Anthony Grygelko Sr. and Katie Grygelko v. Amerihome Mortgage Company
Anthony Grygelko Sr. and Katie Grygelko v. Amerihome Mortgage Company, LLC; Federal National Mortgage Association (Fannie Mae); Mortgage Electronic Registration Systems, Inc. (MERS); and Trott Law, P.C.
- Jeffrey Bryan
- 0:25-cv-03883
- U.S. District Court · District of Minnesota
- 5
In Grygelko v. Amerihome Mortgage Company, LLC, Judge Jeffrey M. Bryan dismissed the case without prejudice — though the written order says 'with prejudice' — because the court lacked the legal authority (subject matter jurisdiction) to hear the Grygelkos' claims about their home's foreclosure.
Homeowners who file foreclosure-related lawsuits in federal court without establishing a proper basis for federal jurisdiction (either diversity of citizenship with specific party citizenship allegations, or a genuine federal law claim supported by facts). Also relevant to anyone seeking emergency relief in federal court when jurisdiction is uncertain.
What happened
In Grygelko v. Amerihome Mortgage Company, LLC, Anthony Grygelko Sr. and Katie Grygelko sued their mortgage servicer, Fannie Mae, MERS, and a foreclosure law firm after receiving a notice that their Blaine, Minnesota home would be sold at a foreclosure sale on November 13, 2025. The Grygelkos argued that the assignment of their mortgage loan was void for lack of consideration, that Defendants had no legal right to foreclose, and they asked the court to halt the sale. They brought claims for quiet title, a declaration that Defendants lacked authority to foreclose, violations of a commercial code provision and Minnesota foreclosure statutes, and slander of title.
A U.S. Magistrate Judge recommended dismissing the case because the federal court lacked jurisdiction — that is, the legal authority — to hear it. Federal courts can only hear cases if they involve a question of federal law or if the parties are citizens of different states and the amount in dispute exceeds a threshold (called diversity jurisdiction). The Grygelkos' complaint relied only on federal question jurisdiction, but their claims were all based on state law. When they objected and raised diversity jurisdiction, the court found that argument could not save them because their complaint never included any specific allegations about where the parties were citizens, as required.
Judge Jeffrey M. Bryan overruled the Grygelkos' objections, adopted the Magistrate Judge's recommendation, and dismissed the case. The court rejected the argument that citations to the Foreign Agents Registration Act or 'federal securitization accounting principles' created federal jurisdiction, finding that citing a federal law without supporting facts is not enough. Because the court had no jurisdiction, it also declined to rule on the Grygelkos' emergency motion to stop the foreclosure sale. The written order states the dismissal is 'with prejudice,' though the body of the opinion states 'without prejudice' — readers should note this inconsistency.
The detailed version
Case
Anthony Grygelko Sr. and Katie Grygelko v. Amerihome Mortgage Company, LLC; Federal National Mortgage Association (Fannie Mae); Mortgage Electronic Registration Systems, Inc. (MERS); and Trott Law, P.C., File No. 25-CV-03883 (JMB/DTS), U.S. District Court for the District of Minnesota.
Judge
Jeffrey M. Bryan, United States District Judge (with a Report and Recommendation from U.S. Magistrate Judge David T. Schultz).
Background
Plaintiffs Anthony Grygelko Sr. and Katie Grygelko own a home in Blaine, Minnesota. They originally obtained a mortgage loan from Bay Equity LLC, which was subsequently assigned to Amerihome Mortgage Company, LLC. Plaintiffs challenged the validity of that assignment, claiming it was void for lack of consideration, and asserted that Fannie Mae is the true owner of the loan while Amerihome is merely the servicer. On September 17, 2025, Plaintiffs received a Notice of Mortgage Foreclosure issued by Trott Law, P.C. on behalf of Amerihome, scheduling a foreclosure sale for November 13, 2025.
Claims Asserted
- Count I: Quiet title under Minn. Stat. § 559.01, et seq. - Count II: Declaratory judgment that Defendants lack standing and authority to foreclose and that mortgage assignments are void. - Count III: Violation of UCC Article 2, § 201 and relevant Minnesota foreclosure statutes. - Count IV: Slander of title.
Plaintiffs also filed a Motion for Temporary Restraining Order (TRO) seeking to halt the scheduled November 13, 2025 foreclosure sale.
Procedural Posture
Magistrate Judge David T. Schultz issued a Report and Recommendation (R&R) on October 16, 2025, recommending dismissal for lack of subject matter jurisdiction. Plaintiffs timely objected.
Legal Standards Applied
- De novo review of objected-to portions of an R&R. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b). - Liberal construction of pro se (self-represented) filings. Stone v. Harry, 364 F.3d 912, 914 (8th Cir. 2004). - The court has an independent obligation to confirm subject matter jurisdiction and must dismiss if it is absent. Hertz Corp. v. Friend, 559 U.S. 77, 94 (2010); Fed. R. Civ. P. 12(h)(3). - Plaintiffs bear the burden to establish jurisdiction. Moss v. United States, 895 F.3d 1091, 1097 (8th Cir. 2018).
Diversity Jurisdiction Analysis
Diversity jurisdiction (28 U.S.C. § 1332) requires complete diversity of citizenship between the parties. The Complaint asserted only federal question jurisdiction and contained no specific allegations about the citizenship of any party. The court found that Plaintiffs' attempt to raise diversity jurisdiction for the first time in their objection could not cure the Complaint's deficiency, citing Barclay Square Props. v. Midwest Fed. Sav. & Loan Ass'n of Minneapolis, 893 F.2d 968, 969 (8th Cir. 1990), which requires that pleadings 'set forth with specificity the citizenship of the parties.'
Federal Question Jurisdiction Analysis
Federal question jurisdiction (28 U.S.C. § 1331) exists when a claim arises under federal law. The court agreed with the R&R that all of Plaintiffs' claims — quiet title, declaratory judgment regarding mortgage assignments, UCC/state foreclosure statute violations, and slander of title — arise under state law. Plaintiffs argued that the Foreign Agents Registration Act (22 U.S.C. § 611) and 'federal securitization accounting principles' established federal question jurisdiction. The court rejected this, explaining that merely citing a federal statute without supporting factual allegations does not create a well-pleaded federal claim. The court also found this action did not fall within the narrow category of state-law cases that raise a substantial embedded federal question, citing Great Lakes Gas, 843 F.3d at 329, 331; Empire Healthchoice Assur., Inc. v. McVeigh, 547 U.S. 677, 699–700 (2006); and Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 315 (2005).
Ruling
Judge Bryan overruled Plaintiffs' objections, adopted the R&R, and dismissed the action. Because the court lacked subject matter jurisdiction, it also declined to address the pending Motion for Temporary Restraining Order.
IMPORTANT INCONSISTENCY
The body of the opinion (Discussion section) states that the court 'dismisses this action without prejudice for lack of subject matter jurisdiction,' while the Order section at the end states the matter is 'DISMISSED with prejudice.' These are legally distinct outcomes: dismissal without prejudice would permit Plaintiffs to refile in a court with proper jurisdiction, while dismissal with prejudice would bar refiling. The opinion text is internally contradictory on this point, and a reviewer should flag this for correction or clarification.
Reviewer note from the AI+
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.