Kline v. Mortg. Elec. Registration Sys., Inc.
| Decision Date | 01 August 2017 |
| Docket Number | Case No. 16-3932 |
| Parties | EUGENE KLINE, et al., Plaintiffs-Appellants, v. MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., et al., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Sixth Circuit |
NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
When Eugene Kline twice defaulted on loans secured by two mortgages on his home, the holders of these loans brought foreclosure actions against him. After paying off his debts, Kline and co-plaintiffs brought a putative class action suit against various entities involved with the foreclosure actions, alleging that these entities charged them improper fees in connection with the foreclosures. For the reasons discussed below, we AFFIRM the district court's judgment in all respects.
In 2004, Kline entered into two loan transactions with WMC Mortgage Corporation ("WMC"): (1) a promissory note for $160,000 secured by a mortgage on his home, and (2) a promissory note for $30,000 secured by a second mortgage on his home. WMC assigned Kline's loans to Merrill Lynch Mortgage Investors, Inc., which deposited the notes into trusts of residential mortgage-backed securities (collectively, "the Trust").
In 2005, after Kline fell behind on payments, the Reimer Firm filed a foreclosure action against Kline that identified the plaintiff as "Mortgage Electronic Registration Systems, Inc., [("MERS")] c/o HomEq Servicing Corporation." Summ. J. Decision, ECF No. 492, Page ID 8864. Shortly thereafter, Wachovia Bank, N.A., sold HomEq, the loan servicer, to Barclays Capital Real Estate, Inc., which then assumed the servicing of Kline's loans. Kline was able to cure the default, and in 2007, he brought suit against HomEq and Reimer alleging that they illegally and improperly charged him certain fees. The court dismissed the case as untimely.
In 2007, after Kline defaulted on his loans again, Reimer again filed a foreclosure action, this time identifying the plaintiff as "Wells Fargo, N.A. as Trustee c/o HomEq Servicing Corporation." Id. at 8865. Ten days later, MERS assigned the loans to Wells Fargo. The Lerner Firm filed an answer on behalf of MERS asserting an interest in the Balloon Note secured by the second mortgage. Reimer sent Kenneth Wegner, Kline's attorney, a letter stating the payoff and reinstatement quotes for both mortgages. Two months later, Wegner sent letters to Reimer and Lerner requesting a payoff amount. Both firms responded with estimates. Wegner then sent letters to both firms requesting a more detailed itemization of the fees. Both firms responded with itemized costs, including those incurred during the litigation. Kline sold his home and paid off both loans in November 2007.
On November 10, 2008, Kline and co-plaintiffs1 filed a putative class action suit against Defendants, many of whom are no longer parties to this litigation, arising out of the fees and costs Defendants charged them when they paid off their loans. Kline filed an amended complaint on April 14, 2010, alleging that (1) Reimer, Lerner, and MERS violated the Fair DebtCollection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692e, 1692f; (2) MERS, Barclays, Wells Fargo,2 and WMC violated the Truth in Lending Act ("TILA"); (3) all Defendants violated section 1345.01 of the Ohio Consumer Sales Practices Act, ("OCSPA"); (4) all Defendants were unjustly enriched in violation of Ohio law; and (5) all Defendants breached a contract in violation of Ohio law. We resolve only those claims preserved for appellate review.
On March 27, 2015, Reimer, Lerner, Wells Fargo, Barclays, and MERS moved for summary judgment. On April 10, 2015, while the time for Kline to respond was pending, Kline faxed to the court a letter requesting a status conference and asserting a right to additional discovery before he responded to Defendants' summary judgment motions, reasoning that recent discovery responses had uncovered issues that necessitated additional discovery. However, this letter was not filed with the Clerk, and no certificate of service was filed with it to indicate that it was served on Defendants. On May 7, 2015, Kline filed a letter with the court making substantially the same claims. While Kline was sending letters to the court, the deadline to respond to Defendants' motions for summary judgment apparently came and went without response from Kline, so Defendants requested via email that the court grant their motions based on Kline's failure to timely respond. The district court denied Defendants' request, allowing Kline additional time to respond. After Kline filed memoranda in opposition to the motions, on December 23, 2015, the district court granted Defendants' motions for summary judgment.
