Johnson v. Long Beach Mortgage Loan Trust 2001-4, No. CIV.A 05-0644(CKK).
| Court | U.S. District Court — District of Columbia |
| Writing for the Court | Kollar-Kotelly |
| Citation | 451 F.Supp.2d 16 |
| Parties | Viola JOHNSON, and Kevin R. McCarthy, Trustee for the Estate of Viola Johnson, Plaintiffs, v. LONG BEACH MORTGAGE LOAN TRUST 2001-4, et al., Defendants. |
| Docket Number | No. CIV.A 05-0644(CKK). |
| Decision Date | 04 August 2006 |
Kevin R. McCarthy, Trustee for the Estate of Viola Johnson, Plaintiffs,
v.
LONG BEACH MORTGAGE LOAN TRUST 2001-4, et al., Defendants.
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Thomas C. Willcox, Washington, DC, for Plaintiffs.
Catherine Anne Bledsoe, Gordon, Feinblatt, Rothman, Hoffberger & Hollander Litigation, Sedica Sawez, Gerald J. Gaeng, Rosenberg Martin Funk Greenberg LLP, Baltimore, MD, for Defendants.
KOLLAR-KOTELLY, District Judge.
Plaintiff Viola Johnson, an elderly District of Columbia retiree, together with the trustee of her bankruptcy estate (collectively "Plaintiff'), bring the above-captioned action against a mortgage broker, two lenders, and several related entities who sold her two home loans, alleging inter alia that the companies took advantage of her age and lack of sophistication to charge excessive fees while failing to make mandatory disclosures under the Truth in Lending Act ("TILA"). Plaintiff seeks rescission of the loans, restitution, and damages under several legal theories. See Compl. ¶¶33-38 (Count I—Violations of the District of Columbia Consumer Protection Act) ("DCCPA"), ¶¶ 39-45 (Count II—Common Law Fraud), ¶¶ 46-52 (Count III—Unconscionability), ¶¶ 53-61 (Count IV—Violation of the Usury Statute), ¶¶ 62-69 (Count V—Violations of D.C. MLBA), ¶¶ 70-76 (Count VI—Breach of Fiduciary Duty), ¶¶ 77-82 (Count VII— Conspiracy), ¶¶ 83-87 (Count. VIII—Aiding & Abetting the Deception of Ms. Johnson), ¶¶ 88-93 (Count IX—Negligence),
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¶¶ 94-103 (Count X—Negligent Supervision), ¶¶ 04-107 (Count XI—TILA Violations), ¶¶ 08-115 (Count XII—Declaratory Relief of a Valid Rescission Under TILA), ¶¶ 116-119 (Count XIII—Derivative Claims Against Washington Mutual). See infra at 23-24 (Table 1).
In response to Plaintiffs Complaint Defendants EquiCredit Corporation of Maryland and EquiCredit Corporation of the District of Columbia filed a[4] Motion to Dismiss, and Defendants Long Beach Mortgage Company, Long Beach Mortgage Loan Trust 2001-4, and Washington Mutual jointly filed a[8] Motion to Dismiss ( [4] and [8] are collectively referred to as "Defendants' Motions to Dismiss"), followed by Plaintiffs collective Opposition and Defendants' Replies. Upon consideration of the filings before the Court, the attached exhibits, the relevant case law, and the entire record herein, the Court shall grant Defendants' Motions to Dismiss with respect to Count IV and Count XI, grant-in-part and deny-in-part Defendants' Motions to Dismiss with respect to Counts XII and XIII, and deny Defendants' Motions to Dismiss with respect to the remaining Counts.1 The Court further holds that it may exercise personal jurisdiction over Defendant Long Beach Mortgage Loan Trust 2001-4 ("the Trust"). The Court's disposition is summarized infra at 24-25 and 55-56 (Table 2).
