Inge v. Rock Financial Corp.

• Decision Date: 26 February 2002
• Docket Number: No. 00-2003.,00-2003.
• Citation: 281 F.3d 613
• Parties: LaTonya INGE, Plaintiff, Jody Holman, on behalf of herself and all others similarly situated, Plaintiff-Appellant, v. ROCK FINANCIAL CORPORATION; d/b/a Rock Financial Corp.; d/b/a Rock Financial; d/b/a Boulder Financial; d/b/a Fresh Start Loan Center, a Division of Rock Financial; d/b/a Fresh Start Loan Center; d/b/a MoveEasy, a Michigan Corporation, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 613

281 F.3d 613

LaTonya INGE, PlaintiffJody Holman, on behalf of herself and all others similarly situated, Plaintiff-Appellant, v.ROCK FINANCIAL CORPORATION; d/b/a Rock Financial Corp.; d/b/a Rock Financial; d/b/a Boulder Financial; d/b/a Fresh Start Loan Center, a Division of Rock Financial; d/b/a Fresh Start Loan Center; d/b/a MoveEasy, a Michigan Corporation, Defendant-Appellee.

No. 00-2003.

United States Court of Appeals, Sixth Circuit.

Argued October 26, 2001.

Decided and Filed February 26, 2002.

COPYRIGHT MATERIAL OMITTED

John E. Anding(briefed), Christopher G. Hastings(argued and briefed), Drew, Cooper & Anding, Grand Rapids, MI, for Plaintiffs-Appellant.

George G. Kemsley(briefed), Bodman, Longley & Dahling LLP, Detroit, MI, James J. Walsh(argued and briefed), Bodman, Longley & Dahling LLP, Ann Arbor, MI, for Defendant-Appellee.

Before: JONES and CLAY, Circuit Judges; DOWD, District Judge.^*

OPINION

CLAY, Circuit Judge.

Plaintiff, Jody Holman, seeks our review of the district court's dismissal of her second amended complaint for failure to state a claim against Defendant, Rock Financial Corporation, under the Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1601-15, and subsequent denial of her post-dismissal request to file a third amended complaint.For the following reasons, weREVERSEthe district court's dismissal of the second amended complaint, REVERSEthe district court's denial of leave to file a third amended complaint, and REMAND.

BACKGROUND

On February 27, 1998, Plaintiff borrowed money from Defendant, a real estate lender, to refinance the purchase of her home.In making and settling the loan, Defendant assessed Plaintiff certain fees as part of Defendant's finance charge.Prior to closing the loan, Defendant disclosed some, but not all, of these fees to Plaintiff.Specifically, the HUD-1 settlement statement provided to Plaintiff at closing identified two previously undisclosed fees: a charge of $120 for "Document preparation" and a charge of $200 to the Title Office for "Settlement or closing."

On December 18, 1998, Plaintiff and non-appealing co-plaintiff, LaTonya Inge("Inge"), filed a complaint, styled as a class action, against Defendant in the Circuit Court for Kent County, Michigan, seeking damages and injunctive relief and alleging in Count I, unfair or deceptive acts or practices pursuant to Mich. Comp. Laws Ann. §§ 19.418(3)and445.903; in Count II, unauthorized practice of law; in Count III, unjust enrichment; in Count IV, innocent misrepresentation; and in Count V, negligent misrepresentation.Plaintiff and Inge attached to their complaint a good faith estimate of loan closing fees issued to Inge by Defendant, statements of actual loan settlement costs issued by Defendant to Inge and Plaintiff separately ("HUD-1" or "HUD-1A" forms), and a guide to settlement costs published by the United States Department of Housing and Urban Development("HUD").Several months later, Defendant removed the civil action to the United States District Court for the Western District of Michigan.

On September 22, 1999, Plaintiff and Inge filed an amended complaint asserting TILA claims against Defendant and attaching copies of the same materials that accompanied the complaint in the state court.On November 8, 1999, Defendant filed a motion to dismiss the amended complaint.Two weeks later, Magistrate Judge Doyle A. Rowland issued a scheduling/case management order, setting a December 1, 1999 deadline for amendments to the pleadings.Plaintiff and Inge subsequently filed a timely motion for leave to file a second amended complaint, with accompanying brief and proposed second amended complaint.Ten days later, Defendant filed a reply brief in support of its motion to dismiss the amended complaint, addressing matters raised in the proposed second amended complaint.Plaintiff and Inge filed their second amended complaint on January 7, 2000, again attaching HUD-1 documents and a guide to settlement costs by HUD.

On April 11, 2000, the district court granted Defendant's motion to dismiss the TILA claims in the second amended complaint.The district court dismissed Inge's TILA claim as time-barred pursuant to the one-year statute of limitations in 15 U.S.C. § 1640(e).¹The district court also held that Plaintiff failed to state a claim under the TILA because Plaintiff had failed to plead that the difference between Defendant's initially disclosed finance charge and the actual finance charge exceeded $100, applying the "Tolerances for accuracy" provision of 15 U.S.C. § 1605(f)(1)(A).The court then remanded Plaintiff's remaining state law claims to the Kent County Circuit Court, pursuant to the supplemental jurisdiction and removal statutes, 28 U.S.C. §§ 1367and1441(c).

