Rufus v. Seneca Mortgage Servicing, Llc et al

MOTION to Dismiss Amended Complaint, MOTION to Dismiss for Failure to State a Claim, MOTION to Dismiss for Lack of Jurisdiction

D. Md.May 16, 2017

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND-SOUTHERN DIVISION BRENDA RUFUS, Plaintiff, v. SENECA MORTGAGE SERVICING, LLC et al., Defendants. No. PJM 17-CV-0351 MOTION TO DISMISS AMENDED COMPLAINT Pursuant to Fed. R. Civ. P. 8(a), 9(b), 12(b)(1), and 12(b)(6), and for the reasons set forth in the accompanying memorandum which is hereby incorporated by reference, Defendant Seneca Mortgage Servicing, LLC (“Seneca”) hereby moves to dismiss the amended complaint filed in this matter, or in the alternative, moves that Seneca be dismissed as a defendant in this matter. May 16, 2017 Respectfully submitted, /s/ Stephen W. Miller (Bar No. 19957) John R. Grimm (Bar No. 19223) Harris, Wiltshire & Grannis, LLP 1919 M Street NW 8th Floor Washington, DC 20036 smiller@hwglaw.com 202-730-1305 (Telephone) 202-730-1301 (Fax) Counsel for Seneca Mortgage Servicing, LLC Case 8:17-cv-00351-PJM Document 16 Filed 05/16/17 Page 1 of 2 CERTIFICATE OF SERVICE I certify that on May 16, 2017, the foregoing was filed electronically through the Court’s CM/ECF system. Participants in the case who are registered CM/ECF users will be served by the Court’s CM/ECF system. I further certify that on May 16, 2017, the foregoing document was served upon the following parties by U.S. mail: Brenda Rufus Michael Radziewicz 10502 Cedarwood Lane 313 South Lake Drive Fort Washington, MD 20744 Stevensville, MD 21666 Gerard J. Dupree U.S. Bank, N.A. 12600 Willow Marsh Lane 351 West Camden Street Fort Washington, MD 20720 Baltimore, MD 21201 I further certify, pursuant to Fed. R. Civ. P. 5(b)(2)(D) that the addresses of unnamed Defendants Does 1 through 50, Inclusive are unknown to me, and that I therefore sent a service copy to the Clerk of the Court. /s/ Stephen W. Miller Case 8:17-cv-00351-PJM Document 16 Filed 05/16/17 Page 2 of 2 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND-SOUTHERN DIVISION BRENDA RUFUS, Plaintiff, v. SENECA MORTGAGE SERVICING, LLC et al., Defendants. No. PJM 17-CV-0351 MEMORANDUM IN SUPPORT OF DEFENDANT SENECA MORTGAGE SERVICING LLC’S MOTION TO DISMISS AMENDED COMPLAINT Pursuant to Federal Rules of Civil Procedure 8(a), 9(b), 12(b)(1), and 12(b)(6), Defendant Seneca Mortgage Servicing, LLC (“Seneca”) respectfully requests that this Court dismiss Plaintiff’s amended claims for failure to state any claims upon which relief can be granted, failure to satisfy the pleading requirements of Fed. R. Civ. P. 9(b), and failure to allege complete diversity among the parties. BACKGROUND Plaintiff filed this action pro se on February 6, 2017. This Court granted Plaintiff’s request to proceed in forma pauperis, and Seneca was served with the complaint by the U.S. Marshals Service on March 29, 2017. Seneca moved to dismiss Plaintiff’s original complaint on April 19, 2017. In its motion, Seneca explained that Plaintiff had failed to plead any facts sufficient to show what conduct she complained of, what conduct she attributed to Seneca, what injury she suffered, and whether this Court has diversity jurisdiction over this case. Plaintiff filed an amended complaint on May 5, 2017. Plaintiff’s amended complaint failed to cure any of the defects Seneca pointed out in its initial motion to dismiss, and is substantially similar to the original complaint in this matter. Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 1 of 11 2 Aside from a few additional factual allegations that still do not state a claim, Plaintiff has “escalated” the amount of relief sought to $1,400,000.00, without alleging any facts supporting a $900,000 increase in damages sought compared to the original complaint. Other than those changes, however, the amended complaint is essentially identical to the original complaint. Accordingly, this memorandum is substantially similar to the one Seneca filed in support of its initial motion to dismiss. (ECF No. 10 (Apr. 19, 2017)). We have modified it where appropriate to address Plaintiff’s new allegations, but the arguments and authorities are otherwise unchanged. The amended complaint accuses all defendants of fraud, negligence, misrepresentation, some form of unlawful possession of real property, and violating Plaintiff’s right to due process. (Am. Compl. at 5). Additionally, Plaintiff now alleges that “divergent paths taken by both the mortgage note and the deed of trust” have left a “cloud on all title activity . . . due to no definitive claimant of ownership of the note(s).” (Am. Compl. at 5). As shown below, however, the amended complaint still fails to satisfy the pleading requirements of Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007). The