Glenn v. Wells Fargo Bank, N.A.

• Decision Date: 26 January 2017
• Docket Number: Civil Action No. PX 15-3058
• Parties: MAURICE GLENN, Plaintiff, v. WELLS FARGO BANK, N.A., Defendant.
• Court: U.S. District Court — District of Maryland

MAURICE GLENN, Plaintiff,
v.
WELLS FARGO BANK, N.A., Defendant.

Civil Action No. PX 15-3058

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND

January 26, 2017

MEMORANDUM OPINION

This is Plaintiff's second attempt to survive Defendant's challenge to the sufficiency of his Complaint. Because Plaintiff's Amended Complaint has done little to address the deficiencies that the Court identified in dismissing this action originally, many of Plaintiff's counts will suffer the same fate here. One critical difference, however, is that Plaintiff's Amended Complaint for the first time identified allegations stemming from a specific business account that Plaintiff held with Defendant, the terms of which compel arbitration for those claims. As to the claims related to Plaintiff's business account, the Court grants Defendant's Motion to Dismiss because they are arbitrable (ECF No. 31). As to Plaintiff's non-arbitrable claims, the Court grants Defendant's Motion to Dismiss for failure to state a claim (ECF No. 31). The Court also denies as moot Defendant's Motion to Strike (ECF No. 35), grants Plaintiff's motion for an extension of time to file supplemental exhibits (ECF No. 33), and denies Plaintiff's motion for leave to file a surreply (ECF No. 38).

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I. BACKGROUND

A. Factual Background¹

Plaintiff Maurice Glenn ("Plaintiff"), who is African-American, banked with Wachovia Bank, N.A. ("Wachovia") before it merged with Defendant Wells Fargo Bank, N.A. ("Defendant" or "Wells Fargo") in December 2008. Plaintiff maintained two accounts with Wells Fargo—a business line of credit and a mortgage loan.² ECF No. 25 at 3. With regard to Wachovia, Plaintiff obtained his business line of credit on May 29, 2007. ECF No. 25 at 3; ECF No. 31-3 at 1-8. The 2007 Wachovia loan agreement provided for an interest rate "at a per annum rate equal to the prime rate published in the 'Money Rates' section of the Eastern edition of The Wall Street Journal (the 'WSJ Prime Rate') plus a margin of 1.10%." ECF No. 31-3 at 2; ECF No. 25 at 4. Plaintiff alleges that despite the 3.25% interest rate associated with the line of credit, he was allegedly charged an increased interest rate of 7.25% without notification and "in stark violation of his original contract." ECF No. 25 at 5. Plaintiff contends Wells Fargo has also never refunded Plaintiff the money paid in excess of the agreed upon interest as required by the 2007 Wachovia credit agreement. ECF No. 25 at 4-5.This same 2007 Wachovia loan agreement contains an arbitration provision. ECF No. 31-3 at 5.

In 2010, Plaintiff signed a Wells Fargo BusinessLine Authorization Form ("the Authorization Form"), converting his account from Wachovia to a Wells Fargo BusinessLine

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account. ECF No. 31-3 at 9-10; ECF No. 34-2.³ The authorization form states that the signatory has "read and agree[s] with the Terms and Conditions on the reverse side of the Authorization Form." ECF No. 31-3 at 9; ECF No. 34-2 at 1. The "Terms and Conditions" include a provision requiring arbitration upon demand of any party in:

. . . any action, dispute, claim or controversy of any kind, whether in contract or in tort, statutory or common law, legal or equitable, or otherwise, now existing or hereafter arising between the parties in any way arising out of, pertaining to or in connection with (1) any agreement, document or instrument to which this Arbitration Program is attached or in which it appears or is referenced, or any related agreements, documents or instruments . . .; (2) all past, present, or future loans, lines of credit, notes, instruments, drafts, credits, accounts, deposit accounts, safe deposit boxes, safekeeping agreements, guarantees, letters of credit, goods or services, or other transactions, contracts or agreements of any kind whatsoever; (3) any past, present or future incidents, omissions, acts, errors, practices, or occurrences causing injury to either party where the other party or its agents, employees or representatives may be liable, in whole or in part . . . .

ECF No. 31-3 at 12.

The 2010 BusinessLine Customer Agreement also contained a provision for amending the contract:

[The Wells Fargo] Bank may unilaterally change any of the terms of any of Customer's Accounts at Bank's sole discretion at any time. Bank will provide Customer with such notice as is required by law, by mailing such notice to Customer at the latest address shown in Bank's records. If Customer has elected to receive statements electronically, notices may be delivered to Customer electronically in the same manner that statements are delivered. Subject to applicable law and provided Bank does not notify Customer otherwise, any changes will apply to the current balance of its Accounts as well as to future balances.

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The 2010 BusinessLine Customer Agreement further explained that "that use of any feature of the BusinessLine account or BusinessLine® MasterCard® card may be used as evidence of the foregoing authorizations, acceptances and agreements." ECF No. 31-2 at 10.

