Indymac Federal Bank Fsb, Plaintiff, Vs. Israel A. Machado - 50 2008 Ca 037322xxxx Mb

IN THE CIRCUIT COURT FOR THE 15TH JUDICIAL CIRCUIT, IN AND FOR PALM BEACH COUNTY, FLORIDA INDYMAC FEDERAL BANK FSB,

GENERAL JURISDICTION DIVISION

Plaintiff, CASE NO. 50 2008 CA 037322XXXX MB

vs.

Division: AW ISRAEL A. MACHADO; NEENA M. MACHADO; ANY AND ALL UNKNOWN PARTIES CLAIMING BY, THROUGH, UNDER, AND AGAINST THE HEREIN NAMED INDIVIDUAL DEFENDANT(S) WHO ARE NOT KNOWN TO BE DEAD OR ALIVE, WHETHER SAID UNKNOWN PARTIES MAY CLAIM AN INTEREST AS SPOUSES, HEIRS, DEVISEES, GRANTEES, OR OTHER CLAIMANTS; TENANT #1, TENANT #2, TENANT #3, and TENANT #4 the names being fictitious to account for parties in possession Defendant(s),

MOTION FOR SANCTION OF DISMISSAL WITH PREJUDICE

Defendants. ___________________________________/ This is a foreclosure case in which the Plaintiff, INDYMAC FEDERAL BANK FSB, seeks to take the home of Defendants, ISRAEL and NEENA MACHADO. The Defendants move to dismiss this case with prejudice as a sanction for committing fraud upon the Court and for pervasive discovery abuses. I.

Introduction A.

The parties.

INDYMAC FEDERAL BANK, F.S.B. is the name given to IndyMac Bank, F.S.B., which ceased to exist in July of 2008 when the Office of Thrift Supervision appointed the Federal Deposit Insurance Corporation (“FDIC”) as the bank’s conservator. 1 The Plaintiff itself ceased

1

Deposition of Plaintiff’s Vice President, Erica Johnson-Seck, taken July 9, 2009, p. 5. ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB to exist on March 19, 2009 when the FDIC completed the sale of INDYMAC FEDERAL BANK, F.S.B. to OneWest Bank, F.S.B. (collectively referred to as the “BANK”) B.

The Plaintiff’s representative, Erica Johnson-Seck.

A key figure in this foreclosure case is the BANK’s Vice-President of Foreclosure and Bankruptcy, Erica Johnson-Seck. (“Ms. Johnson-Seck”).

Ms. Johnson-Seck executed the

documents that form the lynchpin of the BANK’s case, as well as several discovery responses: •

The Assignment of Mortgage, (in her capacity as a signing officer of Mortgage Electronic Registration Systems or “MERS”);

•

The Affidavit of Amounts Due and Owing;

•

Plaintiff’s Response to Defendant’s Interrogatories, dated May 21, 2009.

Mortgage

Loan

Ownership

Ms. Johnson-Seck has been the subject of several uncomplimentary judicial opinions. In the case of In re Kang Jin Hwang, 396 B.R. 757 (Bankr. C.D. Cal. 2008), the Court expressed disbelief regarding her testimony that IndyMac was the duly authorized servicing agent for the note owner. In Deutsche Bank National Trust Company v. Maraj, 18 Misc 3d 1123 (A) (Sup Ct, Kings County 2008), Judge Schack was concerned that Ms. Johnson-Seck “assigned the mortgage to plaintiff, DEUTSCHE BANK, and then subsequently executed the affidavit of facts … as an officer of DEUTSCHE BANK.” 2 The court openly wondered if Ms. Johnson-Seck was committing fraud on the court: Did Ms. Johnson-Seck change employers from July 3, 2007 to July 31, 2007, or does she engage in self dealing by wearing two corporate hats? The Court is concerned that there may be fraud on the part of plaintiff DEUTSCHE BANK, or at least malfeasance. Before [ordering the sale] the Court requires an affidavit

2

Id. at 2. Deposition of Erica Johnson-Seck, Exhibit M. 2 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB from Ms. Johnson-Seck, describing her employment history for the past three years. 3 Ms. Johnson-Seck never provided the ordered affidavit. 4 The Maraj case is identical to the instant case insofar as Ms. Johnson-Seck signed the Assignment of Mortgage as the officer of MERS and also the Affidavit of Amounts Due and Owing as an officer of Plaintiff. Similarly, in Indymac Bank, FSB v. Bethley, 2009 NY Slip Op. 50186 (N.Y. Sup. Ct. 2/6/09), Judge Schack ordered Plaintiff to provide affidavit of Ms. Johnson-Seck explaining how she could act as Vice President of INDYMAC BANK, FSB, MERS, and Deutsche Bank without a conflict. As with the Maraj case, Ms. Johnson-Seck never provided the ordered affidavit. 5 Defendants in this case deposed Johnson-Seck on July 9, 2009, the transcript of which has been filed with the Court. At that time, she revealed that Plaintiff and Plaintiff’s counsel have actively and repeatedly misled the Court in this case, transgressions that merit even the severest of sanctions – outright dismissal of this case. Specifically: •

