Van Duzer v. U.S. Bank Nat'Lass'N

Decision Date31 January 2014
Docket NumberCivil Action No. H–13–1398.
Citation995 F.Supp.2d 673
PartiesCharles B. VAN DUZER and Candace B. Van Duzer, Plaintiffs, v. U.S. BANK NATIONAL ASSOCIATION, Individually and as Trustee for Rasc 2006–KS5; Merscorp Holdings, Inc.; Mortgage Electronic Registration Systems, Inc.; and Unknown Claimants, Defendants.
CourtU.S. District Court — Southern District of Texas

OPINION TEXT STARTS HERE

Charles B. Van Duzer, Magnolia, TX, pro se.

Candace B. Van Duzer, Magnolia, TX, pro se.

Graham W. Gerhardt, Jonathan Riley Key, Bradley Arant et al., Birmingham, AL, for Defendants.

MEMORANDUM OPINION AND ORDER

SIM LAKE, District Judge.

Plaintiffs Charles B. Van Duzer and Candace B. Van Duzer (collectively, Plaintiffs) brought this pro se action against defendants U.S. Bank National Association, Individually and as Trustee for RASC 2006–KS5 (US Bank”), Merscorp Holdings, Inc. (Merscorp), and Mortgage Electronic Registration Systems, Inc. (MERS) (collectively, Defendants) alleging causes of action related to the origination, subsequent assignment, and attempted foreclosure of a home equity loan. Pending before the court is Defendants' Motion for Judgment on the Pleadings and Incorporated Brief in Support Thereof (Defendants' 12(c) Motion) (Docket Entry No. 12). For the reasons explained below, Defendants' 12(c) Motion will be granted.

I. Background

On February 21, 2006, Plaintiffs obtained a $556,000 home equity loan from Homecomings Financial Network, Inc. (“Homecomings”).1 The loan was evidenced by a Note 2 and secured by a first lien on Plaintiffs' property.3 MERS was identified as “the beneficiary under [the] Security Instrument.” 4 GMAC Mortgage LLC (GMAC) was the loan servicer.5

A. Plaintiffs' Bankruptcy

In July of 2007 MERS, as nominee for Homecomings, sought a judicial foreclosure on Plaintiffs' property under the terms of the Security Instrument. 6 On August 30, 2007, Plaintiffs filed a Chapter 13 bankruptcy petition in the United States Bankruptcy Court for the Southern District of Texas.7 On November 29, 2007, Plaintiffs' Chapter 13 Plan was confirmed by the bankruptcy court.8

On January 25, 2008, Plaintiffs sought to convert their bankruptcy from a Chapter 13 proceeding to a Chapter 7 proceeding.9 On February 19, 2008, Plaintiffs moved to strike Homecomings' proof of claim, arguing that Homecomings was not the owner of the Note and Security Instrument.10 On March 13, 2008, Plaintiffs filed a motion for leave to sell the property at issue in this case.11 Concluding that the property was exempt, the bankruptcy court entered an order on March 31, 2008, authorizing Plaintiffs to sell the property.12 The order required “all liens [to] be paid at closing, in accordance with state law” and stated that the property “may not be sold unless the liens are paid at closing.” 13 The bankruptcy court determined that its order mooted Plaintiffs' motion to strike Homecomings' proof of claim.14 Plaintiffs received a Chapter 7 discharge on July 9, 2008.15

On January 12, 2009, GMAC filed a motion to lift the automatic stay with regard to the property.16 On February 12, 2009, the bankruptcy court denied the motion as moot because Plaintiffs were “granted a bankruptcy discharge” and [u]pon the granting of their discharge, the automatic stay against exempt property terminated.” 17 Plaintiffs appealed the bankruptcy courts' Order on February 17, 2009.18 The Order was affirmed by the district court on October 28, 2009.19

B. The Prior Lawsuit

Plaintiffs filed suit against Homecomings, MERS, GMAC, and Residential Funding Company, LLC (collectively, “the 2010 Defendants) on January 29, 2010, to prevent a judicial foreclosure on the property.20 The 2010 Defendants removed the case to the United States Court for the Southern District of Texas on February 16, 2010.21 Plaintiffs filed their First Amended Petition/Complaint in federal court on June 16, 2010.22 On September 27, 2010, the lawsuit was remanded to state court.23 On October 20, 2011, the 2010 Defendants filed a motion for summary judgment in state court.24 The state court granted the motion for summary judgment on December 8, 2011.25

C. The Current Lawsuit

The Note and Security Instrument were assigned to U.S. Bank on June 12, 2012. 26 On April 3, 2013, U.S. Bank sought a judicial foreclosure under the terms of the Security Instrument.27 On May 14, 2013, Plaintiffs filed this suit against Defendants.28 Defendants filed their Answer on June 3, 2013.29

