United States District Court, N.D. Alabama, Western Division
DAVID PROCTOR UNITED STATES DISTRICT JUDGE.
case is before the court on Defendant JPMorgan Chase Bank,
N.A.'s (“Chase”) Motion to Dismiss
Plaintiff's Amended Complaint (Doc. # 30) and Defendants
Seterus, Inc., Federal National Mortgage Association
(“Fannie Mae”), and Mortgage Electronic
Registration Systems, Inc.'s (“MERS”) Motion
to Dismiss Plaintiff's Amended Complaint (Doc. # 33). The
Motions to Dismiss are fully briefed and under submission.
(Docs. # 39-42). After careful review, and for the reasons
explained below, the court concludes that Defendants'
Motions to Dismiss are due to be granted in part and denied
case concerns a mortgage on Plaintiff's residence and
whether Defendants violated the terms of a settlement
agreement -- as well as several federal statutes -- while
servicing the mortgage and conducting foreclosure
proceedings. Plaintiff's Amended Complaint (Doc. # 22)
asserts the following claims:
1. Count One-Negligence
2. Count Two-Wantonness
3. Count Three-Unjust Enrichment
4. Count Four-Wrongful Foreclosure
5. Count Five-Slander of Title
6. Count Six-Breach of Contract
7. Count Seven-Fraud
8. Count Eight-Placed in a False Light
9. Count Nine-Defamation, Libel, and Slander
10. Count Ten-Violations of the Truth in Lending Act
11. Count Eleven-Violations of the Real Estate Settlement
Procedures Act (“RESPA”)
12. Count Twelve-Violations of the Fair Credit Reporting Act
13. Count Thirteen-Violations of the Fair Debt Collection
Practices Act (“FDCPA”)
14. Count Fourteen-Claim for Declaratory Relief
(Doc. # 22). Defendants move for dismissal of all of the
claims, except for the breach-of-contract, FDCPA, and
declaratory relief claims.
The Amended Complaint's Allegations
to his Amended Complaint, in June 2007, Plaintiff purchased
property located at 3813 East Second Avenue, Tuscaloosa,
Alabama 35405 (the “Property”) for approximately
$122, 700.00. (Doc. # 22 at ¶ 5). Plaintiff financed the
purchase with a loan from Mortgage America, Inc.
(Id.). Defendant MERS obtained the mortgage
instrument on behalf of Mortgage America. (Id.). In
2008, Cenlar began servicing Plaintiff's mortgage.
(Id. at ¶ 7).
April 2008, Plaintiff filed a Chapter 13 bankruptcy petition.
(Id. at ¶ 9). Cenlar filed a proof of claim
with the bankruptcy court and received payments pursuant to
Plaintiff's bankruptcy plan. (Id.). In September
2010, while Plaintiff remained under the protection of the
bankruptcy plan, Defendant Chase commenced servicing of the
loan. (Id. at ¶¶ 7, 9). Plaintiff
challenges the validity of the mortgage assignment to Chase.
(See Id. at ¶ 7 & n. 1). In August 2011,
Plaintiff received a bankruptcy discharge. (Id. at
September 2011, Chase allegedly sent Plaintiff a notice of
default for failing to tender mortgage payments that were
actually paid by a bankruptcy trustee. (Id.).
Plaintiff continued to send monthly payments to Chase, but it
responded with more default notices. (Id. at ¶
11). In January 2013, Chase commenced foreclosure proceedings
on the Property, which Plaintiff contested as invalid.
(Id. at ¶ 13). Plaintiff filed a lawsuit to
stop the foreclosure sale in January 2014. (Id. at
¶ 14). That lawsuit was removed to federal court.
(Id.). In May 2015, after the removal and engaging
in subsequent litigation, Plaintiff and Defendant Chase
entered into a formal settlement agreement resolving the
claims brought in that suit. (Id. at ¶ 15).
Pursuant to the settlement agreement, Chase agreed “to
bring [Plaintiff's] account current for the month of June
2015.” (Id. at ¶ 16).
alleges that Defendant Chase violated the terms of the
settlement agreement. (Id.). Although Plaintiff
resumed his mortgage payments, Chase did not accept them and
sent them back to him. (Id. at ¶ 17). Chase
sent Plaintiff demands for additional payments in May, June,
July, August, and September 2015 - payments that Plaintiff
contends were not owed under the settlement agreement.
