Pitts v. Mozilo, Case No.: GJH-15-451
| Decision Date | 11 August 2015 |
| Docket Number | Case No.: GJH-15-451,Member Case No.: GJH-15-933 |
| Parties | HERCULES O. PITTS, et al. Plaintiffs, v. ANGELO MOZILO, et al. Defendants. |
| Court | U.S. District Court — District of Maryland |
Defendants removed this action from the Circuit Court for Prince George's County, Maryland (the "Circuit Court") to this Court on February 18, 2015. See ECF No. 1. Plaintiffs challenge Defendants' actions with regard to a loan on a residential property and the ultimate foreclosure on that property. Defendants have filed motions to dismiss based primarily on failure to state a claim. See ECF Nos. 12, 16, 22 & 30.1 A hearing on these motions is unnecessary. See Loc. R. 105.6 (Md.). For the reasons that follow, the motions to dismiss are GRANTED.
Plaintiffs bought or refinanced a residential property located at 11609 Bonaventure Drive, Upper Marlboro, MD 20774 (the "Property") on November 22, 2006. See ECF No. 16-2. To do so, Plaintiffs borrowed $704,700.00 from Countrywide Home Loans, Inc. The loan was secured by a deed of trust against the Property. Id.
A foreclosure was docketed against the Property on July 28, 2014 in the Circuit Court. See ECF No. 12-2. On October 22, 2014, the Plaintiffs filed a motion to stay the foreclosure, arguing that their constitutional rights had been violated. See ECF No. 12-2. On October 27, 2014, the Circuit Court denied Plaintiffs' motion and permitted the foreclosure to proceed. See ECF No. 12-3. On October 28, 2014, the Property was sold at a public foreclosure auction. See ECF No. 12-4.
Plaintiffs filed a lawsuit against Defendants on December 16, 2014 in the Circuit Court.2 See ECF No. 1 at 1. Plaintiffs allege that Defendants Angelo Mozilo and Countrywide Home Loans, Inc. originally provided Plaintiffs with the loan for the Property. See ECF No. 2 at 2. Plaintiffs assert that Defendant Samuel I. White was a trustee and participated in the securitization of Plaintiffs' loan. See id. Plaintiffs further allege that Defendants Bank of America, NA; Laurel H.G. O'Sullivan; McCabe, Weisberg & Conway; Specialize Loan Servicing, LLC; and Bank of New York Mellon were involved in the improper securitization of Plaintiffs' loan. See id. Plaintiffs also claim there are other potential defendants whom Plaintiffs cannot yet identify. See id. at 3.
Plaintiffs' lawsuit disputes that Defendants own the title and deed of trust to the Property. See ECF No. 2 at 3-7. Plaintiffs suggest that Defendants violated laws and committed fraud in the original loan transaction and subsequent securitization of the loan. See id. Further, Plaintiffs believe Defendants have assigned the title and deed of trust and, therefore, did not have the right to foreclose on the property and owe Plaintiffs monetary damages. See id. Plaintiffs claim Defendants' actions constitute violations of the Truth in Lending Act ("TlLA") and the RealEstate Settlement Procedures Act ("RESPA"), fraud, intentional infliction of emotional distress, and slander of title. Plaintiffs assert that due to Defendants' violations of these laws, Defendants lacked standing to foreclose on the Property and Plaintiffs are entitled to quiet title of the property, a declaration that Defendants do not have an interest in the Property, a rescission of the loan, and monetary damages. See id. at 8-16.
Federal Rule of Civil Procedure 12(b)(6) permits a defendant to present a motion to dismiss for failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). "When it appears on the face of the complaint that the limitation period has run, a defendant may properly assert a limitations defense through a Rule 12(b)(6) motion to dismiss." See Miller v. Pac. Shore Funding, 224 F.Supp. 2d 977, 985 (D. Md. 2002), aff'd, 92 F. Appx. 933 (4th Cir. 2004); see also Dean v. Pilgrim's Pride Corp., 395 F.3d 471, 474 (4th Cir. 2005) ().
To survive a motion to dismiss invoking 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, 'to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic 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 draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. at 663. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. at 678-79; Twombly, 550 U.S. at 545 ().
