Whitehead et al v. Ocwen Financial Corp. et al

MOTION to Dismiss for Failure to State a Claim

N.D. Okla.November 11, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA ZACHARY WHITEHEAD and BILLIE WHITEHEAD, Plaintiffs, vs. OCWEN FINANCIAL CORP., OCWEN LOAN SERVICING, LLC, and WELLS FARGO BANK, N.A. Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. 4:16-cv-00536-GKF-FHM DEFENDANTS OCWEN LOAN SERVICING, LLC AND WELLS FARGO BANK, N.A. AS TRUSTEE’S RULE 12(B)(6) MOTION TO DISMISS PLAINTIFFS’ AMENDED COMPLAINT AND INCORPORATED MEMORANDUM IN SUPPORT Defendants Ocwen Loan Servicing, LLC (“OLS”) and Wells Fargo Bank, National Association as Trustee for Securitized Asset Backed Receivables LLC 2005-OP2 Mortgage Pass-Through Certificates, Series 2005-OP2 (“Wells Fargo”) move to dismiss plaintiffs Zachary and Billie Whitehead’s amended complaint under Federal Rule of Civil Procedure 12(b)(6) and submit their incorporated memorandum of law in support. OCWEN LOAN SERVICING, LLC AND WELLS FARGO BANK, N.A. AS TRUSTEE By: /s/ Chethan G. Shetty P. Russell Perdew (admitted pro hac vice) rperdew@lockelord.com Chethan G. Shetty (admitted pro hac vice) cshetty@lockelord.com LOCKE LORD LLP 111 South Wacker Drive Chicago, Illinois 60606 312-443-1887 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 1 of 23 Brian J. Rayment, OBA #7441 Triad Center, Ste. 550 7666 E. 61st Street Tulsa, OK 74133 Telephone: 918-254-7915 Facsimile: 918-254-7915 Email: brayment@kivell.com Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 2 of 23 i TABLE OF CONTENTS Page INTRODUCTION ...........................................................................................................................1 BACKGROUND .............................................................................................................................2 LEGAL STANDARD......................................................................................................................3 ARGUMENT...................................................................................................................................4 I. This Court should dismiss the TCPA claim because the amended complaint does not allege facts showing OLS used an ATDS...................................................4 II. No facts are set forth with sufficient particularity to plead a fraud claim .................8 III. The Whiteheads’ malicious prosecution claim fails for several reasons.................10 IV. This Court should dismiss Count VI alleging abuse of process ..............................13 CONCLUSION..............................................................................................................................15 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 3 of 23 ii TABLE OF AUTHORITIES Page(s) Cases Abbas v. Selling Source, LLC, No. 09 CV 3413, 2009 WL 4884471 (N.D. Ill. Dec. 14, 2009) ................................................7 Ashcroft v. Iqbal, 556 U.S. 662 (2009).......................................................................................................3, 4, 5, 8 Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007).......................................................................................................3, 4, 5, 8 Bivins v. Oklahoma, No. 13-CV-0802-CVE-PJC, 2014 WL 1976463 (N.D Okla. May 15, 2014)....................10, 12 Cowdrey v. Allen, No. 05-CV-461-TCK-PJC, 2006 WL 3241381 (N.D. Okla. Nov. 7, 2006) ............................12 Flores v. Adir Int’l, LLC, No. 2:15-cv-00076-AB-PLA, 2015 WL 4340020 (C.D. Cal. July 15, 2015)............................7 Freidman v. Massage Envy Franchising, LLC, No. 3:12-cv-02962, 2013 WL 3026641 (S.D. Cal. June 13, 2013) ...........................................7 GFF Corp. v. Associated Wholesale Grocers, Inc., 130 F.3d 1381 (10th Cir. 1997) .................................................................................................3 Gragg v. Orange Cab Co., Inc., No. C12-0576RSL, 2013 WL 195466 (W.D. Wash. Jan. 17, 2013) .........................................6 Greenberg v. Wolfberg, 890 P.2d 895 (Okla. 1994)...........................................................................................11, 13, 14 Hetronic Intern., Inc. v. Rempe, 99 F. Supp. 3d 1341 (W.D Okla. 2015) ...................................................................................13 Houghton v. Foremost Fin. Servs. Corp., 724 F.2d 112 (10th Cir. 1983) .................................................................................................13 Johansen v. Vivant, Inc., No. 12 C 7159, 2012 WL 6590551 (N.D. Ill. Dec. 18, 2012) ...............................................6, 7 King & King Enterprises v. Champlin Petroleum Co., No. 75-276-C, 1976 WL 1330 (E.D. Okla. Sept. 30, 1976) ....................................................12 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 4 of 23 iii Knutson v. ReplyA, Inc., No. 10-CV-1267, 2011 WL 291076 (S.D. Cal. Jan. 27, 2011)..................................................7 Koch v. Koch Indus., 203 F. 3d 1202 (10th Cir. 