(Id. at ¶ 18). Plaintiff also asserts that
Chase sent written communications to Plaintiff in May, June,
July, August, and September 2015 which reflected incorrect
amounts due on the mortgage account. (Id.).
Plaintiff asked Chase for “a detailed explanation of
the escrow fees and an escrow analysis of his account,
” but Chase failed to provide the requested
information. (Id. at ¶ 19). Moreover, Plaintiff
notified Chase that it was violating the settlement agreement
and that its communications to him misstated the debt he
owed, in violation of the RESPA and the FDCPA.
(Id.). In August 2015, Chase allegedly increased
Plaintiff's monthly payment from $1, 100 per month to
over $2, 200 per month. (Id. at ¶ 20). In
August 2015, December 2015, and January 2016, Plaintiff sent
Chase Qualified Written Requests (“QWR”) under
the RESPA, but it did not respond to the QWRs. (Id.
at ¶¶ 21, 112).
February 2016, Defendant Seterus began servicing
Plaintiff's mortgage. (Id. at ¶ 22). It
allegedly relied on Chase's records regarding the
mortgage loan, which incorrectly reflected that the account
was in default status. (Id.). Defendant Seterus
immediately sent default notices to Plaintiff and accelerated
the mortgage loan. (Id. at ¶ 23). Plaintiff
informed Seterus that Chase had failed to fix errors in the
mortgage loan records, but Seterus refused to correct those
errors. (Id. at ¶ 24). In November 2016,
Defendants Seterus and Fannie Mae began foreclosure
proceedings on the Property. (Id. at ¶ 25).
Plaintiff alleges that the foreclosure proceedings were
improper because Defendants “refused to engage in a
legitimate and good faith mortgage foreclosure avoidance
workout, [refused to] accept the proper payments, inflated
the amount due, and [ ] threatened to foreclose on Plaintiff[
] without any basis to do so.” (Id.).
Plaintiff also alleges that he sent QWRs to Seterus in
February 2016, May 2016, November 2016, January 2017, and
February 2017. (Id. at ¶ 112).
the foreclosure proceedings, notices were published in the
Tuscaloosa News that allegedly contained false information
about the default. (See Id. at ¶¶ 26-27).
Inaccurate information about the default also was reported to
the national credit bureaus, which Plaintiff asserts damaged
his credit record. (Id. at ¶ 28). Several
neighbors approached Plaintiff and asked him about the
foreclosure sale, which they learned about from the sale
notices. (Id. at ¶ 29). Several of
Plaintiff's clients also asked him about the foreclosure
sale, and some of those clients stopped doing business with
him thereafter. (Id.). Plaintiff sent a letter
disputing the debt to the firm handling the foreclosure in
February 2017, along with the QWR he sent to Seterus.
(Id. at ¶ 30).
alleges that Defendant wrongfully accelerated the mortgage
loan and wrongfully commenced foreclosure proceedings.
(Id. at ¶¶ 32-33). He contests the
standing of Defendants Seterus and Fannie Mae to conduct
foreclosure proceedings. (Id. at ¶ 33).
Notably, Plaintiff has not alleged in the Amended Complaint
that any Defendant completed a foreclosure sale of the
Standard of Review
Federal Rules of Civil Procedure require that a complaint
provide “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). However, the complaint must include
enough facts “to raise a right to relief above the
speculative level.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). Pleadings that
contain nothing more than “a formulaic recitation of
the elements of a cause of action” do not meet Rule 8
standards, nor do pleadings suffice that are based merely
upon “labels and conclusions” or “naked
assertion[s]” without supporting factual allegations.
Id. at 555, 557. In deciding a Rule 12(b)(6) motion
to dismiss, courts view the allegations in the complaint in
the light most favorable to the non-moving party. Watts
v. Fla. Int'l Univ., 495 F.3d 1289, 1295 (11th Cir.
survive a motion to dismiss, a complaint must “state a
claim to relief that is plausible on its face.”
Twombly, 550 U.S. at 570. “A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Although “[t]he plausibility standard is not akin to a
‘probability requirement, '” the complaint
must demonstrate “more than a sheer possibility that a
defendant has acted unlawfully.” Id. A