Ms. Johnson-Seck’s Affidavit of Amounts Due and Owing was not made upon her own personal knowledge – despite sworn statements to the contrary in the Affidavit. Additionally, the Affidavit was not properly executed or notarized. (See Defendants’ Amended Motion to Strike Affidavits, filed separately)

•

Plaintiff is not, and never has been, the owner of the Promissory Note – despite sworn answers to interrogatories to the contrary.

•

Plaintiff was not the mortgagee at the time the Complaint was filed, despite representations to the contrary in discovery responses and the Assignment of Mortgage.

•

The Promissory Note in this case was never lost – despite allegations to the contrary in the Complaint. Each of these offenses, taken by itself, sullies the integrity of the judicial system and

richly deserves the rebuke of the Court. Together, they demonstrate a pattern of misconduct that 3

Id.; Deposition of Erica Johnson-Seck, pp. 153-155. Deposition of Erica Johnson-Seck, p. 155. 5 Deposition of Erica Johnson-Seck, pp. 160-161. 3 4

ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB evinces the unmistakable portrait of a litigant that is contemptuous of the truth and, in the pursuit of expediency, quite willing to make a mockery of the Court’s discovery procedures. II.

The Plaintiff’s Answers to Interrogatories Fraudulently Concealed That Plaintiff is, At Best, Merely the Agent of an Undisclosed Note Owner. Plaintiff’s Complaint alleged that it “is now the holder of the Mortgage Note and

Mortgage and/or is entitled to enforce the Mortgage Note and Mortgage.” While this allegation is exceedingly noncommittal, Plaintiff does not say that it is entitled to enforce the Promissory Note and Mortgage on behalf of someone else. The allegation is clearly designed to impel the reader to the conclusion that Plaintiff owns the Note and Mortgage, or at least owns the right to enforce them on its own behalf. Neither is true. In reality, as will be shown below, the Promissory Note is securitized, meaning that it is owned by a completely different bank in its capacity as Trustee for a Real Estate Mortgage Investment Conduit (or REMIC). Plaintiff is merely the Servicer for the trustee bank with no ownership rights to the Promissory Note. Similarly, at the time of filing, Plaintiff had no ownership right to enforce the mortgage lien against Defendants’ home. Defendants propounded interrogatories on Plaintiff for the specific purpose of determining the identity of the true owner of the subject Promissory Note, and thus, the real party in interest in this case. Plaintiff or its counsel, however, intentionally withheld the fact that the real owner of the Note was, and is, a non-party: Deutsche Bank National Trust Company. The first of these interrogatories merely sought the name of the person answering them. The BANK, however, had trouble answering even this seemingly innocuous question truthfully.

4 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 1. What is the name and address of the person answering these interrogatories, and, if applicable, the person's official position or relationship with the party to whom the interrogatories are directed? Plaintiff’s Answer: The undersigned counsel for the Plaintiff and the undersigned Affiant

The “undersigned Affiant” who executed the answers to the interrogatories under oath was the very same BANK Vice-President who executed the Affidavit of Amounts Due and Owing in this case – Ms. Johnson-Seck. And although the answer to this interrogatory listed her as a “person answering these interrogatories,” she testified at deposition that she did not actually participate in providing any answers. 6 Moreover, the Affiant could not even identify who, if anyone, approved the interrogatory answers for her signature. 7

6 7

Deposition of Erica Johnson-Seck, p. 91. Deposition of Erica Johnson-Seck, p. 92. 5 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 2 Please identify all the persons and/or entities who are the current beneficial owners of, or who have a beneficial or equitable interest [defined as the entitlement to keep the proceeds of the promissory note or any recovery in the case] in the Promissory Note and Mortgage. Plaintiff’s Answer: INDYMAC FEDERAL BANK FSB

In this answer, Ms. Johnson-Seck states under oath that Plaintiff has the complete beneficial interest in the Note (i.e. entitled to keep any recovery in this case). She thus continued to conceal that Plaintiff is but the agent of the real party in interest. Upon cross-examination, however, Ms. Johnson-Seck conceded that it is Deutsche Bank National Trust Company – not IndyMac Federal Bank, FSB (or OneWest Bank, F.S.B.) – that is entitled to the “recovery” sought in this foreclosure case, i.e. the title to the home: Q. … So from the very beginning, before this case ever starts, you know, the attorneys know, everyone knows that the entity that's going to get the house at the end of the day is Deutsche Bank National Trust Company, not OneWest, right? A. The house or the proceeds from the sale of the REO. Q. The house, title of the house is going into the name of Deutsche Bank? A. That's correct. 8 Worse, the misleading answer to Interrogatory No. 2 was drafted by Plaintiff’s counsel who knew, even before the case was filed, that Deutsche Bank National Trust Company was the entity which would ultimately take title to the home:

