## Facts

- Mark and Jamileh Miller executed a $216,236 promissory note to IndyMac Bank, F.S.B., secured by a deed of trust on their Colorado residence.
- The deed of trust named MERS as nominee-beneficiary for IndyMac and contemplated that the note could be sold without borrower notice.
- After default, Deutsche Bank sought a Colorado Rule 120 order authorizing sale, relying on a copy of the note bearing a blank endorsement; the state court granted the order without requiring production of the original note.
- The Millers then filed Chapter 13, triggering the automatic stay under 11 U.S.C. § 362(a).
- Deutsche Bank moved for relief from stay under § 362(d), asserting it owned the note and deed of trust and attaching only a copy of the note with the blank endorsement.
- The Millers objected that Deutsche Bank was not a party in interest because it had not produced the original note or shown possession of it.
- In bankruptcy court, Deutsche Bank’s counsel indicated the bank did not then have the original note but stated it would be produced if an evidentiary hearing occurred; no evidentiary hearing was held, the original note was never produced, and the stay was lifted.
- The Bankruptcy Appellate Panel affirmed, reasoning that Rooker–Feldman barred the bankruptcy court from revisiting the state Rule 120 determination that Deutsche Bank was an “interested person.”

## Issues

1. Whether the Rooker–Feldman doctrine barred the bankruptcy court from determining Deutsche Bank’s “party in interest” status for § 362(d) stay relief given the prior Rule 120 order authorizing sale.
2. Whether Deutsche Bank met its burden to prove it was a “party in interest” entitled to relief from the automatic stay by showing a colorable right to enforce the note and deed of trust under applicable law.

## Decision

- The Tenth Circuit reversed the BAP and the stay-relief order and remanded.
- Rooker–Feldman did not apply because the stay-relief dispute required an independent federal determination of party-in-interest status and did not seek appellate review of the state Rule 120 order.
- Deutsche Bank failed to carry its burden to establish it was entitled to enforce the note and therefore failed to show it was a § 362(d) party in interest.
- A copy of a note with a blank endorsement, without competent evidence of possession or another legally sufficient basis to enforce, was insufficient to justify relief from stay.

## Legal Principles

- Only a “party in interest” may obtain relief from the automatic stay under 11 U.S.C. § 362(d), and the movant bears the burden to establish its standing.
- A stay-relief movant must show at least a colorable claim to enforce a right against estate property; in a mortgage-note context, this generally requires proof of the right to enforce the note under state law.
- Under Colorado negotiable-instruments law, a note endorsed in blank is payable to bearer, and enforcement as a “holder” generally requires actual physical possession; transfer by physical delivery may confer enforcement rights, but it must be proven with competent evidence.
- Attorney representations and unauthenticated copies, without evidence establishing possession, transfer, or another enforcement basis (such as a properly supported lost-note claim), do not establish party-in-interest status.
- Rooker–Feldman bars lower federal courts from exercising appellate review over state-court judgments, but it does not bar federal adjudication of distinct federal questions merely because a related state proceeding occurred.

## Conclusion

The Tenth Circuit held that a prior Colorado Rule 120 authorization did not prevent the bankruptcy court from assessing standing for stay relief, and it reversed because Deutsche Bank did not prove it could enforce the note and thus did not establish itself as a party in interest under § 362(d).


Miller v. Deutsche Bank Nat’l Tr. Co. (In re Miller), 666 F.3d 1255 (10th Cir. 2012)