NEEDREPLACE

• Citation: 7 F.Supp.3d 468
• Decision Date: 25 March 2014
• Docket Number: Civil Action No. 10–7057.
• Parties: Megan MACAULEY, Plaintiff, v. ESTATE OF Frank C. NICHOLAS et al., Defendants.
• Court: New York District Court

7 F.Supp.3d 468

Megan MACAULEY, Plaintiff,

v.ESTATE OF Frank C. NICHOLAS et al., Defendants.

Civil Action No. 10–7057.

United States District Court, E.D. Pennsylvania.

Signed March 25, 2014

Motions granted. A. Victor Meitner, Jr., Patrick J. McMonagle, A. Victor Meitner, Jr., P.C., Blue Bell, PA, for Plaintiff.

Scott Sciarra, Collegeville, PA, pro se.

Adam G. Silverstein, Julie D. Goldstein, Fox Rothschild LLP, Warrington, PA, John I. McMahon, Jr., McMahon & McMahon, Norristown, PA, Thomas W. Hazlett, Emily J. Hanlon, Schnader Harrison Segal & Lewis LLP, Samuel E. Cohen, Marshall Dennehey Warner Coleman & Goggin, Philadelphia, PA, Blair H. Granger, David J. Scaggs, The Granger Firm, Paoli, PA, John A. Lucy, Johnson Duffie Stewart & Weidner PC, Lemoyne, PA, for Defendants.

MEMORANDUM OPINION

TUCKER, Chief Judge.

Presently before the Court are six motions for judgment on the pleadings: (1) Defendant Gateway Funding Diversified Mortgage Services, LP's Motion for Judgment on the Pleadings (Doc. 114); (2) Defendant Prudential Reddington Realtors' Motion for Judgment on the Pleadings (Do c. 115); (3) Defendant First American Title Insurance Co.'s Motion for Judgment on the Pleadings (Do c. 118); (4) Defendants Chase Abstract Co. and Steve P. Stampone's Motion for Judgment on the Pleadings (Doc. 120); (5) Defendants Estate of Frank C. Nicholas, Casey Nicholas, and Elizabeth Nicholas' Motion for Judgment on the Pleadings (Doc. 124) (“Nicholas Defendants”); and (6) Defendant Aurora Commercial Corp.'s Motion for Judgment on the Pleadings (Doc. 137).¹ Also under consideration are Plaintiff's responses in opposition to the above-referenced motions. (Docs. 116, 117, 122, 123, 125, & 138.) Upon consideration of the parties' motions with briefs and exhibits, and arguments presented at oral argument, Defendants' ² motions will be granted for the reasons set forth below. The Court will dismiss Plaintiff's federal law claims, with prejudice, and declines to exercise supplemental jurisdiction over Plaintiff's pendent state law claims.

I. Factual Background and Relevant Procedural History

A. Overview

This is a civil RICO action. Plaintiff Megan Macauley (“Macauley”) initiated this action against twenty defendants,³ including her ex-husband, Defendant Christopher Hill (“Hill”), whom Macauley alleges orchestrated a series of fraudulent real estate transactions in her name without her knowledge. Macauley contends that all the Defendants aided and abetted Hill and, as a result of the transactions, she sustained damage to her creditworthiness and reputation. The Complaint asserts twelve causes of action for violations of the Racketeer Influenced and Corrupt Organization Act (“RICO”) under 18 U.S.C. §§ 1962(a)– (d), conversion, fraud, unjust enrichment, negligence and gross negligence, breach of contract, violations of the Unfair Trade Practices and Consumer Protection Law, 73 Pa. Stat. Ann. § 201–1 et seq. , and mortgage lending claims under the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2601 et seq., the Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. § 1691 et seq., and the Home Mortgage Disclosure Act (“HMDA”), 12 U.S.C. § 2801 et seq. Macauley requests the following relief: one million dollars, interest, costs, reasonable attorneys' fees, threefold damages, and punitive damages.

B. Plaintiff's Factual Allegations⁴

Because the Court writes primarily for the parties, the Court will discuss only those alleged facts relevant to its decision. Megan Macauley and Christopher Hill met sometime in 2005 and were married on June 16, 2007. At all times relevant to the Complaint, Macauley was a teacher and Hill worked with a real estate investment group named AmGroup and later, Defendant Wasubul Investments, LLC. By October 13, 2007, Macauley and Hill were separated. The Complaint details the following fraudulent transactions.

On December 6, 2006, Macauley and Hill purchased a property located at 3248 Berry Brow Drive, Chalfont, Pennsylvania (“Berry Brow property”). The house was originally owned by Frank and Elizabeth Nicholas, the parents of Hill's friend and business associate, Defendant Casey Nicholas. Macauley alleges that Hill persuaded her to refinance her condominium, at 404 Victoria Drive, to free up cash for the purchase of the Berry Brow property. Defendant Scott Sciarra, then an employee at Defendant Gateway Funding, refinanced the condo for $192,000. Macauley received approximately $21,000 for weddings costs and a down payment on Berry Brow. The couple paid an additional $100,000 at closing. Macauley contends that Hill made her believe that the $100,000 was his and that he had deposited the money into her account to go towards the closing. However, Macauley later discovered through bank records that Casey Nicholas deposited the $100,000 into her account. Macauley further contends that the mortgage obtained for the property far exceeded its fair market value.

