robo-signed - defendant michael a fox motion for sanctions

8/8/2019 Robo-signed - Defendant Michael a Fox Motion for Sanctions

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INTHE LICKINGCOUNTY COURTOF COMMON PLEASCIVIL DIVISION

DEUTSCHBANK TRUSTCOMPANY CASENO09 CV0205TMMAS TRUSTEE FORRALI 2006QAI ICMACMORTGAGE CORP JUDGEMARCELAIN

PaintiffVMICHAELAFOX et al

Defendants

DEFENDANTMICHAELAFOXSOTION FOR SANCTIONS AND TOHOLDPLAINTIFF DEUTSCH BANKTRUST COMPANYCMACMORTGAGE CORP

INCONTEMPTOF COURTNowcomesDefendant MichaelAFox Defendant pursuant to CivR56Gnd for

h is motion fo r sanctions and to hold Plaintiff Deutsch B ank T ru st CompanycGMACMortgage Corp GMAC in contempt ofcourt A memorandum in support is a ttached he re toand incorporated herein by reference Defendant requests an oral hearing on this matter

Respect fu l ly submittedTHE SHERROD LAWFIRMLLC

J HN S 078598950 Venture Drive Ste B1Dublin Ohio 430176143944061416515axjohnaherrodlawneAttorney for Defendant MichaelA Fox

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Memorandum InSupportIFactual BackgroundOn February 2 2009 GMAC filed a complaint fo r foreclosure against Defendant

GMAC init iated th e p rocess of foreclosing on Defendantsroperty located at 10999 Jug StreetJohnstown Ohio 43031 Attached to Plaintiffs complaint was a false and misleadingAssignment signed by Jef f rey Stephan anagent of GMAC The Ass ignment is atta ch edhereto as ExhibitA On March 17 2009 Defendant answered Plaintiffs complaint OnMarch 25 2009 Plaintiff filed a motion fo r summary j udgment wh ich relied on fals e andmisleading affidavits s igned by Jeffrey Stephan A copy of the Courtslectronic docket isattached hereto as ExhibitB

ABackground IntoFalse AssignmentsIn many mortgage fo rec losu re cases fi led in Ohio GMAC claimed and claims to be the

holder of the promissory note and mortgage that form the basis fo r the foreclosure act ion and inthese cases GMAC is obviously the plaintiff In many oth er Oh io cases GMAC is not th e

named plaintiff but is the servicer or sub servicer fo r a trustee holding in a pool hundreds oreven thousands of mortgages fo r investors in certificates evidencing ownership interests in thesecuritized mortgage loans thetrust As a serv icer for th e trust GMAC is responsib le forcollecting payments on the mortgage loans from borrowers and applying them a s required by theapplicable documents communicating with the borrowers about insurance a n d tax payments theborrowers a llegedly owe negotiating with borrowers ov er late fees other fees and loanmodif icat ions initiating and pursuing foreclosure proceed ings aga inst borrowers obtainingaffidavits and assignments of mortgage to pursue and selling properties of the borrowers thath av e b e en foreclosed upon

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GMAC acted and is still acting as a sub serv icer for trusts in securi t ized transactions inmany Ohio foreclosure cases including this one In a securitized transaction wth a masterserv icer and sub serv icer th e su b serv icer has pr imary responsibi l i ty fo r communicat ions withthe borrowers and actions taken against the borrower In orde r to facilitate the mortgagesecur i t ization process when the borrower executes a mortgage typically tha t mortgage is eitheragranted to Mortgage Electronic Registration Systems Inc MERS orbhe originalmortgage is ass igned to MERS MERS is a corporat ion created by th e mortgage bankingindustry whose shareholders consist ofbanks and other f inancial inst i tut ions including GMAC

The mortgage banking industry created MERS to streamline the mortgage process andsave money by using electronic commerce to eliminate paper and the need to file assignments ofmortgage every t ime a mortgage was transferred in the securit izat ion process or subsequentchanges in servicing Unless MERS is th e plaintiff in a forec losure case MERS does not holdthe note of a borrower and is no t named in the note or any transfer of the note but simply isnamed th e secured party in th e mortgage filed in th e loca l real estate records a s th e nominee ofthe note holder

When a trustee of a secur i tized t ransact ion init iates a foreclosure act ion a s a plaintiff th eserv icer su b serv icer or its agent is responsible for th e preparat ion of th e papers filed in th eOhio foreclosure action In th e many secu r it iz ed tr ansac t ions in which GMAC was or is th ese rv ic e r o r su b servicer ofOhio mortgage loans GMAC has been responsible fo r th e preparationof the necessary documents including an assignment ofmortgage assigning the mortgage fromMERS to th e trustee In some cases MERS g ives se rv ice rs and sub servicers th e authority toexecute assignments of mortgage from MERS to th e trustee MERS however never au tho ri zes