2000) ................................................................................................8 Lee v. Enterprise Fin. Group, No. CIV-08-1221-M, 2009 WL 1362605 (W.D. Okla. May 14, 2009)...................................10 Lewis v. Crystal Gas Co., 532 P.2d 431 (Okla. 1975).......................................................................................................11 Lillard v. Stockton, 267 F. Supp. 2d 1081 (N.D. Okla. 2003).............................................................................9, 10 McGinnity v. Kirk, 362 P.3d 186 (Okla. 2015).......................................................................................................14 Meyers v. Ideal Basic Indus., Inc., 940 F.2d 1379 (10th Cir. 1991) ...............................................................................................10 Meyers v. Kruger, 759 F. Supp. 770 (E.D. Okla. 1990) ........................................................................................12 Miller v. Cain, No. 14-2613, 2015 WL 222434 (W.D. La. Jan. 14, 2015) ....................................................6, 7 Oliver v. DirecTV, LLC, No. 14-cv-7794, 2015 WL 1727251 (N.D. Ill. Apr. 13, 2015)..................................................7 Salmon v. CRST Expedited, Inc., No. 14-CV-265-CVE-TLW, 2014 WL 4656499 (N.D. Okla. Sept. 17, 2014)..........................5 U.S. ex rel. Sikkenga v. Regence Bluecross Blueshield of Utah, 472 F.3d 702 (10th Cir. 2006) ...................................................................................................8 St. Louis Baptist Temple, Inc. v. FDIC, 605 F.2d 1169 (10th Cir. 1979) .................................................................................................3 Tal v. Hogan, 453 F.3d 1244 (10th Cir. 2006) .................................................................................................3 TKO Energy Services, LLC v. M-I L.L.C., No. 12-cv-108-GFK-PJC, 2013 WL 789458 (N.D. Okla. Mar. 4, 2013) ..................................8 Statutes 12 O.S. § 1033 ...............................................................................................................................13 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 5 of 23 iv 47 U.S.C. § 227(a)(1).......................................................................................................................5 47 U.S.C. § 227(b)(1)(A).................................................................................................................5 Other Authorities Federal Rule of Civil Procedure 8(a)(2) ..........................................................................................3 Federal Rule of Civil Procedure Rule 9(b) ..............................................................................1, 8, 9 Federal Rule of Civil Procedure Rule 12(b)(6)......................................................................2, 3, 15 Federal Rule of Civil Procedure Rule 56.........................................................................................2 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 6 of 23 1 INTRODUCTION OLS and Wells Fargo previously moved to dismiss, and the Whiteheads responded by amending their complaint in an apparent attempt to cure the deficiencies. But the Whiteheads only made one substantive change to the claims against OLS and Wells Fargo-they corrected their identification of Wells Fargo-and failed to cure the numerous other pleading deficiencies identified in the first motion to dismiss.1 This Court should therefore dismiss the amended complaint. Count II asserts a claim against OLS under the Telephone Consumer Protection Act (“TCPA”), and Counts IV through VI assert claims against both OLS and Wells Fargo for fraud (Count IV), malicious prosecution (Count V), and abuse of process (Count VI). These claims should be dismissed for a number of reasons, all of which were raised in OLS’s prior motion. First, setting aside the purely conclusory recitation of the elements of a TCPA claim, there are no factual assertions that OLS dialed Mr. Whitehead using an automatic telephone dialing system (“ATDS”) as defined in the TCPA, which is a required element for a TCPA claim. Nor are there any allegations sufficient to attribute any fraudulent misrepresentations to OLS or Wells Fargo, as required by Rule 9(b). The malicious prosecution claim fails because it is based on the defendants filing a motion in a foreclosure case, but that tort requires initiating a lawsuit rather than the filing a discrete motion. Finally, the Whiteheads’ abuse of process claim fails because they do not contend that lawful process was improperly used, but instead collaterally attack the validity of the process itself. Each claim also fails to attribute any conduct to OLS, which is grouped together with co-defendant Ocwen Financial Corporation throughout the amended complaint and both are collectively identified as “Ocwen” and sometimes grouped together with 1 See Dkt. No. 25. Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 7 of 23 2 Wells Fargo as “Defendants” without any further detail as to which entity was involved in which conduct. For these reasons, this Court should dismiss Counts II and IV through VI against OLS and Wells Fargo. And because Defendants raised these deficiencies in their prior motion to dismiss and the deficiencies remain uncured in the amended complaint, the Court should dismiss these claims with prejudice. BACKGROUND The amended complaint alleges that after the Whiteheads defaulted on their payments under a mortgage and note on or before June 1, 2009, “servicing of the note was transferred to Defendant Ocwen Financial Corporation and Defendant Ocwen Loan Servicing, LLC” and that these defendants performed as servicers for the loan. (Am. Compl., ¶¶ 15, 20-21.) The amended complaint groups Ocwen Financial Corporation (“OFC”) and OLS together, collectively refers to them as “Ocwen” and never sets forth any particular allegations of conduct by either OFC or OLS. (See, e.g., id., ¶ 21 (“Ocwen was acting on behalf of and as loan servicers and agents of Wells Fargo.”); (id. ¶ 24) (“Upon information and belief, Ocwen, acting in Wells Fargo’s name and as its servicer and agent, prosecuted the foreclosure action” against the Whiteheads).) A judgment was entered against the Whiteheads on February 18, 2010 and a Sheriff’s Deed was subsequently recorded. (Id., ¶¶ 26, 29.) On December 4, 2014, “Ocwen, acting as Wells Fargo’s agent and in its name, moved the court to vacate the February 18, 2010 judgment, the October 19, 2010 Sheriff’s sale, the November 23, 2010 Order Confirming sale and the December 20, 2010 Sheriff’s Deed transferring title to the property to Wells Fargo …” (Am. Compl., ¶ 34.) A copy of the December 4, 2014 Application to Vacate Journal Entry, Sheriff’s Sale, Order Confirming Sheriff’s Sale and Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 8 of 23 3 Void the Sheriff’s Deed is attached here as Exhibit 1.2 The motion states that it was filed “in order to name and serve additional parties of interest.” (Ex. 1.) The motion was granted the same day it was filed. (Am. Compl., ¶ 36.) Wells Fargo filed a First Amendment to Petition on January 5, 2015. A copy of the First Amendment to Petition is attached here as Exhibit 2. The First Amendment to Petition states that it realleges and restates all allegations stated in the Petition except that it is adding Sand Canyon Corporation, who may claim an interest in the subject property, as a defendant. (Ex. 2.) Naming Sand Canyon was consistent with the motion to vacate, which was filed for purposes of naming additional parties. (Ex. 1.) A default judgment was entered against the Whiteheads on March 3, 2015. (Am. Compl., ¶ 37.) In March of 2015, months after the motion to vacate and amendment to the petition were filed, and after the judgment was obtained, “Ocwen began calling and sending letters [to the Whiteheads] in an effort to collect on the debt.” (Id. ¶ 38.) LEGAL STANDARD Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” The U.S. Supreme Court has held that, under the pleading standard set by Rule 8, “[a] pleading that offers ‘labels and conclusions’ or ‘a formulaic recitation of the elements of a cause of action will not do.’” 2 The Court may consider filings from the state court foreclosure action on a Rule 12(b)(6) motion to dismiss without converting the motion to a Rule 56 motion for summary judgment because the documents are referenced in the amended complaint and are central to the Whiteheads’ claims. GFF Corp. v. Associated Wholesale Grocers, Inc., 130 F.3d 1381, 1384 (10th Cir. 1997). And, “facts subject to judicial notice may be considered in a Rule 12(b)(6) motion without converting the motion to dismiss into a motion for summary judgment.” Tal v. Hogan, 453 F.3d 1244, 1264 n.24 (10th Cir. 2006). Under Tenth Circuit precedent, the Court may take judicial notice of “facts which are part of its public records” and “matters that are verifiable with certainty.” St. Louis Baptist Temple, Inc. v. FDIC, 605 F.2d 1169, 1172 (10th Cir. 1979). The Court may take judicial notice of the Application to Vacate Journal Entry, Sheriff’s Sale, Order Confirming Sheriff’s Sale and Void the Sheriff’s Deed (Exhibit 1) and First Amendment to Petition (Exhibit 2) because they are a matter of public record and are verifiable with certainty. Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 9 of 23 4 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Nor does a complaint suffice if it merely offers “naked assertion[s]” devoid of “further factual enhancement.” Id. Factual allegations must be sufficient to raise a right to relief above the speculative level. Twombly, 550 U.S. at 555. To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to “state a claim for relief that is plausible on its face.” Iqbal, 556 U.S. at 678; Twombly, 550 U.S. 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. Iqbal, 556 U.S. at 678; Twombly, 550 U.S. at 556. The tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Iqbal, 556 U.S. at 678; Twombly, 550 U.S. at 555. Thus, threadbare recitals of the elements of a cause of action supported by nothing more than mere conclusory statements do not suffice. Id. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. Iqbal, 556 U.S. at 679. Furthermore, and particularly relevant here, “a district court must retain the power to insist upon some specificity in pleading before allowing a potentially massive factual controversy to proceed.” Twombly, 550 U.S. at 558. ARGUMENT I. This Court should dismiss the TCPA claim because the amended complaint does not allege facts showing OLS used an ATDS. The Whiteheads have not corrected their failure to plead any facts supporting their conclusory allegation that Ocwen dialed Mr. Whitehead using an ATDS. Instead, Count II still relies on the improper legal conclusion that “Ocwen” violated the TCPA by calling Mr. Whitehead’s cellular phone without his consent using an ATDS and that “Ocwen uses ATDS, including ones that are also capable of being an Automatic Dial Announcing Device Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 10 of 23 5 (“ADAD”).” (Am. Compl., ¶¶ 48-49, 67.) Use of an ATDS is a required element of a TCPA claim. 47 U.S.C. § 227(b)(1)(A) (prohibiting certain calls made using an ATDS). The TCPA defines an ATDS as “equipment which has the capacity-(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” Id. at § 227(a)(1). To state a claim under the TCPA, a plaintiff must allege that: (1) a call was made to a cellular or wireless phone, (2) using an ATDS or an artificial or prerecorded voice, and (3) without prior express consent of the called party. 47 U.S.C. § 227(b)(1)(A); Salmon v. CRST Expedited, Inc., No. 14- CV-265-CVE-TLW, 2014 WL 4656499, at *2 (N.D. Okla. Sept. 17, 2014) (quoting Meyer v. Portfolio Recovery Associates, LLC, 707 F.3d 1036, 1043 (9th Cir. 2012)). The Whiteheads fail to satisfy the second element of a TCPA claim because they allege no facts showing Ocwen placed any call using an ATDS or an “artificial or prerecorded voice.” Rather, the Whiteheads simply state the conclusion that Ocwen called “using an Automated Telephone Dialing System (“ATDS”) with the capacity to store telephone numbers as that term is used in the TCPA.” (Am. Compl., ¶ 48.) This wholly conclusory allegation simply repeats a part of the statutory definition of an ATDS without alleging any supporting facts. Indeed, the Whiteheads never allege that OLS’s dialing equipment uses a “random or sequential number generator” or that it has the capacity to dial numbers it stores or produces using a random or sequential number generator. See 47 U.S.C. § 227(a)(1). But even if the Whiteheads had parroted the entire definition of an ATDS, they still provide no basis-likely because they cannot-for their bare conclusion that the alleged calls were made with an ATDS. This is precisely the sort of defective pleading that constitutes nothing more than “a formulaic recitation of the elements of a cause of action.” See Iqbal, 556 U.S. at 678-679; Twombly, 550 U.S. at 555. Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 11 of 23 6 Federal courts throughout the country have dismissed TCPA claims with this same defect. Specifically, courts hold that while a TCPA plaintiff need not allege “specific technical details” regarding a defendant’s ATDS use, he must at least describe in laymen’s terms the facts about the calls “or provide the circumstances surrounding them to establish his belief that” they were made using an ATDS. Johansen v. Vivant, Inc., No. 12 C 7159, 2012 WL 6590551, at *3 (N.D. Ill. Dec. 18, 2012); Miller v. Cain, No. 14-2613, 2015 WL 222434, at *9 (W.D. La. Jan. 14, 2015) (“Courts rely on facts that permit an inference that the calls were made using an ATDS ‘such as the content of the message, the context in which it was received, and the existence of similar messages.’”) (citations omitted); Gragg v. Orange Cab Co., Inc., No. C12-0576RSL, 2013 WL 195466, at *2 (W.D. Wash. Jan. 17, 2013) (granting motion for judgment on the pleadings where plaintiff’s contention that “the message he received was sent by means of an ATDS” was possible, but did “not appear plausible” because where only one text message was at issue, “Plaintiff’s allegations regarding the frequency with which this message has been sent and the use of an ATDS to send them are unsupported by any specific facts and appear less likely than the alternate inference, namely that plaintiff received a customer-specific text … through human agency, rather than an ATDS”). For example, in Vivant and Cain, the courts observed that a plaintiff can plausibly suggest the use of an ATDS by describing the robotic sound of the voice on the other line, the lack of human response when he attempted to have a conversation with the “person” calling him, the generic content of the messages received, or anything else about the circumstances of a call or message contributing to his belief it was pre-recorded or delivered via an ATDS. Vivant, 2012 WL 6590551 at *3; Cain, 2015 WL 222434 at *9. The court in Vivant dismissed the TCPA claim because plaintiff “provide[d] no information about the two messages he allegedly received from Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 12 of 23 7 [defendant] other than stating that [defendant] left pre-recorded messages on his cellular phone using an ATDS.” Vivant, 2012 WL 6590551 at *3. The court held that “[w]ithout enhancing his complaint with anything more than the language already available in the statute, Plaintiff provides only a threadbare, ‘formulaic recitation of the elements’ of a TCPA cause of action, which is not entitled to an assumption of truth.” Id. (quoting Iqbal, 556 U.S. at 678; Twombly, 550 U.S. at 555; Brooks v. Ross, 578 F.3d 574, 581 (7th Cir. 2009)). And in Cain, where the plaintiff made no allegations regarding the circumstance of the alleged call, the court noted that “the vast majority of courts to have considered the issue have found that ‘[a] bare allegation that defendant[] used an ATDS is not enough.’” 