According to the Defendant, Wells Fargo then amended the contract governing the business account in an updated BusinessLine Customer Agreement, effective June 1, 2011 (the "2011 BusinessLine Customer Agreement"). ECF No. 31-3 at 16; ECF No. 36 at 11. The amendment also contained an arbitration provision identical to the provision in the 2010 BusinessLine Authorization Form. Compare ECF No. 31-3 at 11-12 (provision from 2010 agreement), with ECF No. 31-3 at 15 (provision from 2011 agreement).

Plaintiff alleges that between 2012 and 2014, Defendant denied Plaintiff's eleven lending applications based solely on his race. Specifically, the applications are:

• A July 30, 2012 credit application denied on August 15, 2012. ECF No. 25 at 11-12.
• A March 5, 2013 "mortgage refinance" or "loan consolidation" application denied on March 13, 2013. ECF No. 25 at 14.
• An April 29, 2013 or May 14, 2013 "reopened" mortgage refinance or fixed mortgage application denied after May 2013. ECF No. 25 at 15-16.
• A November 25, 2013, HAMP modification application denied on December 24, 2013. ECF No. 25 at 7.
• A December 9, 2013 rate decrease application for his business line of credit denied on December 13, 2013. ECF No. 25 at 10.
• A December 23, 2013 rate decrease application for his business line of credit denied on December 24, 2013. ECF No. 25 at 11.
• A January 29, 2014 HAMP modification application denied on February 7, 2014. ECF No. 25 at 7.⁴
• A February 13, 2014 application for an unknown type of loan. ECF No. 25 at 20.
• A February 20, 2014 mortgage refinance application denied in April of 2014. ECF No. 25 at 21.

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• A November 2014 mortgage refinance application denied on December 30, 2014. ECF No. 25 at 21-23.
• A July 2, 2015 HAMP modification application denied on July 7, 2015. ECF No. 25 at 8-9.

For each, Plaintiff baldly asserts that he was denied the above-described benefits because of his race but offers no detail as to whether he was qualified to obtain the benefits he sought or why his denial was race based. ECF No. 25 at 7-12, 14-16, 21-23. Only one of the above alleged denials does Plaintiff aver that a particular bank representative, Geetesh Kapoor, reacted negatively upon hearing that Plaintiff is African-American. ECF No. 25 at 13-14.⁵ Notably, however, Plaintiff included the identical averments in his original complaint that has been deemed insufficient as a matter of law. See ECF No. 23 at 16.

Plaintiff also alleges in his Amended Complaint, as he did in his original Complaint, that he complained to United States Senator Benjamin Cardin, which Senator Cardin's Office then forwarded to Wells Fargo's Home Mortgage Office of Executive Complaints. ECF No. 25 at 15. As a result, Plaintiff contends that he was denied conversion of a business line of credit and a

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home equity loan "in retaliation for Plaintiff having filed a credit discrimination complaint against Wells Fargo with the office of Senator Cardin." ECF No. 25 at 16.

Then, on June 28, 2013, Glenn filed a complaint against Wells Fargo with the Consumer Financial Protection Bureau ("CFPB") concerning one of his mortgage refinance applications. ECF No. 25 at 17. He also claims that he was denied participation in the Home Affordable Modification Program ("HAMP") and an interest rate decrease on his business line of credit in retaliation for the complaints to the CFPB and Senator Cardin. ECF No. 25 at 18-19.

Plaintiff lodged a complaint with the Office of the Comptroller of the Currency ("OCC") regarding Defendant's denial of his 2013 HAMP application. ECF No. 25 at 19. Once again, Plaintiff claims that his home mortgage refinance application was initially approved, but then Wells Fargo rescinded this approval in retaliation for his various government complaints. ECF No. 25 at 23.

B. Procedural History

Plaintiff initiated this action against Defendant on October 10, 2015. On November 9, 2015, Defendant moved to dismiss the complaint for failure to state a claim under Fed. R. Civ. P. 12(b)(6). ECF No. 11. On July 1, 2016, the Court granted Defendant's motion without prejudice and with leave to file an Amended Complaint. ECF No. 24; see Glenn v. Wells Fargo Bank, N.A., No. CV DKC 15-3058, 2016 WL 3570274 (D. Md. July 1, 2016). Plaintiff then filed an Amended Complaint. ECF No. 25.

The Amended Complaint asserts the identical claims brought in his initial complaint: violations of the Federal Equal Credit Opportunity Act ("ECOA") 15 U.S.C.§ 1691 (Count I); the Maryland Equal Credit Opportunity Act ("MECOA"), Md. Code Ann., Com. Law § 12-701 et seq. (Count II); the Fair Housing Act ("FHA"), 42 U.S.C. § 3601 et seq. (Count III); Title VI

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of the Civil Rights Act of 1964 ("Title VI"), 42 U.S.C. § 2000d et seq. (Count IV); and Retaliation under Title VI of the Civil Rights Act of 1964 (Count V); and breach of contract (Count VI).

Defendant moves to dismiss all claims related to Plaintiff's business...