MERS wins in class-action suit from Minnesota counties

MERSCORP has won again in a legal battle stemming from its assignment of a mortgage, but this time the challenge wasn’t over MERS’ authority to assign the mortgage.

In this case, 87 counties in Minnesota filed a class-action lawsuit against MERS, stating that MERS deprived the counties of recording fees for mortgage assignments by allowing parties to bypass recordation with the counties, causing the loss of statutory recording fees and creating gaps in chains of title.

The U.S. Court of Appeals for the Eighth Circuit ruled on an appeal brought by the counties and upheld the District Court of Minnesota’s decision, which found that there is no mandatory recording requirement under Minnesota law and dismissed the challenge brought by the counties against MERS.

The Circuit Court held that, “ … because we believe Minnesota case law establishes that Minnesota law imposes no duty to record a mortgage or a mortgage assignment with the county recorder, the district court did not err in its determination that there was no mandatory recording requirement under Minnesota law.”

Read on.

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