Broussard v. Citimortgage, Inc. et alBriefS.D. Ala.August 18, 201628010529 v1 IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION TRACY LYNNE BREECH BROUSSARD, Plaintiff, v. CITIMORTGAGE, INC., AND PENNYMAC CORP. Defendants. ) ) ) ) ) ) ) ) ) ) ) CIVIL ACTION 16-CV-149-CB-M JURY DEMAND DEFENDANT CITIMORTGAGE, INC.'S MEMORANDUM IN SUPPORT OF MOTION TO DISMISS PLAINTIFF'S COMPLAINT COMES NOW Defendant CitiMortgage, Inc. ("CitiMortgage"), and pursuant to Fed. R. Civ. P. 12(b)(6), files its Memorandum in Support of its Motion to Dismiss. For the following reasons, CitiMortgage's Motion is due to be granted. I. INTRODUCTION While Plaintiff attempts to assert claims of (i) wrongful foreclosure; (ii) fraud; (iii) violation of the Truth in Lending Act; and (iv) wire fraud, she fails to provide any factual allegations whatsoever which would provide a basis for her claims. Consequently, Plaintiff has failed to meet this Court's pleading standards as required by Rules 8(a), 9(b), and 12(b)(6). Additionally, Plaintiff's claims, to the extent they are asserted against CitiMortgage, are due to be dismissed for Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 1 of 12 28010529 v1 - 2 - failure to state a claim as CitiMortgage is not the servicer of the mortgage on the subject property and has no interest in or control over the subject property or any foreclosure proceedings. Accordingly, the claims in the Complaint asserted against CitiMortgage are due to be dismissed. II. STATEMENT OF FACTS On or about April 22, 2013, CitiMortgage assigned its interest in the mortgage on the subject property to PennyMac. (See Complaint, Ex. B.) After that time, according to Plaintiff, PennyMac paid property taxes on the subject property. (See Complaint.) It appears from the relief requested in the Complaint, that PennyMac subsequently sought to foreclose on the subject property. (See Complaint.) Based upon these allegations, Plaintiff seeks to have pending foreclosure proceedings suspended, to purchase the subject property at fair market value, and compensatory damages and punitive damages. However, none of Plaintiff's claims against CitiMortgage state a claim for relief, and each should be dismissed under Rules 8(a), 9(b), and 12(b)(6). III. STANDARD OF REVIEW The United States Supreme Court has held that to withstand dismissal under Fed. R. Civ. P. 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, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 2 of 12 28010529 v1 - 3 - U.S. 544, 570 (2007)). Facial plausibility is established when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Iqbal, 129 S. Ct. at 1949 (quoting Twombly, 550 U.S. at 556). This standard “requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. Although “the pleading standard does not require detailed factual allegations . . . [it] demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Id. Thus, courts are not bound to accept as true a legal conclusion couched as a factual allegation. Iqbal, 129 S. Ct. at 1949-50 (citation omitted). See also Financial Security Assurance, Inc. v. Stephens, Inc., 500 F.3d 1276, 1282 (11th Cir. 2007) (holding that in order for a plaintiff to satisfy its obligation to provide the grounds of an entitlement to relief under Twombly, a plaintiff must allege more than labels and conclusions; rather, the complaint must include factual allegations adequate to raise a right to relief above the speculative level); Mack v. City of High Springs, 486 Fed. Appx. 3, 6 (11th Cir. 2012) (“To survive a motion to dismiss under Rule 12(b)(6), the plaintiff must plead either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory.”) (internal quotation omitted). In addition, a Complaint must meet the pleading standard set out by Fed. R. Civ. P. 8. While Rule 8(a)(2) merely requires “a short and plain statement of the Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 3 of 12 28010529 v1 - 4 - claim showing that the pleader is entitled to relief”, this “short and plain” standard demands more than just “labels and conclusions, and a formulaic recitation of the elements of a cause of action.” Twombly, 550 U.S. at 555. IV. ARGUMENT AND CITATION OF AUTHORITY A. Plaintiff's Complaint Fails to State a Claim Pursuant to FRCP 8(a). Plaintiff's Complaint is due to be dismissed as Plaintiff fails to state a claim under Rule 8(a). The purposes of Rule 8 are to “give the adverse party fair notice of the claim asserted so as to enable [it] to answer and prepare for trial,” and “to avoid undue prolixity” so that the court and the responding party are not “forced to select the relevant material from a mass of verbiage.” Lonesome v. Lebedeff, 141 F.R.D. 397, 398 (E.D.N.Y. 1992) (quoting Salahuddin v. Cuomo, 861 F.2d 40, 42 (2d Cir. 1988)). While it is true that pro se pleadings should be liberally construed and held to a less stringent standard than pleadings drafted by attorneys, Trawinski v. United Techs., 313 F.3d 1295, 1297 (11th Cir. 2002), pro se pleadings are nevertheless required to conform to procedural rules. Loren v. Sasser, 309 F.3d 1296, 1304 (11th Cir. 2002). In order to survive a motion to dismiss and comply with Rule 8(a) requirements, a complaint must provide a “short and plain statement of the