United States District Court, D. Nevada
C. JONES United States District Judge.
case arises out of several homeowners' association
foreclosure sales. Pending before the Court is a motion for
FACTS AND PROCEDURAL HISTORY
Federal Housing Finance Agency (“FHFA'), the
Federal National Mortgage Association (“Fannie
Mae”), the Federal Home Loan Mortgage Corporation
(“Freddie Mac”) and five lending institutions
have sued Thunder Properties, Inc. (“Thunder”) to
quiet title to thirteen properties in Reno and Sparks, Nevada
(“the Properties”) for which Thunder is the
current record owner. Specifically, Plaintiffs seek a
declaration that under the Supremacy Clause and 12 U.S.C.
§ 4617(j)(3), first deeds of trust against the
Properties were not extinguished under state law by
homeowners' association foreclosure sales because Fannie
Mae or Freddie Mac held the respective loans and first deeds
of trust at the time of foreclosure. Plaintiffs have moved
for offensive summary judgment.
must grant summary judgment when “the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). Material facts are those which may affect
the outcome of the case. See Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). A dispute as to a
material fact is genuine if there is sufficient evidence for
a reasonable jury to return a verdict for the nonmoving
party. See Id. A principal purpose of summary
judgment is “to isolate and dispose of factually
unsupported claims.” Celotex Corp. v. Catrett,
477 U.S. 317, 323-24 (1986).
determining summary judgment, a court uses a burden-shifting
scheme. The moving party must first satisfy its initial
burden. “When the party moving for summary judgment
would bear the burden of proof at trial, it must come forward
with evidence which would entitle it to a directed verdict if
the evidence went uncontroverted at trial.” C.A.R.
Transp. Brokerage Co. v. Darden Rests., Inc., 213 F.3d
474, 480 (9th Cir. 2000) (citation and internal quotation
marks omitted). In contrast, when the nonmoving party bears
the burden of proving the claim or defense, the moving party
can meet its burden in two ways: (1) by presenting evidence
to negate an essential element of the nonmoving party's
case; or (2) by demonstrating that the nonmoving party failed
to make a showing sufficient to establish an element
essential to that party's case on which that party will
bear the burden of proof at trial. See Celotex
Corp., 477 U.S. at 323-24.
moving party fails to meet its initial burden, summary
judgment must be denied and the court need not consider the
nonmoving party's evidence. See Adickes v. S.H. Kress
& Co., 398 U.S. 144 (1970). If the moving party
meets its initial burden, the burden then shifts to the
opposing party to establish a genuine issue of material fact.
See Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986). To establish the
existence of a factual dispute, the opposing party need not
establish a material issue of fact conclusively in its favor.
It is sufficient that “the claimed factual dispute be
shown to require a jury or judge to resolve the parties'
differing versions of the truth at trial.” T.W.
Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n,
809 F.2d 626, 631 (9th Cir. 1987). In other words, the
nonmoving party cannot avoid summary judgment by relying
solely on conclusory allegations unsupported by facts.
See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir.
1989). Instead, the opposition must go beyond the assertions
and allegations of the pleadings and set forth specific facts
by producing competent evidence that shows a genuine issue
for trial. See Fed. R. Civ. P. 56(e); Celotex
Corp., 477 U.S. at 324.
summary judgment stage, a court's function is not to
weigh the evidence and determine the truth, but to determine
whether there is a genuine issue for trial. See
Anderson, 477 U.S. at 249. The evidence of the nonmovant
is “to be believed, and all justifiable inferences are
to be drawn in his favor.” Id. at 255. But if
the evidence of the nonmoving party is merely colorable or is
not significantly probative, summary judgment may be granted.
See Id. at 249-50. Notably, facts are only viewed in
the light most favorable to the non-moving party where there
is a genuine dispute about those facts. Scott v.
Harris, 550 U.S. 372, 380 (2007). That is, even where
the underlying claim contains a reasonableness test, where a
party's evidence is so clearly contradicted by the record
as a whole that no reasonable jury could believe it, “a
court should not adopt that version of the facts for purposes
of ruling on a motion for summary judgment.”
Court and others in the District have ruled that 12 U.S.C.
§ 4617(j)(3) prevents the sale of any property in which
the FHFA (as conservator of Fannie Mae or Freddie Mac) has an
interest without the FHFA's consent. See My Global
Vill., LLC v. Fed. Nat'l Mortg. Ass'n, No.
2:15-cv-00211, 2015 WL 4523501, at *4 (D. Nev. July 27, 2015)
(Jones, J.) (citing Skylights LLC v. Byron, 112
F.Supp.3d 1145, 1151-59 (D. Nev. 2015) (Navarro, C.J.)). The
Skylights case has been cited dozens of times by
other judges of this District and only in approval. The Court
considers this point of law settled unless and until the
Court of Appeals rules otherwise. The dispositive question
under § 4617(j)(3) is whether Fannie Mae or Freddie Mac
(or the FHFA as conservator) held any interest in the
Properties on the respective dates of foreclosure.
although § 4617(j)(3) is the only issue specifically
addressed in the Complaint, Plaintiffs have broadly asked for
a declaration that the deeds of trust survived the respective
foreclosure sales, and they argue via the present motion that
the deeds of trust cannot have been extinguished under
Bourne Valley Court Tr. v. Wells Fargo Bank, N.A.,
832 F.3d 1154 (9th Cir. 2016) (ruling that Chapter 116's
opt-in notice scheme is facially unconstitutional under the
Due Process Clause of the Fourteenth Amendment). The Court is
bound by Bourne Valley and must therefore grant
summary judgment to Plaintiffs on that basis as to any of the
Properties for which Thunder cannot show a factual dispute as
to whether a constitutionally reasonable attempt at notice of
the foreclosure sale was made. The Court will address §
4617(j)(3) as to each property, as well.
The Ringneck Way Property
CTX Mortgage Co., LLC (“CTX”) held the promissory
note and attendant deed of trust as to the Ringneck Way
Property from July 14, 2006 until it transferred them to
JPMorgan Chase Bank, N.A. (“Chase”) on January
16, 2012. (Deed of Trust, ECF No. 22-1, at 2; Assignment, ECF
No. 22-1, at 23). Thunder bought the Ringneck Way Property at
the foreclosure auction on August 7, 2013. (Foreclosure Deed,
ECF No. 22-1, at 26). Plaintiffs have not satisfied their
initial burden to produce evidence that would entitle them to
a directed verdict under § 4617(j)(3) if uncontroverted
at trial because they have adduced no evidence of Fannie Mae
or Freddie Mac (or the FHFA as conservator) having held any
interest in the Ringneck Way Property on the date of
foreclosure (or ...