BANK NATIONAL ASSOCIATION v. UBS REAL ESTATE SECURITIES INC

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Supreme Court, Appellate Division, First Department, New York.

U.S. BANK NATIONAL ASSOCIATION, etc., Plaintiff, v. UBS REAL ESTATE SECURITIES, INC., Defendant.

Ace Securities Corp., etc., et al., Plaintiffs–Appellants, v. DB Structured Products, Inc., Defendant–Respondent.

10355-10356

Decided: November 19, 2019

Manzanet–Daniels, J.P., Tom, Kapnick, Gesmer, Singh, JJ. Kasowitz Benson Torres LLP, New York (David J. Abrams of counsel), for U.S. Bank National Association, appellant. McKool Smith, P.C., New York (Zachary W. Mazin of counsel), for Ace Securities Corp, Home Equity Loan Trust, HSBC Bank USA and National Association, appellants. Skadden, Arps, Slate, Meagher & Flom LLP, New York (Alexander C. Drylewski of counsel), for UBS Real Estate Securities, Inc., respondent. Simpson Thacher & Bartlett LLP, New York (William T. Russell, Jr. of counsel), for DB Structured Products, Inc., respondent.

Order, Supreme Court, New York County (Marcy S. Friedman, J.), entered on or about March 29, 2016, which granted defendant DB Structured Products, Inc.'s motion to dismiss the complaint pursuant to CPLR 3211(a)(5) with prejudice, unanimously affirmed, with costs.  Order, same court and Justice, entered July 28, 2016, which granted defendant UBS Real Estate Securities, Inc.'s motion to dismiss the amended complaint pursuant to CPLR 3211, unanimously affirmed, with costs.

The dispositive issue in both appeals is whether the trustee of a residential mortgage-backed securities trust is a “plaintiff” within the meaning of CPLR 205(a) when the prior action was commenced by the trust's certificateholders.  In U.S. Bank N.A. v. DLJ Mtge. Capital, Inc., 141 A.D.3d 431, 35 N.Y.S.3d 82 (1st Dept. 2016), affd 33 N.Y.3d 84, 98 N.Y.S.3d 530, 122 N.E.3d 47 (2019) (“HEAT”), we concluded that “the trustee [was] not entitled to refile the claims pursuant to CPLR 205(a), because it [was] not a ‘plaintiff’ under that statute” (id. at 433, 35 N.Y.S.3d 82).  Our decision “could not have been clearer, and that decision is still good law and binding upon us under principles of stare decisis” (First Hudson Capital, LLC v. Seaborn, 54 A.D.3d 251, 252, 862 N.Y.S.2d 501 [1st Dept. 2008], appeal dismissed 11 N.Y.3d 894, 873 N.Y.S.2d 270, 901 N.E.2d 764 [2008]).  Plaintiff Ace Securities Corp.'s attempt to distinguish HEAT is unavailing.  Neither plaintiff has demonstrated the “compelling circumstances” required to depart from stare decisis (see People v. Aarons, 305 A.D.2d 45, 56, 759 N.Y.S.2d 20 [1st Dept. 2003], affd 2 N.Y.3d 547, 780 N.Y.S.2d 533, 813 N.E.2d 613 [2004];  see also Dufel v. Green, 198 A.D.2d 640, 603 N.Y.S.2d 624 [3d Dept. 1993], affd 84 N.Y.2d 795, 622 N.Y.S.2d 900, 647 N.E.2d 105 [1995]).