8

Deposition of Erica Johnson-Seck, p. 98. 6 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Q. [W]hen you transferred this case to your attorneys, you specifically instruct them that the title of the property, when judgment is issued eventually at the end of the case where you're successful, the title of the property is put in the name of Deutsche Bank National Trust Company; isn't that right? A. At the conclusion of the foreclosure? Q. Yes. A. Yes. * * * Q. So when the attorney filled this out, drafted this for you, he knew that at the end of the day the proceeds of the note, whether that be money or house, is going to go to Deutsche Bank; isn't that right? A. Yes. 9

9

Deposition of Erica Johnson-Seck, pp. 98, 99. 7 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 3 Please identify all the persons and/or entities who are current legal owners of, or who have a legal interest in, the Promissory Note and Mortgage. Plaintiff’s Answer: INDYMAC FEDERAL BANK FSB

In this sworn answer, Plaintiff blithely identified itself as the legal owner of the Note and mortgage. On deposition, however, Ms. Johnson-Seck admitted this was untrue as it pertained to the Promissory Note: Q. Well, IndyMac Federal Bank is not, when this was signed, was not the current legal owner of the promissory note? A. No. Q. Deutsche Bank was the current legal owner of the promissory note? A. Yes. Q. And still is today? A. Yes. 10 Plaintiff INDYMAC FEDERAL BANK FSB does, in fact, have a colorable claim of ownership to the subject mortgage in this case … now. This is because Ms. Johnson-Seck assigned the mortgage to her own company after the case was filed. She accomplished this by posing as the vice-president of the original mortgagee – a separate entity called MERS 11 (see discussion below).

10 11

Deposition of Erica Johnson-Seck, p. 93. Mortgage Electronic Registration Systems, Inc. 8 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 5 Please identify the current investor or investors with an interest in the Mortgage Loan. Plaintiff’s Answer: Plaintiff objects to this interrogatory as it seeks information which is privileged or confidential under Florida law. In addition, Plaintiff objects to this interrogatory as not relevant and designed or calculated to lead to the discovery of admissible evidence. Plaintiff further objects to the definitions and instructions as confusing, burdensome and not promulgated in accordance with the Florida Rules of Civil Procedure.

“Investor” in banking argot means the owner of the Note. 12 The objections, therefore, could only have been interposed for an improper purpose, because the identity of the owner of the note cannot be “privileged or confidential under Florida law.” Nor can it be irrelevant. On deposition, Ms. Johnson-Seck instantly answered the question (with no objection from counsel): Q. No. 5 asks: Please identify the current investor or investors with an interest in the mortgage loan. Again, your attorney objected, but you know the answer to that question, don't you? A. Yes. Q. And the answer is? A. Deutsche Bank. Indeed, the deponent had volunteered that Deutsche Bank National Trust Company was the investor (i.e. owner of the Note) early in the deposition. 13

12 13

Deposition of Erica Johnson-Seck, p. 54. Deposition of Erica Johnson-Seck, p. 52. 9 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 7 Please identify the Trust in which the subject loan has been securitized, as well as the Trustee, and the applicable Pooling and Servicing Agreement. Plaintiff’s Answer: The mortgage is not securitized.

This response to the interrogatory was false, and in the context of all the other falsehoods in this case, could only have been an intentional: Q. Yeah. No. 7: Please identify the trust in which the subject loan has been securitized as well as the trustee and the applicable pooling and servicing agreement. Answer: The mortgage is not securitized. That is flatout wrong, correct? A. Yes. 14

14

Deposition of Erica Johnson-Seck, p. 109. 10 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Interrogatory No. 8 Please state whether there are there any terms of the applicable Pooling and Servicing Agreement that restrict or limit Your authority to modify the subject loan, and if so, please describe the restrictions or limitations, including but not limited to: a. Whether loan modifications are forbidden outright; b. Whether only certain types of modifications are permitted, and if so, the types that are permitted; c. Whether there is a cap on the total number of loans in the pool that may be modified, and if so, whether that cap has been reached; d. Whether You are required to purchase any loans that you modify at an amount equal to or greater than the face value outstanding. Plaintiff’s Answer: There is no applicable Pooling and Servicing Agreement.

