Rick Sovereign v. Deutsche Bank

FILED
NOT FOR PUBLICATION JUN 30 2015
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
RICK L. SOVEREIGN; AMY J. No. 12-35449
SOVEREIGN,
D.C. No. 3:11-cv-00995-BR
Plaintiffs - Appellants,
v. MEMORANDUM*
DEUTSCHE BANK; et al.,
Defendants - Appellees.
Appeal from the United States District Court
for the District of Oregon
Anna J. Brown, District Judge, Presiding
Submitted June 22, 2015**
Before: HAWKINS, GRABER, and W. FLETCHER, Circuit Judges.
Rick L. and Amy J. Sovereign appeal pro se from the district court’s
judgment dismissing their action related to a home mortgage loan and foreclosure
proceedings. We have jurisdiction under 28 U.S.C. § 1291. We review de novo.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Shell Gulf of Mexico Inc. v. Ctr. for Biological Diversity, Inc., 771 F.3d 632, 635
(9th Cir. 2014) (dismissal for lack of subject matter jurisdiction); Cervantes v.
Countrywide Home Loans, Inc., 656 F.3d 1034, 1040 (9th Cir. 2011) (dismissal for
failure to state a claim). We affirm in part, vacate in part, and remand.
The district court properly dismissed defendants Deutsche Bank and
MortgageIt, Inc. because the Sovereigns’ claims for declaratory relief do not state
that the Sovereigns and these parties have adverse legal interests. See Shell Gulf of
Mexico Inc., 771 F.3d at 635 (“To determine whether a declaratory judgment
action presents a justiciable case or controversy, courts consider whether the facts
alleged, under all the circumstances, show that there is a substantial controversy,
between parties having adverse legal interests, of sufficient immediacy and reality
to warrant the issuance of a declaratory judgment.” (citation and internal quotation
marks omitted)).
The district court dismissed the Sovereigns’ claims against defendants
Mortgage Electronic Registration Systems, Inc. (“MERS”) and CitiMortgage after
finding, among other things, that MERS was a proper beneficiary of the
Sovereigns’ deed of trust under Oregon law. However, after the district court
entered judgment, the Oregon Supreme Court decided, in reviewing a deed of trust
similar to the one here, that MERS was not a “beneficiary” of a deed of trust under
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the Oregon Trust Deed Act, nor is MERS eligible to serve as the beneficiary
simply by being designated as such in the deed of trust. See Brandrup v.
ReconTrust Co., 303 P.3d 301, 304, 309-12 (Or. 2013) (en banc). Because the
district court did not have the benefit of Brandrup, we vacate and remand to allow
the district court to reconsider the Sovereigns’ claims against MERS and
CitiMortgage.
The court has received appellee Cal-Western Reconveyance Corporation’s
notice of bankruptcy and automatic bankruptcy stay, filed on July 24, 2013. This
case remains stayed as to appellee Cal-Western Reconveyance Corporation. On or
before November 13, 2015, appellee Cal-Western Reconveyance Corporation shall
file a status report regarding the bankruptcy proceedings.
The parties shall bear their own costs on appeal.
AFFIRMED in part, VACATED in part, and REMANDED.
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