Terra West Collections Group, LLC v. Federal National Mortgage Association et al, No. 2:2015cv01692 - Document 32 (D. Nev. 2015)

Court Description: ORDER Granting 31 Stipulation Permitting the Federal Housing Finance Agency, as Conservator of the Federal National Mortgage Association, to Intervene. Signed by Magistrate Judge Cam Ferenbach on 11/18/2015. (Copies have been distributed pursuant to the NEF - NEV)
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Terra West Collections Group, LLC v. Federal National Mortgage Association et al 1 2 3 4 5 6 7 8 9 10 Doc. 32 Leslie Bryan Hart, Esq. (SBN 4932) John D. Tennert, Esq. (SBN 11728) FENNEMORE CRAIG, P.C. 300 E. Second St., Suite 1510 Reno, Nevada 89501 Tel: 775-788-2228 Fax: 775-788-2229 lhart@fclaw.com; jtennert@fclaw.com (Pro Hac Vice to be Submitted) Asim Varma, Esq. Howard N. Cayne, Esq. Michael A.F. Johnson, Esq. ARNOLD & PORTER LLP 601 Massachusetts Ave., NW Washington, DC 20001-3743 Tel: (202) 942-5000 Fax: (202) 942-5999 Asim.Varma@aporter.com; Howard.Cayne@aporter.com; Michael.Johnson@aporter.com Attorneys for Proposed Intervenor Federal Housing Finance Agency UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 11 12 13 14 15 16 TERRA WEST COLLECTIONS GROUP, LLC, Plaintiff, vs. FEDERAL NATIONAL MORTGAGE ASSOCIATION; CITY OF HENDERSON; and REPUBLIC SERVICES, Defendants. 17 18 19 20 21 22 23 24 25 CASE NO. 2:15-cv-01692-JAD-VCF STIPULATION TO ENTRY OF ORDER AND [PROPOSED] ORDER PERMITTING THE FEDERAL HOUSING FINANCE AGENCY, AS CONSERVATOR OF THE FEDERAL NATIONAL MORTGAGE ASSOCIATION, TO INTERVENE FEDERAL NATIONAL MORTGAGE ASSOCIATION, Counterclaimant, vs. TERRA WEST COLLECTIONS GROUP, LLC; ANTHEM HIGHLANDS COMMUNITY ASSOCIATION; and RUGGED OAKS INVESTMENTS, LLC, Counter-Defendants. 1. The Federal Housing Finance Agency (“FHFA” or “Conservator”), as Conservator for the Federal National Mortgage Association (“Fannie Mae”), seeks to intervene in the above-captioned action pursuant to 12 U.S.C. § 4617(b)(2)(A)(i) and Fed. R. Civ. P. 24. 26 27 28 2. On September 6, 2008, FHFA’s Director appointed the FHFA Conservator of Fannie Mae in accordance with the Housing and Economic Recovery Act of 2008, Pub. L. 110- FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11040253.1 Dockets.Justia.com 1 289, 122 Stat. 2654 (codified at 12 U.S.C. § 4617) (“HERA”), and the Federal Housing 2 Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. § 4501, et. seq.). 3 3. The FHFA, as Conservator, has succeeded to “all rights, titles, powers, and 4 privileges” of Fannie Mae, including its right to sue and be sued in the federal courts. See 5 12 U.S.C. § 4617(b)(2)(A)(i). 6 4. Accordingly, FHFA asserts that it has an unconditional federal statutory right to 7 intervene in this matter, see Fed. R. Civ. P. 24(a)(1), and to assert its interests in a manner 8 consistent with the Conservator’s powers and duties. 9 5. 10 Answer. 11 /// 12 /// 13 /// 14 /// 15 /// 16 /// 17 /// 18 /// 19 /// 20 /// 21 /// 22 /// 23 /// 24 /// 25 /// 26 /// 27 /// 28 Pursuant to Fed. R. Civ. P. 24(c), FHFA attaches as Exhibit A their intended /// FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11040253.1 2 1 STIPULATION 2 3 FHFA, Fannie Mae, and Plaintiff/Counter-Defendant Terra West Collections Group, through their undersigned attorneys of record, hereby stipulate and request that the Court make 4 this stipulation an order of the Court: 5 The FHFA shall be permitted to intervene in the above-referenced action pursuant to 12 U.S.C. § 4617(b)(2)(A)(i) and Fed. R. Civ. P. 24. 