Again, this sworn answer is an absolute falsity. There is, in fact, an applicable Pooling and Servicing Agreement: Q. No. 8: Please state whether there are any terms of the applicable pooling and servicing agreement that restrict or limit your authority to modify the subject loan. I'm going to skip down to the answer because the answer is: There is no applicable pooling and servicing agreement. Once again, that answer is flatout wrong? A. That's right. 15 Nor could this falsehood be explained or excused by a miscommunication between the Plaintiff and its counsel. Just as with the other false interrogatory answers, the Plaintiff’s attorney knew, or should have known, this interrogatory answer was untrue when he drafted it for the affiant’s signature and when he served the sworn response on Defendant. The letter

15

Deposition of Erica Johnson-Seck, p. 109. 11 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB transmitting the case to Plaintiff’s counsel (the “Transmittal Letter” 16) conclusively demonstrates that both Plaintiff and Plaintiff’s counsel knew before the case was filed that the note owner was Deutsche Bank National Trust Company:

Transmittal Letter to Plaintiff’s Counsel Plaintiff’s Counsel

Date of transmittal (one week before Complaint filed). Assignment of Mortgage executed December 2, 2008, but claims that the transfer actually occurred on this date.

Trust identified, clearly showing that mortgage loan is securitized.

Deutsche Bank National Trust Company identified as the “Investor” (Note Owner) and the entity in which title should vest.

16

Deposition of Erica Johnson-Seck, Exhibit P13. 12 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Ms. Johnson-Seck agreed that the Transmittal Letter discloses the true owner of the Promissory Note in this case and that the loan is actually securitized: Q. [B]ut you know that your transmittal letter tells your counsel who owns the loan. And in fact, in this case it says Deutsche Bank National Trust Company, right? A. Yes. Q. They knew from day one that the loan was securitized, they knew who the trustee was, they knew who the pooling and servicing -- what pooling and servicing agreement governed the trust; isn't that right? A. Yes. 17 In summary, Plaintiff is merely the servicer for the subject mortgage loan and, therefore, lacks standing to bring this action without joining the real party in interest.

Far more

disconcerting is the fact that it actively engaged in a campaign to thwart discovery designed to uncover this truth: Q. And yet you never tell the court, in any of the documents that we've seen, never told the court, and even sworn documents, sworn things like these answers to interrogatories, that the real owner of the loan, real owner of the note is Deutsche Bank; isn't that right? A. In everything that you've shown me, that is correct. Q. Is there anything you can point to, any of the pleadings in this case anywhere, where IndyMac, now OneWest, has been up front with the court in saying we're just the servicer, the real owner is Deutsche Bank? A. No. 18 III.

Plaintiff’s Masquerade as the Owner of the Note is at the Behest of the True Owner, Deutsche Bank, and the Original Mortgagee, MERS. Plaintiff’s motivation for intentionally misleading the Court is that it is paid to do so.

The reason Plaintiff, the servicer and agent of Deutsche Bank, did not bring this suit in the name

17 18

Deposition of Erica Johnson-Seck, p. 110. Deposition of Erica Johnson-Seck, pp. 124-125. 13 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB of the true owner of the note (Deutsche Bank) or the original mortgagee (MERS) is because both these entities forbid the use of their own names as the party plaintiff: Q. Isn't the purpose of this document [the Assignment of Mortgage] to make it so that IndyMac, in this case, IndyMac Federal Bank FSB, can foreclose in its own name, regardless of who the real owner of the note is? A. The purpose of this document is everything you said, but I will add to that, that we cannot foreclose in the name of MERS, which is why we have to assign it out of MERS for the legal action. Q. Nor can you foreclose in the name of Deutsche Bank National Trust Company; isn't that true? A. It used to be. Recently, we have been given approval to action in the name of Deutsche Bank and foreclosing in the name of Deutsche Bank, but up until, I can't remember the exact date, early June, we had to action in our name and vest in Deutsche's name. Q. So isn't that the purpose of this whole charade is that you can't foreclose in the name of the real owner of the note, you can't foreclose in the name of the real owner of the mortgage, so IndyMac goes in pretending to be the real owner of the note and the mortgage? MR. MANCILLA: Objection to the form of the question. Go ahead and answer it, if you can. THE WITNESS:

I don't know how to answer that question.

