Merscorp Holdings Inc. v. Malloy
To prevail on a request for a temporary injunction, a plaintiff must prove: 1.) it lacks an adequate legal remedy; 2.) it would suffer irreparable injury in the absence of an injunction; 3.) it is likely to prevail; and 4.) the balance of the equities favor the issuance of an injunction. The plaintiff, Mortgage Electronic Registration Systems Inc., also known as MERS, was formed to serve as a mortgagee and to hold legal title to the interests granted by security instruments. When a mortgage deed is filed on the public land records, MERS can be identified as the mortgagee of record. If the mortgage is transferred to another member of the MERS system, there is no separate assignment of the mortgage, because MERS remains the mortgagee of record, and the entities have not been required to pay another filing fee. The legislature amended C.G.S. §§7-34a and 49-10, effective July 15, 2013, to require the payment of additional fees by the "nominee of a mortgagee." MERS claimed it is the only entity that qualifies as the "nominee of a mortgagee," and that the amendments were directed at MERS and qualify as takings without just compensation. MERS also argued that the statutory amendments violate MERS' rights to due process and equal protection of the law. MERS filed a request for a temporary court injunction, to preserve the status quo. If the plaintiff prevails on the merits, the plaintiff may pursue the parties that receive the recording fees. The court was not persuaded that the plaintiff lacks an adequate legal remedy or that the plaintiff established irreparable harm, in the absence of an injunction. The court rejected the argument that the plaintiff's allegation of constitutional harm mandates a finding of irreparable harm. If the plaintiff prevails and proves that the statutory amendments are unconstitutional, it can be made whole with an award of monetary damages. The court denied the plaintiff's request for a temporary court injunction.