TRO Temporary Restraining Order Pleadings 39-2
TRO Temporary Restraining Order Pleadings 39-2
TRO Temporary Restraining Order Pleadings 39-2
17 Defendant
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APPLICATION FOR TEMPORARY RESTRAINING ORDER, PRELIMINARY
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INJUNCTION AND DECLARATORY RELIEF
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COMES NOW, Plaintiffs OWEN T. LENNON, CAROL CUTTER LENNON
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22 H/W. (Plaintiffs) and files Verified Emergency Petition for Temporary Restraining Order
23 and/or Preliminary Injunction, and Declaratory Relief against the listed Defendants. A
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temporary restraining order is appropriate to maintain the status quo. Plaintiffs home will be
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sold within the next week and Plaintiffs are subject to eviction actions, without immediate
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intervention from this Court.
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A.PARTIES
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1. Plaintiff is now, and at all times relevant to this action, a resident of the County
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of MORRIS, State of NEW JERSEY.
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6 At all times relevant to this action, Plaintiff has owned the Property located at 39
12 and believes, and thereon alleges, that The CIT Group/Consumer Finance (CIT) is the
18 MORTGAGE LOAN TRUST 2007-1, is a national banking association, doing business in the
19 County of MORRIS, State of NEW JERSEY and is the purported Master Servicer for Securitized
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Trust and/or a purported participant in the imperfect securitization of the Note and/or the Deed of
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Trust as more particularly described in this Complaint.
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4. Defendant, THE BANK OF NEW YORK MELLON AS TRUSTEE FOR
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24 CITI MORTGAGE LOAN TRUST 2007-1 (BNY), Plaintiff is informed and believe, and
25 thereon allege that, Defendant THE BANK OF NEW YORK MELLON AS TRUSTEE FOR
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CITI MORTGAGE LOAN TRUST 2007-1 (BNY), is a corporation, doing business in the
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1 County of MORRIS, State of NEW JERSEY and is the purported Sponsor for Securitized Trust
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and/or a purported participant in the imperfect securitization of the Note and/or the Deed of Trust
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as more particularly described in this Complaint.
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5. Defendant, Plaintiff The CIT Group/Consumer Finance (CIT), is informed
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6 and believe, and thereon allege that, Defendant The CIT Group/Consumer Finance (CIT) is
7 a corporation, doing business in the County of MORRIS, State of NEW JERSEY and is the
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purported Sponsor for Securitized Trust and/or a purported participant in the imperfect
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securitization of the Note and/or the Deed of Trust as more particularly described in this
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Complaint.
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13 thereon allege that, Defendant CITIMORTGAGE INC, is a New York corporation, doing
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business in the County of MORRIS, State of NEW JERSEY and is the purported Sponsor and
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Servicer for Securitized Trust and/or a purported participant in the imperfect securitization of the
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Note and/or the Deed of Trust as more particularly described in this Complaint.
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19 aka MERS (MERS), Plaintiff is informed and believe, and thereon allege, that MERS is a
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corporation duly organized and existing under the laws of BROWARD, whose last known
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address is 1818 Library Street, Suite 300, Reston, Virginia 20190; website:
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http://www.mersinc.org. MERS is doing business in the County of BROWARD, State of
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24 VIRGINIA. Plaintiff is further informed and believe, and thereon allege, that Defendant MERS
25 is the purported Beneficiary under the Deed of Trust and/or is a purported participant in the
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imperfect securitization of the Note and/or the Deed of Trust, as more particularly described in
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1 this Complaint.
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Plaintiff does not know the true names, capacities, or basis for liability of
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Defendants sued herein as Does 1 through 100, inclusive, as each fictitiously named Defendant is
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in some manner liable to Plaintiff, or claims some right, title, or interest in the Property. Plaintiff
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6 will amend this Complaint to allege their true names and capacities when ascertained. Plaintiff is
7 informed and believe, and therefore allege, that at all relevant times mentioned in this Complaint,
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each of the fictitiously named Defendants are responsible in some manner for the injuries and
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damages to Plaintiff so alleged and that such injuries and damages were proximately caused by
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such Defendants, and each of them.