Also on December 6, 2006, Defendant Bear Stearns Residential Mortgage Co. approved a first mortgage for $464,250 and a second mortgage for $123,800.00 on the Berry Brow property. The appraiser was Defendant Shawn Strauss. The title company used was Aaron Abstract Co. The mortgage originator was Scott Sciarra.

Hill made several additional purchases of properties with the assistance of the above defendant companies and individuals. Macauley contends that the purchases were in her name and that she had no knowledge of any of them. These properties include:

(1) 1741 N. 27th St Philadelphia, PA (appraised by Shawn Strauss; brokered by Defendant Financial Mortgage Corp.; Defendant Chase Abstract was the title company; Defendant Steve Stampone was the title clerk and notary);

(2) 1709 N. 27th Street, Philadelphia, PA (appraised by Shawn Strauss; brokered by Financial Mortgage Corp.; Chase Abstract was the title company; Defendant First American Title Insurance provided title insurance; Steve Stampone was the title clerk and notary); and

(3) 2453 Turner Street, Philadelphia, PA (“Turner Street property”) (seller was Wasubul Investments, LLC; Chase Abstract was the title company; Bear Sterns provided the mortgage; Gateway Diversified Mortgage received a 3% origination fee).

In addition, Hill also purchased a property located at 137 Buckhill Rd., Albrightville, PA (“Buckhill Road property”) in 2005 prior to the couple's marriage and then later had the property transferred to Macauley's name without her knowledge or consent. According to the Complaint, all of the properties went into foreclosure.

Macauley contends that she did not learn of Hill's actions until after she received a notice of foreclosure on the Berry Brow property. Macauley then ran her credit report and discovered that Berry Brow was listed in her name, in addition to the Turner Street property. She also discovered unknown credit card debt, water/sewer bills and several agreements of sale that referenced Defendant Nick Yaimbilis.

As previously noted, Macauley and Hill separated on October 13, 2007. Macauley's divorce from Hill was finalized on July 10, 2008. Macauley was forced to file bankruptcy as a result of Hill's fraudulent transactions. As part of the couple's divorce settlement, Hill sold all of the properties listed in Macauley's name; however, Macauley remains liable for the deficient balance with the mortgage companies.

C. Relevant Procedural History

Macauley's Complaint was filed on December 3, 2010. A Rule 16 Conference was held in this matter on May 7, 2012. Subsequently, on May 11, 2012, the Court ordered Macauley to file a RICO Case Statement to provide additional details of her alleged RICO claims. To support the RICO Case Statement, Macauley requested to take the deposition of Hill, the alleged “ringleader” of the alleged RICO conspiracy. Pursuant to court order, Hill's multi-day deposition was completed on July 31, 2012 and Macauley filed her RICO Case Statement on September 14, 2012. (Doc. 112.)

Thereafter, the instant motions for judgment on pleadings were filed. Oral argument on the motions was subsequently held on June 12, 2013.⁵ Macauley has not filed an amended complaint in this action, so the allegations in the original Complaint remain unchanged and are supplemented by the court ordered RICO Case Statement.

II. Standard of Review

Rule 12(c) allows a party to move for judgment on the pleadings “[a]fter the pleadings are closed-but early enough not to delay trial.” Fed.R.Civ.P. 12(c). A motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) is subject to the same standard of review applicable to a motion to dismiss under Rule 12(b)(6). See Turbe v. Gov't of Virgin Islands, 938 F.2d 427, 428 (3d Cir.1991). A court may dismiss a plaintiff's complaint under Rule 12(b)(6) only when it does not state a claim for relief that is “plausible on its face.” Santiago v. Warminster Twp., 629 F.3d 121, 128 (3d Cir.2010) (quoting Sheridan v. NGK Metals Corp., 609 F.3d 239, 262 n. 27 (3d Cir.2010)). All well-pled factual allegations contained in a plaintiff's complaint must be accepted as true and must be interpreted in the light most favorable to plaintiff. Argueta v. U.S. Immigration & Customs Enforcement, 643 F.3d 60, 74 (3d Cir.2011). A complaint is plausible on its face when its factual allegations allow a court to draw a reasonable inference that a defendant is liable for the harm alleged. Santiago, 629 F.3d at 128.

To determine the sufficiency of a complaint, courts of the Third Circuit are required to perform a three-step analysis. Santiago, 629 F.3d at 130. First, a court must identify plaintiff's claims and determine the required elements of those claims. Id. Next, a court must identify, and strike, conclusory allegations contained in plaintiff's complaint. Id. Conclusory allegations are those that are no more than “an unadorned, the-defendant-unlawfully-harmed-me accusation, labels and conclusions, a formulaic...