substantive portions of the amended complaint state, in their entirety: Plaintiff’s Denial of Right to Due Process and constitutianal [sic] rights per improper mortgage company procedures, both servicing through an independent broker /realtor, and otherwise, and including, but not limited to, improper noticing for mortgage note and deed activities. (I.e., Divergent paths for both stipulate relevant causes of action). This action cites: Fraud, Negligence, and Misrepresentation attributed to Defendants’ multiple violations of ignoring proper loan procedures. Causes(s) [sic] of action exist from divergent paths taken by both the mortgage note and the deed of trust ; E.g., A cloud on all title activity exists due to no definitive claimant of ownership of the note(s), due to divergent paths taken by both the mortgage note and by the deed of trust. *** Defendant’s claim estate or interest in the real property described in this Complaint adverse to that of Plaintiff, and absent a valid trustee’s deed, now set forth as an Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 2 of 11 3 Absentee Trustee’s Deed, as the existence of any valid trustee’s deed which could benefit Defendants would be null and void, and in favor of Plaintiff, thereby effecting the necessary cancellation of said deed as Defendants’ claims are without any merit. Later compensation therefore is moot, and will only injure plaintiff further. Again, causes(s) [sic] of action exist from divergent paths taken by both the mortgage note and the deed of trust ; E.g., A cloud on all title activity exists due to no definitive claimant of ownership of the note(s), due to divergent paths taken by both the mortgage note and by the deed of trust. *** Plaintiff realleges, and incorporates by reference, all preceeding [sic] allegations implemented in this Complaint as fully set forth herein. Defendants’ claim estate or interest in real property described in this Complaint adverse to that of Plaintiff, and absent a valid trustee’s deed, now set forth as an Absentee Trustee’s Deed, as the existance [sic] of any valid trustee’s deed which could benefit Defendants would be null and void, and in favor of the plaintiff, thereby effecting the necessary cancellation of said deed as Defendants’ claims are without any right, and which Plaintiff now requests; E.g., With no valid trustee’s deed. Defendants’ have no legal right, tittle [sic], or interest in real property which is the subject matter of this action, and is more commonly known as: 10502 CEDARWOOD LANE, FORT WASHINGTON, MD 20744 *** Accordingly, Plaintiff also seeks monetary and punitive damages in the amount of $1,400,000.00. (Am. Compl. at 4-5). Regarding jurisdiction, the amended complaint asserts that this Court has jurisdiction based on diversity of citizenship among the parties, and alleges that Plaintiff is a citizen of Maryland while Seneca is incorporated under the laws of, and has its principal place of business in, New York. (Id. at 3-4). However, the amended complaint still makes no allegations regarding the citizenship of two of the named defendants. (See id. at 2). These cursory and unclear allegations fail to state a cognizable claim, and the Court should dismiss the amended complaint. STANDARD OF REVIEW A party may move for dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6) where a complaint fails to state facts sufficient to “state a claim to relief that is plausible on its Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 3 of 11 4 face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Whether a complaint adequately states a claim for relief is normally judged under Federal Rule of Civil Procedure 8(a)(2), which requires “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2); see Twombly, 550 U.S. at 555. A complaint must state “a plausible claim for relief,” as “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009). Although pro se complaints are construed liberally in favor of the plaintiff, “even a pro se complaint must be dismissed if it does not allege a plausible claim for relief.” Mountcastle v. SunTrust Bank, No. MJG-12-0885, 2013 WL 588981, at *2 (D. Md. Feb. 12, 2013) (internal quotation marks omitted). To satisfy the plausibility standard, a complaint “must contain more than labels and conclusions or a formulaic recitation of the elements of a cause of action.” Id. (quoting Twombly, 550 U.S. at 555) (internal quotation marks omitted). The factual allegations in even a pro se complaint must “be enough to raise a right to relief above the speculative level[.]” Redding v. Justia, Inc., No. CCB-11-0674, 2011 WL 5833662, at *2 (D. Md. Nov. 18, 2011) (quoting Twombly, 550 U.S. at 555 and dismissing pro se complaint). When the “well- pleaded facts do not permit the court to infer more than