COURT OF COMMON PLEAS
MAHONING COUNTY, OHIO
LASALLE NATIONAL BANK AS TRUSTEE
FOR CERTIFICATE HOLDERS OF BEAR
STEARNS ASSET-BACKED SECURITIES
LLC ASSET-BACKED SECURITIES SERIES
2004-HE5,
Plaintiff,
)
CASE NO. 2005-CV-03869
)
Judge Durkin
)
)
MEMORANDUM IN SUPPORT OF
)
DEFENDANTS RONALD J.
) SMITH’S AND NANCY L. SMITH’S
)
MOTION FOR STAY OF
v.
) FORECLOSURE SALE PENDING
)
DETERMINATION OF FEDERAL
RONALD J. SMITH, et al,
)
ACTION FOR VIOLATIONS OF
)
FEDERAL TRUTH-IN-LENDING
Defendants.
) ACT, FEDERAL REAL ESTATE
) SETTLEMENT PROCEDURES ACT,
______________________________________) CIVIL RICO, AND OTHER RELIEF
Defendants RONALD J. SMITH and NANCY L. SMITH, through undersigned
counsel, file this Memorandum in Support of their Motion to Stay Foreclosure Sale
Pending Determination of [their] Federal action for Violations of the Federal Truth-InLending Act, the Federal Real Estate Settlement Procedures Act, Civil RICO under the
Ohio RICO statute, and for other relief, and as grounds state as follows:
1. This Court previously entered an Order which provides for a foreclosure sale
of the Plaintiffs’ primary residence to take place on Tuesday, June 24, 2008.
2. Plaintiffs have filed an action in the United States District Court for the
Northern District of Ohio, Eastern Division (copy of filed Complaint attached
hereto and incorporated herein by reference) sounding in violations of the
Federal
Truth-In-Lending
Act,
the
Federal
Real
Estate
Settlement
Procedures Act, Civil RICO under the Ohio RICO statute, and other relief.
3. Pursuant to the Ohio Civil RICO statute (ORC sec. 2929.34), the Court is
authorized, in connection with the prosecution of the civil RICO claim, to
grant injunctive relief without the necessity of a showing of special or
irreparable injury to the plaintiff, and that pending the determination of the
civil RICO action that the court may issue a Temporary Restraining Order or
Temporary Injunction upon showing of significant injury to the plaintiff (ORC
sec. 2929.34(D)).
4. As set forth in the attached Complaint, Plaintiffs have and continue to suffer
significant and ongoing injuries and damages, including the loss of their
home, if emergency injunctive relief is not granted.
5. The Ohio Civil RICO statute also provides, as part of the relief afforded to a
plaintiff, that the defendant’s interest in any real property is to be divested
when said interest has been acquired through a pattern of corrupt activity.
ORC sec. 2929.34(B)(1) and 2929.32(A)(2).
6. As set forth in the attached Complaint, the Defendants named in the Federal
action acquired an interest in the Plaintiffs’ residential real property through a
pattern of corrupt conduct and activity.
7. Defendants RONALD J. SMITH and NANCY L. SMITH thus request that this
Court immediately grant a stay of all further proceedings in or arising out of
this action including a stay of the foreclosure sale pending the full
determination of the Federal action.
8. The granting of a stay pending the litigation of rights in another forum has
been previously approved by the Ohio Legislature and case law in
connection with the granting of a stay of state court proceedings pending
arbitration. ORC sec. 2711.02; Harlament v. Fishcher Attached Homes, Ltd.,
2003 OH 694, OHCA 2003, citing Harper v. J.D. Byrider of Canton, 148 Ohio
App.3d 122, 2002-Ohio-2657, 772 N.E. 2d 190.
9. The same rationale, purpose, and grounds for the stay of state court
proceedings pending arbitration are applicable here, where Plaintiffs have
challenged the legality of the entire underlying loan process and have sought
relief under multiple Federal Statutes, State Statutes, and common law,
including the Ohio RICO Statute which provides for injunctive relief pending
determination of the RICO claim and for the relief of divesting a defendant
from its interest in real property if that interest was found to have been
acquired by a pattern of corrupt conduct.
10. If the instant Motion is not granted, Plaintiffs will suffer irreparable injury,
including in the form of the loss of their home and eviction therefrom.
11. Any alleged prejudice to the Plaintiff (a bank Trustee for a group of unnamed
holders of investment securities who may in fact not even have legal title to
the Plaintiffs’ mortgage and who, in all likelihood, never had standing to
institute the foreclosure proceeding herein ab initio) with the granting of this
Motion is greatly outweighed by the severe prejudice to the Smith family with
the denial of this Motion.
12. This Motion is being filed in good faith based on Federal and State law legal
grounds for relief and not for any purpose of delay.
13. Under the circumstances where the purported Plaintiff in this action may not
have (and may never have had) actual legal standing to bring the foreclosure
in the first instance and may in fact not be the true or real party in interest at
all, no bond should be required as a prerequisite to this Court’s granting of a
stay.
WHEREFORE, Plaintiffs respectfully request that this Court grant the relief
requested herein for the reasons set forth, and for any other and further relief
which is just and proper.
Respectfully submitted,
W. Jeff Barnes
(counsel to seek admission pro hac vice)
W. J. Barnes, P.A.
1515 North Federal Highway
Suite 300
Boca Raton, Florida 33432
Telephone: (561) 864-1067
Telefax: (702) 804-8137
________________________
Maurus G. Malvasi
(Ohio Bar No.
)
11 Overhill Road
Youngstown, Ohio 44512
Telephone: (330) 788-9900
Telefax: (513) 793-4400
Telefax: (513) 788-9265
Attorneys for Plaintiffs
CERTIFICATE OF SERVICE
THE UNDERSIGNED HEREBY CERTIFIES that a true and correct copy of the
foregoing has been forwarded, via U.S. Mail, to Michael L. Wiery, Esq., 5601 Hudson
Drive, Hudson, Ohio 44236 on this ___________ day of June, 2008.
________________________
Maurus G. Malvasi