Seven days later, on April 18, 2000, Plaintiff filed a motion for leave to file a third amended complaint, desiring to cure the defects in pleading identified by the district court in its order dismissing Plaintiff's TILA claim.Plaintiff accompanied the motion with a proposed third amended complaint.The third amended complaint elaborated on Plaintiff's claim that a fee assessed for "Document preparation" was not "bona fide and reasonable," citing document preparation instructions contained in Appendix A of 24 C.F.R. § 3500("Regulation X").

On July 19, 2000, the district court denied Plaintiff's motion for leave to file a third amended complaint.The district court first held that Plaintiff had failed to show "good cause" under Fed.R.Civ.P. 16(b) for modifying the December 1, 1999amendment deadline set in the scheduling order.In the alternative, the court held that even if Plaintiff's desire to cure defects in the complaint constituted good cause under Rule 16, Plaintiff had not so cured because the third amended complaint still did not satisfy the $100 tolerance.

DISCUSSION

I.APPELLATE JURISDICTION

Prior to addressing the merits of Plaintiff's appeal, we must determine our jurisdiction.SeeGen. Acquisition, Inc. v. GenCorp, Inc.,23 F.3d 1022, 1024(6th Cir.1994).Our appellate jurisdiction extends to "all final decisions of the district courts."28 U.S.C. § 1291.A district court's decision is "final" for purposes of § 1291 when it "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment."Catlin v. United States,324 U.S. 229, 233, 65 S.Ct. 631, 89 L.Ed. 911(1945).The question of appellate jurisdiction in this matter arises out of Plaintiff's notice of appeal, filed in the district court on August 15, 2000, wherein Plaintiff references only the district court's July 19, 2000 opinion and order denying leave to file a third amended complaint.Ordinarily, the district court's denial of leave to amend does not constitute an appealable order.Soliday v. Miami County, Ohio,55 F.3d 1158, 1165(6th Cir.1995)(citingCaldwell v. Moore,968 F.2d 595, 598(6th Cir.1992)).Defendant argues that if any order of the district court should be considered final for purposes of authorizing this appeal, it is the district court's opinion and order dismissing Plaintiff's second amended complaint on April 11, 2000.Because Plaintiff did not take an appeal from the April 11, 2000 order, Defendant argues that we should dismiss this appeal on jurisdictional grounds.

We disagree with Defendant's jurisdictional argument.A timely motion to alter or amend judgment brought pursuant to Fed.R.Civ.P. 59(e) tolls the thirty-day deadline for filing a notice of appeal during the pendency of the motion to alter or amend.SeeFed. R.App. P. 4(a)(4).Rule 59(e) imposes its own ten-day deadline for a motion to alter or amend.When a party files a motion to reconsider a final order or judgment within ten days of entry, we will generally consider the motion to be brought pursuant to Rule 59(e).Cockrel v. Shelby County Sch. Dist.,270 F.3d 1036, 1047(6th Cir.2001);Vance ex rel. Hammons v. United States,90 F.3d 1145, 1148 n. 2(6th Cir.1996).

Here, seven days after entry of the district court's order dismissing her second amended complaint, Plaintiff filed her motion to file a third amended complaint.Plaintiff's April 18, 2000 motion makes no mention of Rule 59(e) and does not facially purport to be a "motion for reconsideration" of the dismissal order; rather, Plaintiff references only Fed.R.Civ.P. 15, and requests leave to file an amended pleading.Despite the styling of Plaintiff's April 18, 2000 motion, we construe the motion as a timely-filed motion to alter or amend the April 11, 2000 dismissal order.SeeTrotter v. Regents of Univ. of N.M.,219 F.3d 1179, 1183(10th Cir.2000);Widell v. Wolf,43 F.3d 1150, 1151(7th Cir.1994);Bodin v. Gulf Oil Corp.,877 F.2d 438, 440(5th Cir.1989).Had the district court granted Plaintiff's motion and permitted her to file an amended complaint, it "would have had to set aside and vacate its dismissal order" of April 11, 2000.Quartana v. Utterback,789 F.2d 1297, 1300-01(8th Cir.1986).The district court's July 19, 2000 opinion and order denying Plaintiff leave to amend a third time therefore triggered the period for filing her notice of appeal, and Plaintiff timely filed her notice of appeal on August 15, 2000.Seeid. at 1301;Trotter,219 F.3d at 1183;see alsoBrown v. Local 58, Int'l Bhd. of Elec. Workers, AFL-CIO,76 F.3d 762, 768-69(6th Cir.1996)(construing post-dismissal motion to "enter an alternative order" as a Rule 59(e) motion, although the motion did not name Rule 59(e) and sought vacation of dismissal order, rather than a separately entered judgment pursuant to Rule 58);Smith v. Hudson,600 F.2d 60, 62(6th Cir.1979)(explaining that district courts can properly consider Rule 59(e) motions that precede entry of judgment pursuant to Rule 58 and that "a motion which asks a court to vacate and reconsider, or even to reverse its prior holding, may properly be treated under Rule 59(e) as a motion to alter or amend a judgment")(...