2015 WL 222434 at *8 (quoting Baranski v. NCO Fin. Sys., Inc., No. 13 CV 6349, 2014 WL 1155304, at *6 (E.D.N.Y. Mar. 21, 2014) (“Plaintiff must do more than simply parrot the statutory language … they must at least describe, in laymen’s terms, the facts about the calls or the circumstances surrounding the calls that make it plausible that they were made using an ATDS.”)).3 The Whiteheads’ claim likewise fails because they have alleged no facts-despite amending their pleading-that would make plausible their claim that Mr. Whitehead was called 3 See also Oliver v. DirecTV, LLC, No. 14-cv-7794, 2015 WL 1727251, at *3 (N.D. Ill. Apr. 13, 2015) (“While Plaintiffs’ allegations are consistent with Defendant having used an ATDS, to wit, were possibly made with an ATDS, these alleged facts do not suggest beyond the ‘speculative level’ that Defendant actually used an ATDS and is liable under the TCPA.”) (emphasis in original); Freidman v. Massage Envy Franchising, LLC, No. 3:12-cv-02962, 2013 WL 3026641, at *2 (S.D. Cal. June 13, 2013) (dismissing TCPA claim where the “text messages are generic and impersonal … but that is not enough to make the claims plausible. It is just as conceivable that the text messages were done by hand, or not using an ATDS.”); Knutson v. ReplyA, Inc., No. 10-CV-1267, 2011 WL 291076, at *2 (S.D. Cal. Jan. 27, 2011) (“[T]he complaint gives no details about the manner of the calls except that they were solicitations about Defendant’s real estate business. There is nothing in the complaint that allows the court to infer the calls were randomly generated or impersonal.”); Abbas v. Selling Source, LLC, No. 09 CV 3413, 2009 WL 4884471, at *3 (N.D. Ill. Dec. 14, 2009) (conclusory allegations regarding the use of an ATDS are “bare legal conclusions entitled to no weight”); Flores v. Adir Int’l, LLC, No. 2:15-cv-00076- AB-PLA, 2015 WL 4340020, at *4 (C.D. Cal. July 15, 2015) (granting motion to dismiss with prejudice where the “[p]laintiff’s TCPA claim rest[ed] solely on his conclusory allegation that Defendant used an ATDS”). Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 13 of 23 8 by OLS via an ATDS. Rather, they simply parrot some of the language of the TCPA. The Whiteheads’ pleading is plainly improper under the ironclad requirements of Iqbal and Twombly and the relevant TCPA authorities discussed above. This Court should therefore dismiss Count II. II. No facts are set forth with sufficient particularity to plead a fraud claim. Count IV alleging fraud against “Defendants” should be dismissed as to OLS and Wells Fargo because the amended complaint falls far short of the heightened pleading requirements of Rule 9(b) and the Whiteheads have made no effort in their amended complaint to plead their fraud claims with any specificity. Under Oklahoma law, the elements of actionable fraud are: (1) a false material misrepresentation, (2) made as a positive assertion which is either known to be false or is made recklessly without knowledge of the truth, (3) with the intention that it be acted upon, and (4) which is relied on by the other party to his own detriment. TKO Energy Services, LLC v. M-I L.L.C., No. 12-cv-108-GFK-PJC, 2013 WL 789458, at *9 (N.D. Okla. Mar. 4, 2013). Further, the federal rules require specific and detailed factual allegations to support a fraud claim. Fed. R. Civ. P. 9(b) (“In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake.”); Koch v. Koch Indus., 203 F. 3d 1202, 1236 (10th Cir. 2000) (“Rule 9(b)’s purpose “is to afford defendant fair notice of plaintiff’s claims and the factual background upon which [they] are based.”) (internal quotations and citations omitted). This fair notice “requires a complaint alleging fraud to set forth the time, place and contents of the false statements and the consequences thereof.” TKO, 2013 WL 789458 *8 (quoting Koch, 203 F. 3d at 1236). The need for detail regarding the allegedly false statements is well established. U.S. ex rel. Sikkenga v. Regence Bluecross Blueshield of Utah, 472 F.3d 702, 726-27 (10th Cir. 2006). (“At a minimum, Rule 9(b) requires that a plaintiff set forth the ‘who, what, when, where and Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 14 of 23 9 how of the alleged fraud, and must set forth the time, place and contents of the false representation, the identity of the party making the false statements and the consequences thereof.”). The amended complaint falls short of Rule 9(b)’s requirements