Could Danny Masterson’s odd legal fight over his Hollywood house endanger his freedom?

A few days ago we were doing some random online searches of court records, as we do, when we had a thought.

We have been closely following Danny Masterson’s criminal and civil litigation, which is all based at Los Angeles Superior Court. But out of curiosity we wondered if Masterson was involved in any federal lawsuits.

We were surprised to learn that since 2013 Masterson has filed a series of bizarre lawsuits without the help of an attorney against the Bank of New York Mellon and the Mortgage Electronic Registrations Systems (MERS) in regards to the financing of his Hollywood Hills home.

These days, Masterson and his wife Bijou Phillips live in a house they own in Santa Ynez, a town in Santa Barbara County, and they rent out the Hollywood Hills residence, which is on Hollyridge Drive just a few blocks north of Scientology’s Hollywood Celebrity Centre, and was once owned by rock legend Chuck Berry. Masterson bought the 4,323-square-foot house in 2007 for $2.995 million, with a promissory note of $1.995 million, according to court records. (Zillow says it’s worth about $4.4 million today.)

In the lawsuits that Masterson has filed, some with himself as sole plaintiff, others with Bijou, he argues that BNY Mellon and MERS have filed faulty paperwork and that it means he is under no obligation to continue making payments. And this assertion is buried under a mountain of verbiage that is extremely difficult to follow.

When a 2014 lawsuit was dismissed, US District Court Judge Dean D. Pregerson noted wearily that Masterson’s second amended complaint suffered substantially from the problems that had existed in a first amended complaint that Pregerson had previously dismissed. And the judge noted that Masterson, in his opposition to the most recent motion to dismiss, “fails to address several of the arguments raised in the motion, while also raising arguments not applicable to this case.”

This was a judge’s polite way of saying that Masterson, representing himself, was clogging up the court with a lot of irrelevant nonsense.

An appellate court affirmed Pregerson’s ruling, but remanded it over a technicality. So Masterson filed a fifth lawsuit in 2018, again submitting an impenetrable complaint.

“Plaintiffs appear to be merely throwing arguments up against the wall with the hope that they can formulate some basis for cancelling their mortgage loan without full repayment,” wrote attorney Douglas Stastny for BNY Mellon in yet another motion to dismiss.

The picture that emerges in the court documents is that Masterson has been playing courthouse lawyer in what his bank alleges is just a desperate attempt to keep his house from being foreclosed on.

In the most recent lawsuit, Masterson and his wife make a “prayer for relief,” asking for $5 million in damages and injunctive relief to prevent any “claims against Plaintiffs’ property.” In other words, hands off the house and forget any payments on it while it’s tied up in litigation.

Previously, we’ve noted that the Masterson family has made other odd appearances in the legal arena. In 2017, Masterson’s stepfather Rusty Tweed was banned from trading securities for life after the SEC sued him for fraud, alleging that he’d run a Ponzi scheme. And Danny isn’t the only one to represent himself in court: For several years, his mother Carol Masterson has been engaged in a similarly quixotic legal fight with the mortgage holder of her Park City, Utah home. In fact, that case looks very similar to Danny’s, where impenetrable filings make rather crazy claims about deed documents. Like her son’s lawsuits, Carol’s case has been dismissed and an appeal upheld.

Now, one might be tempted to write all this off as the follies of the rich and famous and their sense of entitlement.

However, there’s a reason why this may become more than merely a curiosity dug up by a bored reporter.

Once we started asking around for comment on the situation, it apparently set off some minor earthquakes.

You see, when Danny Masterson was charged with three counts of forcible rape in June, a criminal case that has him facing 45 years to life in prison, he put up a bond for $3.3 million in order to keep himself out of custody while he awaits trial.

If that bond was secured at least in part by his Hollyridge Drive house, the fact that the property is tied up in a fight over its mortgage in federal court could become an issue in his criminal case.

We called the bail bond company that had issued Masterson his get out of jail card, Bail Bond Professionals in Tustin, and spoke to owner Jason Meyerson. He politely told us that he couldn’t comment on the situation. We also sent detailed messages to Masterson’s criminal defense attorney Tom Mesereau and civil litigator Andrew Brettler, asking them for comment.

With hearings looming in both the civil and criminal cases, this is a particularly sensitive time, and we’re hearing that Masterson’s legal adventures in federal court are now being looked at carefully by both sides. We should know in just a few days if there are any repercussions in court.

