Cordner v. Specialized Loan Servicing, LLC
| Decision Date | 07 July 2016 |
| Docket Number | CIVIL ACTION FILE NO. 1:15-CV-2090-TWT-JFK |
| Parties | LANA CORDNER, and SELBY CORDNER, Plaintiffs, v. SPECIALIZED LOAN SERVICING, LLC, AMERICA'S WHOLESALE LENDER, BANK OF AMERICA, N.A., MORTGAGE ELECTRONIC REGISTRATION SYSTEM, INC., MCCALLA RAYMER, LLC, INVITATION HOMES, IH5 PROPERTY GEORGIA, L.P., THE BANK OF NEW YORK MELLON, DONALD R. HICKS, SHERRY NIKODEM, DAN ALLEN, and FIRST AMERICAN TITLE COMPANY, Defendants. |
| Court | U.S. District Court — Northern District of Georgia |
THIS MATTER is before the Court upon Motions [Docs. 7, 10, and 26] to Dismiss filed by Defendants on various grounds. Plaintiffs did not respond to any of Defendants' Motions. These matters, now ripe for disposition by the Court, are referred by the District Judge pursuant to 28 U.S.C. § 636(b)(1)(B) for Report and Recommendation.
This action arises out of the foreclosure of real property, the former residence of Plaintiffs Lana and Selby Cordner ("Cordners"), located at 464 Crested View Drive, Loganville, Georgia, 30052 ("Property"). [Doc. 1 ("Third Complaint")]. This is the third such civil action initiated by Plaintiffs in protest of foreclosure.2
On May 19, 2006, Plaintiffs obtained a loan from America's Wholesale Lender ("AWL") in the principal amount of One Hundred Fifty-Two Thousand Nine Hundred Ten and 00/100 ($152,910.00) ("Loan"). [Doc. 7-2 / Exhibit A ("Security Deed")]. In order to secure payment of the Loan, Plaintiffs executed a security deed ("Security Deed") conveying the Property to Mortgage Electronic Registration System, Inc. ("MERS") (as grantee under the security deed, and nominee for AWL), recorded onMay 25, 2006, in Deed Book 46542, page 304, in the Gwinnett County, Georgia, real property records. [Id.].
On September 20, 2011, MERS assigned all rights, title and interest in and to the Security Deed to The Bank of New York Mellon, f/k/a The Bank of New York ("BONYM"), as Trustee for the Certificate Holders of the CW ABS Inc., Asset-Backed Certificates, Series 2006-12. [Doc. 7-3 / Exhibit B ("Assignment")]. The Assignment to BONYM was recorded on the same date at Deed Book 50879, Page 121, of the Gwinnett County, Georgia, real property records. [Id.].
At some point after the Assignment to BONYM, Plaintiffs defaulted on the Loan. On or around October 25, 2013, Plaintiffs received a package from Specialized Loan Servicing, LLC, advising Plaintiffs that the mortgage was in default, that the Property would be referred for foreclosure, and that the foreclosure would be conducted by BONYM. [Third Complaint at 4, ¶ 12].
Following notice to the Cordners, and after at least one delay, a non-judicial foreclosure sale of the Property was held on June 2, 2015.3 [Doc. 26-1 at 2]. Defendant IH5 Property Georgia, L.P. ("IH5"), was the highest bidder at the foreclosure sale and purchased the Property for $120,800.00. [Doc. 26-1 at 10 /Exhibit 1]. Accordingly, BONYM, as Trustee, transferred the Property to IH5 upon purchase. [Id.].
On July 27, 2015, a Deed of Power conveying the Property from Trustee BONYM (as attorney-in-fact for Plaintiffs) to IH5 was recorded at Deed Book 53744, page 0189, in the Superior Court of Gwinnett County, Georgia. [Doc. 26 / Exhibit 1 ("Deed of Power")]. Defendant McCalla Raymer, LLC ("McCalla"), as servicer of the loan, facilitated the foreclosure sale. [Id.]. Defendant Specialized Loan Servicing, LLC ("SLS") acted as attorney-in-fact for BONYM. [Id. at 3].
On March 28, 2014, Plaintiffs Lana and Selby Cordner, acting pro se, commenced a civil suit via a filing entitled "Complaint for Permanent Injunction for Cease and Desist any and all Foreclosure Proceedings and Collection Activity, in any and every, Including Reporting any Payment Activities; and other Equitable Relief" ("First Complaint") against SLS, McCalla, AWL, BONYM, and MERS in the Superior Court of Gwinnett County, Georgia. [See Cordner, et al. v. Specialized Loan Servicing, LLC, et al., State Action No. 14-A-0-2665-2 ("First Complaint")]. Plaintiffs alleged violations of federal law such as violations of the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. § 2601, et seq., violations of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692, et seq., violations of the Truthin Lending Act ("TILA"), 15 U.S.C. § 1601, et seq., and violations of the Home Ownership and Equity Protection Act ("HOEPA"), 15 U.S.C. § 1641, et seq. [Id. at ¶¶ 87-89, 100].
