Barberan v. Nationpoint

• Citation: 706 F.Supp.2d 408
• Decision Date: 02 March 2010
• Docket Number: No. 07-CV-11595 (KMK).,07-CV-11595 (KMK).
• Parties: Jimmy BARBERAN and Tatsiana Barberan, Plaintiffs,v.NATIONPOINT, A Division of National City Bank, Mortgage Electronic Registration Systems, Inc., Atima, Home Loan Services, Inc. d.b.a. Nationpoint Loan Services, LaSalle Bank National Association as Trustee for First Franklin Loan Trust 2006-FF 18, Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, First Franklin Mortgage Loan Trust Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, and Unknown Owners of the Evidence of the Debt and/or Owners of the Note, Defendants.LaSalle Bank National Association as Trustee for First Franklin Loan Trust 2006-FF-18, Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, Plaintiff,v.Tatsiana Barberan, Jimmy Barberan, Board of Managers of Spring Hollow Condominium Two, and John Doe, Defendants.
• Court: U.S. District Court — Southern District of New York

706 F.Supp.2d 408

Jimmy BARBERAN and Tatsiana Barberan, Plaintiffs,

v.NATIONPOINT, A Division of National City Bank, Mortgage Electronic Registration Systems, Inc., Atima, Home Loan Services, Inc. d.b.a. Nationpoint Loan Services, LaSalle Bank National Association as Trustee for First Franklin Loan Trust 2006-FF 18, Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, First Franklin Mortgage Loan Trust Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, and Unknown Owners of the Evidence of the Debt and/or Owners of the Note, Defendants.

LaSalle Bank National Association as Trustee for First Franklin Loan Trust 2006-FF-18, Mortgage Loan Asset-Backed Certificates, Series 2006-FF18, Plaintiff,

v.Tatsiana Barberan, Jimmy Barberan, Board of Managers of Spring Hollow Condominium Two, and John Doe, Defendants.

No. 07-CV-11595 (KMK).

United States District Court,

S.D. New York.

March 2, 2010.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Jimmy Barberan, Tatsiana Barberan, Middletown, NY, Pro Se, Plaintiffs.

Scott Stephen McKessey, Esq., Reed Smith LLP, Philadelphia, PA, for Defendants.

Jordan W. Siev, Esq., Joseph Benjamin Teig, Esq., Reed Smith LLP, New York, NY, for Defendants.

Craig P. Curcio, Esq., Law Offices of Craig P. Curcio, Middletown, NY, for Defendants.

KENNETH M. KARAS, District Judge:

Jimmy and Tatsiana Barberan (“Plaintiffs”), proceeding pro se, bring this action against Nationpoint, a Division of National City Bank (“Nationpoint”), Mortgage Electronic Registration Systems, Inc., Atima (“MERS”), Home Loan Services, Inc. d.b.a. Nationpoint Loan Services (“HLS”), LaSalle Bank National Association as Trustee for First Franklin Loan Trust 2006-FF-18, Mortgage Loan Asset-Backed Certificates, Series 2006-FF18 (“LaSalle”), First Franklin Mortgage Loan Trust Mortgage Loan Asset-Backed Certificates, Series 2006-FF18 (“Franklin Certificates”), and “unknown owners of the evidence of the debt and/or owners of the note,” asserting claims to quiet title to the property located at 15 Woodlake Drive, Middletown, N.Y. 10940 (“the Property”); for violations of the Truth in Lending Act (“TILA”), 15 U.S.C. § 1601 et seq. ; and for breach of contract, breach of fiduciary duty, negligence, and wrongful foreclosure. Defendants move to dismiss all of Plaintiffs' claims pursuant to Fed.R.Civ.P. 12(b)(6). For the reasons stated herein, Defendants' motion is granted in part and denied in part.

I. Background

For purposes of deciding Defendants' motion, the Court accepts as true the allegations contained in Plaintiffs' Amended Verified Complaint (“Amended Complaint”), described below, and construes them in the light most favorable to Plaintiffs.

A. Factual Background

Plaintiffs own a condominium, located at 15 Woodlake Drive, Middletown, New York. (Am. Compl. ¶ 47.) Defendant Nationpoint is characterized by Plaintiffs as a “Lender.” ( Id. ¶ 9.) Defendant HLS does business under the name First Franklin Loan Services. ( Id. ¶ 45.) Defendant MERS is a Delaware corporation involved in the mortgage industry ( id. ¶¶ 19-20), which has contracts with one or more Defendants ( id. ¶ 30), and acts as a nominee for owners of loans, ( id. ¶¶ 32-33). Defendant LaSalle is a banking corporation acting as trustee for First Franklin Mortgage Loan Trust 2006-FF18. ( Id. ¶ 37.)

“Defendants claim that on or about October 18, 2006, Plaintiffs signed a Promissory Note” (“Note”) with Nationpoint and “entered into a consumer mortgage transaction” (“Mortgage”) with Nationpoint. ( Id. ¶ 52.) Plaintiffs deny signing “that Promissory Note and that alleged [mortgage] contract” ( id. ¶ 54), and assert that there “was never a meeting of the minds,” ( id. ¶ 55). “The alleged obligation was secured by the” Property. ( Id. ¶ 58.) Plaintiffs also claim that Nationpoint inserted false and conclusory statements into the Note and Mortgage documents. ( Id. ¶¶ 60-61.) Despite denying signing the Note and Mortgage, Plaintiffs “kept the loan paid current, up until they rescinded it.” ( Id. ¶ 70.) Plaintiffs also claim that the TILA disclosure forms associated with the loan “did not exactly match the Federal Reserve Board Model Form H-8” ( id. ¶ 65), and contained ambiguous and misleading information ( id. ¶¶ 67-68), and an incorrect rescission expiration date, ( id. ¶ 69). Plaintiffs attempted to rescind the loan on November 24, 2007 by sending a “Notice of Rescission” to Nationpoint. ( Id. ¶¶ 70-71.)