MR. MANCILLA: Thank you. Ask him to rephrase it or ask it again. Don't try to guess if you don't understand it. I didn't understand it either, anyway. THE WITNESS:

Most investors dictate that we do the foreclosure action in our name and not in the investor's name. It's in the PSA or the regs. That's with Fannie and Freddie. So we go through the action as a servicing agent for the investor. 19

See also, the Limited Power of Attorney granted by Deutsche Bank to Plaintiff which provides:

19

Deposition of Erica Johnson-Seck, p. 122-124 (emphasis added). 14 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Nothing contained herein shall…be construed to grant the Servicer the power to initiate or defend any suit, litigation or proceeding in the name of Deutsche Bank National Trust Company… 20 The BANK’s contractual obligations with the real parties in interest, however, cannot trump its obligation to be truthful and candid with the Court. Nor should Deutsche Bank or MERS be permitted to shield themselves from counterclaims by instructing their agent to pretend it is something it is not. While it is the Plaintiff bank and its counsel who intentionally misled the Court in this case (and others), 21 all three entities conspired in the dissemination of these untruths.

20

Exhibits Q and U to Deposition of Erica Johnson-Seck, see also Deposition of Erica JohnsonSeck, pp. 162, 212-213. 21 See Indymac Federal Bank FSB v. Debenedetti, Case No. 50 2008 CA 036505XXXX MB (Palm Beach County) 15 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB IV.

The Plaintiff Became Mortgagee By Assigning The Mortgage To Itself, Even Though It Does Not Own The Note. A.

Ms. Johnson-Seck executed the Assignment of Mortgage in the guise of an officer of the original mortgagee, MERS.

Ms. Johnson-Seck, the same person who signed the fallacious interrogatory answers and Affidavit of Amounts Due and Owing, also executed the Assignment of Mortgage in this case. The Assignment purports to transfer the lien from the original mortgagee, MERS, to Plaintiff.

The Assignment of Mortgage

Q. Does this refresh your recollection that you in fact signed the mortgage from MERS to your own company in this case? A. Yes. Q. Okay. And in doing so, you signed it as the vice-president, not of OneWest, not of IndyMac, not of IndyMac Federal, but of Mortgage Electronic Registrations Systems, Inc., right? 16 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB A. Right. 22 Ms. Johnson-Seck admits that she is not an actual officer of MERS. 23 She is not paid by MERS, has no job duties as a vice-president of MERS, does not attend any board meetings of MERS (or any meetings at all), does not report to the president of MERS (or even know who he or she is), is not involved in any governance of MERS, has no MERS employees that report to her, has no vote in any MERS corporate decisions, and has never been to MERS headquarters (or even know where it is). 24 She does not even have the authority to see the information that is in the note-tracking database maintained by MERS. 25 And as with the Affidavit and the answers to interrogatories, the Assignment of Mortgage was prepared by Plaintiff’s counsel and sent to Ms. Johnson-Seck, who signed it without reviewing anything other than the name of the entity for which she was signing. 26 In accordance with the bank’s standard procedure, a notary who was not actually present to witness JohnsonSeck’s signature, later notarized the document, possibly on an entirely different day. 27 Still later, the “witnesses” who, like the notary, were not actually present to witness Johnson-Seck’s signature, inscribed their names. 28 B.

Posing as an “officer” of MERS is actually promoted by MERS by way of a corporate officer self-appointment scheme.

MERS is an organization created by the mortgage banking industry which acts as nominee in the county land records for the lender.

In order to facilitate transfers of the

mortgages held in the name of MERS, it authorizes its Member organizations (such as,

22

Deposition of Erica Johnson-Seck, p. 111. Deposition of Erica Johnson-Seck, pp. 6, 116. 24 Deposition of Erica Johnson-Seck, pp. 116-117. 25 Deposition of Erica Johnson-Seck, pp. 125, 121-122. 26 Deposition of Erica Johnson-Seck, p. 119. 27 Deposition of Erica Johnson-Seck, p. 119. 28 Deposition of Erica Johnson-Seck, pp. 18, 22. 17 23

ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Plaintiff) 29 to appoint their own employees to sign as “vice-presidents” or “assistant secretaries” of MERS. 30 This is accomplished through a generic MERS “Corporate Resolution” available on its website, which may be obtained by a Member company’s employee by simply filling out the Request Form. Therefore, individuals signing as “vice president” or “assistant secretary” of MERS are not, as would be supposed from reading these official-sounding titles, management-level officers of MERS.

Indeed, they are not even employees of MERS.

Because they need only be

“employees” of the Member company, these MERS “vice presidents” are not necessarily management-level officers of any organization. Corporations such as MERS are certainly free to designate representatives to sign documents on their behalf.

It is highly inappropriate, however, for a corporation to

indiscriminately hand out corporate titles, such as “vice president,” for use in signing those documents. It is inappropriate because its very purpose is to defeat statutory requirements designed to ensure that property transfers are approved at the highest levels of corporate governance.

C.

Self-appointment by non-employees to sign as MERS corporate officers does not meet the solemnity requirements of Florida Statutes.