On April 30, 2014, prior to service being accomplished as to the other named defendants, Defendant McCalla filed a Notice of Removal in this federal district court asserting subject matter jurisdiction based upon 28 U.S.C. §§ 1331, 1367, 1441, and 1446. See Cordner, et al. v. Specialized Loan Servicing, LLC, et al. ("Cordner I"), Civil Case No. 1:14-CV-01296-TWT [Doc. 1 at 2 n.1]. On May 7, 2014, McCalla moved to dismiss Plaintiffs' First Complaint for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. [Doc. 3]. After Plaintiffs failed to respond, McCalla's motion was granted by the presiding judge, The Honorable Thomas W. Thrash, Jr., Chief U. S. District Court Judge, Northern District of Georgia.4 [Doc. 4]. The Court stated in its ruling that "Plaintiffs' wrongful foreclosure theories have been rejected by the Courts of Georgia" and that "Plaintiffs fail to allege a plausible claim for relief against the attorneys." [Doc. 4 at 2]. On June 25, 2014, SLS and BONYM moved to dismiss all claims brought against them. [Doc. 6]. Again, Plaintiffs did not respond to the motion to dismiss. On August 6, 2014, the districtcourt granted the motion and dismissed both SLS and BONYM from the case, explaining that "Plaintiffs have no standing to contest the assignment of their mortgage and fail to state a plausible claim for relief." [Doc. 10]. The district court orders dismissing Plaintiffs' claims brought against McCalla, SLS, and BONYM did not expressly state whether dismissal was with or without prejudice.5 [Docs. 4, 10].
On October 8, 2014, Cordner I was referred to this magistrate judge for determination of any pretrial matters. [Doc. 11]. The only remaining Defendants were AWL and MERS, and neither had been served. [Doc. 11 at 3]. The undersigned noted that Plaintiffs had not taken any steps to effect service or otherwise prosecute the claim. [Doc. 11 at 2-3]. On December 4, 2014, upon a Report and Recommendation from the undersigned, Chief Judge Thrash dismissed Plaintiffs' First Complaint with prejudice for want of prosecution, Fed. R. Civ. P. 41(b) and LR 41.3(A)(3), N.D.Ga.6 [Doc. 14]. Final judgment was entered December 5, 2014. [Doc. 15].
On May 27, 2015, approximately a week before the June 2, 2015, foreclosure sale, Plaintiffs filed a second lawsuit identical to Cordner I against the exact same defendants in the Superior Court of Gwinnett County, Georgia. [See Cordner v. Specialized Loan Servicing, LLC, et al., Gwinnett Case No. 15A05823-2 ("Second Complaint")]. Plaintiffs commenced the second lawsuit via a Motion for Temporary Restraining Order and/or Preliminary Injunction requesting that the foreclosure sale of the Property be prohibited. [Doc. 2]. Defendants removed the case to this federal district court on June 26, 2015. See Cordner, et al. v. Specialized Loan Servicing, LLC, et al. ("Cordner II"), Civil Case No. 1:15-CV-2298-TWT [Doc. 1 / Exhibit A]. Plaintiffs' motion for injunctive relief was unsuccessful. [Doc. 6]. On July 2, 2015, Defendants McCalla, MERS, SLS, and BONYM moved to dismiss Plaintiffs' Second Complaint under Fed. R. Civ. P. 12(b)(6). [Doc. 4]. Defendants argued that Plaintiffs' Second Complaint was "a verbatim copy of the complaint filed in Cordner I" and, therefore, precluded by res judicata and/or collateral estoppel (issue preclusion) doctrine. [Doc. 4 at 5-10]. Plaintiffs opposed Defendants' motion and also petitioned to "quiet title" in the Property. [Docs. 8 and 9].
On September 15, 2015, Chief U.S. District Judge Thrash dismissed Cordner II based upon the doctrine of res judicata. [Doc. 13]. Judge Thrash stated succinctly,"[t]his action is virtually identical to the previous action filed by the Plaintiffs that was dismissed with prejudice by this Court." [Id. at 2].
On June 11, 2015, while Cordner II was still pending in state court, Plaintiffs commenced the instant action by filing an "Affidavit Complaint for Deprivation of Rights under 42 U.S.C. [§§] 1983, 1985, 1986, et seq." [Doc. 1 ("Third Complaint")]. In the instant suit, Plaintiffs bring claims against many of the same Defendants, including SLS, McCalla, BONYM, MERS, and AWL, while adding new parties Bank of America, N.A. ("BANA"), Donald R. Hicks ("Hicks"), Dan Allen ("Allen"), IH5 Property of Georgia, L.P. ("IH5"), Invitation Homes ("IH"), Sherry Nikodem ("Nikodem"), and First American Title Insurance Company ("First American").7 [Id.]. The enumerated causes of action within Plaintiffs' Complaint include: Vicarious Liability (Count I), Violation of the Fair Debt Collection Practices Act (Count II), Unjust Enrichment (Count III), "Set Aside Trustee's Sale" (Count IV), "Void or Cancel Trustee's Deed Upon Sale" (Count V), Mental Anguish (Count VI), Criminal Conspiracy of Theft (Count VII), Breach of Contract (Count VIII), Negligence (Count IX), Breach of Fiduciary Duty (Count X), Violations of Plaintiffs' Rights - 42 U.S.C.§ 1983 (Count XI), Denied Equal Protection under the Law - 42 U.S.C. § 1983 (Count XII), 18 U.S.C. §§ 1961-69 RICO (Count XIII), and 15 U.S.C. § 1601 TILA (Count XIV).8
Plaintiffs, claiming to be the "sole titleholders" of the Property, are residents of Gwinnett County, Georgia. [Third Complaint at 3, ¶¶ 2, 3, 6]. Plaintiffs' Third Complaint alleges that during the relevant time period, all of the Defendants conducted business in Gwinnett...
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