Melford v. Kahane & Assocs., Case No. 18-cv-60881-BLOOM/Valle

• Decision Date: 15 October 2018
• Docket Number: Case No. 18-cv-60881-BLOOM/Valle
• Parties: JUDITH MELFORD, Plaintiff, v. KAHANE AND ASSOCIATES, et. al., Defendants.
• Court: U.S. District Court — Southern District of Florida

JUDITH MELFORD, Plaintiff, v. KAHANE AND ASSOCIATES, et. al., Defendants.

Case No. 18-cv-60881-BLOOM/Valle

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA

October 15, 2018

ORDER ON MOTIONS TO DISMISS

THIS CAUSE is before the Court upon Defendants Select Portfolio Servicing Inc., Towd Point Master Funding Trust REO, and U.S. Bank Trust National Association's Joint Motion to Dismiss, ECF No. [36] and Defendant Kahane & Associates, P.A.'s Motion to Dismiss, ECF No. [37] (the "Motions"). The Court has carefully reviewed the record, the parties' briefs, and the applicable law. For the reasons that follow, the Motions are granted.

I. BACKGROUND

Plaintiff Judith Melford f/k/a Judith P. Watkins ("Plaintiff") initiated this lawsuit on April 4, 2018 against Defendants for violations of the Fair Debt Collection Practices Act ("FDCPA") and Florida Consumer Collection Practices Act ("FCCPA"), breach of contract, and malicious prosecution. The Defendants seek to dismiss the Plaintiff's claims based upon the expiration of the statute of limitations, Florida's litigation privilege, the Colorado River abstention doctrine and the failure to plead sufficient causes of action.

According to Plaintiff's Complaint, on November 19, 2007, Plaintiff entered into a loan agreement ("the Loan") with Regions Bank d/b/a Regions Mortgage. ECF No. [1] at ¶ 31. The Loan was for the purchase of and secured by a residential property where Plaintiff and her former spouse Michael P. Watkins resided. Id. at ¶ 34. On April 27, 2012, Plaintiff and Mr. Watkins entered into a loan modification agreement (the "Loan Modification") with Regions Bank, wherein Plaintiff was released from her obligations under the original Loan. Id. at ¶¶ 39-41.

On February 1, 2016, Towd Point Master Funding Trust REO ("Towd") became the successor-in-interest for the Loan. Id. at ¶ 43. U.S. Bank Trust National Association ("U.S. Bank") is the trustee of Towd and is tasked to carry out functions on its behalf. Id. at ¶ 17. Select Portfolio Servicing ("SPS") is an attorney-in-fact of Towd. Id. at ¶ 20. Kahane & Associates, P.A. ("Kahane") was retained by SPS as attorney-in-fact for Towd and U.S. Bank to attempt to collect the debt owed to Towd. Id. at ¶ 44.

On April 25, 2016, Kahane, on behalf of Towd and U.S. Bank, filed a foreclosure proceeding against Plaintiff in the Circuit Court of the 5th Judicial Circuit in and for Citrus County, Florida, Case No. 2016 CA 000336 ("State Court Action"). Id. at ¶ 45. Plaintiff waived formal process of the State Court Action complaint on April 1, 2017. Id. ¶ 50. The State Court Acton complaint alleged:

9. Defendant(s), JUDITH P. WATKINS A/K/A JUDITH PAULINE WATKINS has defaulted under the Note and Mortgage by failing to pay the January 1, 2015 payment and all subsequent payments due thereafter.

...

12. Defendant(s), JUDITH P. WATKINS A/K/A JUDITH PAULINE WATKINS, owes Plaintiff $193,794.32 that is due on the principal on the Note and Mortgage, together with interests from December 1, 2014, late charges, all costs of collection (including title search expenses for ascertaining necessary parties to this action), and reasonable attorney's fees.

On June 12, 2017, Kahane filed a motion for entry of a default in the State Court Action and on June 16, 2017, an Order of Default was entered against Plaintiff. Id. at ¶ 53. On July 14, 2017,Kahane filed a motion for summary judgment on behalf of Towd, U.S. Bank, and SPS and on July 31, 2017, Plaintiff was voluntarily dismissed from the State Court Action. Id. at ¶¶ 66, 69. Plaintiff thereafter sought and was denied recovery of her attorney's fees and costs associated with the State Court Action. Id. at ¶¶ 70-71. The order denying Plaintiff's motion for attorney's fees is currently on appeal with the Fifth District Court of Appeals. Id. at ¶ 72.

Plaintiff alleges that from June 2016 through July 2017, Plaintiff communicated to all Defendants that pursuant to the Loan Modification, Plaintiff was no longer obligated on the Loan. Id. at ¶ 55. Plaintiff further alleges that from June 2017 through July 2017, all Defendants continuously represented to Plaintiff that she was legally liable for the payment of the subject debt and continued their attempts to collect the subject debt from Plaintiff. Id. at ¶ 59.

Defendants filed the instant Motions on July 2, 2018. Plaintiff's Responses, and Defendants' Replies, timely followed. See ECF Nos. [40], [41], [46], [47].