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servicers or su b servicers to execute an assignment ofmortgage tha t inc ludes an assignment ofanote

Despite this lack ofauthority GMAC h a s caused assignments ofmortgage to b e preparedand executed by agents ofGMAC that imp roperly purpo rt to assign the note from MERS to thetrustee and fa lse ly c laim that the GMAC emp lo yee in th is c a s e Jeffrey Stephan has authority toassign t h e note on behalf of MERS GMACseffrey S t e p h a n h a s executed thousands of s u c himproper a n d false assignments that have b e e n filed in Ohio foreclosure c a s e s and that have t h epurpose of trying to dece ive the borrower and courts a s to who is the note holder

B GMAC Signed and Filed False Affidavits in 2006In May of2006 the Circu i t Court of the Fourth Judicial Circu i t in and fo r Duva ll County

Florida sanctioned th e plaintiff in a mortgage foreclosure case the Florida ForeclosureDecsion because an employee ofGMAC had signed a false aff idavit on beha l f ofth e plaintiffThe court said Plaintiff through its servicing entity GMAC Mortgage Corporat ion submit tedfalse test imony to th e Cour t in the form ofAffidavits of Indebtedness s igned and subscr ibed byaimitedSigning Officer with GMAC Mortgage Corporationwho would attest to reviewall of th e relevant loan documentswhen in facshe neither reviewed th e referenced recordsnor was familiar with th e manner in which th e records were created by GMAC on behalf ofPlaintiffnone of th e Affidavits we re s ig ne d before aNotary

The court sanctioned plaintiff in the Florida Foreclosure decision and ordered GMAC toprovide writ ten confi rmation that affidavits filed in future foreclosure actions in Floridaaccurately memorial ize th e actions and conduct of th e affiants

C GMACContinued to File False Affidavits in 2009 and 2010

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J e f f r e y S t e p h a n h a s b e e n a t e a m l e a d e r in t h e f o r e c l o s u r e d e p a r t m e n t of GMAC for yearsincluding through at least August 2 2010 Stephan h a s been a n employee of GMAC oraffiliates for approximate ly five years In a December 10 2009 deposit ion the 2009Depos i t ion in a Florida state court foreclosure case the 2009FloridaCase Stephan test if iedt h a t h is t e a m brought t o him approximately1000 affidavits a n d a s s i g n m e n t s in a month for himt o sign I n s p i t e of t h e F l o r i d a F o r e c l o s u r e Decision S t e p h a n t e s t i f i e d t h a t h e d i d n o t s i g n t h eaffidavits b a s e d o n h i s p e r s o n a l k n o w l e d g e a n d t h a t h e relied o n others H e a l s o testified t h a t h i st e a m did not verify t h e a c c u r a c y of information They d o not g o into t h e s y s t e m a n d verify t h einformation a s ac curate We a r e relying on our attorney network to ensure that they a r e askingfor the correct information Stephan knew or should have known that t h e s e thousands ofaffidav its wou ld b e filed in Ohio courts and relied upon by O hio common pleas judges ind e c id i n g w h e t h e r t h e plaintiff in t h e particular c a s e h a d a right t o f o r e c lo s e o n Ohio residents

W h e n S t e p h a n e x e c u te d a n affidavit o r a s s i g n m e n t h e testified h e did not a s c e r t a i n w h ot h e c u r r e n t p r o m is s o r y n o t e h o l d e r was e v e n t h o u g h h is affidavits a l w a y s s t a t e d o r implied t h a tplaintiff w a s t h e h o l d e r of th e note T h e a g e n t s of GMAC p r e p a r e d t h e s e a f f i d a v i t s t o m i s le a dthe courts in Ohio on such matters a s who kept the applicable records who the holder of the notewas th e a m o u n t d u e t o w h o e v e r t h e h o l d e r of t h e n o t e was a n d w h e th e r p r o p e r n o tic e a l l e g in gdefault had been sent to the borrower

D e s p i t e h is a c k n o w le d g e d l a c k of p e r s o n a l knowledge S t e p h a n s w o r e in t h o u s a n d s ofaffidavits a n d a s s i g n m e n t s h e s i g n e d for Ohio c o u r t s t h a t h e h a d p e r s o n a l knowledge of t h e f a c t sc o n t a i n e d in t h e affidavit or assignment S t e p h a n s ig n e d t h o u s a n d s of t h e s e f a l s e documents a n dhe and GMAC caused thousands of these false documents to be fi led in thousands ofmortgageforeclosure casesinOhio Stephan claiming to be anofficerofMERS signed for many Oh io

