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Sheedy v. Bank of New York Mellon

United States District Court, D. Massachusetts

December 18, 2017

THOMAS E. SHEEDY, TRUSTEE OF THE RED BIRD TRUST, Plaintiff,
v.
BANK OF NEW YORK MELLON, Defendants.

          MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS 1ST AMENDED COMPLAINT (DOCKET NO. 10)

          TIMOTHY S. HILLMAN, DISTRICT JUDGE.

         Introduction

         Thomas Sheedy (“Plaintiff”) is trustee of RedBird Trust (“Trust”), the owner of a property located in Northborough, Massachusetts (the “Property”). Bank of New York Mellon (“Defendant”), as trustee for the Certificateholders of CWABS, Inc., Asset-Backed Certificates, Series 2005-17 (“CWABS”), conducted a foreclosure sale on the Property on February 6, 2017 (“2017 Foreclosure”) after Defendant was assigned the rights and interests in the mortgage on the Property (the “Mortgage”) by MERS. The nonjudicial foreclosure was conducted pursuant to the statutory power of sale provided in the Mortgage. See Mass. Gen. Laws ch. 183 § 21. Plaintiff alleges that the Defendant did not have the authority to conduct the 2017 Foreclosure and has brought the instant action. I find that the pleadings fail to state a claim upon which relief can be granted and must be dismissed. Fed.R.Civ.P. 12(b)(6).

         Facts Alleged

         On November 22, 2005, Daniel and Tammy Lyons (“Borrowers”) gave the Mortgage and promissory note (the “Promissory Note”) on the Property to Countrywide Home Loans, Inc. (“Countrywide”). The Mortgage provides inter alia:

MERS is a separate corporation that is acting solely as nominee for [Countrywide] and [Countrywide's] successors and assigns. MERS is the mortgagee under this Security Instrument.
*** Borrower does hereby mortgage, grant and convey to MERS, (solely as nominee for [Countrywide] and [Countrywide's] successors and assigns) and to the successors and assigns of MERS, with the power of sale, the following described property . . .
Borrower understands and agrees that MERS holds only legal title to the interest granted by Borrower in this Security Instrument but, if necessary to comply with law or custom, MERS (as nominee for [Countrywide] and [Countrywide's] successors and assigns) has the right: to exercise any or all of those interests, including but not limited to, the right to foreclose and sell the Property…
The Note or a partial interest in the Note (together with this Security Instrument) can be sold one or more times without prior notice to Borrower.
…Lender at its option may require immediate payment in full…and may invoke the STATUTORY POWER OF SALE and any other remedies permitted by Applicable Law. (Docket No. 10-2).

         On December 9, 2006, Plaintiff became the second mortgagee on the Property, behind the CWABS mortgage.

         CWABS, the Depositor, and Countrywide, the seller, executed a pooling and servicing agreement and prospectus supplement (“PSA”). As a result of the PSA, the Mortgage was securitized into the CWABS trust with Defendant named as trustee on or about May 30, 2014. The PSA provided a cut-off date for assignments for December 1, 2005. The PSA provided inter alia

the Depositor may its discretion provide evidence that the related Mortgage is held through the MERS(R) System. In addition, the Mortgages for some or all of the Mortgage Loans in the Trust Fund that are not already held through the MERS(R) System may, at the discretion of the Master Servicer, in the future be held through the MERS(R) System. For any Mortgage held through the MERS(R) System, the Mortgage is recorded in the name of Mortgage Electronic Registration Systems, Inc., or MERS(R), as nominee for the owner of the Mortgage Loan, and subsequent assignments of the ...

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