This time, U.S. District Court Judge David Doty ordered Butler to pay for the attorney fees for Wells Fargo Bank, Mortgage Electronic Registration Systems, Inc., Merscorp Inc and Federal National Mortgage Association.
Last month, month Doty’s colleague U.S. District Court Judge Patrick Schlitz ordered Butler to pay $50,000 in sanctions for filing repeated frivolous lawsuits and delaying cases for the purpose of collecting fees from clients.
Butler has brought the same argument in a series of mortgage cases. He sues on behalf of homeowners for the common industry practice of securitizing mortgages by having them held by and recorded in the name of a nominal mortgagee such as MERS rather than the holder of the promissory note. This allows the mortgages to be repeatedly sold without each sale being recorded on the title.
The plaintiffs argued that if the entity that holds their mortgage, usually MERS, is not the entity that holds the promissory note, the mortgage and the foreclosure of the mortgage is invalid.
Butler’s arguments have been dismissed by the Minnesota Supreme Court and the 8th Circuit Court of Appeals.
In his order, Doty outlines his frustration with Butler’s tactics.
“Butler presents no argument for reversing or modifying that law, and instead argues that it does not apply. Despite the repeated dismissal of Butler’s actions in this district and the Eighth Circuit, he continues to file actions, congesting the docket of the court, taking resources away from cases that have merit and charging clients to pursue meritless claims. These frivolous actions have, at best, the result of allowing Butler’s clients to remain in their homes (or continue to own their rental properties) without payment. In fact, the real outcome for plaintiffs is to needlessly prolong the period of financial and housing uncertainty brought on by their failure to meet their loan-payment obligations.”
Doty said he was not imposing additional monetary sanctions on Butler due to Schiltz’s recent order. Instead he asked the defendants to file affidavits that outlined how much they have spent as a result of Butler’s “frivolous claims.”
A copy of Doty’s order is available here.