GRUENDER, Circuit Judge.
A group of homeowners (collectively, "the Homeowners") are challenging the validity of the foreclosure of their home mortgages. The district court
Wells Fargo Bank, N.A. ("Wells Fargo") is either the original mortgagee or assignee of each of the Homeowners' mortgages. After the Homeowners defaulted on their mortgages, Wells Fargo initiated foreclosure proceedings pursuant to Minnesota's non-judicial foreclosure statute, Minnesota Statute section 580 et seq., which authorizes foreclosure by advertisement if certain criteria are met. Wells Fargo subsequently purchased all of the properties at sheriff's sales. Shortly thereafter, the Homeowners filed suit in Minnesota state court, contesting Wells Fargo's authority to foreclose on their mortgages. In addition to Wells Fargo, the Homeowners named MERS and MERSCORP (collectively, "MERS"),
The Homeowners argued remand was necessary because the district court did not have subject matter jurisdiction over the suit. According to the Homeowners, jurisdiction was lacking because there was not complete diversity between parties
"We review de novo the district court's grant of a motion to dismiss under Rule 12(b)(6), construing all reasonable inferences in favor of the nonmoving party." Retro Television Network, Inc. v. Luken Comm'ns, LLC, 696 F.3d 766, 768 (8th Cir.2012). The Homeowners' complaint raised twelve counts against the Wells
The quiet-title claim invokes Minnesota Statute section 559.01, which authorizes "[a]ction[s] to determine adverse claims" to real property.
Two of the theories underlying the Homeowners' quiet-title claim, however, are identical to those found in Murphy to be distinct from the "show-me-the-note" theory. See Murphy, 699 F.3d at 1033; see also Karnatcheva, 704 F.3d at 547-48 (recognizing that the theories "[t]he Notices of Pendency, Powers of Attorney, and Assignments of Mortgages were not executed by an authorized individual" and "[t]he Assignments of Plaintiffs' Mortgages were invalid" are "not foreclosed by Jackson's rejection of the `show-me-the-note' theory"). These claims attack the holder's legal interest in the mortgage, rather than the failure to produce the note. The district court also ruled that, to the extent any of the grounds attacked the holder's legal interest in the mortgage, these "speculative, conclusory statements" were insufficient to state a claim.
The Homeowners argue that dismissal was inappropriate because these claims were adequately pled under state pleading standards. However, in a diversity suit such as this one, "[w]e apply federal pleading standards — Rules 8 and 12(b)(6) — to the state substantive law to determine if a complaint makes out a claim under state law." Karnatcheva, 704 F.3d at 548. Alternatively, the Homeowners appear to contend that even if Rule 8 applies, the district court erred in concluding that they failed to meet its requirements. Recently, this court held that a complaint articulating the same two bases for settling adverse claims under section 559.01 did not include "anything to support the[ ] claim that the defendants' adverse claims are invalid, other than labels and conclusions," and thus was properly dismissed. Id. The Homeowners' pleadings for these two bases mirror those in Karnatcheva, and therefore we affirm the district court's dismissal.
We also affirm the district court's dismissal of the Homeowners' slander-of-title claim. Slander of title occurs when an individual maliciously publishes a false statement to others concerning the real property a plaintiff owns or has an interest in, and the false statement causes the plaintiff pecuniary loss. Paidar v. Hughes, 615 N.W.2d 276, 279-80 (Minn.
The Wells Fargo parties filed a motion for sanctions under Rule 11 and 28 U.S.C. § 1927, as well as under the district court's inherent authority to sanction attorneys for acting in bad faith or abusing the judicial process. The district court awarded attorneys' fees under Rule 11(c) and, therefore, did not reach either of the alternate grounds for sanctioning Butler. "We review the district court's determinations concerning Rule 11 under the abuse-of-discretion standard." Clark v. United Parcel Serv., Inc., 460 F.3d 1004, 1008 (8th Cir.2006).
Butler argues that our partial reversal in Murphy means sanctions are inappropriate. We disagree. Murphy held that the majority of the claims Butler filed — in a complaint virtually identical to the one in this case — were blatantly premised on the "show-me-the-note" theory. Murphy, 699 F.3d at 1033. Butler's duplication of these claims is all the more egregious when viewed in context. Just one week before Butler filed the Murphy complaint, this court recognized the Minnesota Supreme Court's rejection (two years earlier) of the "show-me-the-note" theory in a case that Butler himself argued before us. Stein, 662 F.3d at 978-80; see also Reed v. Great Lakes Cos., 330 F.3d 931, 936 (7th Cir.2003) ("[I]n deciding whether to sanction such a litigant [a judge] can take into account a history of frivolous litigation."). As this court recently noted in Karnatcheva, when also reviewing a substantially similar complaint filed by Butler, even the quiet-title claims divorced from the "show-me-the-note" theory were but a flimsy construction of "labels and conclusions."
For the foregoing reasons, we affirm the district court's dismissal of the Homeowners' suit and the imposition of sanctions on the Homeowners' counsel.