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Lender Processing Services Inc LPS provides a separate system that createsdocuments fo r GMAC in the foreclosure process and acts a s an intermediary between attorneysfor GMAC in the foreclosure process As part of GMAC pol icy Stephan did no t read everyparagraph of the summary judgment affidavits he s igned that were prepared by LPS Thesummary judgment affidavits that Stephan signed contained inaccuracies GMAC knew orshould have known that failure to supervise the accuracy of the input of information intomaintenance of information in and calculations provided by the outsou rced compu te r systemsa n d d o c u m e n t p r e p a r a t i o n would l e a d t o e r r o r s a n d i n a c c u r a c i e s t h a t would violate GMACsd u t y t o c o n s u m e r s t o a c c u r a t e l y a c c o u n t for p a y m e n t s r e c e i v e d b y c o n s u m e r s a n d p a y m e n t sowed by consumers

GMAC learned of the 2009 Deposition s o o n after that deposition bu t it took nocorrective action whatsoever During the 2010 Deposition Stephan testif ied ah e signedaffidavits o u t s i d e t h e p r e s e n c e of a notarybhen h e s i g n e d a summary judgment affidavit h edid not i n s p e c t a n y exhibits a t t a c h e d t o itce did not r e a d e v e r y p a r a g r a p h of t h e s u m m a r yj u d g m e n t a f fi d a v i t s h e s i g n e d a n d d t h e p ro c e s s h e f o l l o w e d in s i g n i n g s u m m a r y j u d g m e n taffidavits i s in a c c o r d a n c e with t h e policies a n d procedures required of you by GMAC GMAClearned of th e 2010 Deposi t ion in June 2010

D Sanctions inMaine in 2010The defendant in the Maine Mortgage Forec losure moved fo r sanctions fo r a false

affidavit that Stephan signed and which the court relied upon The Maine court held orala r g u m e n t o n t h e m o t i o n o n S e p te m b e r 1 2010 O n S e p t e m b e r 24 t h e M a i n e c o u r t v a c a t e d th eg r a n t of s u m m a r y j u d g m e n t a n d a l s o a d d r e s s e d a m o t i o n f o r a p r o t e c t i v e o r d e r t h a t h a d b e e nfiled t h a t would h a v e prohibited t h e dissemination of t h e deposition of S t e p h a n t a k e n in t h e c a s e

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T h e Maine court s a i d that Plaintiffpoints to t h e e m b a r r a s s m e n t GMAC a n d its e m p l o y e e s h a v esuffered a n d will continue to suffer from t h e posting of e x c e r p t s from Stephansepositiontranscript o n a n Internet blog T h e Maine court d e n i e d t h e motion for protective order notingStephanseposit ion was taken to advance a legitimate purposeThe Maine court then granted the motion fo r sanctions filed by t h e borrower stating

Rather than being an isolated or inadvertent instance of misconduct th eCour t finds th at GMAC has persisted in its unlawful documen t s igningpract ices long after and even in th e face of th e Florida Courtsrder andthat such conduct constitutes bad fath under Rule56ghesedocuments are submitted to a court with the intent that the court find ahomeowner l iable to th e plaintiff for thousands of dollars and sub jec t toforecosure of the deborsesidence Filing such a document withoutsuff ic ient regard for its accu racy wh ich th e c o urt in ordinary ci rcumstancesm ay neve r be ab le to invest igate or otherwise verify is a ser ious andtroubling matterSince the oral argument in the Maine Mortgage Foreclosure C a s e was held on September

1 201 0 GMAC knew sanctions were imminent In spite of his admissions in his deposit ionsJeffrey Stephan is stil l emp loye d b y GMAC reflecting the fact that his actions were inaccordance withGMACpol ic ies and procedureIlLawandArgumentPlaintiffsomplaint and motion fo r summary judgment were accompan ied by false and

misleading affidavits and a false and misleading assignment According to CivR56GAffidavits made in bad faith Should it appear to th e sat is fact ion of th e court atany t ime that any of the affidavits presented pursuant to this rule are presentedin bad faith the cour t shal l forthwith order the party employing them to payto th e other party th e amoun t of th e reasonable expenses which th e filing of th eaffidavit caused h im to incur including reasonable attorneysees and anyoffending party may be adjudged guilty ofcontemptHere there is no quest ion Plaintiffsffidavits and ass ignment were presented to this Courtin bad faith GMAC employee Jeffrey Stephan h a s consistent ly acknowledged that h e partook in

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th e above described conduct on thousands of occasions As the Maine court noted this is not anisolated event GMAC has engaged in chicanery and subterfuge in a deliberate effort todeceive the courts and unwtting consumers

Accordingly based upon the foregoing Defendant requests that th is C o urt enter an orderadjudging Plaintiff in con tempt and award ing De fendant h is reasonable attorneysees and anaward of sanctions not less than1000000efendant requests an o ra l h e arin g o n this matter

Respect fu l ly submittedTHE SHERROD LAWFIRMLLCeeHED 0078598VentureDrive St B1n Ohio 430173944061416515axjohngsherrodlawneAttorney for Defendant MichaelA Fox

