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Kelley v. Novad Management Consulting

United States District Court, N.D. Alabama, Southern Division

February 28, 2018




         I. Introduction

         Before the Court is Defendant NOVAD Management Consulting's (“NOVAD”) Motion To Dismiss (the “Motion”) Plaintiffs' Amended Complaint. (Doc. 31).[1] Plaintiffs Jay Kelley and Gail Kelley (collectively the “Kelleys”) responded to the Motion. (Doc. 35). NOVAD replied. (Doc. 36). This Motion is ripe for review.

         II. Relevant Background

         At the Motion To Dismiss stage, the Court accepts everything in the Complaint as true for purposes of this opinion only. The Court will provide a brief summary of the basic facts alleged in the Amended Complaint as they relate to the Motion To Dismiss.[2]

         The Kelleys are Alabama residents who entered into a reverse mortgage. (Doc. 28 at 1, ¶2 and 4, ¶4). On May 8, 2016, NOVAD became the service company for this mortgage. (See Id. at 4-5, ¶8). “On October 22, 2016, [the Kelleys] received a letter dated October 17, 2016[, ] from [NOVAD] reiterating the five circumstances under which a reverse mortgage becomes due and payable.” (Id. at 5, ¶9). They letter then stated that “[o]ne of the circumstances stated above has occurred and placed this loan in a due and payable status which requires the debt to be repaid. The total amount due and payable as of 11/16/2016 is $287, 685.15.” (Id. at 5, ¶10 and 16) (emphasis omitted). However, none of those enumerated circumstances occurred. (Id. at 6, ¶12).[3], [4]

The Kelleys bring one count in their Amended Complaint:
Plaintiffs submit that the evidence submitted herein clearly shows that Defendants' wrongful contention that "One of the above circumstances has occurred", is arbitrary and capricious, is without supporting evidence, has no basis in fact, is clearly an intentional act of deceit and deception, designed to defraud Plaintiffs, and many others, out of hundreds of thousands, if not millions of dollars.

(Doc. 28 at 9).

         III. Standard

         A Rule 12(b)(6) motion attacks the legal sufficiency of the complaint. See Fed. R. Civ. P. 12(b)(6) (“[A] party may assert the following defenses by motion: (6) failure to state a claim upon which relief can be granted[.]”). The Federal Rules of Civil Procedure require only that the complaint provide “‘a short and plain statement of the claim' that will give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests.” Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 103, 2 L.Ed.2d 80 (1957) (footnote omitted) (quoting Fed.R.Civ.P. 8(a)(2)), abrogated by Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 1965, 167 L.Ed.2d 929 (2007); see also Fed. R. Civ. P. 8(a) (setting forth general pleading requirements for a complaint including providing “a short and plain statement of the claim showing that the pleader is entitled to relief”).

         While a plaintiff must provide the grounds of his entitlement to relief, Rule 8 does not mandate the inclusion of “detailed factual allegations” within a complaint. Twombly, 550 U.S. at 555, 127 S.Ct. at 1964 (quoting Conley, 355 U.S. at 47, 78 S.Ct. at 103). However, at the same time, “it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). “[O]nce a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint.” Twombly, 550 U.S. at 563, 127 S.Ct. at 1969.

         “[A] court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth.” Iqbal, 556 U.S. at 679, 129 S.Ct. at 1950. “While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Id. “When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Id. (emphasis added). “Under Twombly's construction of Rule 8 . . . [a plaintiff's] complaint [must] ‘nudge[] [any] claims' . . . ‘across the line from conceivable to plausible.' Ibid.” Iqbal, 556 U.S. at 680, 129 S.Ct. at 1950-51.

         A claim is plausible on its face “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678, 129 S.Ct. at 1949. “The plausibility standard is not akin to a ‘probability requirement, ' but it asks for more than a sheer possibility ...

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