the mere possibility of misconduct,” a complaint must be dismissed. Id. (quoting Iqbal, 556 U.S. at 679). The Court must dismiss a pro se complaint when “it appears beyond doubt that the litigant can prove no set of facts in support of his claim that would entitle him to relief.” Mountcastle, 2013 WL 588981, at *2. Even under this liberal standard, Plaintiff has failed to state a claim. ARGUMENT The amended complaint should be dismissed because Plaintiff has not pleaded facts sufficient to support a cause of action, has not pleaded fraud and misrepresentation with Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 4 of 11 5 particularity, and has not pleaded facts sufficient to establish that this Court has subject-matter jurisdiction. I. PLAINTIFF HAS FAILED TO STATE A CLAIM UPON WHICH RELIEF CAN BE GRANTED. Even under the relaxed pleading standard for pro se complaints, Plaintiff has failed to allege enough facts to allow this case to move forward. It is simply not clear from the amended complaint what act or omission Plaintiff complains of. The amended complaint alleges that this action involves a “Denial of Right of Due Process and constitutional rights,” as well as fraud, negligence, and misrepresentation, purportedly resulting from Defendants’ allegedly improper mortgage servicing practices. (Am. Compl. at 5). But it contains no factual allegations other than a bare, conclusory allegation of “improper mortgage company procedures, both servicing through an independent broker /realtor, and otherwise, including, but not limited to, improper noticing for mortgage note and deed activities (I.e., divergent paths for both)[,]” and “multiple violations of ignoring proper loan procedures.” (Am. Compl. at 5). The amended complaint now includes an expanded allegation1 that “[a] cloud on all title activity exists due to no definitive claimant of ownership of the note(s), due to divergent paths taken by both the mortgage note and by the deed of trust.” But it is still unclear what this means, which mortgage, deed, and “divergent paths” Plaintiff refers to, and what conduct by Seneca Plaintiff complains of. Other than the vague reference to a “cloud” on “all title activity,” it is also unclear how Plaintiff has been injured. Even construing these new allegations in the light most favorable to Plaintiff, it is simply unclear what conduct is being attributed to Seneca. 1 The original complaint also referred to “divergent paths” taken by a mortgage and deed. (Compl. at 5). Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 5 of 11 6 The remaining substantive portions of Plaintiff’s amended complaint appear only to state unclear and unsupported legal conclusions. Even to the extent that the complaint does offer a limited legal theory, it is not tied to any facts, and it is not articulated clearly enough to meet the standard in Iqbal and Twombly. See Redding, 2011 WL 5833662, at *3 (dismissing complaint that “consists entirely of ‘naked assertions,’ some of which are disjointed and incoherent and all of which are unsubstantiated by facts”). Moreover, aside from simply naming several causes of action, the amended complaint does not even state which elements Plaintiff will attempt to prove at trial, much less allege facts that would support those elements if accepted as true. In Redding, a court in this District dismissed a pro se complaint which, like the amended complaint here, “failed even to set forth those basic elements [of a cause of action] or to identify conduct on the part of any defendant that could constitute a basis for liability.” Id. at *3. Dismissal is appropriate here for the same reason. The amended complaint also lacks specific allegations necessary to determine whether this case presents a cognizable claim against Defendants. For instance, as discussed below, Plaintiff invokes the Court’s diversity jurisdiction, but has not pleaded facts sufficient to establish that complete diversity exists among the parties. Plaintiff has also failed to identify any facts specifically relating to Seneca or any other Defendant showing why they are properly named in this action. This alone is a basis for dismissing Seneca from this case: in Redding, the court dismissed a complaint that, like Plaintiff’s, did “not identify why each claim should apply to each of the named defendants and fail[ed] to identify tortious . . . conduct specific to the individual defendants.” Id. at *2. Finally, Plaintiff’s allegation that “[t]hese events have especially taken place within the past few years, following the crises and debacles stemming from the Mortgage Meltdown disaster circa 2008,” (Am. Compl. at 4), does not allow the Court Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 6 of 11 7 to determine whether this action is barred by Maryland’s general