II. LEGAL STANDARD

Rule 8 of the Federal Rules requires that a pleading contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). Although a complaint "does not need detailed factual allegations," it must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (explaining that Rule 8(a)(2)'s pleading standard "demands more than an unadorned, the defendant-unlawfully-harmed-me accusation"). In the same vein, a complaint may not rest on "'naked assertion[s]' devoid of 'further factual enhancement.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557 (alteration in original)). "Factual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555. These elements arerequired to survive a motion brought under Rule 12(b)(6) of the Federal Rules of Civil Procedure, which requests dismissal for "failure to state a claim upon which relief can be granted."

When reviewing a motion under Rule 12(b)(6), a court, as a general rule, must accept the plaintiff's allegations as true and evaluate all plausible inferences derived from those facts in favor of the plaintiff. See Miccosukee Tribe of Indians of Fla. v. S. Everglades Restoration Alliance, 304 F.3d 1076, 1084 (11th Cir. 2002); AXA Equitable Life Ins. Co. v. Infinity Fin. Grp., LLC, 608 F. Supp. 2d 1349, 1353 (S.D. Fla. 2009). However, this tenet does not apply to legal conclusions, and courts "are not bound to accept as true a legal conclusion couched as a factual allegation." Twombly, 550 U.S. at 555; see Iqbal, 556 U.S. at 678; Thaeter v. Palm Beach Cnty. Sheriff's Office, 449 F.3d 1342, 1352 (11th Cir. 2006). Moreover, "courts may infer from the factual allegations in the complaint 'obvious alternative explanations,' which suggest lawful conduct rather than the unlawful conduct the plaintiff would ask the court to infer." Am. Dental Ass'n v. Cigna Corp, 605 F.3d 1283, 1290 (11th Cir. 2010) (quoting Iqbal, 556 U.S. at 682). A court considering a Rule 12(b) motion is generally limited to the facts contained in the complaint and attached exhibits, including documents referred to in the complaint that are central to the claim. See Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 959 (11th Cir. 2009); Maxcess, Inc. v. Lucent Technologies, Inc., 433 F.3d 1337, 1340 (11th Cir. 2005) ("[A] document outside the four corners of the complaint may still be considered if it is central to the plaintiff's claims and is undisputed in terms of authenticity.") (citing Horsley v. Feldt, 304 F.3d 1125, 1135 (11th Cir. 2002)).

In addition to the Rule 8(a) plausibility pleading requirement, Rule 9(b) imposes a heightened pleading standard for claims sounding in fraud: "In alleging fraud or mistake, a partymust state with particularity the circumstances constituting fraud or mistake." Fed. R. Civ. P. 9(b). Rule 9(b) thus forces a plaintiff to "offer more than mere conjecture," U.S. ex rel. Clausen v. Laboratory Corp. of America, Inc., 290 F.3d 1301, 1313 (11th Cir. 2002), and "requires that a complaint plead facts giving rise to an inference of fraud." W. Coast Roofing & Waterproofing, Inc. v. Johns Manville, Inc., 287 Fed.Appx. 81, 86 (11th Cir. 2008). "Rule 9(b) is satisfied if the complaint sets forth (1) precisely what statements were made in what documents or oral representations or what omissions were made, and (2) the time and place of each such statement and the person responsible for making (or, in the case of omissions, not making) same, and (3) the content of such statements and the manner in which they misled the plaintiff, and (4) what the defendants obtained as a consequence of the fraud." Clausen, 290 F.3d at 1310 (quoting Ziemba v. Cascade Int'l, Inc., 256 F. 3d 1194, 1202 (11th Cir. 2001)); see also Garfield v. NDC Health Corp., 466 F. 3d 1255, 1262 (11th Cir. 2006) (Rule 9(b) requires that the complaint state the "who, what, when, where, and how" of the alleged misconduct).

The purpose of the Rule 9(b) particularity requirement is to "alert[ ] defendants to the precise misconduct with which they are charged and protect[ ] defendants against spurious charges of immoral and fraudulent behavior." Ziemba, 256 F.3d at 1202 (internal quotations omitted). "Essentially, the requirements of Rule 9(b) are satisfied if the complaint provides a reasonable delineation of the underlying acts and transactions allegedly constituting the fraud such that the defendants have fair notice of the nature of plaintiff's claim and the grounds upon which it is based." U.S. ex rel. Heater v. Holy Cross Hosp., Inc., 510 F. Supp. 2d 1027, 1033 (S.D. Fla. 2007) (quotations omitted); see also Wagner v. First Horizon Pharm. Corp., 464 F. 3d 1273, 1277 (11th Cir. 2006) ("The rule ensures that the defendant has sufficient information to formulate a defense by putting it on notice of the conduct complained of.") (quotations omitted).

III. DISCUSSION

The FDCPA seeks to remedy abusive, deceptive, and unfair debt collection practices by debt collectors against consumers, and prohibits debt collectors from using "unfair or unconscionable means to collect or attempt to collect any debt." 15 U.S.C. § 1692f; see 15 U.S.C. § 1692e; Owen v. I.C. Sys., Inc., 629 F.3d 1263, 1270 (11th Cir. 2011). Under the FDCPA, a debt collector who "fails to comply with any provision...