Omrazeti v. Aurora Bank FSB
| Decision Date | 25 June 2013 |
| Docket Number | Cv. No. SA:12-CV-00730-DAE |
| Parties | KHAFRA K. OMRAZETI, Plaintiff, v. AURORA BANK FSB, AURORA LOAN SERVICES, NATIONSTAR MORTGAGE LLC, AND DEUTSCHE BANK NATIONAL TRUST COMPANY Defendants. |
| Court | U.S. District Court — Western District of Texas |
On June 5, 2013, the Court heard oral argument on the Motion to Dismiss Second Amended Complaint filed by Defendants Aurora Bank FSB, individually and as subservicer to Aurora Loan Services LLC ("Aurora"); Nationstar Mortgage LLC ("Nationstar"); and Deutsche Bank National Trust Company ("Deutsche Bank") (collectively, "Defendants"). (Doc. # 19.) Justin Opitz, Esq., appeared on behalf of Defendants. Lynda Ladymon, Esq., appeared on behalf of Plaintiff Khafra K. Omrazeti. After carefully considering the Motion, and in light of the parties' arguments at the hearing, the Court, for the reasons that follow, GRANTS Defendants' Motion to Dismiss.
In 2007, Plaintiff Khafra Omrazeti purchased two tracts of real property in Bexar County, Texas. (Doc. # 17 ("SAC") ¶ 4.) The first is located at 24610 Alamoso Falls, San Antonio, TX 78255; the second is located at 25710 Gold Yarrow, San Antonio, TX 78260. (Id. ¶¶ 4-5.) First Magnus Financial Corporation ("First Magnus") was the original lender on both mortgages. (Id.) According to the SAC, however, Defendant Aurora later claimed to be the assignee of the Deeds of Trust. (Id. ¶ 4.)
At some point (Plaintiff does not provide a date), Aurora initiated foreclosure proceedings on the two properties, and on July 2, 2012, Plaintiff brought suit against Aurora in the 438th Judicial District Court of Bexar County, Texas, seeking to enjoin the foreclosures. (Doc. # 1-1.) The state-court Petition contended that Aurora lacked standing to foreclose as a result of allegedly invalid assignments and asserted causes of action for fraud, misrepresentation, negligence, wrongful foreclosure, and to quiet title. (Id. ¶ 10-11, 13-19.)
On July 27, 2012, Aurora removed the case to this Court on the basis of diversity jurisdiction. (Doc. # 1 at 3-5.) On September 25, 2012, Aurora filed a Motion to Dismiss Plaintiff's Original Petition for failure to state a claim. (Doc. # 5.) On December 3, 2012, Plaintiff filed an Amended Complaint. (Doc. # 8.) On December 17, 2012, Aurora moved to dismiss the AmendedComplaint. (Doc. # 9.) On April 5, 2013, Plaintiff filed his Second Amended Complaint, adding Nationstar (which by that time purported to be the assignee of the deed of trust and the mortgage servicer, see SAC ¶¶ 4, 5) and Deutsche Bank as Defendants. (Doc. # 17.)
On April 19, 2013, Defendants filed a Motion to Dismiss Plaintiff's Second Amended Original Complaint. (Doc. # 19.) Plaintiff did not file a Response. Defendants' Motion to Dismiss is now before the Court.
Federal Rule of Civil Procedure 12(b)(6) authorizes dismissal of a complaint for "failure to state a claim upon which relief can be granted." Review is limited to the contents of the complaint and matters properly subject to judicial notice. See Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007). In analyzing a motion to dismiss for failure to state a claim, "[t]he court accepts 'all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff.'" In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007) (quoting Martin K. Eby Constr. Co. v. Dallas Area Rapid Transit, 369 F.3d 464, 467 (5th Cir. 2004)). To survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to drawthe reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
A complaint need not include detailed facts to survive a Rule 12(b)(6) motion to dismiss. See Twombly, 550 U.S. at 555-56. In providing grounds for relief, however, a plaintiff must do more than recite the formulaic elements of a cause of action. See id. at 556-57. "The tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions," and courts "are not bound to accept as true a legal conclusion couched as a factual allegation." Iqbal, 556 U.S. at 678 (internal quotations and citations omitted). Thus, although all reasonable inferences will be resolved in favor of the plaintiff, the plaintiff must plead "specific facts, not mere conclusory allegations." Tuchman v. DSC Commc'ns Corp., 14 F.3d 1061, 1067 (5th Cir. 1994); see also Plotkin v. IP Axess Inc., 407 F.3d 690, 696 (5th Cir. 2005) ().