6 7 8 9 DATED this 17th day of November, 2015. GORDON LAW FENNEMORE CRAIG, P.C. By: By: 10 11 12 13 /s/ Leslie Bryan Hart Leslie Bryan Hart, Esq. (SBN 4932) John D. Tennert, Esq. (SBN 11728) 300 E. Second St., Suite 1510 Reno, Nevada 89501 Tel: 775-788-2228 Fax: 775-788-2229 lhart@fclaw.com; jtennert@fclaw.com and ARNOLD & PORTER LLP (Pro Hac Vice to be submitted) Asim Varma, Esq. Howard N. Cayne, Esq. Michael A.F. Johnson, Esq. Attorneys for Proposed Intervenor Federal Housing Financing Agency /s/ Aviva Gordon Aviva Y Gordon, Esq. (SBN 5333) 6655 Cimarron, Suite 200 Las Vegas, NV 89113 Tel: 702-527-5557 Fax: 702-527-5559 agordon@gordonlawlv.com Attorneys for Plaintiff/Counter-Defendant Terra West Collections Group 14 15 16 17 ALDRIDGE PITE LLP 18 By: 19 20 21 22 23 /s/ Laurel Handley Laurel I. Handley, Esq. (SBN 9576) Jory C. Garabedian, Esq. (SBN 10352) 520 South 4th Street, Suite 360 Las Vegas, Nevada 89101 Tel: (858) 750-7600 Fax: (702) 685-6342 lhandley@aldridgepite.com; jgarabedian@aldridgepite.com Attorneys for Defendant/Counterclaimant Federal National Mortgage Association 24 ORDER 25 IT IS SO ORDERED. 26 ________________________________ __________________ _ UNITED STATES JUDGE DATED: 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11040253.1 3 1 CERTIFICATE OF SERVICE 2 Pursuant to F.R.C.P. 5(b) and Electronic Filing Procedure IV(B), I certify that on the 17th 3 day of November, 2015, a true and correct copy of the STIPULATION TO ENTRY OF 4 ORDER AND [PROPOSED] ORDER PERMITTING THE FEDERAL HOUSING 5 FINANCE AGENCY, AS CONSERVATOR OF THE FEDERAL NATIONAL 6 7 MORTGAGE ASSOCIATION, TO INTERVENE, was transmitted electronically through the 8 Court’s e-filing electronic notice system to the attorney(s) associated with this case. If electronic 9 notice is not indicated through the court’s e-filing system, then a true and correct paper copy of 10 the foregoing document was delivered via U.S. Mail. 11 12 Joseph P Garin NVECF@lipsonneilson.com 13 Joshua Ohiozogie Igeleke , Jr. jigeleke@hutchlegal.com 14 15 16 /s/ Pamela Carmon Pamela Carmon 17 18 19 20 21 22 23 24 25 26 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11040253.1 4 Exhibit A Exhibit A 1 2 3 4 5 6 7 8 9 10 Leslie Bryan Hart, Esq. (SBN 4932) John D. Tennert, Esq. (SBN 11728) FENNEMORE CRAIG, P.C. 300 E. Second St., Suite 1510 Reno, Nevada 89501 Tel: 775-788-2228 Fax: 775-788-2229 lhart@fclaw.com; jtennert@fclaw.com (Pro Hac Vice to be Submitted) Asim Varma, Esq. Howard N. Cayne, Esq. Michael A.F. Johnson, Esq. ARNOLD & PORTER LLP 601 Massachusetts Ave., NW Washington, DC 20001-3743 Tel: (202) 942-5000 Fax: (202) 942-5999 Asim.Varma@aporter.com; Howard.Cayne@aporter.com; Michael.Johnson@aporter.com Attorneys for Intervenor Federal Housing Finance Agency UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 TERRA WEST COLLECTIONS GROUP, LLC, Plaintiff, vs. FEDERAL NATIONAL MORTGAGE ASSOCIATION; CITY OF HENDERSON; and REPUBLIC SERVICES, Defendants. and FEDERAL HOUSING FINANCE AGENCY, as Conservator for the Federal National Mortgage Association, Intervenor. FEDERAL NATIONAL MORTGAGE ASSOCIATION, Counterclaimant, and FEDERAL HOUSING FINANCE AGENCY, as Conservator for the Federal National Mortgage Association, Intervenor. vs. TERRA WEST COLLECTIONS GROUP, LLC; ANTHEM HIGHLANDS COMMUNITY ASSOCIATION; and RUGGED OAKS INVESTMENTS, LLC, Counter-Defendants. 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 CASE NO. 2:15-cv-01692-JAD-VCF [PROPOSED] ANSWER AND COUNTERCLAIMS BY INTERVENOR FEDERAL HOUSING FINANCE AGENCY, AS CONSERVATOR FOR THE FEDERAL NATIONAL MORTGAGE ASSOCIATION 1 Simultaneously with this Answer, the Federal Housing Finance Agency (“FHFA”), in its 2 capacity as Conservator for the Federal National Mortgage Association (“Fannie Mae”), is filing, 3 along with the other parties to this action, a joint stipulation that FHFA be permitted to intervene 4 in this action pursuant to Federal Rule of Civil Procedure 24. In accordance with Rule 24(c)’s 5 6 requirement that a motion to intervene “be accompanied by a pleading that sets out the claim or 7 defense for which intervention is sought,” FHFA submits this Answer to respond as follows to 8 the Complaint filed by Plaintiff Terra West Collections Group, LLC ( “Plaintiff”) on July 21, 9 2015. 