10-D 1 comm16dc2_10d_77.htm Form 10-D


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM 10-D

ASSET-BACKED ISSUER
DISTRIBUTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the monthly distribution period from:
July 13, 2022 to August 12, 2022

Commission File Number of issuing entity: 333-206705-02
Central Index Key Number of issuing entity: 0001663244

COMM 2016-DC2 Mortgage Trust
(Exact name of issuing entity as specified in its charter)

Commission File Number of depositor: 333-193376
Central Index Key Number of depositor: 0001013454

Deutsche Mortgage & Asset Receiving Corporation
(Exact name of depositor as specified in its charter)

Central Index Key Number of sponsor (if applicable): 0001541294
German American Capital Corporation
(Exact name of sponsor as specified in its charter)

Central Index Key Number of sponsor (if applicable): 0001089877
KeyBank National Association
(Exact name of sponsor as specified in its charter)

Central Index Key Number of sponsor (if applicable): 0001555524
 LoanCore Capital Markets LLC (formerly known as Jefferies
LoanCore LLC)
(Exact name of sponsor as specified in its charter)

Lainie Kaye (212) 250-2500
(Name and telephone number, including area code, of the person to
contact in connection with this filing)

New York
(State or other jurisdiction of incorporation or organization
of the issuing entity)

Lower Tier Remic  81-1634426
Upper Tier Remic  81-1758688
Grantor Trust  81-6375604
(I.R.S. Employer Identification No.)

c/o Deutsche Bank Trust Company Americas as Certificate Administrator
1761 East St. Andrew Place, Santa Ana CA
(Address of principal executive offices of the issuing entity)

92705
(Zip Code)

(212) 250-2500
(Telephone number, including area code)

NONE
(Former name, former address, if changed since last report)

Registered / reporting pursuant to (check one)
Title of Class  Section 12(b)  Section 12(g)  Section 15(d)  Name of Exchange
(if Section 12(b))
Class A-1           [ ]             [ ]             [X]        Not Applicable
Class A-2           [ ]             [ ]             [X]        Not Applicable
Class A-3           [ ]             [ ]             [X]        Not Applicable
Class A-SB          [ ]             [ ]             [X]        Not Applicable
Class A-4           [ ]             [ ]             [X]        Not Applicable
Class A-5           [ ]             [ ]             [X]        Not Applicable
Class X-A           [ ]             [ ]             [X]        Not Applicable
Class A-M           [ ]             [ ]             [X]        Not Applicable
Class B             [ ]             [ ]             [X]        Not Applicable
Class C             [ ]             [ ]             [X]        Not Applicable

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes _X_   No ____


Part I - DISTRIBUTION INFORMATION

Item 1.  Distribution and Pool Performance Information.
On  August 12, 2022 a distribution was made to holders of the
certificates issued by COMM 2016-DC2 Mortgage Trust.  The
distribution report is attached as Exhibit 99.1 to this Form 10-D.

During the distribution period from July 13, 2022 to August 12, 2022
no assets securitized by Deutsche Mortgage & Asset Receiving
Corporation (the "Depositor") and held by COMM 2016-DC2 Mortgage
Trust were the subject of a demand to repurchase or replace for breach
of the representations and warranties contained in the underlying
transaction documents.

The Depositor filed a Form ABS-15G pursuant to Rule 15Ga-1 under the
Securities Exchange Act of 1934 on February 15, 2022.  The CIK number
of the Depositor is 0001013454.

German American Capital Corporation ("GACC"), one of the sponsors and
mortgage loan sellers, filed a Form ABS-15G pursuant to Rule 15Ga-1
under the Securities Exchange Act of 1934 on February 15, 2022.  The
CIK number of GACC is 0001541294.

KeyBank National Association ("KeyBank"), one of the sponsors
and mortgage loan sellers, filed a Form ABS-15G pursuant
to Rule 15Ga-1 under the Securities Exchange Act of 1934 on
February 02, 2022.  The CIK number of KeyBank is 0001089877.

LoanCore Capital Markets LLC (formerly known as Jefferies LoanCore LLC)
("LoanCore"), one of the sponsors and mortgage loan sellers, filed
a Form ABS-15G pursuant to  Rule 15Ga-1
under the Securities Exchange Act of 1934 on February 08, 2022.
The CIK number for LoanCore is 0001555524.