Kline was required to file a motion for class certification by June 9, 2015, but again missed the deadline. Accordingly, Defendants filed a joint motion to strike and dismiss Kline's class allegations for failure to file a class certification brief. Kline responded, insisting that his April 10, 2015 and May 7, 2015 letters constituted requests for extensions. In a decision dated September 25, 2015, the district court construed these letters as requests to reopen discovery anddenied the requests, concluding that Kline failed to justify additional discovery. Then, it granted Defendants' motion to strike, concluding that Kline disregarded the district court's admonitions regarding the deadline to file the class certification motion and that there was not good cause for the delay.
Next, on December 21, 2015, Kline moved for leave to file a second amended complaint, seeking to add RICO and fraud claims based on "new evidence" that Defendants made misrepresentations during the foreclosure actions and during the instant litigation. On December 23, 2015, the district court, observing that Kline alleged facts to support these additional claims in his original complaint, denied Kline's motion, citing undue delay and futility of amendment as reasons.
Finally, on January 20, 2016, and January 28, 2016, respectively, Kline moved for reconsideration of the district court's rulings on Defendants' motions for summary judgment and Kline's motion to amend and moved for relief from the district court's orders granting summary judgment to Defendants, denying his motion to amend, and striking class allegations from the complaint. On July 18, 2016, the district court denied Kline's post-judgment motions. On August 12, 2016, Kline filed a timely notice of appeal.
As an initial matter, Defendants contend that Kline's notice of appeal is insufficient to confer jurisdiction over all of the claims Kline raises in his briefs on appeal. Kline's notice of appeal stated that he appealed:
from the Order dated July 18, 2016, denying Plaintiff's Motion for Reconsideration of the District Court's Orders (i) dated September 25, 2015 striking the class allegations from the Complaint; (ii) dated December 23, 2015, granting Defendants' motions for summary judgement; and (iii) dated December 23, 2015, denying plaintiff's motion to file an amended complaint.
Notice of Appeal 1, ECF No. 514, Page ID 9401. He attached to the notice the district court's July 18 order. One could construe this to mean that Kline sought to appeal only the motion for reconsideration of the three enumerated orders, rather than the underlying decisions and the motion for relief from judgment, which is the interpretation Defendants urge the court to adopt.
This court "has jurisdiction only over the areas of a judgment specified in the notice of appeal as being appealed," but the notice of appeal should be given liberal construction. JGR, Inc. v. Thomasville Furniture Indus., Inc., 550 F.3d 529, 532 (6th Cir. 2008) (citing Smith v. Barry, 502 U.S. 244, 248 (1992)). "[A] notice of appeal that names only a post-judgment decision may extend to the judgment itself if it can be reasonably inferred from the notice of appeal that the intent of the appellant was to appeal from the final judgment and it also appears that the appellee has not been misled." United States v. Grenier, 513 F.3d 632, 635 (6th Cir. 2008) (quoting Harris v. United States 170 F.3d 607, 608 (6th Cir. 1999)). This intent may be inferred from briefs and other filings. Id. Kline's initial brief on appeal makes clear that he challenges (1) the district court's entry of summary judgment in Defendants' favor; (2) the district court's denial of Kline's Rule 60 motion for relief from judgment;3 (3) the district court's decision to strike Kline's class allegations; and (4) the court's denial of Kline's motion to amend his complaint. This was more than sufficient to place Defendants on notice of the district court decisions at issue, see id., as indicated by the fact that Defendants respond to all of these issues in their briefs. Accordingly, we address each of Kline's claims of error in turn.
We review a district court's grant of summary judgment de novo. Jackson v. VHS Detroit Receiving Hosp., Inc., 814 F.3d 769, 775 (6th Cir. 2016). Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A dispute is "genuine" "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Ford v. Gen. Motors Corp., 305 F.3d 545, 551 (6th Cir. 2002) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The moving party bears the initial burden of establishing that there are no genuine issues of material facts, which it may accomplish "by demonstrating that the nonmoving party lacks evidence to support an essential element of its case." Id. (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)). In response, the nonmoving party must present ...
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