because it never alleges the details of the alleged false statements. Rather, the Whiteheads allege only that “Defendants falsely represented that the Whiteheads could still own the property years after the foreclosure and confirmation of sheriff’s sale by entering into an agreement modifying the note and mortgage.” (Am. Compl., ¶ 79.) This allegation is insufficient to state a claim under Rule 9(b) because “where fraud is alleged against multiple defendants, blanket allegations of fraud couched in language such as ‘by the defendants’ are insufficient. Instead, the specifics of the alleged fraudulent activity of each defendant must be set forth.” Lillard v. Stockton, 267 F. Supp. 2d 1081, 1094 (N.D. Okla. 2003). Despite taking the opportunity to amend their pleading, the Whiteheads still fail to allege which of the three defendants made the representation that they “could still own the property.” And the Whiteheads still fail to set forth when the representation was made, where the representation was made, how the representation was made, or any other contents of the representation. (Am. Compl., ¶ 79.) Nor does the amended complaint explain why such a representation was false given that the 2010 foreclosure judgment, Sheriff’s sale, order confirming Sheriff’s sale, and the Sheriff’s Deed were vacated-which would have caused ownership of the property to revert to the Whiteheads for over a year until entry of the agreed order on April 28, 2016 that restored the original foreclosure judgment and orders. (Id. ¶¶ 34, 36, 55.) With the foreclosure and sheriff’s sale vacated, there is no indication from the amended complaint of how “Defendants’” alleged loan modification offer was false or fraudulent. Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 15 of 23 10 Accordingly, Count IV should be dismissed because it sets forth no specifics regarding the conduct of OLS or Wells Fargo. See Lee v. Enterprise Fin. Group, No. CIV-08-1221-M, 2009 WL 1362605, at *4 (W.D. Okla. May 14, 2009) (dismissing fraud claim where “plaintiffs impermissibly lumped all defendants together, rather than setting forth the identity of the party making the fraudulent statements, as well as the time, place and contents of the alleged fraudulent statements”); Stockton, 267 F. Supp. 2d at 1112 (dismissing fraud claim for failure to comply with Rule 9(b)’s particularity requirements). III. The Whiteheads’ malicious prosecution claim fails for several reasons. The Whiteheads’ claim under Count V for malicious prosecution should be dismissed with prejudice because the Whiteheads do not allege facts showing that OLS or Wells Fargo brought an “original action” upon which this claim is based or that an original action was terminated in the Whiteheads’ favor. Nor can the Whiteheads establish the “probable cause” requirement. A malicious prosecution claim requires a defendant to have filed a case (which plaintiff ultimately won) maliciously and without probable cause. Bivins v. Oklahoma, No. 13-CV-0802- CVE-PJC, 2014 WL 1976463, at *3 (N.D Okla. May 15, 2014) (“The essential elements of a state law malicious prosecution are: ‘(1) the bringing of the original action by the defendant; (2) its successful termination in plaintiff’s favor; (3) want of probable cause to join the plaintiff; (4) malice; and (5) damages.’”) (quoting Young v. First State Bank, Watonga, 628 P.2d 707, 709 (Okla. 1981)). “Malicious prosecution actions are disfavored by Oklahoma courts, and the elements of the action are narrowly construed.” Meyers v. Ideal Basic Indus., Inc., 940 F.2d 1379, 1383 (10th Cir. 1991). Here, the Whiteheads do not base their claim on the initiation of a case but on the filing of a motion within the exiting foreclosure case “to vacate the judgment, sale, confirmation and Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 16 of 23 11 sheriff’s deed …” (Am. Compl., ¶ 88.) But malicious-prosecution claims apply only to the initiation of a proceeding-i.e., filing a lawsuit-rather than particular motions filed within a proceeding. See Greenberg v. Wolfberg, 890 P.2d 895, 903 (Okla. 1994) (“The essence of malicious prosecution is abuse of judicial process by bringing a civil proceeding with malice.”) (emphasis in original); Lewis v. Crystal Gas Co., 532 P.2d 431, 433 (Okla. 1975) (discussing the initiation of civil proceedings). The Court should dismiss Count V with prejudice for this reason alone. Second, the Court should also dismiss this claim with prejudice because there was no successful termination of an original action in the Whiteheads’ favor. On the contrary, a judgment of foreclosure was entered in favor of Wells Fargo and against the Whiteheads. Although the Whiteheads prevailed on a motion within that case, that simply put the case “back to its footing as of December of 2010” (Am. Compl. ¶ 54), which is not a termination of the foreclosure in the Whiteheads’ favor. Indeed, in granting the Whitehead’s motion, the court reinstated the judgment of foreclosure, Sheriff’s sale, confirmation of sale, and Sheriff’s Deed transferring title to Wells Fargo. Thus, the Whiteheads lost the foreclosure case, so they