Attorney Fined More Than $50,000 for Frivolous MERS Lawsuits

A Minneapolis-based attorney has been sanctioned by a federal judge for filing one, in what appears to be a series of nearly 30 lawsuits based on what the court says are frivolous ""show-me-the-note"" defenses designed to thwart foreclosure proceedings in Minnesota - namely by calling into question the validity of ""MERS"":http://www.mersinc.org as mortgagee and authorized nominee of the noteholder.
[IMAGE] U.S. District Court Judge Patrick J. Schiltz has ordered William B. Butler of ""Butler Liberty Law, LLC"":http://butlerlibertylaw.com/ to personally pay $50,000 to the court and pay an additional undetermined amount of legal costs incurred by counsel for MERS and its co-defendants.

District Court Judge Schiltz also dismissed several lawsuits filed by Butler and has forwarded a copy of the court's order to the Minnesota Lawyers Professional Responsibility Board for review.

In _Welk, et al. v. GMAC_, District Court Judge Schiltz found that attorney Butler had “made a cottage industry out of

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filing frivolous show-me-the-note actions” despite the fact that “this argument has been rejected by the Minnesota Supreme Court, by the United States Court of Appeals for the Eighth Circuit, and by every federal judge sitting in Minnesota who has addressed the argument.”

As explained by the court, a “plaintiff bringing a show-me-the-note claim generally argues that, because the entity that holds her mortgage (say, MERS) is not the same entity that holds her note (say, U.S. Bank), the mortgage on her home or the foreclosure of that mortgage is invalid.”

District Court Judge Schiltz ruled that the sanction of $50,000 was justified due to “the extraordinarily egregious and brazen nature of Butler’s conduct” through his pleadings and harm done to his clients by “exploiting them financially” by earning fees “if multiplied by the number of cases he has brought, indicated he has earned tens (or even hundreds) of thousands of dollars marketing show-me-the-note cases over the Internet.”

“Federal Judge Patrick J. Schiltz set an example with his very strong warning to attorneys who take advantage of foreclosed borrowers and give plaintiffs false-hope when they chose to file baseless lawsuits against MERS,” commented Janis L. Smith, VP of corporate communications for MERS’ parent company Merscorp Holdings.

“Cleary, there is a steep price to be paid for lawyers who prey on consumers who are experiencing financial difficulty and waste the Court’s valuable time with unsupportable attacks on the MERS system.”