MERS has adopted a system calculated to impart an aura of corporate authority to the transfer of real property interests so as to give the appearance of complying with the solemnity requirements of §§ 692.01 and 689.01 Florida Statute and similar laws of other states. It is doubtful that when the Florida legislature required corporate conveyances be executed by “its

29 30

Deposition of Erica Johnson-Seck, p. 138. MERS Corporate Resolution, Deposition of Erica Johnson-Seck, Exhibit T. 18 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB president, or any vice-president or chief executive officer,” 31 it contemplated the use of signatures by non-management-level employees, much less, employees of a completely different entity. There can be no point to this subterfuge other than a dubious effort to meet the letter of the statutes, without regard to their spirit. V.

Plaintiff Attempted to Conceal that its Representation of an Earlier Mortgage Transfer Was Merely an Artifice. A.

Plaintiff’s Answer to Interrogatory 3 (Regarding Assignment of Mortgage)

In preparation for the evidentiary hearing that must be granted under in WM Specialty Mortgage, LLC v. Salomon, 874 So.2d 680 (Fla. 4th DCA 2004), 32 Defendant propounded discovery aimed at uncovering the truth about the November 14th date in the Assignment. Once again, Plaintiff tried to mislead this Court. One of the interrogatories and Plaintiff’s sworn response were as follows:

Defendant’s Interrogatory No. 3 (Regarding Assignment of Mortgage) Please describe the reason the date [November 14, 2008] appears in the Assignment of Mortgage attached to the Amended Complaint in this case, including but not limited to, all events that occurred on that date with respect to the transfer of the subject promissory note and mortgage. Plaintiff’s Answer: Plaintiff is without knowledge as to this interrogatory as the Assignment of Mortgage was not executed by the Plaintiff.

To say that this response is disingenuous is an understatement. While the Assignment of Mortgage was, on its face, executed by an officer of MERS, the preparation and execution of that 31

§692.01 Florida Statutes. See DGG Development Corp. v. Estate of Capponi, 983 So.2d 1232 (Fla. 5th DCA 2008). 32 Defendants have separately filed a Motion for Summary Judgment on this issue. 19 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Assignment was orchestrated by Plaintiff and Plaintiff’s counsel and the person who actually executed it was Plaintiff’s Vice-President, Erica Johnson-Seck: Q. So this was my effort to get some information about the assignment that we're getting today but didn't get with those answers to interrogatories. … [question and answer quoted above read to witness] Are you comfortable with that answer? A. No. Q. Because the Assignment of Mortgage was executed by you? A. Right. Q. And you are the vice president of the plaintiff? A. Yes. 33 Plaintiff’s counsel prepared both the Assignment of Mortgage and the interrogatory response that claimed complete bewilderment about the contents of that Assignment because it “was not executed by Plaintiff.” 34 Even Ms. Johnson-Seck agreed that her counsel “knew or should have known that [she] signed the Assignment of Mortgage.” 35 Accordingly, the pretense at ignorance in responding to the interrogatory could have but one purpose – to conceal the truth. The truth Plaintiff and its counsel wished to conceal was that the “backdating” of the Assignment had no factual basis and the case should be dismissed under Jeff-Ray.

33

Deposition of Erica Johnson-Seck, p. 134. Deposition of Erica Johnson-Seck, p. 135. 35 Deposition of Erica Johnson-Seck, p. 136. 34

20 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB B.

Plaintiff’s Responses to Requests for Admission (Regarding Assignment of Mortgage)

Defendant also propounded Requests for Admission to prove the absence of any factual basis for claiming that MERS had transferred the mortgage lien to Plaintiff before the case was filed. Again Plaintiff responded falsely, denying what it should have admitted.

Defendant’s Request for Admission No. 6 (Regarding Assignment of Mortgage) Admit that MERS did not physically transfer the subject note or mortgage to Plaintiff on or before November 14, 2008. Plaintiff’s Answer: Denied.

On deposition, Ms. Johnson-Seck admitted that MERS never physically transferred a note or mortgage to anyone, and could not explain why the Request was denied: Q. Because I think you'll agree, MERS never physically transferred anything to anybody? A. That's true. Q. MERS never had the note, so it didn't physically transfer the note? A. True. Q. And as the signing officer of MERS, you know that the only thing that happened with respect to that mortgage is that you executed an assignment? A. Assignment, yes. Q. You didn't physically transfer the mortgage to anyone? A. No. Q. The MERS records that we just went through, they don't show the mortgage being physically transferred to anyone? A. No. 21 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Q. Can you come up with a reason why your company would deny that MERS did not physically transfer the subject note or mortgage? A. But this wasn't prepared by -- these are not -- okay. Wait. MR. MANCILLA: 36 Maybe the lawyer didn't understand it. I don't understand it, so maybe he didn't. THE WITNESS:

I -- I don't know. I wasn't there.