When a complaint fails to adequately state a claim, such deficiency should be "exposed at the point of minimum expenditure of time and money by the parties and the court." Twombly, 550 U.S. at 558 (citation omitted). However, the plaintiff should generally be given at least one chance to amend the complaint under Rule 15(a) before dismissing the action with prejudice. Great Plains Trust Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 329 (5th Cir. 2002).
Because Plaintiff's claims are all based on his argument that Defendants obtained the Deeds of Trust and the Notes through invalid assignments, the Court begins by addressing whether Plaintiff has standing to challenge those assignments.
The original lender on Plaintiff's two mortgages was First Magnus. The Deeds of Trust named Mortgage Electronic Registration Systems ("MERS") as the beneficiary and nominee for First Magnus and granted MERS the power to foreclose and sell the property.
Now, however, Deutsche Bank claims to hold, "as trustee of a securitized trust," the Notes corresponding to Plaintiff's mortgages. (SAC ¶ 6.) Aurora, says Plaintiff, once claimed to be the assignee of the Deeds of Trust and the servicer of his mortgages. (Id. ¶ 4.) At some point, however—apparently after it initiated foreclosure proceedings—Aurora "purported to transfer whatever rights it held in the Plaintiff's mortgages to Nationstar . . . ." (Id. ¶ 6; id. at 2 n.1.)1 Accordingly, Plaintiff appears to allege that, at present, Deutsche Bank purports to hold the Notes and Nationstar purports to be the assignee of the Deeds of Trust.
Plaintiff concedes that, on their face, "the real property records establish[] a chain of title in Defendants . . . ." (SAC ¶ 18.) However, he insists that "none of the Defendants have the authority to foreclose on the real property and could not have properly obtained a valid assignment of the lien." (Id. ¶ 5.) The real property records are incorrect, insists Plaintiff, because "Defendants have stepped in and filed assignments of Deeds of Trust based upon invalid and/or fraudulent documents . . . ." (id. ¶ 23).
In support of this assertion, Plaintiff appears to argue that any assignment from First Magnus to another party must have been fraudulent since First Magnus "filed [for] bankruptcy on August 21, 2007," and since the bankruptcy court entered an order prohibiting First Magnus from transferring any assets. (Id. ¶ 5.) While Plaintiff's mortgages were "purportedly securitized into a trust and sold on Wall Street," they were "never validly transferred into those trusts" due to the bankruptcy court's order forbidding transfers. (Id.) "Defendantscannot establish," insists Plaintiff, "that MERS (acting through an Aurora employee) had the right to contravene a Federal Bankruptcy Court Order and assign the loans." (Id. ¶ 8.) Plaintiff also appears to argue that any assignment of his loan to a trust is invalid because it took place after the closing date of the trust. (Id. at 5.) Plaintiff did not provide a copy of or citation to the bankruptcy court's order, state when the closing date of the trust was, or state when his mortgages were purportedly transferred to the trust.
Because Plaintiff has conceded that the real property records do establish a chain of title in Defendants (SAC ¶ 18), the first question is whether Plaintiff has standing to challenge the assignments that resulted in Deutsche Bank holding the Notes and Nationstar being the assignee of the Deeds of Trust— assignments to which he was not a party. For the reasons that follow, the Court concludes that Plaintiff does not have standing.
As this Court has explained, whether a plaintiff-mortgagor has standing to challenge the validity of an assignment to which he was not a party depends on the nature of the challenge asserted. See Howard v. J.P. Morgan Chase N.A., Cv. No. SA-12-CV-00440-DAE, 2013 WL 1694659, at *5 (W.D. Tex. Apr. 18, 2013); Calderon v. Bank of America N.A., Cv. No. SA:12-CV-00121-DAE, 2013 WL 1741951, at *9 (W.D. Tex. April 23, 2013). Specifically, aplaintiff-mortgagor has standing to assert against an assignee any challenge that would render the assignment void rather than merely voidable. Tri-Cities Constr., Inc. v. Am. Nat'l Ins. Co., 523 S.W.2d 426, 430 (Tex. Civ. App. 1975). As the Texas Court of Appeals has put it:
The law is settled that the obligors of a claim may defend the suit brought thereon on any ground which renders the assignment void, but may not defend on any...
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