Ademiluyi v. PennyMac Mortg. Inv. Trust Holdings I, LLC

• Decision Date: 11 March 2013
• Docket Number: Civil Action No. ELH–12–0752.
• Citation: 929 F.Supp.2d 502
• Parties: Christie ADEMILUYI, Plaintiff, on behalf of herself and others similarly situated, v. PENNYMAC MORTGAGE INVESTMENT TRUST HOLDINGS I, LLC, et al., Defendants.
• Court: U.S. District Court — District of Maryland

929 F.Supp.2d 502

Christie ADEMILUYI, Plaintiff, on behalf of herself and others similarly situated,

v.PENNYMAC MORTGAGE INVESTMENT TRUST HOLDINGS I, LLC, et al., Defendants.

Civil Action No. ELH–12–0752.

United States District Court,

D. Maryland.

March 11, 2013.

Janet Sue Legg, Phillip Rease Robinson, Scott C. Borison, Phillip R. Robinson, Legg Law Firm LLC, Frederick, MD, for Plaintiff.

Edward Win-Teh Chang, Blank Rome LLP, Philadelphia, PA, Harris N. Cogan, Blank Rome LLP, New York, NY, James Robert Billings Kang, Blank Rome LLP, Washington, DC, for Defendants.

MEMORANDUM OPINION

ELLEN LIPTON HOLLANDER, District Judge.

Plaintiff Christie Ademiluyi filed a Class Action Complaint (the “Complaint,” ECF 1) against defendants PennyMac Mortgage Investment Trust Holdings I, LLC (“PennyMac Holdings”) and PennyMac Mortgage Investment Trust (“PennyMac Trust”) (collectively, “PennyMac”), asserting claims under state and federal law, based on defendants' debt collection activities. Plaintiff contends, inter alia, that defendants operated as debt collection agencies in Maryland without obtaining the requisite debt collection license, in accordance with the Maryland Collection Agency Licensing Act (“MCALA”), Md. Code (2010 Repl. Vol., 2012 Supp.), § 7–301 of the Business Regulation Article (“B.R.”). She seeks damages in excess of $8,500,000.

In particular, Count I, styled as a claim for “Class Declaratory Judgment and Injunctive Relief,” seeks a declaration that defendants unlawfully engaged in debt collection practices. In addition, plaintiff seeks to enjoin defendants' allegedly unlawful conduct, and requests disgorgement of “all amounts that each has obtained while acting illegally as a debt collection agency without a license.” Count II alleges that defendants' unlicensed debt collection activity violated various provisions of the Fair Debt Collection Practices Act (“FDCPA”), including 15 U.S.C. §§ 1692e & 1692f. In Count III, plaintiff asserts that defendants' unlicensed debt collection activity constitutes mortgage fraud, in violation of the Maryland Mortgage Fraud Protection Act (“MMFPA”), Md. Code (2010 Repl. Vol. 2012 Supp.), § 7–401et seq. of the Real Property Article (“R.P.”). Count IV presents a claim for unjust enrichment, on the ground that defendants received benefits from their alleged unlawful debt collection activity.¹

Pursuant to Fed.R.Civ.P. 12(b)(6), defendants have moved to dismiss (“Motion,” ECF 10), and the Motion has been extensively briefed.² No hearing is necessary to resolve it. See Local Rule 105.6. For the reasons that follow, the Motion will be granted in part and denied in part.³

Factual Background

On April 30, 2007, plaintiff executed an Adjustable Rate Note for $465,000 (the “Note”) with lender ABN AMRO Mortgage Group, Inc. (“ABN AMRO”), as to real property located at 8309 Maple Street in Laurel, Maryland. Compl. ¶ 10; see Note, Motion Exh. A (ECF 10–3). The property is plaintiff's personal residence. Compl. ¶ 38. The Note was secured by the property, as reflected in the Deed of Trust dated April 30, 2007, which was recorded in the land records of Prince George's County, Maryland. Deed of Trust, Motion Exh. B (ECF 10–4). ⁴

In or about 2010, plaintiff fell behind on her mortgage payments to Citi Mortgage, Inc. (“Citi”), successor-in-interest to the Note by merger with ABN AMRO. See Assignment of Mortgage, Motion Exh. C (“Assignment,” ECF 10–5); Compl. ¶ 33. Between July 2010 and January 2011, in response to “an unaffordable loan modification” applied by Citi without plaintiff's consent, plaintiff and Citi negotiated “a modification or other loss mitigation alternatives,” culminating in a forbearance agreement accepted by Ademiluyi on December 22, 2010. Id. ¶¶ 34–36. It “amended payments due on the original note and security instrument for seventeen months.” Id. ¶ 37. Ademiluyi submitted her full application for a loan modification on January 10, 2011. Id.