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12 Plaintiff is informed and believe, and thereon allege, that at all times herein
13 mentioned, each of the Defendants were the agents, employees, servants and/or the joint-
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venturers of the remaining Defendants, and each of them, and in doing the things alleged herein
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below, were acting within the course and scope of such agency, employment and/or joint venture.
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B. INTRODUCTION
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18 On July 13, 2007, plaintiff executed and delivered to defendant The CIT
24 Ave Mount Arlington, NJ. 07856, which is more specifically described as BLOCK 10 and LOT
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1 to in this complaint as "the deed of trust/mortgage," and the property described in the deed of
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trust/mortgage is referred to as "the property." A copy of the deed of trust/mortgage is attached,
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marked Exhibit A, and incorporated by reference.
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Defendant CIT did NOT cause to be recorded a notice of default in the official
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6 records of NEW JERSEY County, MORRIS, alleging that a breach of the obligation secured by
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Defendants, and each of them, intend to sell the property, having given notice that
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sale of the property. Unless restrained, defendants, and each of them, will thus sell the property
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or cause the property to be sold. This sale would be to plaintiff's great and irreparable injury, for
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13 which pecuniary compensation would not afford adequate relief, in that plaintiff, having no right
14 to redeem the property from the sale, will forfeit the property if the sale takes place as scheduled.
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C. FACTUAL ALLEGATIONS
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For years, mortgage brokers and lenders have been selling loan products that they
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knew or should have known would never be able to be repaid by the borrower and would prevent
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19 borrowers from ever actually owning the home. Instead, borrowers were offered interest-only,
20 negative amortization, and/or other subprime loan products that amounted to no more than a
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short term lease until the payments became so unaffordable that the borrowers are now faced
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with either bankruptcy or foreclosure. The housing bubble of the past decade was created by
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predatory lending practices, such as charging excessive fees, incorporating payment penalties,
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25 negative amortization payments, or other abusive terms in the agreements, providing kickbacks
26 to brokers, flipping loans, using balloon payments to conceal the true burden of the financing,
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1 requiring unnecessary insurance and other products, including mandatory arbitration clauses,
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steering borrowers to subprime loans when they qualify for conventional loans, and using bait
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and switch tactics. All were rampant within the industry without oversight or good judgment and
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found to be inconsistent with important national objectives, including the goals
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6 1
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Rather than offering a loan product that was viable and long-term for the borrower and lender,
12 brokers and lenders greedily sold whatever they could get away with, arguably the primary
13 catalyst for what is now this countrys worst economic crisis since the Great Depression.
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The loan product sold to Plaintiff in this case was exactly the kind of loan that has
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contributed to our national problem. The Defendants were aware of this trend, and possessed the
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foresight to advise Plaintiff of this risk. They intentionally concealed the negative implications of
18 the loan they were offering, and as a result, Plaintiff face the potential of losing their home to the
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obtaining a $255,000 mortgage loan secured by Plaintiffs principal residence, 39 Edgemere Ave
24 Mount Arlington, NJ 07856. This note was secured by a Deed on the Property in favor of
25 (CIT). The terms of the finance transaction with (CIT) are not clear or conspicuous, nor
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consistent, and are illegal which violates several statutes and is in essence creates an illegal loan.
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1 Further, this loan was underwritten without proper due diligence by
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(CIT) as evidenced by their failure to verify borrowers income utilizing signed
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IRS Income Tax Disclosure Form 4506T which would have provided past borrower tax returns.
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(CIT) also used a GDW Cost of Savings as the Index for the basis of this loan, because the
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6 Lender controls this Index and it is directly based upon the average rate of interest (CIT)
7 parent company.
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In addition, and unbeknownst to Plaintiffs, (CIT) illegally, deceptively and/or
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otherwise unjustly, qualified Plaintiff for a loan which (CIT) knew or should have known that
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Plaintiff could not qualify for or afford by, for example, the underwriter has approved this loan
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12 based upon credit scores and the borrowers Stated Income only. Had (CIT) used a more
13 accurate and appropriate factor, such as Tax Forms and a more determinative level of scrutiny of
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determining comply with the requirement to provide Plaintiff with a Mortgage Loan Origination
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Agreement the debt to income ratio, Plaintiff would not have qualified for the loan in the first
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place. Consequently, (CIT) sold Plaintiff a loan product that it knew or should have known
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18 would never be able to be fully paid back by Plaintiff. (CIT) ignored long-standing economic
19 principals of underwriting and instead, knowingly, liberally, greedily and without any regard for
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Plaintiffs rights sold Plaintiff a deceptive loan product.
