Fitch v. Fed. Hous. Fin. Agency

• Decision Date: 31 March 2022
• Docket Number: C. A. 18-214-JJM-PAS
• Parties: KENNETH FITCH and ESTATE OF DIANNE L. FITCH, Plaintiffs, v. FEDERAL HOUSING FINANCE AGENCY; FEDERAL NATIONAL MORTAGE ASSOCIATION; WELLS FARGO BANK, N.A.; 266 PUTNAM AVENUE, LLC; RUSHMORE LOAN MANAGEMENT SERVICES LLC; U.S. BANK NATIONAL ASSOCIATION as Trustee for RMAC TRUST, SERIES 2016-CTT, Defendants.
• Court: U.S. District Court — District of Rhode Island

KENNETH FITCH and ESTATE OF DIANNE L. FITCH, Plaintiffs, v. FEDERAL HOUSING FINANCE AGENCY; FEDERAL NATIONAL MORTAGE ASSOCIATION; WELLS FARGO BANK, N.A.; 266 PUTNAM AVENUE, LLC; RUSHMORE LOAN MANAGEMENT SERVICES LLC; U.S. BANK NATIONAL ASSOCIATION as Trustee for RMAC TRUST, SERIES 2016-CTT, Defendants.

C. A. No. 18-214-JJM-PAS

United States District Court, D. Rhode Island

March 31, 2022

ORDER

John J. McConnell, Jr. Chief Judge.

The Court has reviewed the full briefing on Defendant 266 Putnam Avenue, LLC's (“Putnam”) two Motions for Partial Summary Judgment. ECF Nos. 96, 117. The Court has also reviewed Magistrate Judge Patricia A. Sullivan's Report and Recommendation (“R&R) (ECF No. 184) and Plaintiffs' Objections (ECF Nos. 185, 188).

The Court accepts the thorough and well-reasoned R&R for the reasons stated in it. Plaintiffs' claims seeking to void the foreclosure center mainly on notice, but the Court agrees that Putnam's notices were adequate; specifically, the Default Notice that Putnam mailed to Plaintiffs strictly complied with Paragraph 22 of the Mortgage as set forth in Woel v. Christiana Tr. as Tr. for Stanwich Mortg. Loan Tr. Series 2017-17, 228 A.3d 339 (R.I. 2020); the Foreclosure Notice was not sent prematurely; other notices, including the Notice of Mediation, were properly addressed because Kenneth Fitch was undisputedly not the Borrower. Moreover, Fannie Mae had standing to foreclose.

The Court also agrees that Plaintiffs' constitutional due process claim in Count I fails because the First Circuit Court of Appeals recently determined that Fannie Mae is not a government actor. Montilla v. Fed. Nat'l Mortg Ass'n, 999 F.3d 751 (1st Cir. 2021), cert denied sub nom. Monti la v. Fannie Mae No. 21-688, 2022 WL 827863 (U.S. Mar. 21, 2022).

In objecting to the R&R, Plaintiffs argue that applying Montilla and dismissing the constitutional claim deprives the Court of jurisdiction as no federal claims remain in the case and the parties are not diverse. Plaintiffs argue that the R&R errs by failing to consider the jurisdictional issue and urge the Court to dismiss the case for lack of jurisdiction. The Court declines to do so. “[O]nce [] supplemental jurisdiction has attached, the mere fact that the anchoring federal claim subsequently goes up in smoke does not, without more, doom all pendent state-law claims.” Lawless v. Steward Health Care Sys., LLC, 894 F.3d 9, 19 (1st Cir. 2018) (citing Rodriguez v. Doral Mortg. Corp., 57 F.3d 1168, 1177 (1st Cir. 1995); 28 U.S.C. § 1367(a), (c)). The Court considers “‘judicial economy, convenience fairness, and comity'” in deciding whether to exercise pendant jurisdiction. Lawless, 894 F.3d at 20 (quoting Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 n.7 (1988)). ...