MR. MANCILLA: Yeah. Well, if you don't know, you don't know. BY MR. ICE: Q. Okay. Well, you know, we can speculate that the lawyer misunderstood, but as you're sitting here today, can you provide a reason yourself why that should be denied? A. No. 37

36 37

Plaintiff’s counsel in attendance at the deposition. Deposition of Erica Johnson-Seck, pp. 145-146. 22 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Request for Admission No. 9 (Regarding Assignment of Mortgage) Admit that Plaintiff is not the entity identified as the “Investor” in the MERS® System. Plaintiff’s Answer: Without knowledge and therefore denied.

Again, on deposition, Ms. Johnson-Seck admitted that the MERS System records identified an entity other than the Plaintiff as the “Investor” (note owner) and that she had no explanation for the denial of the Request for Admission: Q. Is the plaintiff identified as the investor in the MERS' system records? A. No. Q. So you admit that plaintiff is not identified? A. Yes. Q. And you also admit that it should never have been denied? A. I don't see why it was denied. 38

38

Deposition of Erica Johnson-Seck, p. 148. 23 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB

Defendant’s Request for Admission No. 10 (Regarding Assignment of Mortgage) Admit that Plaintiff did not acquire an interest in the mortgage prior to the filing of the Complaint. Plaintiff’s Answer: Denied.

Once again, on deposition, Plaintiff admitted that which should have been admitted in Response to the Requests for Admission: Q. No. 10, admit that plaintiff did not acquire an interest in the mortgage prior to the filing of the complaint. Answer: Denied. … Do you see that answer and response? A. Yes. Q. This response is also incorrect, isn't it? A. Yes. 39 Leaving aside that the discovery abuse of falsely denying that which should be admitted merits the severest of sanctions, this single admission is case dispositive in Defendant’s favor. The case should be immediately dismissed under Jeff-Ray.

39

Deposition of Erica Johnson-Seck, pp. 148-149. 24 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB C.

Plaintiff’s Responses to Requests for Production (Regarding Assignment of Mortgage) Defendant’s Request for Production No. 3 (Regarding Assignment of Mortgage) Any and all documents that evidence a physical transfer of the Mortgage from MERS to the Plaintiff on or before November 14, 2008. Plaintiff’s Answer: All requested documents in the Plaintiff’s possession, custody or control will be produced, except those documents which are privileged, confidential or work product.

Again, Plaintiff’s response is abusive of the discovery process. Plaintiff’s representative (and MERS signing officer) admitted that MERS did not make, and could not have made, a physical transfer of the Mortgage. 40

To suggest that responsive documents would be

forthcoming or that documents were withheld due to privilege (despite the absence of a privilege log) displays a shocking lack of candor with the Court. VI.

The Promissory Note Was Never Lost. The Complaint that was filed in this case on November 21, 2008 contained a count to

reestablish a lost note. In it, Plaintiff alleged that it had lost possession of the original Note and that “[a]fter due and diligent search, Plaintiff has been unable to obtain possession of the Mortgage Note.” 41

These factual representations in the Complaint were false because the

Promissory Note in this case were never lost: Q. It is true that the promissory note in this case was never lost, correct? …

40 41

Deposition of Erica Johnson-Seck, pp. 151, 152. Complaint, ¶18. 25 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB A. It was never lost. 42 The Complaint also alleges that “Plaintiff does not presently have a copy of the note, but is seeking to obtain a copy, and will file a copy with the Court when obtained.” This allegation is also highly suspect given that Plaintiff usually has an electronic copy of the note available to be printed and attached to the Complaint. 43 VII.

The Sanction of Dismissal is Warranted in this Case. As shown in the discussion above, the BANK has filed many documents with the Court

in complete disregard of the truth or falsity of their factual underpinnings. Under the Court’s general civil contempt powers, the Court is authorized and entitled to sanction the BANKS’s misconduct. As summarized by the Fifth District in Robinson v. Weiland, 988 So.2d 1110 (Fla. 5th DCA 2008): Pretrial discovery is not intended as a game. Many trial judges throughout this state have bemoaned the tactics of the minority of lawyers and parties that abuse the discovery process. See The Fla. Bar v. Miller, 863 So.2d 231 (Fla.2003) (ordering one-year suspension of attorney who deliberately concealed his knowledge of client's receipt of EEOC's right-to-sue letter); The Fla. Bar v. Rood, 569 So.2d 750 (Fla.1990) (concealing expert's memorandum and causing clients to sign false answers under oath warranted attorney's one-year suspension); Mercer v. Raine, 443 So.2d 944, 946 (Fla.1983) (affirming sanctions of striking defendant's answer and entering default judgment for discovery violations when defendant "knew what was going on" and had "total disregard for the consequences" of pending action); …. As this court has stated: The integrity of the civil litigation process depends on the truthful disclosure of facts. A system that depends on an adversary’s ability to uncover falsehoods is doomed to failure, which is why this kind of conduct [fraudulent concealment of facts] must be discouraged in the strongest possible way. See also Channel Components, Inc. v. America II Electronics, Inc., 915 So.2d 1278 (Fla. 2d DCA 2005).

