Bankruptcy

Deutsche Bank Gets a Kick

By Bill McLeod, Esq.

On October 31, a US District Court judge sitting in the Northern District of Ohio issued a decision involving Deutsche Bank?s attempts to foreclosure on a number of properties in Ohio. The bank claimed that the federal court had jurisdiction because there was diversity of the parties: the parties resided or had a principal place of business in different states, and the amount in controversy exceeds $75,000. The bank is not incorporated nor has a principal place of business in Ohio. The bank was not the original lender, but alleged it held an assignment of the mortgage.

On October 10, the judge ordered the bank to produce a copy of the assignment: ?Since the Plaintiff bears the burden of establishing federal diversity jurisdiction as well as standing to bring an action, Plaintiff is ordered by October 17, 2007, to file a copy of these executed Assignments demonstrating Plaintiff was the holder and owner of the Note and Mortgage as of the date the Complaint was filed, or the Court will dismiss the Complaint.?

An assignment was filed on October 10. The document stated that the bank had been assigned the mortgage on August 13, 2007, and purportedly recorded on August 21, 2007.

The complaint was filed on July 27, 2007. In dismissing the foreclosure cases,

This Court acknowledges the right of banks holding valid mortgages, to receive timely payments. And, if they do not receive timely payments, banks have the right to properly file actions on the defaulted notes ? seeking foreclosure on the property securing the notes. Yet, this Court possesses the independent obligations to preserve the judicial integrity of the federal court and to jealously guard federal jurisdiction. Neither the fluidity of the secondary mortgage market, nor monetary or economic considerations of the parties, nor the convenience of the litigants supersedes those obligations.

Read the case here, and please be sure you read footnote no. 3 on pages 5-6. It?s priceless.

Full post as published by McLeod Law Offices on November 15, 2007 (boomark / email).