claim” and give fair notice of what the plaintiff’s claim is and the grounds upon which it rests. Buford v. City of Atlanta, No. CIV.A. 1:06-CV-3089T, 2007 WL 1341115, Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 4 of 12 28010529 v1 - 5 - at *2 (N.D. Ga. Apr. 30, 2007); see also Gordon v. Green, 602 F.2d 743, 744-47 (5th Cir. 1979) (dismissing complaint containing verbose pleadings because it violated Rule 8). The Complaint is anything but a plain statement of the claims against CitiMortgage. Indeed, the Complaint is completely devoid of any specific facts related to CitiMortgage or wrongful conduct by CitiMortgage relating to the foreclosure in which Plaintiff has not alleged CitiMortgage had any involvement. Instead, the Complaint simply recites several causes of action, and entirely fails to assert any specific allegations against CitiMortgage, and thus fails to provide CitiMortgage with reasonable notice of the claims and allegations asserted against it. Clime v. Sunwest PEO, 253 F. App’x 805, 806, (11th Cir. 2007) (stating that “it is . . . necessary that a complaint contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory.”). As drafted, the Complaint is incomprehensible and CitiMortgage cannot be expected to prepare an adequate answer and defense. Forcing CitiMortgage to answer or otherwise respond to this Complaint “would fly in the face of the very purposes for which Rule 8 exists.” Lonesome, 141 F.R.D. at 398. Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 5 of 12 28010529 v1 - 6 - B. Plaintiff's Foreclosure Claim Fails As CitiMortgage Had No Involvement Whatsoever In The April 2016 Foreclosure. Plaintiff's first claim appears to be that a wrongful foreclosure has occurred relating to the subject property. Plaintiff does not allege that CitiMortgage was involved in any current foreclosure proceedings, and Plaintiff has admitted that CitiMortgage assigned the mortgage to PennyMac in 2013. Accordingly, this claim fails against CitiMortgage because it had no involvement whatsoever with the any scheduled foreclosure, and Plaintiff cannot allege such. Plaintiff admits that CitiMortgage no longer has any interest in Plaintiff's loan or mortgage based upon the Assignment. Because Plaintiff acknowledges that CitiMortgage has no interest in the property, and CitiMortgage has not attempted to foreclose, this claim against CitiMortgage necessarily fails under Rule 12(b)(6) because a material element of the claim fails. See Mack v. City of High Springs, 486 Fed. Appx. 3, 6 (11th Cir. 2012) (“To survive a motion to dismiss under Rule 12(b)(6), the plaintiff must plead either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory.”) (internal quotation omitted). The missing material element of this claim is that Plaintiff can allege no damages against CitiMortgage because it had no involvement in the allegedly scheduled foreclosure. Accordingly, this claim necessarily fails to state a claim for relief and must be dismissed. Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 6 of 12 28010529 v1 - 7 - C. Plaintiff's Fraud Claim Fails As It Is Not Sufficiently Alleged. Plaintiff's fraud claim is also wholly without merit and should be dismissed. Plaintiff makes absolutely no factual allegations in support of her fraud claim. Thus, this claim fails under Rule 12(b)(6). In addition, this claim fails under Rule 9(b) which requires pleading fraud claims with particularity. Accordingly, this claim should be dismissed. Federal Rule of Civil Procedure 9(b) provides that "in all averments of fraud . . . the circumstances constituting fraud . . . shall be stated with particularity." This Court has discussed the standards for dismissal under Fed. R. Civ. P. 12(b)(6) and Rule 9(b), holding in pertinent part as follows: At the motion to dismiss stage, under the heightened pleading standard of Rule 9(b), the Eleventh Circuit requires that a plaintiff allege (1) the precise statements, documents, or misrepresentations made; (2) the time, place, and person responsible for the statement; (3) the content and manner in which these statements misled the Plaintiffs; and (4) what the defendants gained by the alleged fraud. Emergency Response Specialists, Inc. v. CSA Ocean Scis., Inc., No. 2:14-CV- 2214-WMA, 2015 WL 1865453, at *1 (N.D. Ala. Apr. 23, 2015) (internal quotations omitted). In addition to the foregoing pleading standards, in order to state a claim for fraud, a party must establish the six elements to a fraud claim: (1) a false representation; (2) of a material existing fact; (3) reasonably relied on by plaintiff; (4) who suffered damages as a proximate consequence of the misrepresentation; (5) with proof that, at the time of the misrepresentation, the defendant had the present intention not to perform the future act required; and (6) proof that the defendant had the intent to deceive. Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 7 of 12 28010529 v1 - 8 - Trinetics Int'l, Inc. v. DHL Air & Ocean Gen. Transp., Forwarding & Customs Clearance, LLC, No. CV-12-S-2810-NE, 2013 WL 24067, at *6 (N.D. Ala. Jan. 2, 2013). The failure to establish one of these elements subjects a claim for fraud to dismissal. Id. at 7. Plaintiff has made no factual allegations in support of her fraud claim. She does not specify the role of CitiMortgage in this alleged fraud. Plaintiff does not allege the "time, place, and person responsible" for the alleged misrepresentation(s). Plaintiff does do not explain with any specificity how she allegedly relied or acted upon any alleged misrepresentation to her detriment. Furthermore, Plaintiff does not allege what CitiMortgage gained by the alleged misrepresentation(s). For each of these reasons, Plaintiff's fraud claim fails to state a claim upon which relief may be granted and should be dismissed. D. Plaintiff's TILA Claim Fails As It Is Not Sufficiently Alleged. Plaintiff's claim that CitiMortgage violated TILA, 15 U.S.C. § 1601, also fails. First, Plaintiff has utterly failed to state any factual allegations in support of her claim or give any other indication of how CitiMortgage allegedly violated TILA. This subjects her claim to dismissal under Rules 8(a) and 12(b)(6). Next, any claim Plaintiff may have had under TILA is time-barred based upon the allegations on the face of the Complaint. See Barnes v. Compass Bank, 568 F. App'x 743, 744 (11th Cir. 2014) (holding that dismissal on statute of limitations Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 8 of 12 28010529 v1 - 9 - grounds is appropriate where the claim is time-barred from the face of the complaint). TILA has a one year statute of limitations, and it accrues upon the occurrence of the violation. See id. ("The statute of limitations begins with the violation itself-it is upon violation, and not upon discovery of harm, that the claim is complete and the clock is ticking."). Plaintiff states that CitiMortgage transferred its rights in the mortgage to PennyMac by assignment on April 22, 2013. Thus, the absolute last time CitiMortgage could have violated TILA in connection with the subject property or mortgage was on April 22, 2013, making any TILA claims against CitiMortgage are time-barred after April 22, 2014. However, Plaintiff's Complaint was not filed until on or about April 7, 2016. (See Complaint.) Accordingly, any TILA claim against CitiMortgage is time-barred and must be dismissed. E. Plaintiff's Wire Fraud Claim Fails As It Is Not Sufficiently Alleged. Plaintiff's final claim is for wire fraud. Again, Plaintiff has utterly failed to state any factual allegations in support of her claim or give any other indication of how CitiMortgage allegedly committed wire fraud. This subjects her claim to dismissal under Rules 8(a), 9(b) and 12(b)(6). Wire fraud requires that a person "(1) intentionally participates in a scheme to defraud another of money or property and (2) uses or ‘causes' the use of the Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 9 of 12 28010529 v1 - 10 - mails or wires for the purpose of executing the scheme or artifice." Frederick v. Serv. Experts Heating & Air Conditioning, LLC, No. 2:14-CV-01647-RDP, 2016 WL 3753160, at *4 (N.D. Ala. July 14, 2016). "A scheme to defraud requires proof of material misrepresentations, or the omission or concealment of material facts, reasonably calculated to deceive persons of ordinary prudence." Id. quoting United States v. Hasson, 333 F.3d 1264, 1270-71 (11th Cir. 2003) (internal citations omitted). Because Plaintiff has failed to state any factual support for her wire fraud claim, she has necessarily failed to state a claim under Rules 8(a) and 12(b)(6), and she has failed to plead with the particularity required under Rule 9(b) which requires a party to state the "time, place, and person responsible" for a misrepresentation. Based upon the foregoing, Plaintiff's claim against CitiMortgage for wire fraud must be dismissed. V. CONCLUSION WHEREFORE, for the reasons set forth herein, CitiMortgage, Inc. respectfully requests that this Court grant this motion and dismiss Plaintiff's Complaint, and all claims asserted therein, in its entirety with prejudice. Respectfully submitted this 18th day of August, 2016. /s/ Richard C. Keller Rik S. Tozzi (ASB-7144-Z48R) Richard C. Keller (ASB-0207-L69R) Burr & Forman LLP 420 North 20th Street, Suite 3400 Birmingham, AL 35203 Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 10 of 12 28010529 v1 - 11 - Telephone: (205) 251-3000 Facsimile: (205) 458-5110 Email: rtozzi@burr.com rkeller@burr.com Attorneys for Defendant CitiMortgage, Inc. Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 11 of 12 28010529 v1 CERTIFICATE OF SERVICE I hereby certify that on this 18th day of August, 2016, I electronically filed the foregoing DEFENDANT CITIMORTGAGE, INC.'S MEMORANDUM IN SUPPORT OF MOTION TO DISMISS PLAINTIFF'S COMPLAINT to the Clerk of Court for filing and uploading to the CM/ECF system, which will automatically send email notification of such filing to the following attorneys of record: Graham W. Gerhardt Grant A. Premo BRADLEY ARANT BOULT CUMMINGS, LLP One Federal Place 1819 Fifth Avenue North Birmingham, Alabama 35203 ggerhardt@babc.com gpremo@babc.com Attorneys for PennyMac Corporation I hereby certify that I have mailed the foregoing to the following non- CM/ECF participants: Tracy Lynne Broussard P.O. Box 87 McIntosh, Alabama 36553 /s/ Richard C. Keller Richard C. Keller Case 1:16-cv-00149-CG-M Document 21 Filed 08/18/16 Page 12 of 12