Court may determine whether

to extend the plaintiffs’ redemption period as a matter of equity. Michigan courts allow an

“equitable extension” of the redemption period in a statutory foreclosure case because most lawsuits

are not resolved before the end of the redemption period. El-Seblani v. IndyMac Mortgage Services,

510 F. App’x 425, 428 (6th Cir. 2013). “The standards for obtaining such an extension are

-7-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 7 of 11 Pg ID 661
stringent.” Id. at 429. In order to extend the redemption period, the plaintiff must make “‘a clear

showing of fraud, or irregularity.’” Ibid. (quoting Schulthies v. Barron, 16 Mich. App. 246, 167

N.W.2d 784, 785 (1969)); see also Freeman v. Wozniak, 241 Mich. App. 633, 617 N.W.2d 46, 49

(2000) (“[I]n the absence of fraud, accident or mistake, the possibility of injustice is not enough to

tamper with the strict statutory requirements.”); Sweet Air Inv., Inc. v. Kenney, 275 Mich. App. 492,

739 N.W.2d 656, 659 (2007) (“‘[I]t would require a strong case of fraud or irregularity, or some

peculiar exigency, to warrant setting a foreclosure sale aside.’”) (quoting United States v. Garno,

974 F. Supp. 628, 633 (E.D. Mich.1997)). Additionally, the “misconduct” that results in the fraud

or irregularity “must relate to the foreclosure procedure itself.” El-Seblani, 510 F. App’x at 429

(citing Freeman, 241 Mich. App. at 637, 617 N.W.2d at 49 (“Plaintiff cannot argue that there was

fraud, accident, or mistake because plaintiff readily conceded that the foreclosure procedure was

technically proper.”)). 

“[N]o caselaw has defined what constitutes an irregularity” sufficient to set aside a

foreclosure. PHH Mortgage Corp. v. O’Neal, No. 311233, 2013 WL 3025566, at *5 (Mich. Ct.

App. June 18, 2013). However, courts have held that “the simple existence of an irregularity is

insufficient; it must rise to a particular level before a foreclosure sale will be set aside.” Ibid. (citing

Garno, 974 F. Supp. at 633). 

The dictionary defines “irregularity” as “not being or acting in accord with laws, rules, or

established custom.” Webster’s Collegiate Dictionary Tenth Edition, p. 619 (1997). Michigan cases

offer other definitions. The Michigan Supreme Court has defined irregularity as a “proceeding that

is taken without any foundation for it or that is essentially defective,” Jenness v. St. Clair Circuit

Judge, 42 Mich. 469, 471, 4 N.W. 220, 222 (1880); and elsewhere as the “want of adherence to

-8-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 8 of 11 Pg ID 662
some prescribed rule or mode of proceeding,” Turrill v. Walker, 4 Mich. 177, 183 (1856). 

Michigan’s foreclosure by advertisement statute states that “[a] party may foreclose a mortgage by

advertisement if . . . (a) [a] default in a condition of the mortgage has occurred, by which the power

to sell became operative.” Mich. Comp. Laws § 600.3204. A mortgagee establishes a clear showing

of irregularity if a bank forecloses on a mortgagee that is not in default under the terms of the

agreement or a subsequent modification. 

The plaintiffs argue that an irregularity exists in the foreclosure here because they never

defaulted on their mortgage. Compl., dkt. #1-2 at 8 ¶ 20. The defendant contends otherwise. The

heart of the dispute is whether the plaintiffs’ 16 monthly trial period payments satisfied their

monthly mortgage obligations during the period that the defendants considered the plaintiffs for a

loan modification. The plaintiffs never missed a payment; the Bank accepted each of the 16

payments while the plaintiffs waited for the Bank to decide whether to permanently modify the

plaintiffs’ loan. The plaintiffs testified to the magistrate judge that they contacted Bank of America

on a monthly basis and were told to continue making the reduced payments while their application

was under review. Around June 2011, the plaintiffs state that they were told over the phone that

they were no longer being considered for a loan modification. At that point, the plaintiffs

immediately resumed making regular payments as called for by the original mortgage. It was not

until September 2011 that the Bank stopped accepting payments, accelerated the plaintiffs’ loan

obligations and, in 2014, foreclosed on the property. 

The plaintiffs’ complaint and supporting documents raise serious questions about whether

they defaulted under the terms of the mortgage and trial payment plan. And their assertions also

lead the Court to question whether the Bank’s dealing with the plaintiffs were entirely above board. 

-9-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 9 of 11 Pg ID 663
The plaintiffs ask, if they were not in default at the beginning of the process, and they did everything

the Bank asked of them, how could they have breached the terms of the mortgage? Could their

predicament have resulted from inattention by a bank officer? Negligence? Mendacity? These are

good questions that deserve sensible answers before the harsh remedies the Bank has invoked can

be allowed to take their course. 

The Bank says that even if an irregularity existed in the foreclosure, the plaintiffs cannot

establish prejudice. It is true that “[t]o set aside the foreclosure sale, plaintiffs must show that they

were prejudiced by defendant’s failure to comply with [Michigan’s foreclosure by advertisement

statute].” Kim v. JPMorgan Chase Bank, N.A., 493 Mich. 98, 115, 825 N.W.2d 329, 338 (2012). 

However, a showing of prejudice can be made if the plaintiffs can demonstrate “that they would

have been in a better position to preserve their interest in the property absent defendant’s

noncompliance with the statute.” Ibid. The plaintiffs can easily establish prejudice if they did not

default on their loans but were made to endure foreclosure proceedings with the potential loss of

their residence. The Court therefore will extend the redemption period during the pendency of this

litigation.

III.

The plaintiffs, as previously noted, are proceeding pro se. This case appears to be

straightforward; but despite appearances, foreclosure proceedings can be complex and confusing. 

Therefore, the Court will consider appointing pro bono counsel for the plaintiffs in accordance with

the Court’s plan. Of course, the plaintiffs may retain counsel of their own choice if they wish. It

is not recommended that the plaintiffs proceed without a lawyer. If the plaintiffs cannot retain

counsel, they should notify the Court immediately. 

-10-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 10 of 11 Pg ID 664
In the meantime, the Court finds that the tenets of equity favor extension of the redemption

period. Dispossession is not appropriate during the period of redemption. Massachusetts Mut. Life

Ins. Co. v. Sutton, 278 Mich. 457, 461, 270 N.W. 748, 749 (1936) (holding that “it has been the

definite and continuous policy of this state to save to mortgagors the possession and benefits of the

mortgaged premises, as against the mortgagees, until expiration of the period of redemption”); Ruby

& Associates, P.C. v. Shore Fin. Servs., 276 Mich. App. 110, 118, 741 N.W.2d 72, 78 (2007),

vacated in part on other grounds, 480 Mich. 1107, 745 N.W.2d 752 (2008) (same; citations

omitted). 

Accordingly, it is ORDERED that the plaintiffs’ motions for a temporary restraining order

and for a preliminary injunction [dkt. #5] are DENIED.

It is further ORDERED that the redemption period in this matter is extended until further

notice of this Court.

s/David M. Lawson 

DAVID M. LAWSON

United States District Judge

Dated: November 26, 2014

PROOF OF SERVICE

The undersigned certifies that a copy of the foregoing order was served

upon each attorney or party of record herein by electronic means or first

class U.S. mail on November 26, 2014.

s/Susan Pinkowski 

SUSAN PINKOWSKI

-11-

2:14-cv-14335-DML-MKM Doc # 13 Filed 11/26/14 Pg 11 of 11 Pg ID 665