Part II - OTHER INFORMATION

Item 2. Legal Proceedings.

Disclosure from CWCapital Asset Management LLC ("CWCAM"), as special servicer:

On December 17, 2015, U.S. Bank National Association, the trustee under five pooling and servicing
agreements for (i) Wachovia Bank Commercial Mortgage Trust 2007-C30, (ii) COBALT CMBS Commercial
Trust 2007-C2, (iii) Wachovia Bank Commercial Mortgage Trust 2007-C31, (iv) ML-CFC Commercial
Mortgage Trust 2007-5 and (v) ML-CFC Commercial Mortgage Trust 2007-6 commenced a proceeding
with the Second Judicial District Court of Ramsey County, Minnesota (the "State Court") for a
declaratory judgment as to the proper allocation of certain proceeds ("Disputed Proceeds")
received by CWCAM in connection with the sale of the Peter Cooper Village and Stuyvesant
Town property in New York, New York securing loans held by those trusts.  CWCAM was the
special servicer of such property.  The petition requests the State Court to instruct
the trustee, the trust beneficiaries, and any other interested parties as to the amount of
the Disputed Proceeds, if any, that constitute penalty interest and/or the amount of the
Disputed Proceeds, if any, that constitute gain-on-sale proceeds, with respect to each trust.
On February 24, 2016, CWCAM made a limited appearance with the State Court to file a motion
to dismiss this proceeding based on lack of jurisdiction, mootness, standing and forum non
conveniens.  On July 19, 2016, the State Court denied CWCAM's motion to dismiss.  On
July 22, 2016, the action was removed to federal court in Minnesota ("Federal Court").
On October 21, 2016, the Federal Court held a hearing on the motion to transfer the action
to the United States District Court for the Southern District of New York ("SDNY Court"), a
motion to remand to state court and a motion to hear CWCAM's request for reconsideration of
the motion to dismiss.  On March 14, 2017, the Federal Court reserved the determination on
the motion to hear CWCAM's request for reconsideration of the motion to dismiss, denied the
motion to remand the matter to state court and granted the motion to transfer the proceeding
to the SDNY Court.  Cross motions for judgment on the pleadings were filed but the SDNY Court
was unable to decide the case based on the pleadings and the SDNY Court ordered discovery.
All fact discovery was completed in December, 2018 and expert discovery was completed on
March 15, 2019.  The parties submitted cross motions for summary judgment, and on March
19, 2020, the SDNY Court entered an opinion and order in which it granted summary judgment
in CWCAM's favor and held that CWCAM was entitled to the entire amount of penalty interest
and that CWCAM's determination of Yield Maintenance was correct.  In the 127-page opinion,
the SDNY Court found for CWCAM on every issue presented by the trustee's petition, namely,
that the funds in dispute constitute penalty interest and yield maintenance, not gain-on-sale
proceeds, and that the amount of penalty interest and yield maintenance was correctly
calculated. An appeal of the SDNY Court's decision was taken on April 29, 2020.  Oral
argument on the appeal occurred on June 21, 2021.  On July 14, 2022, the Second Circuit
entered a decision affirming in part and reversing in part the SDNY Court's decision,
and remanding to the SDNY Court for further proceedings.  The Second Circuit affirmed
the SDNY's Court holding that Penalty Interest and Yield Maintenance are paid before
Gain-on-Sale Proceeds.  The Second Circuit reversed and remanded for further proceedings
that portion of the SDNY Court's related to approximately $67.2 million in interest on advances.

