BABCOCK CORRECT: SHERMAN SHOULD NOT BE SPECIAL MASTER

The Law Dog, George Babcock, is having a tough time of it lately. He’s already been sanctioned once and likely faces more sanctions, according to posts on his Facebook page.

So why is a fierce homeowner advocate like Babcock getting the bum’s rush? Beside the fact that the question answers itself, one must look to a woman named Merrill Sherman, a former bank president who was appointed “Special Master” over several hundred foreclosure cases, many of them Babcock’s.  Babcock has been openly critical of Sherman for a number of reasons, but the latest and perhaps most despicable reasons were discussed by Babcock on his Facebook page recently.

Sherman: No known grounds for disqualification? Are you shitting me?

Sherman was appointed Special Master pursuant to Rule 53 of the Federal Rules of Civil Procedure, which states that:

A master must not have a relationship to the parties, attorneys, action, or court that would require disqualification of a judge under 28 U.S.C. §455, unless the parties, with the court’s approval, consent to the appointment after the master discloses any potential grounds for disqualification.”

But the judge’s order that made Sherman a Special Master required her to file an affidavit disclosing any possible conflicts with the requirements of Rule 53, and Sherman did in fact file such an affidavit, signed and notarized on January 5, 2012. In this affidavit, Sherman stated that “there are no known grounds for disqualification under 28 U.S.C. §455 that would prevent me from serving as the Special Master.”

Maybe that was true on January 5, 2012 (or maybe it wasn’t), but it doesn’t appear to be true now, because according to Forbes.com, Sherman currently owns 17,000 shares of Brookline Bancorp, Inc.  and Brookline Bank, Inc. is a member of MERS!   (Note: MERS search results cannot be linked here, but if one goes to the preceding link and enters the names of the entities herein, one finds that they are in fact MERS members).   That’s obviously very problematic because MERS is a party to any number of the consolidated cases over which Sherman is Special Master (the judge states as much in his order appointing Sherman Special Master). This fact would appear to put Sherman in violation of Rule 53, particularly because the language of the Rule precludes a “relationship” to the parties involved, which is a very broad category.

Indeed, Sherman’s “relationship” to MERS seems to be rather long-standing–she is a  former president of Bank Rhode Island,  which is also a MERS member.   And according to Business WeekSherman has been on the Board of Directors of Brookline Bancorp, Inc. (MERS member) since January 1, 2012, only four days before she signed an affidavit saying that she knew of no grounds for disqualification!  If being on the Board of Directors of an entity that is a member of a party to the litigation in question isn’t a “relationship” pursuant to Rule 53, pray tell what is?

So what are those grounds for disqualification? Here’s the text of 28 USC § 455—see for yourself just how many grounds Sherman does, in fact, appear to meet:

(a) Any justice, judge, or magistrate judge of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned [Sherman’s impartiality can reasonably be questioned because of her stock ownership in a MERS member]

(b) He shall also disqualify himself in the following circumstances:
(1) Where he has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding;

(2) Where in private practice he served as lawyer in the matter in controversy, or a lawyer with whom he previously practiced law served during such association as a lawyer concerning the matter, or the judge or such lawyer has been a material witness concerning it;

(3) Where he has served in governmental employment and in such capacity participated as counsel, adviser or material witness concerning the proceeding or expressed an opinion concerning the merits of the particular case in controversy;

(4) He knows that he, individually or as a fiduciary, or his spouse or minor child residing in his household, has a financial interest in the subject matter in controversy or in a party to the proceeding, or any other interest that could be substantially affected by the outcome of the proceeding [again, Sherman has a financial interest because of her stock ownership in a MERS member];

(5) He or his spouse, or a person within the third degree of relationship to either of them, or the spouse of such a person:
(i) Is a party to the proceeding, or an officer, director, or trustee of a party;

(ii) Is acting as a lawyer in the proceeding;

(iii) Is known by the judge to have an interest that could be substantially affected by the outcome of the proceeding;

(iv) Is to the judge’s knowledge likely to be a material witness in the proceeding.

(c) A judge should inform himself about his personal and fiduciary financial interests, and make a reasonable effort to inform himself about the personal financial interests of his spouse and minor children residing in his household.

(d) For the purposes of this section the following words or phrases shall have the meaning indicated:
(1) “proceeding” includes pretrial, trial, appellate review, or other stages of litigation;

(2) the degree of relationship is calculated according to the civil law system;

(3) “fiduciary” includes such relationships as executor, administrator, trustee, and guardian;

(4) “financial interest” means ownership of a legal or equitable interest, however small, or a relationship as director, adviser, or other active participant in the affairs of a party, except that:
(i) Ownership in a mutual or common investment fund that holds securities is not a “financial interest” in such securities unless the judge participates in the management of the fund;

(ii) An office in an educational, religious, charitable, fraternal, or civic organization is not a “financial interest” in securities held by the organization;

(iii) The proprietary interest of a policyholder in a mutual insurance company, of a depositor in a mutual savings association, or a similar proprietary interest, is a “financial interest” in the organization only if the outcome of the proceeding could substantially affect the value of the interest;

(iv) Ownership of government securities is a “financial interest” in the issuer only if the outcome of the proceeding could substantially affect the value of the securities.

(e) No justice, judge, or magistrate judge shall accept from the parties to the proceeding a waiver of any ground for disqualification enumerated in subsection (b). Where the ground for disqualification arises only under subsection (a), waiver may be accepted provided it is preceded by a full disclosure on the record of the basis for disqualification.

(f) Notwithstanding the preceding provisions of this section, if any justice, judge, magistrate judge, or bankruptcy judge to whom a matter has been assigned would be disqualified, after substantial judicial time has been devoted to the matter, because of the appearance or discovery, after the matter was assigned to him or her, that he or she individually or as a fiduciary, or his or her spouse or minor child residing in his or her household, has a financial interest in a party (other than an interest that could be substantially affected by the outcome), disqualification is not required if the justice, judge, magistrate judge, bankruptcy judge, spouse or minor child, as the case may be, divests himself or herself of the interest that provides the grounds for the disqualification.

And therein lies Babcock’s problem—he’s pointing out that Emperor Sherman has no clothes, yet he’s being sanctioned for it. We all need to stand with the Law Dogs and share this info far and wide!

About eggsistense

Writer, musician, cartoonist, human being
This entry was posted in Foreclosure, MERS and tagged , , , , , , , , , , , , , . Bookmark the permalink.

One Response to BABCOCK CORRECT: SHERMAN SHOULD NOT BE SPECIAL MASTER

  1. Pingback: BABCOCK OBLITERATES MERS AND MERRILL SHERMAN | LIBERTY ROAD MEDIA

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