cannot state a claim for malicious prosecution. Oklahoma courts narrowly construe the requirement of litigation terminating in the plaintiff’s failure. Indeed, even obtaining a dismissal without prejudice falls short of the requirement of a successful termination of the original action. Wolfberg, 890 P.2d at 904 (“For there to be a prevailing party in an action requires that the underlying proceeding not have been dismissed without prejudice. Dismissal without prejudice is not a termination favorable to the malicious-prosecution plaintiff.”) (emphasis in original). And, “[t]he Oklahoma Supreme Court has consistently recognized the well established principle that where a termination of a Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 17 of 23 12 prosecution is pursuant to a compromise or settlement, a later action for malicious prosecution is barred.” Meyers v. Kruger, 759 F. Supp. 770, 772 (E.D. Okla. 1990) (citing Young, 628 P.2d at 710). Here, the Whiteheads did not succeed in obtaining a dismissal of the foreclosure-with or without prejudice, and that is fatal to their claim. King & King Enterprises v. Champlin Petroleum Co., No. 75-276-C, 1976 WL 1330, at *4 (E.D. Okla. Sept. 30, 1976) (“Federal courts have repeatedly dismissed malicious prosecution complaints for failure to allege a favorable prior termination.”). And, the order purportedly terminating the matter in the Whiteheads’ favor was an agreed order. (Am. Compl., ¶¶ 55, 89.) In other words, it was obtained through a compromise, and therefore there can be no claim for malicious prosecution. This Court should dismiss Count V with prejudice. Bivins, 2014 WL 1976463 at *4 (a criminal case against plaintiff could not “serve as the basis for plaintiff’s state law malicious prosecution claim” because it was dismissed without prejudice); Kruger, 759 F. Supp. at 773 (granting motion to dismiss malicious prosecution claim where the underlying case was terminated by agreement). Further, the Whiteheads have not alleged facts showing a lack of probable cause-which constitutes a “complete defense” to a malicious prosecution claim-because they do not contend that Wells Fargo filed the 2009 foreclosure petition without probable cause. See Cowdrey v. Allen, No. 05-CV-461-TCK-PJC, 2006 WL 3241381, at *3 (N.D. Okla. Nov. 7, 2006). The Whiteheads admit that they defaulted on their repayment obligations under the mortgage and note in June 2009, before the foreclosure was filed. (Am. Compl., ¶ 20.) And, any contention that there was no probable cause for the foreclosure would be rebutted by the foreclosure court’s granting of a judgment against the Whiteheads on February 18, 2010. See Cowdrey, 2006 WL 3241381 at *3 (finding of probable cause at preliminary hearing in criminal matter “negates Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 18 of 23 13 Plaintiff’s ability to meet the third element of her malicious prosecution claim, mandating dismissal of same”). IV. This Court should dismiss Count VI alleging abuse of process. The Court should also dismiss Count VI for abuse of process because the Whiteheads do not allege that Defendants used a proper process for an improper purpose. Rather, they allege Defendants used improper process, which does not state an abuse of process claim. “Abuse of process occurs when legal process is used for an improper purpose, to accomplish an end not lawfully obtainable, or to compel someone to do some collateral thing he could not be legally compelled to do.” Houghton v. Foremost Fin. Servs. Corp., 724 F.2d 112, 116 (10th Cir. 1983). Thus, abuse of process requires the improper use of lawful process. Hetronic Intern., Inc. v. Rempe, 99 F. Supp. 3d 1341, 1351 (W.D Okla. 2015) (“The essence of the tort of abuse of process is ‘not the wrongfulness of the prosecution, but some extortionate perversion of lawfully initiated process to illegitimate ends.’” ) (quoting Heck v. Humphrey, 512 U.S. 477, 485 n. 5, 114 S. Ct. 2364 (1994)); Wolfberg, 890 P.2d at 906 (abuse of process claims are reserved for “perversion of the process after it is issued”) (emphasis in original). Here, the Whiteheads’ abuse of process claim fails because they do not allege any improper use of lawful process. Rather, they claim the motion to vacate was itself improper and unlawful. The Whiteheads complain that the motion was improperly filed without a petition and the issuance of summons as required by 12 O.S. § 1033, that they did not receive proper service of the motion, and that “Defendants had no legally valid reason to” file the motion. (Am. Compl., ¶¶ 99-102.) These allegations plainly amount to a dispute over the propriety of the motion and the foreclosure court’s granting of the motion the same day it was filed. But this attack on the process itself, rather than the use of process, is not the purpose of an abuse of process claim. Wolfberg, 890 P.2d at 905 (“The quintessence of abuse of process is ‘not the Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 19 of 23 14 wrongfulness of the prosecution, but some extortionate perversion of lawfully initiated process to illegitimate ends.’”) (quoting Heck, 