On December 1, 2017, a complaint against CWCAM and others was filed in the United States District
Court for the Southern District of New York styled as CWCapital Cobalt Vr Ltd. v. CWCapital
Investments LLC, et al., No. 17-cv-9463 (the "Original Complaint"). The gravamen of the Original
Complaint alleged breaches of a contract and fiduciary duties by CWCAM's affiliate, CWCapital
Investments LLC in its capacity as collateral manager for the collateralized debt obligation
transaction involving CWCapital Cobalt Vr, Ltd. In total, there are 14 counts pled in the
Original Complaint. Of those 14, 5 claims were asserted against CWCAM for aiding and abetting
breach of fiduciary duty, conversion and unjust enrichment. On May 23, 2018, the Original
Complaint was dismissed for lack of subject matter jurisdiction.   On June 28, 2018, CWCapital
Cobalt Vr Ltd. filed a substantially similar complaint in the Supreme Court of the State of
New York, County of New York styled as CWCapital Cobalt Vr Ltd. v. CWCapital Investments
LLC, et al., Index No. 653277/2018 (the "New Complaint").  The gravamen of the New Complaint
is the same as the previous complaint filed in the United State District Court for the Southern
District of New York.  In total there are 16 counts pled in the New Complaint. Of those 16
counts, 5 claims were asserted against CWCAM for aiding and abetting breach of fiduciary duty,
conversion and unjust enrichment, 1 count seeks a declaratory judgement that the plaintiff
has the right to enforce the contracts in question and 1 count seeks an injunction requiring
the defendants to recognize the plaintiff as the directing holder for the trusts in question.
On January 11, 2019, the plaintiff dismissed with prejudice the declaratory judgment and
injunction counts.  The New Complaint and related summons was not served on the defendants
until July 13, 2018 and July 16, 2018.  The plaintiff's motion for a preliminary injunction
was denied by the court on July 31, 2018.  On August 3, 2018, the defendants, including CWCAM,
filed a motion to dismiss the New Complaint in its entirety. On August 20, 2019, the court
entered an order granting defendants' motion almost in its entirety, dismissing 11 of the
16 counts and partially dismissing 2 additional counts.  Of the remaining counts, 2 are
asserted against CWCAM for aiding and abetting breach of fiduciary duty and unjust enrichment.
On September 19, 2019, CWCapital Cobalt Vr Ltd. filed a notice of appeal relating to the August
20, 2019 dismissal order and on September 26, 2019, filed an amended complaint against CWCI and
CWCAM attempting to address deficiencies relating to certain of the claims dismissed by the
August, 20, 2019 order.  CWCI and CWCAM filed its Motion to Dismiss the amended complaint on
October 28, 2019.  The court heard argument on the Motion to Dismiss the amended complaint on
January 22, 2020 and on October 23, 2020, the court granted the motion dismissing the amended
claims.  On November 30, 2020, CWCapital Cobalt Vr Ltd filed a notice of appeal relating to
the October 23, 2020 dismissal order.  On April 27, 2021, the First Department affirmed the
dismissal as to claims against CWCAM that were part of the August 20, 2019 dismissal, but
reversed the dismissal of two counts for breach of the Collateral Management Agreement against
CWCI.  CWCI has sought leave to file an appeal of the decision. The plaintiff has also sought
leave to appeal the dismissal of the claims against CWCAM.  Both requests for leave were denied
by the First Department.  On May 15, 2020, CWCI and CWCAM filed a motion to renew its motion
to dismiss as to 4 of the remaining counts (including the remaining two counts against CWCAM
for aiding and abetting breach of fiduciary duty and unjust enrichment), based on a decision
entered by Judge Failla in a trust instruction proceeding in the US District Court for the
Southern District of New York awarding summary judgment in favor of CWCAM.  On
September 7, 2021, the court denied the motion to renew.  CWCI and CWCAM filed a notice
of appeal, which they perfected by the filing of their opening brief on July 1, 2022.
On October 1, 2021, CWCI and CWCAM moved to reargue the denial of the motion to renew
(or alternatively, the motion to dismiss) with respect to certain of Cobalt's claims,
including the remaining 2 claims against CWCAM, based on the First Department's
April 27, 2021 decision.  On March 24, 2022, the court denied the relief sought in the
motion to reargue.  CWCI and CWCAM have appealed the court's decision on the motion to
reargue and filed their opening brief on July 11, 2022.  CWCAM believes that it has
performed its obligations under the related pooling and servicing agreements in good faith
and the remaining allegations in the New Complaint are without merit.

Item 10.  Exhibits.
(a) The following is a list of documents filed as part
    of this Report on Form 10-D:

(99.1)   Monthly Report distributed to holders of the
         certificates issued by COMM 2016-DC2 Mortgage Trust,
         relating to the August 12, 2022 distribution.

(b) The exhibits required to be filed by the Registrant
    pursuant to this Form are listed above.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Deutsche Mortgage & Asset Receiving Corporation
(Depositor)


/s/ R. Chris Jones
Name:  R. Chris Jones
Title: Director


/s/ Matt Smith
Name:  Matt Smith
Title: Director



Date:    August 24, 2022