 
For you document hounds, we know you’re going to want to dig into Danny Masterson’s pro se complaint for its sheer nuttiness…

Masterson v. CWALT et al by Tony Ortega

 
UPDATE: Attorney Scott Pilutik helps us understand what is going on in this lawsuit…

I decided to challenge myself and attempt to understand the substance of the complaint as if it wasn’t actually batshit crazy, despite appearances that it was precisely that.

Masterson is claiming that a 2010 assignment of the note and deed to 2151 Holly Ridge Drive property from Countrywide (which held the mortgage) to Bank of NY (as Trustee for the 2007-19 Trust, a mortgage backed security) was fatally flawed because the recording of the transfer, evinced at paragraph 37, was improperly executed by “Mortgage Electronic Registration Systems, Inc.” [MERS], Countrywide’s servicer, when it failed to state that MERS was acting as Countrywide’s attorney-in-fact (the term for a party acting under Power of Attorney). Masterson argues that the recording would have been valid had it been executed as he suggests it should have been in paragraph 45.

Everything else in the complaint all hinges on the court buying that this was a void assignment because MERS wasn’t identified as “attorney-in-fact.”

Now there was some litigation years back over MERS-facilitated assignments. MERS was created to streamline the creation of mortgage-backed securities. Recording real estate sales, transfers, assignments, etc. is a pain in the ass, and I know this because I do it often enough. The problem with MERS is that homeowners might find themselves not knowing who their lender is, and sloppily executed assignments without proper notice can actually harm homeowners not knowing who they need to be paying. The courts were right to be skeptical and some imposed restrictions on MERS assignments.

In the EDNY, one such case, In re Ferrel L. Agard, 444 B.R. 231 (Bankr. EDNY 2011) took MERS to task in a case that involved a MERS assignment, remarking that the “record is barren of any representation that MERS, the purported assignee, had any authority to take any action with respect to the Note. Therefore, the Court finds that the Assignment of Mortgage is not sufficient to establish an effective assignment of the Note.” That would seem to favor Masterson’s position. But Masterson’s property is in California, not Brooklyn where the EDNY is located. He evidently also filed in the SDNY, which properly punted him back to California. The California MERS cases are less borrower-friendly. There was one MERS-friendly Ninth Circuit case that was appealed to the Supreme Court, which could’ve helpfully harmonized the inconsistencies among the state and federal courts, but it denied cert.

Not that suing in EDNY would necessarily help him anyway, because practically all the litigation involving MERS assignments involves actual foreclosures. That’s not the case with Masterson, so it’s worth wondering why he’s spending this much unhinged energy on a case where he’s not suffered an actual injury. Not that a quixotic effort to right a wrong felt by others is an unappreciated waste of time, it’s just hard to see how such a poorly drafted and impenetrable complaint could help anyone, much less Masterson.

There’s also a legal distinction between a “voidable” and “void” deficient assignment worth mentioning; the former can be cured, the latter cannot. Masterson is asking the courts to find the assignment void, which probably isn’t ever going to happen, especially given how he’s not being foreclosed on.

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I recognize that none of the above gets us any closer to explaining what’s really going on with Masterson here, but perhaps it provides some context to the fog.

 
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Bonus items from our tipsters

Get in the loop! We have a feeling that whatever this new briefing is about, its payoff will include this photoshoot.

 
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Source Code

“There is cyclical illness which is dictated in the various R6 implants. A fellow was forced to get sick at the age of five, followed multiples of five, and he’s supposed to get sick from this and from that, and from the other thing. Measles and, you know he’s supposed to have and that’s certain. They predict his health, in other words. When he’s fifty he’s supposed to something or other. What they’re trying to do is make a body cave in. See?” — L. Ron Hubbard, September 30, 1968

 
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Overheard in the FreeZone

“I’ve never seen ANY cause to attack, criticize, blame, and otherwise malign and impugn LRH. I personally went through extreme hell as a result of writing up GAT as a technical degrade when I was Snr C/S of my org, but I never lost my integrity and affinity for the old man, nor his tech. All the reverse sec-checking, imprisonment, wrong indications, etc., never alloyed my affinity. So I’ve little tolerance for that or the badmouthing of Scientology.”