10 1. FHFA admits the allegations contained within Paragraph 1 of the Complaint. 11 2. FHFA admits that Fannie Mae has an interest in property located within the State 12 13 of Nevada. FHFA denies the remaining allegations within Paragraph 2 of the Complaint. 3. FHFA admits that the City of Henderson is an entity existing under the laws of 14 the State of Nevada. FHFA is without knowledge or information sufficient to form a belief as to 15 the truth of the remaining allegations within Paragraph 3 of the Complaint. 16 17 18 19 20 21 22 4. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 4 of the Complaint. 5. Paragraph 5 of the Complaint states legal conclusions that do not require a response. To the extent a response is required, denied. 6. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 6 of the Complaint. 7. FHFA admits that Fannie Mae had an interest in real property located at 2672 23 Strichen Avenue, Henderson, NV 89044 (the “Property”) at the time of the foreclosure sale 24 referred to in Paragraph 7 of the Complaint. FHFA is without knowledge or information 25 sufficient to form a belief as to the truth of the remaining allegations within Paragraph 7 of the 26 Complaint. 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 2 1 8. FHFA avers that it has an interest in the Property that survives notwithstanding 2 the foreclosure sale discussed in Paragraph 8 of the Complaint and that any excess proceeds from 3 that foreclosure sale are not relevant to its interest. 4 5 9. FHFA is without knowledge or information sufficient to form a belief as to the truth of the allegations within Paragraph 9 of the Complaint. 6 10. FHFA is without knowledge or information sufficient to form a belief as to the 7 truth of the allegations within Paragraph 10 of the Complaint. Paragraph 10 of the Complaint 8 also states legal conclusions that do not require a response. To the extent a response is required, 9 denied. 10 11. FHFA admits that neither FHFA nor Fannie Mae colluded with Plaintiff regarding 11 the filing of the Complaint. FHFA is without knowledge or information sufficient to form a 12 belief as to the truth of the remaining allegations within Paragraph 11 of the Complaint. 13 14 15 12. Paragraph 12 of the Complaint states requests for relief that do not require a response. To the extent a response is required, denied. 13. Paragraph 13 of the Complaint states legal conclusions and requests for relief that 16 do not require a response. To the extent a response is required, denied. FHFA is without 17 knowledge or information sufficient to form a belief as to the truth of the remaining allegations 18 within Paragraph 13 of the Complaint. 19 AFFIRMATIVE DEFENSES 20 FHFA’s investigations of these claims are continuing. By this Answer, FHFA waives no 21 affirmative defenses and reserves its right to amend the Answer to insert any subsequently 22 discovered affirmative defenses. 23 FIRST AFFIRMATIVE DEFENSE 24 25 The Complaint fails to state a claim for which relief can be granted because, among other 26 reasons, 12 U.S.C. § 4617(j)(3) precludes an homeowners’ association sale from extinguishing 27 Fannie Mae’s interest in the Property and preempts any state law to the contrary. 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 3 1 SECOND AFFIRMATIVE DEFENSE 2 Plaintiff’s claims are barred by the doctrines of laches, estoppel, waiver, unjust 3 enrichment, and/or unclean hands. 