Table of Contents
Summary Tables: Counts, Disposition, and Dates ........................................... 23
Table 1: Plaintiffs Counts ............................................................... 23
Table 2: The Court's Disposition ......................................................... 24
Table 3: Important Dates ................................................................. 25
I: BACKGROUND ............................................................................ 25
II: LEGAL STANDARDS ...................................................................... 27
III: DISCUSSION .......................................................................... 27
A. Defendant Long Beach Mortgage Loan Trust 2001-4's Motion to Dismiss
for Lack of Personal Jurisdiction .............................................. 27
1. Legal Standards for Exercise of Personal Jurisdiction ......................... 28
2. Personal Jurisdiction Over Long Beach Mortgage Loan Trust 2001-4 .............. 29
(a) The Trust's Contacts With the District of Columbia Related to the
Controversy Sub Judice ................................................... 29
(b) The Trust's First Contact: Holding a Security Interest in the Ms.
Johnson's Property ....................................................... 30
(c) The Trust's Second Contact: Taking Assignment of Ms.
Johnson's Mortgage Note .................................................. 31
(d) Discussion of Relevant Cases from Other Jurisdictions ..................... 32
B. Plaintiffs Fraud and Negligent Supervision Claims Against Long Beach
Mortgage Company ............................................................... 34
C. Plaintiffs Unconscionability Claims .............................................. 35
1. Plaintiffs Claim of Unconscionability Under D.C.Code § 28:2-302 .......... 35
2. Plaintiffs Claim of Unconscionability Under the Common Law .................... 35
3. Plaintiffs Claim of Unconscionability Under D.C.Code § 28-3904(r) ........ 37
D. Statutes of Limitations .......................................................... 38
1. TILA Claims ................................................................... 39
(a) Civil liability under TILA ................................................ 39
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(b) Declaration of a Valid Rescission ......................................... 40
2. Dates of Accrual of Plaintiffs D.C. Claims .................................... 41
(a) Accrual of a Cause of Action Under the Discovery Rule ..................... 41
(b) The Importance of Mortgage USA's Alleged Fiduciary Duty to
Ms. Johnson ............................................................. 44
(c) Matters outside the pleadings ............................................. 46
3. D.C. Claims—applicable statutes of limitations .......................... 47
(a) Plaintiffs Usury Statute Claims ........................................... 47
(b) Plaintiffs Other D.C. Claims .............................................. 48
(c) The Intertwining Doctrine ................................................. 48
4. Plaintiff's arguments for tolling applicable statutes of limitations .......... 49
(a) Bankruptcy ................................................................ 50
(b) Damages and Rescission in Recoupment Under TILA ........................... 50
(c) Equitable Tolling ......................................................... 51
E. Plaintiffs Derivative Claims Pursuant to D.C.Code §§ 28-3808 and 28-3809,
and 16 C.F.R. § 433 ............................................................. 53
1. Plaintiffs Derivative Claims Against Washington Mutual Pursuant to
D.C.Code § 28-3808 .......................................................... 53
2. Plaintiffs Derivative Claims Against Washington Mutual and Long
Beach Mortgage Company Pursuant to D.C.Code § 28-3809 ....................... 54
3. Plaintiffs Derivative Claims Against Washington Mutual and/or Long
Beach Mortgage Loan Trust 2001-4 Pursuant to 16 C.F.R. § 433.2 .............. 54
Table 2: The Court's Disposition ......................................................... 55
IV: CONCLUSION ........................................................................... 56
Summary Tables: Counts, Disposition, and Dates
Table 1: Plaintiffs Counts
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Compl.
Count Title Defendant(s) ¶¶
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I Violations of the District of Columbia All Defendants 33-38
Consumer Protection Act, D.C.Code
Sections 3901 et seq.
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II Common Law Fraud Mortgage USA, 39-45
Long Beach
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III Unconscionability, D.C.Code Section Mortgage USA, 46-52
28:2-302 Long Beach,
Washington Mutual
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IV Violation of the Usury Statute Moltgage USA, 53-61
EquiCredit, Long
Beach
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V Violations of D.C. MLBA Mortgage USA 62-69
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VI Breach of Fiduciary Duty Mortgage USA 70-76
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VII Conspiracy Mortgage USA, 77-82
Long Beach
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VIII Aiding & Abetting the Deception of Mortgage USA, 83-87
Ms. Johnson Long Beach
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IX Negligence All Defendants 88-93
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X Negligent Supervision Mortgage USA, 94-103
EquiCredit, Long
Beach
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XI TILA Violations Mortgage USA, 104-107
EquiCredit, Long
Beach
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XII Declaratory Relief of a Valid Rescission EquiCredit, 108-115
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Under TILA Washington Mutual
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XIII Derivative Claims Against Washington Washington Mutual, 116-119
Mutual, All claims against all other [Long Beach]
Defendants pursuant to D.C.Code
&& 28-3808 and 3809 16 C.F.R. & 433
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Bryce v. Lawrence (In re Bryce), Case No. 09-48516
...DiVittorio v. HSBC Bank USA, N.A. (In re DiVittorio), 670 F.3d 273, 286 (1st Cir. 2012); Johnson v. Long Beach Mortg. Loan Trust 2001-4, 451 F.Supp.2d 16, 51 (D.D.C. 2006) (noting that 15 U.S.C. § 1635(i)(3) does not expand any rights under state law). The Plaintiffs have failed to point to......