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From 1998 until the financial crash of 2008-2009, over 60 million home loans
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where sold by originating lender banks to investment banks to be securitized in a complex series
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24 of billions of transactions. The Plaintiffs home loan was one of the 60 million notes that were
25 securitized.
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Securitization is the process whereby mortgage loans are turned into securities, or
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1 bonds, and sold to investors by Wall Street and other firms. The purpose is to provide a large
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supply of money to lenders for originating loans, and to provide investments to bond holders
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which were expected to be relatively safe. The procedure for selling of the loans was to create a
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situation whereby certain tax laws known as the Real Estate Mortgage Investment Conduit
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6 (hereinafter REMIC) Act were observed, and whereby the Issuing Entities and the Lenders
7 would be protected from either entity going into bankruptcy. In order to achieve the desired
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bankruptcy remoteness, numerous True Sales of the loans had to occur, in which loans were
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sold and transferred to the different parties to the securitization.
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How a particular mortgage loan ended up being transferred to a REMIC TRUST
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13 Agreement (PSA). The PSA is a Trust Agreement required to be filed under penalty of perjury
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with the United States Securities and Exchange Commission (SEC) and which, along with
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another document, the Mortgage Loan Purchase Agreement (MLPA), is the operative
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securitization document created by the finance and securitization industry to memorialize
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19 A True Sale of the loan would be a circumstance whereby one party owned the
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Note and then sold it to another party. An offer would be made, accepted and compensation
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given to the seller in return for the Note. The Notes would be transferred, and the Deeds of
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Trust assigned to the buyers of the Note, with an Assignment made every step of the way, and,
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24 furthermore, each Note would be endorsed to the next party by the previous assignee of record.
25 In order for the Trustee of the Securitized REMIC Trust to have a valid and
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enforceable secured claim against Plaintiffs Home, the Trustee must prove and certify to all
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1 parties that, among other things required under the PSA:
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a. There was a complete and unbroken chain of indorsements and transfers of the
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Note from and to each party to the securitization transaction (which should be from the (A)
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Mortgage Originator to the (B) Sponsor to the (C) Depositor to the (D) Trust/Trustee, and that all
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6 of these indorsements and transfers were completed prior to the Trust closing dates (see
12 in Plaintiffs Home that is the subject of this action. Therefore, if the Defendants, and each of
13 them, did not hold and possess the Note on or before the closing date of the Trust herein, they are
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estopped and precluded from asserting any secured or unsecured claim in this case.
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Plaintiff is informed and believes, and thereon alleges, that pursuant to the terms
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of the PSA, the Mortgage Originator (i.e., the original lender herein) agreed to transfer and
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18 endorse to the Trustee for the Securitized Trust, without recourse, including all intervening
19 transfers and assignments, all of its right, title and interest in and to the mortgage loan (Note) of
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Plaintiffs herein and all other mortgage loans identified in the PSA.
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Based upon the foregoing, Plaintiff is further informed and believe, and thereon
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allege, that the following deficiencies exist, in the True Sale and securitization process as to
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24 this Deed of Trust which renders invalid any security interest in the Plaintiffs mortgage,
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1 and Deed of Trust of which the original lender is the holder, owner and beneficiary of Plaintiffs
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Deed of Trust;
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b. When the loan was sold to each intervening entity, there were no Assignments
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of the Deed of Trust to or from any intervening entity at the time of the sale. Therefore, True
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7 c. The failure to assign and transfer the beneficial interest in Plaintiffs Deed of
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Trust to BNY, in accordance with the PSA of the Defendants, as Securitization Participants;
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d. The failure to endorse, assign and transfer Plaintiffs Note and/or mortgage to
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Defendant BNY, as Trustee for CIT MORTGAGE LOAN TRUST 2007-1 Trust, in accordance
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12 with the PSA; e. No Assignments of Beneficiary or Indorsements of the Note to each of the
13 intervening entities in the transaction ever occurred under NEW JERSEY law, which is
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conclusive proof that no true sales occurred as required under the PSA filed with the SEC; and
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f. Defendants, and each of them, violated the pertinent terms of the PSA.