114 S. Ct. at 2372). Thus, the Court should dismiss Count VI because there is no allegation that lawfully initiated process was improperly used by OLS or Wells Fargo. The Court should dismiss Count VI for the additional reason that the amended complaint does not allege how OLS or Wells Fargo improperly used the foreclosure court’s process primarily for an ulterior or improper purpose. “The significance of [the] word [“primarily”] is that there is no action for abuse of process when the process is used for the purpose for which it is intended, but there is an incidental motive of spite or an ulterior purpose of benefit to the defendant.” McGinnity v. Kirk, 362 P.3d 186, 204 (Okla. 2015) (quoting Restatement (Second) of Torts § 682 (1977), Comment b). “For abuse of process to occur there must be use of the process for an immediate purpose other than that for which it was designed and intended.” (Id.) (emphasis added). Thus, there is no abuse of process when the process “is used legitimately to its authorized conclusion.” Wolfberg, 890 P.2d at 905. Here, the Whiteheads allege that “Defendants issued process in the form of a motion to vacate” and “Defendants then used this process in attempts to collect” the debt. (Am. Compl., ¶¶ 99, 103.) But the amended complaint does not explain how the motion to vacate was improperly used or how its immediate, primary purpose was for “Ocwen”-which was not a party to the foreclosure-to begin debt collection attempts months later. The Whiteheads ignore that the stated purpose of the motion was to “name and serve additional parties of interest” and that Wells Fargo then amended the foreclosure petition to add Sand Canyon as a defendant. Three months after the motion to vacate was filed, two months after the foreclosure petition was amended, and a month after Wells Fargo obtained a new judgment, “Ocwen” began its alleged Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 20 of 23 15 debt collection efforts. The Whiteheads fail to explain how the motion to vacate was not used to accomplish its authorized conclusion; i.e., to vacate the prior foreclosure judgment and file an amendment to the foreclosure petition for purposes of naming an additional defendant. And there is no explanation of how, despite all the intervening litigation in the foreclosure action, the immediate purpose of the motion to vacate was to enable “Ocwen” to collect the debt months after the motion was filed. These pleading deficiencies are fatal to the Whiteheads’ claim. CONCLUSION Despite amending their pleading, the Whiteheads still fail to state a claim under Counts II and IV through VI for the reasons argued here and in the first motion to dismiss. Ocwen Loan Servicing, LLC and Wells Fargo Bank, N.A. therefore respectfully ask this Court to enter an order granting their motion to dismiss under Rule 12(b)(6) with prejudice and any other relief the Court deems necessary. Dated: November 11, 2016 Respectfully Submitted, OCWEN LOAN SERVICING, LLC AND WELLS FARGO BANK, N.A. AS TRUSTEE By: /s/ Chethan G. Shetty P. Russell Perdew (admitted pro hac vice) rperdew@lockelord.com Chethan G. Shetty (admitted pro hac vice) cshetty@lockelord.com LOCKE LORD LLP 111 South Wacker Drive Chicago, Illinois 60606 312-443-1887 Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 21 of 23 16 Brian J. Rayment, OBA #7441 Triad Center, Ste. 550 7666 E. 61st Street Tulsa, OK 74133 Telephone: 918-254-7915 Facsimile: 918-254-7915 Email: brayment@kivell.com Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 22 of 23 17 CERTIFICATE OF SERVICE I hereby certify that on the 11th day of November, 2016, I electronically filed the foregoing with the Clerk of Court using the CM/ECF system. /s/ Chethan G. Shetty Case 4:16-cv-00536-GKF-FHM Document 32 Filed in USDC ND/OK on 11/11/16 Page 23 of 23 EXHIBIT 1 Case 4:16-cv-00536-GKF-FHM Document 32-1 Filed in USDC ND/OK on 11/11/16 Page 1 of 3 Case 4:16-cv-00536-GKF-FHM Document 32-1 Filed in USDC ND/OK on 11/11/16 Page 2 of 3 Case 4:16-cv-00536-GKF-FHM Document 32-1 Filed in USDC ND/OK on 11/11/16 Page 3 of 3 EXHIBIT 2 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 1 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 2 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 3 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 4 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 5 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 6 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 7 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 8 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 9 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 10 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 11 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 12 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 13 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 14 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 15 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 16 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 17 of 18 Case 4:16-cv-00536-GKF-FHM Document 32-2 Filed in USDC ND/OK on 11/11/16 Page 18 of 18