Williams v. Chase Home Fin., LLC, Civil Action No. 3:13-CV-1307-G

• Decision Date: 27 August 2014
• Docket Number: Civil Action No. 3:13-CV-1307-G
• Parties: ESTER WILLIAMS, Plaintiff, v. CHASE HOME FINANCE, LLC, et al., Defendants.
• Court: U.S. District Court — Northern District of Texas

ESTER WILLIAMS, Plaintiff, v. CHASE HOME FINANCE, LLC, et al., Defendants.

Civil Action No. 3:13-CV-1307-G

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION

August 27, 2014

FINDINGS, CONCLUSIONS, AND RECOMMENDATION

Pursuant to Special Order No. 3-251, this pro se case was automatically referred for pretrial management. Before the Court is Defendants' Fed. R. Civ. P. 12(b)(6) Motion to Dismiss Plaintiff's Second Amended Complaint for Failure to State a Claim Upon Which Relief Can Be Granted, filed December 19, 2013. (doc. 11.) Based on the relevant filings and applicable law, the motion should be GRANTED.

I. BACKGROUND

This case involves the foreclosure of real property located at 245 Creekwood Drive, Lancaster, Texas 75146 (the Property). (Orig. Pet. (doc. 1-5) at 2.) On January 22, 2013, Ester Williams (Plaintiff) sued Chase Home Finance, LLC (Chase) and Deutsche Bank National Trust, as Trustee for Long Beach Mortgage Loan Trust 2004-5 (Deutsche) (collectively, Defendants) in state court. (Id.) On January 30, 2013, she filed an amended petition asserting claims for violations of the Texas Debt Collation Practices Act (TDCPA) and the Deceptive Trade Practices Act (DTPA), unreasonable collection efforts, "gross negligence," quiet title, trespass to try title, violation of the Truth in Lending Act (TILA) and Regulation Z (its implementing regulation), and the Real Estate Settlement Procedures Act (RESPA). (doc. 1-8) She sought damages, attorney's fees, court costs,declaratory judgment, and injunctive relief to restrain Defendants from evicting her from the Property. (Id.) On March 29, 2013, Defendants removed the action to federal court, asserting diversity jurisdiction under 28 U.S.C. § 1332. (doc. 1 at 2-3.)¹ On November 22, 2013, dismissal was recommended for failure to state a claim upon which relief can be granted. (doc. 9.)

On December 5, 2013, Plaintiff filed her second amended complaint. (doc. 10.) It explicitly asserts claims for violations of the TDCPA and the DTPA, "gross negligence," declaratory judgment, quiet title, trespass to try title, and "predatory lending and mortgage fraud". (doc. 10 at 6-10.) Liberally construed, the second amended complaint also asserts claims for unreasonable collection efforts, violation of TILA and Regulation Z (its implementing regulation), RESPA, an accounting, and breach of contract. (Id. at 7-8.) Plaintiff seeks damages, attorney's fees, court costs, declaratory judgment, and injunctive relief to restrain Defendants from evicting her. (Id. at 4-9.)

Plaintiff alleges that she purchased the Property on June 22, 2004, for $257,000.00. (Id. at 2.) She obtained a loan from Long Beach Mortgage (LBM) for $205,600.00 (the primary loan) to cover 80 percent of the purchase price, and she executed an "adjustable rate" promissory note and a deed of trust granting a first lien on the Property in favor of LBM. (Id. at 2; doc. 1-8 at 11, 24-28, 40.) She borrowed $51,400.00 from the sellers to cover the remaining 20 percent (the secondary loan), and she signed another promissory note and "warranty deed" granting a "second and inferior vendor's lien" on the Property in their favor. (Id. at 2; doc. 1-8 at 11, 20.)

In 2008, the "mortgage company"² allegedly increased the interest rate on the primary loanwithout giving her "prior, written notification." (doc. 10 at 2.) "Because of such a rapid and high jump in the interest rate, Plaintiff fell behind on her mortgage payments." (Id.) She contacted Chase to request "loan counseling" and a "modification." (Id. at 3.) On February 4, 2008, Chase denied her eligibility for its "loss mitigation program," explaining that it was "unable to obtain clear title to the Property." (doc.1-8 at 29.)

On October 6, 2009, the substitute trustee sold the Property to Deutsche at a foreclosure sale for $127,100.00. (Id. at 40.) "Defendants" brought a subsequent forcible detainer action against her. (doc. 10 at 3.) She sued them for "wrongful foreclosure" and obtained a Temporary Restraining Order (TRO) enjoining her eviction. (Id. at 3-4.) Her suit was "dismissed without prejudice" for failure to comply with a court order. (Id. at 3-4; doc. 1-8 at 31.) Between September 2011 and February 2012, she made payments of $800 "to the court" for Deutsche's benefit. (Id. at 4; doc. 1-8 at 32-37.) On January 10, 2013, the Dallas County Sheriff served her with a notice to vacate the Property. (doc. 1-8 at 38.)