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Bryce v. Lawrence (In re Bryce), Bankruptcy No. 09–48516.
...DiVittorio v. HSBC Bank USA, N.A. (In re DiVittorio), 670 F.3d 273, 286 (1st Cir.2012); Johnson v. Long Beach Mortg. Loan Trust 2001–4, 451 F.Supp.2d 16, 51 (D.D.C.2006) (noting that 15 U.S.C. § 1635(i)(3) does not expand any rights under state law). The Plaintiffs have failed to point to a......
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Briosos v. Wells Fargo Bank, No. C 10-02834 LB
...rescission737 F.Supp.2d 1026right"); In re Hunter, 400 B.R. 651, 662 (Bankr.N.D.2009); Johnson v. Long Beach Mortgage Loan Trust 2001-4, 451 F.Supp.2d 16, 39-41 (D.D.C.2006).Santos, 2009 WL 2500710, at *4 (footnote omitted). The Santos court also noted that Miguel did not address the issue ......
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U.S. Bank Nat'l Ass'n v. Manzo, No. 1–10–3115.
...15 U.S.C. § 1640(e). [See, e.g., In re Hunter, 400 B.R. 651, 662 (Bankr.N.D.Ill.2009); Johnson v. Long Beach Mortgage Loan Trust 2001–4, 451 F.Supp.2d 16, 40 (D.D.C.2006) ]”. However, none of these cases appear to dispute that to stop the ticking of the three-year clock, notice of rescissio......
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Bryce v. Lawrence (In re Bryce), Case No. 09-48516
...DiVittorio v. HSBC Bank USA, N.A. (In re DiVittorio), 670 F.3d 273, 286 (1st Cir. 2012); Johnson v. Long Beach Mortg. Loan Trust 2001-4, 451 F.Supp.2d 16, 51 (D.D.C. 2006) (noting that 15 U.S.C. § 1635(i)(3) does not expand any rights under state law). The Plaintiffs have failed to point to......
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Bryce v. Lawrence (In re Bryce), Bankruptcy No. 09–48516.
...DiVittorio v. HSBC Bank USA, N.A. (In re DiVittorio), 670 F.3d 273, 286 (1st Cir.2012); Johnson v. Long Beach Mortg. Loan Trust 2001–4, 451 F.Supp.2d 16, 51 (D.D.C.2006) (noting that 15 U.S.C. § 1635(i)(3) does not expand any rights under state law). The Plaintiffs have failed to point to a......
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Briosos v. Wells Fargo Bank, No. C 10-02834 LB
...rescission737 F.Supp.2d 1026right"); In re Hunter, 400 B.R. 651, 662 (Bankr.N.D.2009); Johnson v. Long Beach Mortgage Loan Trust 2001-4, 451 F.Supp.2d 16, 39-41 (D.D.C.2006).Santos, 2009 WL 2500710, at *4 (footnote omitted). The Santos court also noted that Miguel did not address the issue ......
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U.S. Bank Nat'l Ass'n v. Manzo, No. 1–10–3115.
...15 U.S.C. § 1640(e). [See, e.g., In re Hunter, 400 B.R. 651, 662 (Bankr.N.D.Ill.2009); Johnson v. Long Beach Mortgage Loan Trust 2001–4, 451 F.Supp.2d 16, 40 (D.D.C.2006) ]”. However, none of these cases appear to dispute that to stop the ticking of the three-year clock, notice of rescissio......