4 THIRD AFFIRMATIVE DEFENSE 5 6 The damages, if any, that were allegedly sustained by Plaintiff as a result of the acts 7 described in the Complaint were caused in whole or were contributed to in part by reason of the 8 acts, omissions, negligence, and/or intentional misconduct of Plaintiff. 9 FOURTH AFFIRMATIVE DEFENSE 10 The damages, if any, that were allegedly sustained by Plaintiff as a result of the acts 11 described in the Complaint were caused in whole or were contributed to in part by reason of the 12 acts, omissions, negligence, and/or intentional misconduct of one or more third parties over 13 14 whom neither FHFA nor Fannie Mae had control. 15 FIFTH AFFIRMATIVE DEFENSE 16 Plaintiff has an adequate remedy at law and has, through its own acts and/or omissions, 17 failed to mitigate its damages, the existence of which are denied. 18 19 SIXTH AFFIRMATIVE DEFENSE Plaintiff failed to join one or more indispensable parties. 20 SEVENTH AFFIRMATIVE DEFENSE 21 22 Fannie Mae breached no duty with regard to Plaintiff. 23 COUNTERCLAIMS 24 FIRST CAUSE OF ACTION 25 26 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 (Declaratory Judgment versus Counter-Defendant Rugged Oaks Investments, LLC) 1. FHFA incorporates by reference the responses of all previous paragraphs, as if fully set forth herein. 11056411.1 4 1 2 3 4 5 6 7 2. Pursuant to 28 U.S.C. § 2201, this Court has the power and authority to declare FHFA and Fannie Mae’s rights and interests in the Property. 3. FHFA is an agency of the federal government of the United States of America and is also the Conservator for Fannie Mae. 4. The Conservator has succeeded by law to all of Fannie Mae’s “rights, titles, powers, and privileges.” 12 U.S.C. § 4617(b)(2)(A)(i). 5. During the Conservatorship, “[n]o property of [FHFA] shall be subject to levy, 8 attachment, garnishment, foreclosure, or sale without the consent of the [FHFA], nor shall any 9 involuntary lien attach to the property of [FHFA].” 12 U.S.C. § 4617(j)(3). 10 6. Fannie Mae’s interest at issue is property of the Conservator. Therefore, applying 11 NRS Chapter 116 or other state law in a manner that extinguishes Fannie Mae’s interest in the 12 Property would violate 12 U.S.C. § 4617(j)(3). 13 7. 12 U.S.C. § 4617(j)(3) preempts any state law that would permit a foreclosure on 14 a superpriority lien to extinguish a property interest of Fannie Mae while it is under FHFA’s 15 conservatorship. 16 8. On or about October 10, 2013, Fannie Mae acquired ownership of the Property at 17 a duly noticed foreclosure sale conducted pursuant to a Deed of Trust encumbering the Property. 18 The Trustee’s Deed Upon Sale conveying the Property to Fannie Mae was recorded in the Books 19 and l Records of Clark County on October 21, 2013 as Instrument No. 20131021-0000768. 20 (ECF 11, Ex. 1.) 21 9. On April 29, 2015, Plaintiff, doing business as Assessment Management Services 22 as agent for Anthem Highlands Community Association (the “HOA”) conducted a foreclosure 23 sale of the Property (the “HOA Sale”), at which the Property was purportedly sold to Rugged 24 Oaks Investments, LLC (“Rugged Oaks”). (ECF 11, Exs. 4 & 5.) 25 10. Rugged Oaks claims an interest in the Property through a Trustee’s Deed Upon 26 Sale recorded in the Clark County Recorder’s Office as Book and Instrument Number 20150507- 27 0004054 that is adverse to FHFA and Fannie Mae’s interests. 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 5 C 1 11. At no time did Plaintiff, Plaintiff’s trustee or agent, the HOA, the HOA’s trustee 2 or agent, or any other person or entity obtain consent from FHFA to extinguish Fannie Mae’s 3 interest in the Property. 