NewRez, LLC v. Greene et al

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
NewRez, 	LLC 	d/b/a 	Shellpoint
Mortgage Servicing,
Plaintiff,
v.
Lori D. Greene, et al.,
Defendants.
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Civil Action No. 4:25-cv-02423
MEMORANDUM, RECOMMENDATION, AND ORDER
This is a foreclosure suit. 	Plaintiff NewRez, LLC d/b/a Shellpoint
Mortgage Servicing sued Defendants Lori D. Greene, the United States of
America, and Sundown Glen Community Association, Inc. Dkt. 1 (complaint).
NewRez brings a breach of contract claim, asserting that Greene defaulted on
her loan that is secured by her property. 	See id. at 2-3. On February 4, 2026
NewRez moved for default judgment against Greene and requested that the
Court order foreclosure on her property. 	Dkt. 29. 	But there is a serious
question as to whether subject matter jurisdiction is proper.
Consistent with its affirmative duty to ensure that subject matter
jurisdiction exists, see Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583
(1999), this Court cannot entertain the request for default judgment before
United States District Court
Southern District of Texas
ENTERED
June 30, 2026
Nathan Ochsner, Clerk
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confirming that jurisdiction is proper. 	See Sys. Pipe & Supply, Inc. v. M/V
VIKTOR KURNATOVSKIY, 242 F.3d 322, 324 (5th Cir. 2001) (describing this
as 	the 	court’s 	“affirmative 	duty” 	when 	addressing 	a 	motion 	for 	default
judgment). And as the party asserting jurisdiction, NewRez bears the burden
to establish that jurisdiction exists. 	See Life Partners, Inc. v. United States,
650 F.3d 1026, 1029 (5th Cir. 2011).
As the basis for subject matter jurisdiction, NezRez pleaded that its
claims are “against an agency and/or officer of the United States of America.”
Dkt. 1 at 1. Specifically, NewRez named the United States of America (through
its officer, the Secretary of Housing and Urban Development) as a co-defendant
because the United States has an interest in the subject property. See id. at 3.
But this Court recently rejected that theory as a basis for jurisdiction.
See Nationstar Mortg., LLC, v. Abbott, 2026 WL 1765978 (S.D. Tex. Apr. 29,
2026), adopted by 2026 WL 1764856 (S.D. Tex. June 18, 2026) (Bennett, J.). In
Nationstar, 	a 	lender 	filed 	a 	foreclosure 	suit 	against 	both 	the 	defaulting
borrower and against the United States, which purportedly held a lien on the
property securing the loan. See id. at *1. The lender invoked federal question
jurisdiction under 28 U.S.C. § 2410, which provides that “the United States
may be named a party in any civil action or suit in any district court, or in any
State court having jurisdiction of the subject matter ... to foreclose a mortgage
or other lien upon ... real ... property on which the United States has or claims
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a mortgage or other lien.” 28 U.S.C. § 2410(a). But as explained in Nationstar,
Fifth Circuit law holds that Section 2410 “does not create a basis for federal
subject matter jurisdiction.” See Nationstar, 2026 WL 1765978, at *2 (quoting
Hussain v. Bos. Old Colony Ins. Co., 311 F.3d 623, 635 (5th Cir. 2002)). 	That
precedent confirms that merely naming the United States based on its an
interest in the subject property does not confer jurisdiction.
NewRez did not cite Section 2410 in its complaint. But the undersigned
sees no difference between this case and Nationstar, which was dismissed for
lack of subject-matter jurisdiction. Accordingly, NewRez must show cause why
this case should not likewise be dismissed. 	NewRez’s motion for default
judgment against Greene should be denied without prejudice to being reurged
if the Court concludes that jurisdiction is proper. See Sys. Pipe & Supply, Inc.,
242 F.3d at 324.
Conclusion and Recommendation
It is therefore ORDERED that Plaintiff NewRez, LLC must SHOW
CAUSE, by July 14, 2026, as to why this case should not be dismissed for
want of jurisdiction. Failure to do so will result in dismissal of this case.
It is further ORDERED that the remaining deadlines in the current
scheduling order (Dkt. 21) are hereby VACATED.
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It is RECOMMENDED that NewRez’s motion for default judgment
(Dkt. 29) be DENIED WITHOUT PREJUDICE to refiling later if the Court
ultimately concludes that jurisdiction exists.
Signed on June 30, 2026, at Houston, Texas.
__________________________________
Yvonne Y. Ho
United States Magistrate Judge
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