by Emily J. Honsa Hicks, Esq.

Since I drafted this article for the American Bankruptcy Institute, one sentence mentioned has ballooned into full-fledged legal challenges.  Merscorp has been sued for avoiding recording fees in both Texas, by the District Attorney for Dallas County, and California. In an economic environment where local and state governments are pinching pennies—and some are considering bankruptcy—it is easy to see more and more administrations considering such action against MERS in an attempt to fill otherwise empty coffers. 

But in good news for MERS, in Phoenix, AZ, U.S. District Judge James A. Teilborg in Phoenix, dismissed claims that would invalidate foreclosures based on MERS documentation, opining that the Plaintiffs did not demonstrate that MERS assignments are defective.  The Federal Appeals Court upheld the decision in September, finding that there were no violations of state law or injuries to the Plaintiffs caused by MERS. (In re Mortgage Electronic Registration Systems (MERS) Litigation, 09-md-2119, U.S. District Court, District of Arizona (Phoenix); appellate case, Cervantes v. Countrywide, 09- 17364, U.S. Court of Appeals for the Ninth Circuit (San Francisco).)  MERS itself offers selected decisions on their website at

Stay tuned for more developments on the hotbed of MERS, and enjoy the article.

A Nation Mired in MERS

Mortgage Electronic Registration Systems, Inc. (MERS) is the leading electronic registry for mortgage lenders, and is linked more and more each day to the foreclosure crisis. MERS has been recently challenged in state foreclosure actions, frequently to different ends creating a “patchwork of conflicting laws and court decisions in different states.” Read the full article.

Emily J. Honsa Hicks is an associate practicing in the Integrated Real Estate Default Group at Weltman, Weinberg & Reis Co., LPA. She can be reached at 216.685.1083 and


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