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Craig v. Bank of New York Mellon Corporation

United States District Court, E.D. New York

March 31, 2014

STEVEN CRAIG, Plaintiff,
v.
THE BANK OF NEW YORK MELLON CORPORATION, f/k/a THE BANK OF NEW YORK, Defendant.

MEMORANDUM AND ORDER

SANDRA L. TOWNES, District Judge.

Plaintiff Steven Craig ("Plaintiff"), proceeding pro se, brings this action to recover damages for violations of the Real Estate Settlement Procedures Act of 1974 ("RESPA"), 12 U.S.C. § 2601 et seq.; the Truth in Lending Act ("TILA"), 15 U.S.C. § 1601 et seq.; and the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692-1692p. Defendant Bank of New York Mellon Corporation, formerly known as Bank of New York ("Defendant"), now moves to dismiss pursuant to Rule 12(b)(6) or, in the alternative, for summary judgment. For the reasons stated below, Defendant's motion is granted, but Plaintiff is granted leave to amend his FDCPA claims.

BACKGROUND

On July 28, 2010, Plaintiff commenced this action in the United States District Court for the Southern District of New York by filing a 24-page, typewritten complaint. That pleading appeared to be based on a form complaint, since it was virtually identical to a complaint filed in September 2010 in Grandy v. BAC Home Loan Servicing, LP, E.D.N.Y. Docket No. 10-CV-4278 (SLT), and to complaints filed in other cases. With a few exceptions, the original complaint did not allege facts specific to Plaintiff's case.

After the case was transferred to this district, Defendant moved for judgment on the pleadings pursuant to Rule 12(c) of the Federal Rules of Civil Procedure. Although Defendant raised eight points, three of which contained sub-points, those arguments fit into two categories. First, Defendant argued that the allegations in the complaint failed to state a claim, asserting (1) that the complaint as a whole failed to satisfy the notice pleading requirements set forth in Rule 8(a) of Federal Rules of Civil Procedure, (2) that the allegations of fraud failed to satisfy the heightened pleading standard of Rule 9(b), and (3) that there was no factual support for each of Plaintiff's six causes of action. Second, Defendant claimed that some of Plaintiff's claims were time-barred, arguing, among other things, that Plaintiff did not commence this action until almost three years after the expiration of the one-year statute of limitations applicable to RESPA claims, and almost one year after the expiration of the three-year statute of limitations applicable to TILA claims.

In a memorandum and order dated March 22, 2012, and filed March 23, 2012 (the "Prior M&O"), this Court directed Plaintiff to file an amended complaint. See Craig v. Bank of New York Mellon Corp., No. 10-CV-4438 (SLT)(RML), 2012 WL 1004870 (E.D.N.Y. Mar. 23, 2012). Since familiarity with the Prior M&O is assumed, a lengthy discussion of the Prior M&O is unnecessary. For purposes of this memorandum and order, it suffices to note that this Court held that, with the exception of "one small portion" of the complaint which sufficiently alleged a cause of action under 12 U.S.C. § 2605(e), the complaint failed to comply with the notice pleading requirements of Rule 8(a). Id., 2012 WL 1004870, at *5-6. Accordingly, this Court did not reach the statute of limitations arguments, but directed Plaintiff to amend his complaint.

The Amended Complaint

On April 25, 2012, Plaintiff filed a six-page amended complaint (the "Complaint"). Although the factual allegations contained in that pleading are not entirely clear, the Complaint implies that, at some point prior to April 14, 2008, Plaintiff entered into a mortgage agreement with a lender. The Complaint does not name the lender or specifically identify the mortgage agreement, but contains several references to "Countrywide Bank" (Complaint, ¶¶ 16-17).

