“Mass Action” Case against MERS Members Unsupported by Facts


Reston, Virginia – May 30, 2013 – (RealEstateRama) — MERSCORP Holdings, Inc. today announced that Judge William F. Kuntz, II, of the U.S. District Court for the Eastern District of New York ruled in favor of MERSCORP Holdings, Inc. and dozens of MERS member institutions in a suit asserting a litany of allegations surrounding conspiracy and fraud.

In Abraham v. American Home Mortgage Servicing, Inc., et al., Judge Kuntz rejected a “mass action” attempt by hundreds of borrowers, finding that they were joined improperly and that, more importantly, the bases for their complaint were  “threadbare recitals” and “conclusory statements” unsupported by specific facts. “Mass action” is defined as any civil action in which monetary relief claims of 100 or more persons are proposed to be tried together on the grounds that the plaintiffs’ claims involve common question of law or fact.

“[T]his Court finds Plaintiffs have failed to ‘plead sufficient factual matter’ … to ‘state a claim to relief that is plausible on its face,’ ” Judge Kuntz wrote. He further held that “[p]laintiffs’ unsupported and speculative allegation that Defendants conspired  with one another is insufficient to establish a related series of transactions or occurrences so as to permit joinder. This Court therefore finds that Plaintiffs’ claims are misjoined…”

Judge Kuntz granted the defendants’ motion to sever and dismiss without prejudice all Plaintiffs except the first named plaintiff, Ms. Abraham, whose complaints he subsequently dismissed in their entirety.

“Judge Kuntz’s ruling clearly established that borrowers who engaged in separate loan transactions by different lenders generally cannot be joined in a single action,” MERSCORP Holdings Director for Corporate Communications, Jason Lobo, said.  “As importantly, he found that none of the allegations were supported by a single fact and further rejected an attempt to amend the complaint a third time as ‘futile.’ ”

For description of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.


MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products. It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

Jason Lobo
Phone: 703.652.1660

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