The United States Court of Appeals for the Ninth Circuit affirmed a Washington federal court’s ruling that dismissed the plaintiffs’ Washington Consumer Protection Act claims along with other claims alleged in a wrongful foreclosure complaint against MERSCORP Holdings and its co-defendants. 

In Mickelson v. Chase Home Finance LLC, the plaintiffs sought to invalidate a completed foreclosure sale by alleging CPA claims against MERS as well as Deed of Trust Act violations against the foreclosing trustee, Northwest Trustee Services, Inc

Under the DTA allegations, the plaintiffs allege the Trustee breached its duty of care and impartiality because the MERS signing officer who executed the assignment of the deed of trust to the foreclosing servicer and note-holder, Chase Home Finance LLC, was also an employee of NWTS. The plaintiffs claimed that the relationship between NWTS, MERS and Chase Home Finance LLC disqualified NWTS from serving as the trustee.  

“Although recent amendments to the DTA have lessened the duty of care a trustee owes the parties to a non-judicial foreclosure, NWTS’s signing agreement with MERS and its limited power of attorney for Chase Home Finance LLC do not breach even the more rigorous pre-amendment standard. Those agreements did not compromise NWTS’s capacity to exercise its discretion as trustee,” the court opinion read.

As for the CPA claims, the court found that the plaintiffs “… do not plausibly allege that any of those defendants cause them any injury, which is required to prove a CPA claim.” 

“We are pleased that the court found that the MERS signing officer’s role with the trustee does not breach the duty of care standards expressed under Washington law,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.