42 43

Deposition of Erica Johnson-Seck, p. 41. Deposition of Erica Johnson-Seck, p. 45. 26 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB Here, Plaintiff and Plaintiff’s counsel 44 have: 1) misled the Court about the real party in interest in the case; and 2) engaged in extensive discovery abuse to obstruct revelation of the known falsities in the complaint – a “flagrant abuse of the judicial process” worthy of severe sanctions. See Martin v. Automobili Lamborghini Exclusive, Inc., 307 F.3d 1332 (11th Cir. 2002). Dismissal for fraud is appropriate where "a party has sentiently set in motion some unconscionable scheme calculated to interfere with the judicial system's ability impartially to adjudicate a matter by improperly influencing the trier of fact or unfairly hampering the presentation of the opposing party's claim or defense." Cox v. Burke, 706 So.2d 43, 46 (Fla. 5th DCA 1998). Trial courts have "the right and obligation to deter fraudulent claims from proceeding in court." Savino v. Fla. Drive In Theatre Mgmt., Inc., 697 So.2d 1011, 1012 (Fla. 4th DCA 1997). This is because "[o]ur courts have often recognized and enforced the principle that a party who has been guilty of fraud or misconduct in the prosecution or defense of a civil proceeding should not be permitted to continue to employ the very institution it has subverted to achieve [its] ends." Hanono v. Murphy, 723 So.2d 892, 895 (Fla. 3d DCA 1998). Where a party perpetrates a fraud on the court which permeates the entire proceedings, dismissal of the entire case is proper. Desimone v. Old Dominion Ins. Co., 740 So.2d 1233, 1234 (Fla. 4th DCA 1999). 44

The Court is also empowered to sanction counsel for its role in the litigation misconduct. The Court is entitled to expect Plaintiff counsel’s compliance with Section 57.105 Florida Statutes which prohibits parties and their attorneys from presenting claims that are not supported by the material facts. The Court may also expect counsel’s compliance with Rule 2.515(a) of the Rules of Judicial Administration, which provides that “[t]he signature of an attorney shall constitute a certificate by the attorney that the attorney has read the pleading or other paper [and] that to the best of the attorney’s knowledge, information and belief there is good ground to support it…” Id. Additionally, the Court may expect that officers of the court comport themselves with the Rules Regulating the Florida Bar which prohibit a lawyer from asserting an issue without a factual basis. Rule 4-3.1 Meritorious Claims and Contentions. (Comment: “What is required of lawyers…is that they inform themselves about the facts of their clients’ cases…”). 27 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB In addition, the above-chronicled misconduct constitutes “unclean hands” on the part of the owner of the subject note and mortgage. “A foreclosure action is an equitable proceeding which may be denied if the holder of the note comes to the court with unclean hands or the foreclosure would be unconscionable.” Knight Energy Services, Inc. v. Amoco Oil Co., 660 So.2d 786, 789 (Fla. 4th DCA 1995). WHEREFORE, Defendants request that the Court enter an order granting the sanction of dismissal with prejudice against Plaintiff in this case.

Dated: July 22, 2009. ICE LEGAL, P.A. Counsel for Defendant 1975 Sansburys Way, Suite 104 West Palm Beach, FL 33411 Telephone: (561) 793-5658 Facsimile: (866) 507-9888

By: THOMAS E. ICE Florida Bar No. 0521655

28 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888

CASE NO. 50 2008 CA 037322XXXX MB CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served by mail this July 22, 2009 to all parties on the attached service list. ICE LEGAL, P.A. Counsel for Defendant 1975 Sansburys Way, Suite 104 West Palm Beach, FL 33411 Telephone: (561) 793-5658 Facsimile: (866) 507-9888

By: THOMAS E. ICE Florida Bar No. 0521655

SERVICE LIST Joseph Mancilla, Esq. FLORIDA DEFAULT LAW GROUP, P.L. 9119 Corporate Lake Dr., Suite 300 Tampa, FL 33634 (305) 662-4110 Plaintiff’s counsel

29 ICE LEGAL, P.A. 1975 SANSBURYS WAY, SUITE 104, WEST PALM BEACH, FL 33411 • TELEPHONE (561)793-5658 • FACSIMILE (866) 507-9888