Plaintiffs allege that MERS concealed the identity of the party for which it acted as a nominee and “falsely represent[ed] that MERS is still nominee.” ( Id. ¶ 31.) Plaintiffs further allege that MERS “recorded, or intends to record, a false assignment of the alleged loan” to unknown owners of the Note. ( Id. ¶ 77.) According to Plaintiffs, LaSalle is “not the holder of any note [or] mortgage relevant to Plaintiffs,” despite LaSalle's claims to the contrary. ( Id. ¶¶ 38-39.) Plaintiffs also claim that LaSalle and HLS “started foreclosure proceedings” on the Property in New York state court ( id. ¶ 126), and that HLS reported the foreclosure proceedings to credit bureaus, ( id. ¶ 127.) As a result, Plaintiffs allege that some of their credit cards were canceled and that their credit limit was decreased. ( Id. ¶ 128.)

B. Procedural Background

Plaintiffs, proceeding pro se, filed an initial complaint on December 27, 2007 against Nationpoint, MERS, HLS, and “Unknown Owners of the Evidence of the Debt and/or Owners of the Note.” (Dkt. No. 1.) Pursuant to this Court's Order, dated December 12, 2008 (Dkt. No. 35), Plaintiffs filed their Amended Complaint on January 29, 2009. (Dkt. No. 38.) ¹ Plaintiffs' Amended Complaint added LaSalle and the Franklin Certificates as Defendants. (Am. Compl. 1.) ² On March 2, 2009, Defendants filed the instant motion to dismiss all of Plaintiffs' claims in the Amended Complaint. (Defs.' Mem. of Law in Supp. of Their Mot. to Dismiss the Am. Compl. (“Defs.' Mem.”) 1-2.) Pursuant to this Court's Order, dated December 21, 2009 (Dkt. No. 55), the Parties submitted supplemental briefing on January 4, 2010, regarding preemption under the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681 et seq. On November 19, 2009, the Court set the matter down for oral argument on January 13, 2010. (Dkt. No. 54.) On January 8, 2010, Plaintiffs wrote the Court to advise that they would be “out of state” on January 13, while Defendants wrote to the Court on January 11, 2010, stating that they would “prefer” another argument date. The Court canceled the oral argument and decides the instant motion on the papers. (Dkt. No. 59.)

II. Discussion

A. Standard of Review

1. General Standards

“On a Rule 12(b)(6) motion to dismiss a complaint, the court must accept a plaintiff's factual allegations as true and draw all reasonable inferences in [the plaintiff's] favor.” Gonzalez v. Caballero, 572 F.Supp.2d 463, 466 (S.D.N.Y.2008); see also Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir.2008) (“We review de novo a district court's dismissal of a complaint pursuant to Rule 12(b)(6), accepting all factual allegations in the complaint and drawing all reasonable inferences in the plaintiff's favor.” (internal quotation marks omitted)). Furthermore, when considering a motion to dismiss a pro se complaint, the court must interpret the complaint liberally to raise the strongest arguments that the allegations suggest. See Cruz v. Gomez, 202 F.3d 593, 597 (2d Cir.2000) (internal citations omitted); see also Hughes v. Rowe, 449 U.S. 5, 9, 101 S.Ct. 173, 66 L.Ed.2d 163 (1980) (internal citations omitted) (noting that courts should hold pro se pleadings “to less stringent standards than formal pleadings drafted by lawyers”).

However, mere “conclusions of law or unwarranted deductions” need not be accepted. First Nationwide Bank v. Gelt Funding Corp., 27 F.3d 763, 771 (2d Cir.1994). Similarly, the Court “need not feel constrained to accept as truth conflicting pleadings that make no sense, or that would render a claim incoherent, or that are contradicted either by statements in the complaint itself or by documents upon which its pleadings rely.” Rieger v. Drabinsky (In re Livent, Inc. Noteholders Sec. Litig.), 151 F.Supp.2d 371, 405 (S.D.N.Y.2001); see also Hirsch v. Arthur Andersen & Co., 72 F.3d 1085, 1095 (2d Cir.1995) (sustaining dismissal of the complaint where “attenuated allegations” supporting a claim were “contradicted both by more specific allegations in the complaint and by facts of which [the court] may take judicial notice”); Am. Centennial Ins. Co. v. Seguros La Republica, S.A., No. 91-CV-1235, 1996 WL 304436, at *16 (S.D.N.Y. June 5, 1996) (“Allegations are not well pleaded if they are made indefinite or erroneous by other allegations in the same complaint ....” (internal quotation marks omitted)). Put more broadly, the “standard to govern the sufficiency of the complaint presumes ‘well-pleaded’ allegations, and it is only those pleadings the courts are charged to deem true.” ³ In re Livent, 151 F.Supp.2d at 405.

Here, the Court is faced with factual assertions by Plaintiffs that are often facially contradictory, making it difficult for Plaintiffs to adequately support their claims “by showing any set of facts consistent with the allegations in the complaint.” See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 563, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (emphasis added). Most troubling is Plaintiffs' repeated denials of signing the Note and Mortgage, while simultaneously stating that they kept the loan paid current and that they are entitled to assert claims that are necessarily premised on the existence of the very loan that is the subject of the Note and Mortgage. Specifically, Plaintiffs assert claims for violations of TILA, which requires a consumer credit transaction, and for breach of a mortgage contract. Because the Court is not constrained to accept these incoherent pleadings as true see In re Livent, 151 F.Supp.2d at 405, the Court construes P...