 
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Past is Prologue

2000: Pinellas/Pasco Medical Examiner Dr. Joan Wood has left office after resigning due to controversy over the Lisa McPherson case. From the St. Petersburg Times on September 30: “Chief Medical Examiner Joan Wood, the embattled doctor who swore never to resign after 18 years at the helm, finally closed out her last autopsy, cleared out her office this week and headed for a new start. Wood, 56, was forced out of office after prosecutors earlier this year dropped charges against the Church of Scientology, blaming Wood’s reversal in the death of Scientologist Lisa McPherson for hopelessly damaging their criminal case. Wood’s credibility with prosecutors may have been irreparably damaged and, after insisting she would never willingly leave office, she quietly handed in her resignation in June, effective today. Wood has not returned repeated calls for comment over the last week, and few know her plans.”

 
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Random Howdy

“I realized this maybe six years ago when I first read about TR-Alice. I was gobsmacked at how obvious it was. I’ve read numerous examples of Hubbard having a laugh at his followers’ expense since then.”

 
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Full Court Press: What we’re watching at the Underground Bunker

Criminal prosecutions:
— Danny Masterson charged for raping three women: Demurrer filed by Masterson, arraignment delayed to October 19.
— Jay and Jeff Spina, Medicare fraud: Jay’s sentencing is set for October 5 in White Plains, NY. Jeffrey’s is set for October 24.
— Hanan and Rizza Islam and other family members, Medi-Cal fraud: Next pretrial conference set for Jan 12 in Los Angeles
— Dennis Nobbe, Medicare fraud, PPP loan fraud: Charged July 29. Bond revoked Sep 14. Nobbe dead, Sep 14.

Civil litigation:
— Luis and Rocio Garcia v. Scientology: Oral arguments were heard on July 30 at the Eleventh Circuit
— Valerie Haney v. Scientology: Forced to ‘religious arbitration.’ Petition for a writ of mandate filed with Cal 2nd Appellate District, Sept 10.
— Chrissie Bixler et al. v. Scientology and Danny Masterson: Oct 5 (Serving Miscavige by publication), Oct 6 (CSI/RTC demurrer against Riales, Masterson demurrer), Oct 26 (motions to compel arbitration)
— Jane Doe v. Scientology (in Miami): Jane Doe dismissed the lawsuit on May 15 after the Clearwater Police dropped their criminal investigation of her allegations.
— Matt and Kathy Feschbach tax debt: Eleventh Circuit ruled on Sept 9 that Feshbachs can’t discharge IRS debt in bankruptcy. Update required in federal lawsuit on Oct 19.
— Brian Statler Sr v. City of Inglewood: Second amended complaint filed, trial set for Nov 9, 2021.
— Author Steve Cannane defamation trial: Trial concluded, awaiting verdict.

 
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Scientology’s celebrities, ‘Ideal Orgs,’ and more!

We’ve been building landing pages about David Miscavige’s favorite playthings, including celebrities and ‘Ideal Orgs,’ and we’re hoping you’ll join in and help us gather as much information as we can about them. Head on over and help us with links and photos and comments.

Scientology’s celebrities, from A to Z! Find your favorite Hubbardite celeb at this index page — or suggest someone to add to the list!

Scientology’s ‘Ideal Orgs,’ from one end of the planet to the other! Help us build up pages about each these worldwide locations!

Scientology’s sneaky front groups, spreading the good news about L. Ron Hubbard while pretending to benefit society!

Scientology Lit: Books reviewed or excerpted in our weekly series. How many have you read?

 
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THE WHOLE TRACK

[ONE year ago] Scientology tried to sell ‘Daily Mail’ on story she was a sexual abuser, Leah Remini says
[TWO years ago] Scientology going ‘Ideal’ with drug rehabs too, and will replace an ailing clinic
[THREE years ago] Never before seen: Video from the first ‘LRH Birthday’ aboard the Scientology ‘Freewinds’
[FOUR years ago] When L. Ron Hubbard briefly let down his guard and admitted Scientology was all a con
[FIVE years ago] JIM CARREY’S SCIENTOLOGIST GIRLFRIEND ON ‘SRD’ WHEN SHE KILLED HERSELF: FRIENDS
[SIX years ago] Does a judge’s order in the Garcia fraud lawsuit suggest trouble for Scientology?
[SEVEN years ago] Meet the New Editor of Scientology’s Propaganda Magazine, Freedom!
[EIGHT years ago] Scientology Sunday Funnies!
[NINE years ago] Scientology’s SF Leaker Talks: We Ask Amy Scobee to Interpret

 
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Posted by Tony Ortega on September 30, 2020 at 07:00

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