CertificateofService

Undersigned ce r ti fies that a true and accura te copy of th e foregoing was del ivered to th efollowing via regular U S Mail t h i s 18 d a y of October 2010Kyle E TimkenEsqPOBox 165028Columbus Ohio 43216AttorneyforPlaintiffDennis Dove Esq20 South Second StreetNewark Ohio 43055

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Attorney for Defendant Licking County Treasurer

Sh od

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A f t e r Recording P l e a s e R e t u r n T oManley DealKochalcLC E v A n u I B I Tox 165028Columbus Ohio 43216FileNumber0j 14oASSIGNMENT

M E R S M o r t g a g e E l e c t r o n i c R e g i s t r a t i o n S y s t e m s In c a c t i n g s o l e l y a s n o m i n e e f o r A e g i s W h o l e s a l e C o r p o r a t i o nA s s i g n e r w h o s e a d d r e s s i s POB o x 2 0 2 6 F l i n t M I 4 8 5 0 1 2 0 2 6 h e r e b y e x e c u t e s t h i s m o r t g a g e a s s i g n m e n t f o r t hgnment toD e u t s c h ep u r p o s e o f a c k n o w l e d g i n g a n d p l a c i n g t h i r d p a r t i e s o n n o t i c e o f t h e t r a n s f e r c o n v e y a n c e a n d a s s irust Company Americas as Trustee forBALI 2006QA1I Assignee w h o s e a d d re s s is do GMAC M o r t g a g eorporation 1 100 VirginiaDrivePox 8300 Fort Washing ton Pennsylvania addre it s i n t e r e s t in t h a t m o r t g a g e d a t e dS e p t e m b e r 2 1 2 0 0 6 e x e c u t e d a n d d e l i v e r e d b y M i c h a e l A F o x a n d B a r b a r a s i c J F o x h u s b a n d a n d w i f e w h i c hm o r t g a g e w a s f i l e d O c t o b e r 2 2 0 0 6 r e c o r d e d a t O f f i c i a l I n s t r u m e n t N u m b e r 2 0 0 6 1 0 0 2 0 0 2 8 6 8 1 R e c o r d e rsf f i c e L i c k i n gounty Ohio

T h e p r o p e r t y e n c u m b e r e d b y s u c h m o r t g a g e i s d e s c r i b e d a s f o l l o w s S e e E x h i b i t A f o r l e g a l d e s c r i p t i o narcel No 0361105620009P r o p e r t y A d d r e s s 1 0 9 9 9 J ug S t re e t J o h n s to w n O H 4 3 0 3 1T h e R e c o r d e r is h e r e b y r e q u e s t e d t o c r o s s r e f e r e n c e t h i s A s s i g n m e n t t o t h e r e c o r d i n g r e f e r e n c e o f t h e m o r t g a g e h e r e i n b e f o r eescribedI n w i t n e s s w h e r e o f M E R S M o r t g a g e E l e c t r o i s R e g i s t r a t i o n S y s t e m s In c a c t i n g s o l e l y a s n o m i n e e f o r A e g i s W h o l e s a l eorporat ion has executed this Assignment this2u day ofJanuary 2009

M E R S M o r tg a g e E l e c tr o n ic R e g i s tr at io n S y s te m s Inc a c t i n gsolely as no in iesafie6 tionBy

SignatureSTATEOF 1 Print Name andTtley StephanCOUNTYO SS Vice PresidentBefore me aNotary ticpersonally appeared MERS Mortgage Eectron R istration stem Inc acting solely a so AegisWholesale Corporation the Company act ing throughg t or w h o a c k n o w l e d g e d t h a t h e s h e i s a u t h o r i z e d t o s i t l A g n m e n t a t h e s h e s i g n e d t h ef o r e g o i n g i n s t r u m e n t o n b e h a l f o f t h e C o m p a n y b y p r o p e r a u t h o r i t y a n d t h a t t h e f o r e g o i n g i n s t r u m e n t i s t h e a c t o f t h eompany for thep ses stated in the i I n t e s t im o n y w h e r e o f I h a v e h e r e u n t o s u b s c r i b e d m y n a m e a n d a f f i x e d m yffical seal on this instrumentday ofJanuary 2009

Notdi Pu 1cr e p a r e d b y M a n l e y D e a s K o c h a l s k i L L C P O B o x 1 6 5 0 2 8 C o l u m b u s O H 43216028A f t e r R e c o r d i n g R e t u r n to M a n l e y D e a s K o c h a l s k i L L C P O B o x 1 6 5 0 2 8 C o l u m b u s O H 4 3 2 1 6 5 0 2 8COMO N W E A L T H O F P E N N S Y L V A N KNOTARUt SEANawr vroon 2010o 3M10yy

robo-signed - defendant michael a fox motion for sanctions

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