Defendants' 12(c) Motion was filed on August 16, 2013.30 Plaintiffs filed a motion for leave to conduct discovery on September 3, 2013.31 Defendants filed a response on September 9, 2013.32 The court denied Plaintiffs' motion on September 10, 2013.33

Plaintiffs filed their Response to Defendants' 12(c) Motion on September 12, 2013.34 Defendants filed a reply on September 19, 2013.35 On September 25, 2013, Plaintiffs filed their Supplemental Response to Defendants' 12(c) Motion.36

II. Applicable Law
A. Motion for Judgment on the Pleadings

A motion brought pursuant to Federal Rule of Civil Procedure 12(c) should be granted if there is no issue of material fact and if the pleadings show that the moving party is entitled to judgment as a matter of law. Greenberg v. General Mills Fun Group, Inc., 478 F.2d 254, 256 (5th Cir.1973). A motion for judgment on the pleadings is subject to the same standard as a motion to dismiss for failure to state a claim. See In re Great Lakes Dredge & Dock Co. LLC, 624 F.3d 201, 209 (5th Cir.2010); Guidry v. American Public Life Insurance Co., 512 F.3d 177, 180 (5th Cir.2007); Jones v. Greninger, 188 F.3d 322, 324 (5th Cir.1999) (per curiam).

The court must accept the factual allegations of the complaint as true, view them in a light most favorable to the plaintiffs, and draw all reasonable inferences in the plaintiffs' favor. Ramming v. United States, 281 F.3d 158, 161 (5th Cir.2001); Jones, 188 F.3d at 324.

“When a federal court reviews the sufficiency of a complaint, before the reception of any evidence either by affidavit or admissions, its task is necessarily a limited one. The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.”

Swierkiewicz v. Sorema N.A., 534 U.S. 506, 122 S.Ct. 992, 997, 152 L.Ed.2d 1 (2002) (quoting Scheuer v. Rhodes, 416 U.S. 232, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974)). To avoid dismissal a plaintiff must allege ‘enough facts to state a claim to relief that is plausible on its face.’ Doe v. MySpace, Inc., 528 F.3d 413, 418 (5th Cir.2008) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1974, 167 L.Ed.2d 929 (2007)). Plausibility requires “more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). “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. “Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief.” Id. (quoting Twombly, 127 S.Ct. at 1966) (internal quotation marks omitted). The court will “not accept as true conclusory allegations, unwarranted factual inferences, or legal conclusions.” Gentilello v. Rege, 627 F.3d 540, 544 (5th Cir.2010). [D]ismissal is proper if the complaint lacks an allegation regarding a required element necessary to obtain relief.” Torch Liquidating Trust ex rel. Bridge Assocs. L.L.C. v. Stockstill, 561 F.3d 377, 384 (5th Cir.2009).

When considering a motion to dismiss courts are generally “limited to the complaint, any documents attached to the complaint, and any documents attached to the motion to dismiss that are central to the claim and referenced by the complaint.” Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir.2010) (citing Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498–99 (5th Cir.2000)); see also C.H., II ex rel. L.H. v. Rankin Cnty. Sch. Dist., 415 Fed.Appx. 541, 545 (5th Cir.2011) (“A district court may look to the pleadings and any documents attached thereto.”); cf. Great Plains Trust Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 313 (5th Cir.2002) (surveying the Fifth Circuit's jurisprudence regarding “the documents that a district court may properly consider in deciding a Rule 12(c) motion). In addition, the court may take judicial notice of matters of public record, including pleadings filed in state court. See Joseph v. Bach & Wasserman, L.L.C., 487 Fed.Appx. 173, 178 (5th Cir.2012) ([T]he court may take judicial notice of matters of public record. Here, the document referenced is a pleading filed with a Louisiana state district court, and it is a matter of public record.” (citation omitted) (citing Funk v. Stryker Corp., 631 F.3d 777 (5th Cir.2011))); Norris v. Hearst Trust, 500 F.3d 454, 461 n. 9 (5th Cir.2007) ([I]t is clearly proper in deciding a 12(b)(6) motion to take judicial notice of matters of public record.”); Hebert Abstract Co., Inc. v. Touchstone Properties, Ltd., 914 F.2d 74, 76 (5th Cir.1990) (“A motion brought pursuant to Fed.R.Civ.P. 12(c) is designed to dispose of cases where the material facts are not in dispute and a judgment on the merits can be rendered by looking to the substance of the pleadings and any judicially noticed facts.”).

When a party presents “matters outside the pleadings” with a motion to dismiss, the court has discretion to either accept or exclude the evidence for purposes of the motion to dismiss. See McBurney v. Cuccinelli, 616 F.3d 393, 410 (4th Cir.2010) (“ ‘As is true of practice under Rule 12(b)(6), it is well-settled that it is within the district court's discretion whether to accept extra-pleading matter on a motion for judgment on the pleadings and treat it as one for summary...

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