When deciding a motion to dismiss under Rule 12(b)(6), a court "must accept as true all of the factual allegations contained in the complaint," and must "draw all reasonable inferences [from those facts] in favor of the plaintiff." E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (citations and internal quotation marks omitted). The Court need not, however, accept unsupported legal allegations, see Revene v. Charles County Comm'rs, 882 F.2d 870, 873 (4th Cir. 1989), legal conclusions couched as factual allegations, Papasan v. Allain, 478 U.S. 265, 286 (1986), or conclusory factual allegations devoid of any reference to actual events. United Black Firefighters of Norfolk v. Hirst, 604 F.2d 844, 847 (4th Cir. 1979). Self-represented litigants' pleadings are "liberally construed" and "held to less stringent standards than formal pleadings drafted by lawyers." Erickson v. Pardus, 551 U.S. 89, 94 (2007) (citation and internal quotation marks omitted). "However, liberal construction does not absolve Plaintiff from pleading a plausible claim." Bey v. Shapiro Brown & Alt, LLP, 997 F.Supp. 2d 310, 314 (D. Md. Feb. 20, 2014); see also Coulibaly v. J.P. Morgan Chase Bank, N.A., No. DKC 10-3517, 2011 WL 3476994, at *6 (D. Md. Aug. 8, 2011) () (citation omitted), aff'd, 526 F. Appx. 255 (4th Cir.2013).
Plaintiffs assert that Defendants violated TILA "by failing to provide Plaintiffs with accurate material disclosures required under TILA and not taking into account the intent of the State legislature in approving this status which was to fully inform home buyers of the pros andcons of adjustable rate mortgage[s] in a language both written and spoken that they understand and comprehend; and advise them to compare similar loan products with other lender[s.]" ECF No. 2 at 12. According to Plaintiffs, Defendants also failed to "offer other loan products that might be more [advantageous] for the borrower under the same qualifying matrix." Id.
In adopting TILA, Congress declared that "[i]t is the purpose of this subchapter to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit." 15 U.S.C. § 1601(a). As such, TILA requires that a creditor make certain material disclosures at the time the loan is made. Id. § 1638(a). TILA is subject to a limitations period of one year from the date of closing for all claims for money damages. 15 U.S.C. § 1640(e); Davis v. Edgemere Finance Co., 523 F.Supp. 1121, 1123 (D. Md. 1981). A rescission claim under TILA must be brought within three years of the loan closing. 15 U.S.C. § 1635(f); Davis, 523 F.Supp. at 1124. Under either limitations period, Plaintiffs' claims were filed in 2014 and arise from a 2006 loan closing. Thus, on the face of the complaint, they are barred by limitations and are DISMISSED. Jesinoski v. Countrywide Home Loans, Inc., 135 S.Ct. 790, 792 (2015).3
Plaintiffs assert that Defendants violated RESPA because they did not provide "separate fee agreements regarding the use of Country Wide Home Loan, Inc. as the [i]ndex for basis of loan, [d]isclosures of additional income due to interest rate increases[,] or the proper form and procedure in relation to the [b]orrower's [r]ight to [c]ancel." ECF No. 2 at 12. Plaintiffs also contend that the "payments between the Defendants were misleading and designed to create a windfall." Id.
Congress enacted RESPA to "insure that consumers . . . are provided with greater and more timely information on the nature and costs of the settlement process and are protected from unnecessarily high settlement charges caused by certain abusive practices . . . ." 12 U.S.C. § 2601. A RESPA claim brought by a private litigant must be brought within either one or three years from the date of the occurrence of the violation, depending on the type of violation. See 12 U.S.C. § 2614. The limitations period begins to run "from the date of the occurrence of the violation," which generally refers to the date of closing for loan origination violations. Brown v. Wilmington Fin., No. CCB-11-699, 2012 WL 975541, at *4 (D. Md. Mar. 21, 2012) (citation omitted).
Plaintiffs' RESPA claim references fees and fee splitting, which is discussed under 12 U.S.C. § 2607 and subject to a one-year limitations period. See 12 U.S.C. § 2614. Nonetheless, applying either a one-year or three-year limitations period, Plaintiffs filed this action eight yearsafter the closing date. Thus, the RESPA claim is DISMISSED as barred by the statute of limitations.
Plaintiffs allege that "Defendants concealed the fact that the [l]oan [was] securitized . . . financial...
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