4 5 6 12. Pursuant to 12 U.S.C. § 4617(j)(3), the foreclosure sale conducted by the HOA could not extinguish Fannie Mae’s interest in the Property. 13. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 7 28 U.S.C. § 2201, that 12 U.S.C. § 4617(j)(3) precludes an HOA foreclosure sale from 8 extinguishing Fannie Mae’s interest in the Property. 9 10 14. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 28 U.S.C. § 2201, that the HOA Sale did not extinguish Fannie Mae’s interest in the Property. 11 SECOND CAUSE OF ACTION 12 (Quiet Title versus Counter-Defendant Rugged Oaks) 13 14 15 16 17 18 19 20 21 15. FHFA incorporates by reference the responses of all previous paragraphs, as if fully set forth herein. 16. Pursuant to 28 U.S.C. § 2201 and NRS § 40.010, this Court has the power and authority to resolve the parties’ adverse claims in the Property. 17. Fannie Mae has an ownership interest in the Property by virtue of its purchase of title at the October 10, 2013 foreclosure sale. 18. FHFA, as Fannie Mae’s conservator, has succeeded by law to all of Fannie Mae’s “rights, titles, powers, and privileges.” 12 U.S.C. § 4617(b)(2)(A)(i). 19. Rugged Oaks claims an interest in the Property through its purported purchase of 22 the Property at an HOA foreclosure sale held on April 29, 2015, and claims that the foreclosure 23 sale extinguished Fannie Mae’s interest. 24 20. Pursuant to 12 U.S.C. § 4617(j)(3), “[n]o property of [FHFA] shall be subject to 25 levy, attachment, garnishment, foreclosure, or sale without the consent of [FHFA], nor shall any 26 involuntary lien attach to the property of [FHFA].” 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 21. Based on the adverse claims being asserted by the parties, FHFA and Fannie Mae are entitled to a judicial determination regarding the rights and interests of the respective parties 11056411.1 6 1 to the case. 2 22. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 3 28 U.S.C. § 2201 and NRS § 40.010, that the HOA Sale did not extinguish Fannie Mae’s interest 4 in the Property. 5 23. FHFA and Fannie Mae are entitled to a determination from this Court, pursuant to 6 28 U.S.C. § 2201 and NRS § 40.010 that Rugged Oaks’s interest in the Property, if any, is 7 subject to Fannie Mae’s interest in the Property. 8 PRAYER FOR RELIEF 9 WHEREFORE, FHFA prays for the following relief: 10 1. That the Court declare that 12 U.S.C. § 4617(j)(3) preempts any Nevada law that 11 would permit a foreclosure on a superpriority lien to extinguish Fannie Mae’s 12 property interest while it is under FHFA’s conservatorship; 13 2. That the Court declare that the HOA sale did not extinguish Fannie Mae’s interest 14 in the Property and thus did not convey the Property free and clear of Fannie 15 Mae’s interest to Rugged Oaks; 16 3. 17 That the Court declare that Rugged Oaks’s interest in the Property, if any, is subject to Fannie Mae’s interest in the Property; 18 4. 19 /// 20 /// 21 /// 22 /// 23 /// 24 /// 25 /// 26 /// 27 /// 28 That FHFA be awarded reasonable attorneys’ fees and costs; and /// FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 7 1 5. 2 DATED this _____ day of November, 2015. That FHFA receive such other relief as the Court deems just and proper. 3 FENNEMORE CRAIG, P.C. 4 By: /s/ Leslie Bryan Hart, Esq. (SBN 4932) John D. Tennert, Esq. (SBN 11728) 300 E. Second St., Suite 1510 Reno, Nevada 89501 Tel: 775-788-2228 Fax: 775-788-2229 lhart@fclaw.com; jtennert@fclaw.com and ARNOLD & PORTER LLP (Pro Hac Vice to be Submitted) Asim Varma, Esq. Howard N. Cayne, Esq. Michael A.F. Johnson, Esq. Attorneys for Intervenor Federal Housing Financing Agency 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 FENNEMORE CRAIG, P.C. 300 E. SECOND ST. SUITE 1510 RENO, NEVADA 89501 (775) 788-2200 11056411.1 8