On April 14, 2008, Mortgage Electronic Registration Systems ("MERS"), acting as "Nominee for Countrywide, " assigned the mortgage to Defendant ( id., ¶16). The document assigning the mortgage to Defendant was signed by Ely Harless and Micall Bachman, both of whom were identified in the document as "Vice President" ( id. ). Although the document did not specify the entity with which the signatories were affiliated, Plaintiff performed an internet search and found references to Mr. Harless as both "Vice President of Mortgage Electronic Registration Systems" and "Vice President of Country Wide" ( id., ¶17). In addition, Plaintiff came across a case in which Judge Schack of the Supreme Court of the State of New York, Kings County, dismissed a foreclosure action brought by Defendant in its capacity as Trustee for the Certificateholders CWALT, Inc. Alternative Loan Trust 2006-OC1 Mortgage Pass-Through Certificates, Series 2006-OC1, on the ground that Mr. Harless lacked authority to assign the mortgages ( id. ).

Plaintiff never received notice of the transfer or assignment of the mortgage ( id., ¶18). However, on or about April 18, 2008, Defendant, acting in its capacity as Trustee for the Certificateholders CWALT, Inc. Alternative Loan Trust 2006-OA14 Mortgage Pass-Through Certificates, Series 2006-OA14, filed a foreclosure action against Plaintiff in the Supreme Court of the State of New York, Kings County ( id., ¶¶ 11, 16). According to Plaintiff, the pleading in that foreclosure action alleged that Defendant and/or CWALT, Inc. Alternative Loan Trust 2006-OA14 Mortgage Pass-Through Certificates, Series 2006-OA14, either owned Plaintiff's Note and Mortgage or "had acquired the right to enforce the Note and Mortgage from the Party entitled to enforce the Note" ( id., ¶¶ 12-13). The Complaint does not allege whether that foreclosure action is still pending or describe the outcome of that action.

On or about May 17, 2010, Plaintiff sent a letter to Defendant via certified mail addressed to the Plano, Texas, office listed in the assignment of mortgage ( id., ¶¶ 14, 19).[1] The letter "requested validation of [Plaintiff's] alleged debt, " and demanded certain documents and the answer to some 200 questions regarding the servicing of Plaintiff's mortgage ( id. ). Defendant never responded to the letter.

Although the Complaint alleges that Defendant has "committed fraud in order to wrongfully foreclose" ( id., ¶ 8), the Complaint does not seek to stay or forestall the foreclosure proceedings. Rather, each of the Complaint's three causes of action seeks to recover damages. The first cause of action alleges that Defendant violated a provision of RESPA, codified at 12 U.S.C. § 2605(e), which imposes a duty on loan servicers to respond to borrowers' inquiries. The Complaint alleges (1) that "Defendant is a servicer of a federally related mortgage loan within the meaning of... § 2605" (Complaint, ¶ 22); (2) that Plaintiff's "written requests for information about his account and correction of Defendants' [ sic ] numerous errors" constituted "qualified written requests, " as defined in § 2605(e)(1)(B) (Complaint, ¶ 23); and (3) that Defendant "deliberately failed to respond in a proper and timely way to Plaintiff's qualified written requests, '" in violation of § 2605(e) (Complaint, ¶ 24). In connection with this first cause of action, the Complaint demands "a proper accounting and application of his mortgage payments, " as well as "actual, statutory, treble and/or punitive damages" and attorney's fees and costs ( id., p. 4).

The second cause of action alleges that Defendant violated TILA by failing to notify Plaintiff that his mortgage had been assigned to Defendant. That cause of action consists of two paragraphs, followed by an ad damnum clause. The first paragraph re-alleges prior paragraphs of the Complaint ( id., ¶ 25). The second quotes 15 U.S.C. § 1641(g)(1) in its entirely (Complaint, ¶ 26). The ad damnum clause requests the damages available under 15 U.S.C. § 1640(a), as well as attorney's fees and costs (Complaint, ¶ 27).