On or about March 9, 2011, while Ademiluyi's modification application was pending, Citi transferred its interest in the Note to PennyMac Holdings, without recourse. Compl. ¶ 38; see Assignment. According to the Complaint, PennyMac Holdings “operates as a wholly-owned subsidiary of Defendant PennyMac Trust which also controls the day to day operations of Defendant PennyMac [Holdings] through the direction of its Board of Trustees and management staff.” Compl. ¶ 3; see also id. ¶ 19. The Complaint also states: “PennyMac Trust was established as a Maryland investment vehicle commonly called and referred to as a real estate investment trust within the meaning of Section 856 of the Internal Revenue Code of 1986.” Id. ¶ 3.⁵

In a letter to Ademiluyi dated March 28, 2011, PennyMac Holdings represented that it had acquired ownership of the Note on February 28, 2011, but that Citi was, at that time, still the mortgage servicer. Compl. ¶ 39. On March 1, 2011 and March 31, 2011, Ademiluyi submitted her mortgage payments to Citi via “electronic funds transfer” in the amount of $2,605.68, presumably in accordance with the forbearance agreement. Id. ¶ 40.⁶

According to the Complaint, in early April 2011, PennyMac Holdings transferred the servicing of the Note to PennyMac Loan Services, LLC (“PennyMac Services”). Compl. ¶ 41.⁷ However, PennyMac Services refused Ademiluyi's April mortgage payment, submitted pursuant to the forbearance agreement, and subsequently represented to plaintiff's attorney that it was not bound by the forbearance agreement. Id. ¶¶ 42–43. Instead, PennyMac Services indicated that its “Making Home Affordable Loan Modification” was the sole option “to keep borrower's [sic] in their home.” Id. ¶ 43. Nonetheless, PennyMac Services determined that Ademiluyi was not eligible for a loan modification, and that her only options to avoid foreclosure were to pay the entire past-due balance, conduct a short-sale, or relinquish the deed in lieu of foreclosure. Id. ¶ 44. And, on May 20, 2011, PennyMac Services represented that it had not received any payments from Ademiluyi since January 1, 2011. Id. ¶ 45. Plaintiff alleges that, despite endeavoring to “resolve her mortgage situation and the botched modification application,” her attempts “have not resolved the situation.” Id. ¶ 46.

On January 30, 2012, PennyMac Holdings sent plaintiff a Notice of Intent to Foreclose (the “Notice”). Id. ¶ 47. In the Notice, PennyMac Holdings identified itself as the “secured party” on the Note, and claimed that plaintiff had been in default as of January 1, 2011. Id. According to the Complaint, PennyMac Holdings also identified itself in the Notice as a “debt collector.” Id. The Complaint does not indicate whether defendants actually foreclosed on plaintiff's property. Plaintiff alleges that, as a result of her attempts to remedy her loan modification dispute and to avoid foreclosure, she suffered damages in the form of attorney's fees, emotional distress, and monetary loss for the mortgage payments made to defendants. Id. ¶ 49. Further, she avers that she and “each class member reasonably relied upon PennyMac [Holdings'] and PennyMac Trust's direct and indirect representations that each was licensed and permitted to operate legally in the state of Maryland.” Id. ¶ 50.

Plaintiff avers that PennyMac Holdings “collects on [mortgage] debts in the State of Maryland for the benefit of its owners and investors including PennyMac Trust.” Id. ¶ 13. These debts are allegedly in default at the time they are acquired by PennyMac Holdings. Id. As of December 31, 2011, almost 75% of the loans held by PennyMac Holdings were in default or in foreclosure status. Id. Further, the Complaint states that PennyMac Holdings “collects monthly mortgage payments and/or reinstatement sums through the mails and interstate wires,” and “through civil litigationin Maryland Courts filed as foreclosure actions.” Id. ¶ 20. And, through its affiliates, PennyMac Holdings offers $8,700 in “financial incentives” to borrowers for participating in a “foreclosure-avoidance program,” which consists of a “deed-in-lieu of foreclosure or short sale of the property.” Id. ¶ 21. Additionally, plaintiff claims that “in more than 50 occurrences in the State of Maryland in the last year,” PennyMac Holdings “attempted to collect debts against Maryland consumers through foreclosure[ ] collection actions filed in Maryland state courts and Maryland land records as well as claims reported to the U.S. Bankruptcy Court for Maryland.” Id. ¶ 18.

Neither PennyMac Holdings nor PennyMac Trust is licensed as a debt collection agency in the State of Maryland, pursuant to the MCALA. Id. ¶ 15. And, according to the Complaint, PennyMac Holdings is not licensed as a Maryland mortgage lender. Id. ¶ 14.⁸ However, the parties agree that the Court may take judicial notice of defendants' licensing status represented via the Nationwide Mortgage Licensing System (“NMLS”) website, available at www. nmls consumer access. org. ⁹Cf. Jeandron v. Bd. of Regents of Univ. Sys. of Md., 510 Fed.Appx. 223, 227 (4th Cir.2013) (“A court may take judicial notice of information publicly announced on a party's web site, so long as the web site's authenticity is not in dispute and ‘it is capable of accurate and ready determination.’ ”) (quoting Fed.R.Evid. 201(b)).¹⁰ These records show that PennyMac Services holds a license as a mortgage lender under Maryland law.

Standard of Review

A defendant may test the adequacy of a complaint by way of a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure. To survive a motion under Fed.R.Civ.P. 12(b)(6), a complaint must contain facts sufficient to “state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007); see Ashcroft v. Iqbal, 556 U.S. 662, 684, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (“Our decision in Twombly expounded the pleading standard for ‘all civil actions' ....” (citation...