On December 19, 2013, Defendants moved to dismiss Plaintiff's second amended complaint. (doc. 5.) With a timely filed response (doc.14) and reply (doc. 15), the motion is now ripe.

II. RULE 12(b)(6) MOTION

Defendants move to dismiss Plaintiff's second amended complaint under Rule 12(b)(6) for failure to state a claim upon which relief can be granted. (doc. 11.)

Rule 12(b)(6) allows motions to dismiss for failure to state a claim upon which relief can begranted. Fed. R. Civ. P. 12(b)(6). Rule 12(b)(6) motions are disfavored and rarely granted. Sosa v. Coleman, 646 F.2d 991, 993 (5th Cir. 1981). Under the 12(b)(6) standard, courts cannot look beyond the face of the pleadings. Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996); see also Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999), cert. denied, 530 U.S. 1229 (2000). It is well-established that "pro se complaints are held to less stringent standards than formal pleadings drafted by lawyers." Miller v. Stanmore, 636 F.2d 986, 988 (5th Cir. 1981). Regardless of whether a plaintiff is proceeding pro se or through counsel, pleadings must show specific, well-pleaded facts, not mere conclusory allegations to avoid dismissal. Guidry v. Bank of LaPlace, 954 F.2d 278, 281 (5th Cir. 1992). The court must accept those well-pleaded facts as true and view them in the light most favorable to the plaintiff. Baker, 75 F.3d at 196. "[A] well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of [the alleged] facts is improbable, and that a recovery is very remote and unlikely." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007) (quotation marks omitted). Still, a plaintiff must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. at 555; accord Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (emphasizing that "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions"). The alleged facts must "raise a right to relief above the speculative level." Twombly, 550 U.S. at 555. A complaint fails to state a claim upon which relief may be granted when it fails to plead "enough facts to state a claim to relief that is plausible on its face." Id. at 570.

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. The plausibility standard is not akin to a "probability requirement," but it asks for more than a sheer possibility that a defendant has acted unlawfully. 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 torelief.'"

Iqbal, 556 U.S. at 678 (citations omitted). When plaintiffs "have not nudged their claims across the line from conceivable to plausible, their complaint must be dismissed." Twombly, 550 U.S. at 570; accord Iqbal, 556 U.S. at 678.

As noted, a court cannot look beyond the pleadings in deciding a 12(b)(6) motion. Spivey, 197 F.3d at 774; Baker, 75 F.3d at 196. Pleadings in the 12(b)(6) context include attachments to the complaint. In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007); Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000). Documents "attache[d] to a motion to dismiss are considered part of the pleadings, if they are referred to in the plaintiff's complaint and are central to her claim." Collins, 224 F.3d at 499 (quoting Venture Assocs. Corp. v. Zenith Data Sys. Corp., 987 F.2d 429, 431 (7th Cir. 1993)); accord Benchmark Elecs., Inc. v. J.M. Huber Corp., 343 F.3d 719, 725 (5th Cir. 2003). In addition, "it is clearly proper in deciding a 12(b)(6) motion to take judicial notice of matters of public record." Norris v. Hearst Trust, 500 F.3d 454, 461 n.9 (5th Cir. 2007); Cinel v. Connick, 15 F.3d 1338, 1343 n.6 (5th Cir. 1994). When a party presents "matters outside the pleadings" with a Rule 12(b)(6) motion to dismiss, the Court has "complete discretion" to either accept or exclude the evidence for purposes of determining the motion. Isquith ex rel. Isquith v. Middle S. Utils., Inc., 847 F.2d 186, 196 n.3 (5th Cir. 1988); accord Gen. Retail Servs., Inc. v. Wireless Toyz Franchise, LLC, 255 F. App'x 775, 783 (5th Cir. 2007). "If . . . matters outside the pleading[s] are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56," and "[a]ll parties must be given a reasonable opportunity to present all the material that is pertinent to the motion." Fed. R. Civ. P. 12(d).

Here, Plaintiff attached to her first amended petition copies of what appear to be a "loansettlement statement" signed at loan closing on June 22, 2004, correspondence between her and the sellers, the warranty deed she signed in the sellers' favor, the adjustable rate note she signed in LBM's favor, Chase's letter denying her eligibility for its loss mitigation program, news articles, and five receipts from the state court for payments she made for Deutsche's account. (doc. 1-8 at 11-37.) Because these documents are referenced in Plaintiff's second amended complaint and are central to their claims, they are considered part of the pleadings, and conversion of the motion to dismiss into a motion for summary is unnecessary.

III. PREVIOUSLY ASSERTED CLAIMS

Defendants move to dismiss all the claims previously asserted...