three-year statute of limitations, or whether a different limitations period applies. See Md. Code Ann., Cts. & Jud. Proc. § 5-101.2 Allowing this case to go forward would require the Court to go beyond liberally construing the pleadings to actually construct both a legal and factual theory on behalf of Plaintiff. Even the liberal standard for pro se complaints “does not transform the court into an advocate[.]” United States v. Wilson, 699 F.3d 789, 797 (4th Cir. 2012). Plaintiff’s bare allegations of fact-which do not describe a coherent act or occurrence related to any Defendants-also make it impossible for Seneca to properly respond, because it is unclear what allegations Seneca must respond to, as required by Rule 8(a). See Jackson v. Early Warning, No. PJM 15-1233, 2016 WL 7228866, at *3, 4, 5 (D. Md. Dec. 13, 2016) (dismissing pro se complaint where “both Defendants and the Court remain unable to reasonably infer which Defendants are liable for the misconduct alleged,” therefore “preclud[ing] Defendants from providing meaningful responses”) (internal quotation marks omitted). The Court should dismiss the amended complaint for failing to state a claim upon which relief can be granted. II. PLAINTIFF HAS NOT PLEADED FRAUD WITH PARTICULARITY. To the extent the amended complaint alleges “Fraud, . . . and Misrepresentation attributed to Defendants’ multiple violations of ignoring proper loan procedures,” it must be dismissed for failing to plead such counts with particularity. The Federal Rules of Civil Procedure require that “[i]n alleging fraud or mistake, a party must state with particularity the circumstances 2 Even if the Court assumes that the amended complaint’s allegation of a “cloud on all title activity” states a continuing cause of action, it is necessary to know which statute of limitation applies so Defendants can understand how far back Plaintiff’s claims can reach. And the amended complaint still does not contain sufficient detail for Defendants to know when this cause of action first accrued, which could be relevant to which affirmative defenses Defendants can raise. Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 7 of 11 8 constituting fraud or mistake.” Fed. R. Civ. P. 9(b).3 At a minimum, the plaintiff must allege the “who, what, when, where, why, and how” of the alleged fraud-the time, place, and contents of the false statement, the identity of the person making that statement, and what the person fraudulently obtained. United States ex rel. Wilson v. Kellogg Brown & Root, Inc., 525 F.3d 370, 379 (4th Cir. 2008) (internal quotation marks omitted).4 Even a pro se complaint must satisfy this particularity requirement. Maheu v. Bank of Am., N.A., No. 12-cv-508, 2012 WL 1744536, at *4 (D. Md. May 14, 2012). The amended complaint does not allege any details in support of its fraud and misrepresentation counts, much less the “who, what, when, where, why, and how” of the alleged fraud, and should be dismissed. Moreover, dismissal is appropriate here because the amended complaint does not alert Defendants to what defenses they must prepare, and there is no indication Plaintiff possesses “substantial prediscovery evidence” of facts supporting fraud. View Point Med. Sys., LLC v. Athena Health, Inc., 9 F. Supp. 3d 588, 611 (D. Md. 2014) (noting that courts should hesitate to dismiss fraud counts where defendant is aware of what defenses to prepare and plaintiff has prediscovery evidence of fraud). To the extent the amended complaint states discrete counts sounding in fraud and related torts, it does not satisfy Rule 9(b), and dismissal is appropriate. 3 Rule 9(b) applies “to all cases where the gravamen of the claim is fraud even though the theory supporting the claim is not technically termed fraud.” Adams v. NVR Homes, Inc., 193 F.R.D. 243, 250 (D. Md. 2000). 4 Whether the Rule 9(b) standard is loosened for fraud by omission is “a question upon which courts disagree.” Bhari Information Tech. Sys. Private Ltd. v. Sriram, 984 F. Supp. 2d 498, 505 (D. Md. 2013). Even under the relaxed standard, however, a plaintiff still must plead specific facts, including when a partial disclosure was made and how she came to rely on it. Id. Even construing the amended complaint as alleging fraud by omission-which is not clear on the face of the complaint-Plaintiff has failed to satisfy the Rule 9(b) standard. Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 8 of 11 9 III. PLAINTIFF HAS NOT ESTABLISHED THIS COURT HAS JURISDICTION OVER THESE CLAIMS. Finally, Seneca moves for dismissal under Rule 12(b)(1), and in the alternative under Rule 12(b)(6), because it is not clear from the amended complaint that Plaintiff has properly invoked this Court’s diversity jurisdiction. The amended complaint does not establish that there is complete diversity among the parties. Section 1332 requires “complete diversity among parties, meaning that the citizenship of every plaintiff must be different from the citizenship of every defendant.” Central W. Va. Energy Co., Inc. v. Mountain State Carbon, LLC, 636 F.3d 101, 103 (4th Cir. 2011). The amended complaint alleges that Plaintiff is a Maryland citizen, (Am. Compl. at 3), so this Court does not have jurisdiction if any Defendant is also a Maryland citizen. But the amended complaint lacks jurisdictional allegations for several Defendants, and the record suggests at least two are in fact Maryland citizens like Plaintiff. A defendant may move to dismiss for lack of subject-matter jurisdiction under either Rule 12(b)(1) or Rule 12(b)(6). James G. Davis Const. Corp. v. Erie Ins. Exchange, 953 F. Supp. 2d 607, 609 (D. Md. 2013). When reviewing a motion to dismiss for lack of diversity under Rule 12(b)(1), the Court may look beyond the complaint and consider other pleadings and papers to determine if complete diversity exists, and it is the plaintiff’s burden to prove subject-matter jurisdiction. Id. Under Rule 12(b)(6), a Court considers only the pleadings, and whether to dismiss depends on Plaintiff’s jurisdictional allegations, which are accorded a presumption of truthfulness. Id. This case should be dismissed under either standard. If the Court evaluates its subject-matter jurisdiction under Rule 12(b)(1), it should consider the original summonses prepared in this case. (Summonses in a Civil Action, ECF No. 7 (Mar. 16, 2017)). Those documents, signed by Plaintiff, list Maryland addresses for Defendants Gerard Dupree and Michael Radziewicz. This suggests they are Maryland citizens, Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 9 of 11 10 and there is no contrary allegation in the amended complaint, or contrary evidence elsewhere in the record. In the alternative, if the Court evaluates its jurisdiction under Rule 12(b)(6), it should dismiss the amended complaint because there are no jurisdictional allegations as to Defendants Dupree, Radziewicz, or Does 1 to 50, inclusive. The amended complaint lists the addresses for Dupree and Radziewicz as either “(On file)” or “N/A” and does not mention Does 1 to 50 inclusive anywhere except the case caption. Because on its face the amended complaint does not establish complete diversity among the parties, Plaintiff has failed to show that this Court has subject-matter jurisdiction over these claims, and the amended complaint should be dismissed under Rule 12(b)(6). CONCLUSION For the foregoing reasons, the Court should dismiss the amended complaint or, in the alternative, dismiss Seneca as a defendant from this case. May 16, 2017 Respectfully submitted, /s/ Stephen W. Miller (Bar No. 19957) John R. Grimm (Bar No. 19223) Harris, Wiltshire & Grannis LLP 1919 M Street NW 8th Floor Washington, DC 20036 smiller@hwglaw.com 202-730-1305 (Telephone) 202-730-1301 (Fax) Counsel for Seneca Mortgage Servicing, LLC Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 10 of 11 CERTIFICATE OF SERVICE I certify that on May 16, 2017, the foregoing was filed electronically through the Court’s CM/ECF system. Participants in the case who are registered CM/ECF users will be served by the Court’s CM/ECF system. I further certify that on May 16, 2017, the foregoing document was served upon the following parties by U.S. mail: Brenda Rufus Michael Radziewicz 10502 Cedarwood Lane 313 South Lake Drive Fort Washington, MD 20744 Stevensville, MD 21666 Gerard J. Dupree U.S. Bank, N.A. 12600 Willow Marsh Lane 351 West Camden Street Fort Washington, MD 20720 Baltimore, MD 21201 I further certify, pursuant to Fed. R. Civ. P. 5(b)(2)(D) that the addresses of unnamed Defendants Does 1 through 50, Inclusive are unknown to me, and that I therefore sent a service copy to the Clerk of the Court. /s/ Stephen W. Miller Case 8:17-cv-00351-PJM Document 16-1 Filed 05/16/17 Page 11 of 11 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND-SOUTHERN DIVISION BRENDA RUFUS, Plaintiff, v. SENECA MORTGAGE SERVICING, LLC et al., Defendants. No. PJM 17-CV-0351 ORDER Presently before the Court is Defendant Seneca Mortgage Servicing, LLC’s Motion to Dismiss Amended Complaint. The Court having considered the Motion and any responses and replies thereto, it is this ____ day of _______________, 2017, hereby ORDERED that the Motion is GRANTED; and it is further ORDERED that this case is DISMISSED for failure to state a claim, failure to meet the pleading requirements of Fed. R. Civ. P. 9(b), and lack of subject matter jurisdiction; and it is further ORDERED that the Clerk is directed to CLOSE this case. __________________________ Peter J. Messittee United States District Judge Case 8:17-cv-00351-PJM Document 16-2 Filed 05/16/17 Page 1 of 1