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D. THE STANDARD FOR INJUNCTIVE RELIEF IS SATISFIED
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18 1. FORECLOSURE TROS:
24 inadequate notice of default was given. (Lupertino v. Carbahal (1973, 3rd Dist) 35 Cal App 3d
25 742, 111 Cal Rptr 112) This relief may also be available to resolve a dispute as to the amount of
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the default. (More v. Calkins (1890) 85 Cal 177, 24 P 729).
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1 2. PRELIMINARY INJUNCTION:
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In deciding whether to issue a preliminary injunction, the trial court considers two
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related factors: (1) the likelihood the plaintiff will prevail on the merits of its case
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at trial, and (2) the interim harm the plaintiff is likely to sustain if the injunction is denied, as
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6 compared to the harm the defendant is likely to suffer if the court grants a preliminary injunction.
7 Buckland v. Threshold Enterprises, Ltd., 155 Cal. App. 4th 798, 66 Cal. Rptr. 3d 543 (2d Dist.
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2007), as modified, (Oct. 22, 2007).
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3. TEMPORARY RESTRAINING ORDER:
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Trial courts should evaluate two interrelated factors when deciding whether to
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12 issue a restraining order: the first is the likelihood that the plaintiff will prevail on the merits at
13 trial, and the second is the interim harm that the plaintiff is likely to sustain if the restraining
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order is denied, as compared to the harm that the defendant is likely to suffer if the order is
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issued. Church of Christ in Hollywood v. Superior Court, 99 Cal. App. 4th 1244, 121 Cal. Rptr.
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2d 810 (2d Dist. 2002).
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25 An actual controversy has arisen and now exists between plaintiff and defendants
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regarding their respective rights and duties. Plaintiff contends that his note and deed of trust
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1 where not transferred and/or assigned pursuant to Plaintiffs loans PSA and/or NEW JERSEY
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Law, that defendants violated Federal TILA and RESPA laws, as well as committed fraud in the
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indictment and concealment at the initiation of the loan. A judicial declaration is necessary and
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appropriate at this time under all the circumstances so that plaintiff may determine his or her
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6 rights and duties under the note and deed of trust, specifically,
7 At the very basis of Plaintiffs Complaint, based upon the facts outlined herein
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and above, Plaintiff has alleged and can demonstrate at trial that Defendants breached their PSA
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contract and through misrepresentation are about to foreclose on Plaintiffs real property, and
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that because of the securitization process Defendants and their predecessors in interest failed to
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12 properly assign Plaintiffs Mortgage note and Deed of Trust according to state law and the PSA
19 enjoining defendants, defendants agents, attorneys, and representatives, and all persons acting in
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concert or participating with them, from selling, attempting to sell, or causing to be sold the
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property, either under the power of sale in the deed of trust/mortgage or by foreclosure action;
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2. A declaration by the court that sale of the property to enforce the deed of trust/mortgage is
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24 improper in that plaintiff has raised a claim that the defendants do not legally hold the note or
25 deed of trust and/or do not have right to foreclose on the subject property;
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3. Costs of suit; and
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1 4. Any further relief that the court may deem just and equitable.
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Dated_________________________ [Signature]
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Attorney for Plaintiff
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VERIFICATION
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I am the plaintiff in this action. I have read the foregoing complaint and it is true of my own
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12 knowledge, except as to those matters stated on information or belief, and as to those matters, I
13 believe it to be true.
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I declare under penalty of perjury under the laws of the State of NEW JERSEY that the
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foregoing is true and correct.
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Date of execution: _________________________________________________________
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18 ________________________PLAINTIFF
19 ________________________ NOTARY
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21 SEAL
22 Dated this [day] of [Month], [year].
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[Attorney Name]
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