The third cause of action alleges that Defendant violated various provisions of the FDCPA. The first three paragraphs of this cause of action re-allege prior paragraphs of the Complaint (Complaint, ¶ 27), allege that Plaintiff is a "consumer" within the meaning of the FDCPA ( id., ¶ 28 (citing 15 U.S.C. § 1692a(3)), and allege that Defendant is a "debt collector" within the meaning of the FDCPA ( id., ¶ 29 (citing 15 U.S.C. § 1692a(6)). The fourth and final paragraph of the third cause of action lists 10 provisions of the FDCPA which were allegedly violated by Defendant ( id., ¶ 30). These four paragraphs are followed by an ad damnum clause which requests the damages available under 15 U.S.C. § 1692k, as well as attorney's fees and costs.

Although the fourth paragraph lists the provisions of the FDCPA which Defendant allegedly violated, it does not allege the specific acts or omissions which resulted in these violations. Rather, the Complaint contains conclusory allegations which track the language of the statutory provision allegedly violated. For example, in alleging that Defendant violated 15 U.S.C. § 1692d, which prohibits a debt collector from engaging "in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt, " the Complaint alleges that Defendant "violated 15 U.S.C. § 1692d by engaging in conduct the natural consequence of which is to harass, oppress, or abuse any person" (Complaint, ¶ 30(a)). Similarly, the Complaint alleges that Defendant violated 15 U.S.C. § 1692e(2)-a provision which prohibits, among other things, "[t]he false representation of... the character, amount, or legal status of any debt"-by "falsely representing the character, amount, or legal status of any debt" (Complaint, ¶ 30(b)).

Defendant's Motion

Defendant now moves to dismiss these three causes of action pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure or, in the alternative, for summary judgment pursuant to Rule 56(c) of the Federal Rules of Civil Procedure. Defendant's moving papers consist of at least eight documents, including a notice of motion, a memorandum of law in support of the motion ("Defendant's Memo"), a statement of undisputed material facts pursuant to Local Civil Rule 56.1, notices pursuant to Local Civil Rules 12.1 and 56.2, two affidavits and one declaration. The declaration (hereafter, the "Coleman Declaration") is executed by Defendant's counsel, Glenn B. Coleman, and attaches documents filed in the course of this action, along with the complaint filed by Defendant in its state foreclosure action. The affidavits are executed by Ruth Joseph, an employee of Bank of America, N.A. ("BANA"), a successor by merger to BAC Home Loans Servicing, LP ("BAC"), and by Glenn Mitchell, a Vice President in Defendant's Corporate Trust Department.

Defendant's Memo contains four points. The first of these sets forth the legal standards applicable to motions pursuant to Rules 12(b)(6) and 56 of the Federal Rules of Civil Procedure. The remaining three points each relate to one of the three causes of action alleged in the Complaint.

Point II, which relates to the first cause of action, contains three arguments for dismissing Plaintiff's RESPA claim. First, after noting that 12 U.S.C. § 2605(e) imposes a duty on loan servicers, Defendant argues that it was only an assignee of the mortgage, not the loan servicer. In support of this argument, Defendant relies on statements in the affidavits signed by Glenn Mitchell and Ruth Joseph which assert that at all times relevant to this action, BANA- not Defendant-was the servicer of the loan at issue in this case (Mitchell Affidavit, ¶ 5; Joseph Affidavit, ¶¶ 6, 10).

The second argument raised in Point II asserts that Plaintiff's RESPA claim should be dismissed because "Plaintiff's inquiry to [Defendant] did not meet the requirements for a [qualified written request]" (Defendant's Memo at 8) (alterations added). Citing to 12 U.S.C. §2605(e)(1)(B), which sets forth the statutory definition of a "qualified written request, " Defendant argues that Plaintiff's letter did not constitute a qualified written request because it failed to "identify any reasons for his belief that his account was in error, did not provide sufficient detail regarding most of the information sought, and requested numerous documents and substantial information unrelated to the servicing of his loan." (Defendant's Memo at 8). In addition, Defendant argues that while it did not respond to Plaintiff's May 17, 2010, letter, BANA responded to an identical letter from Plaintiff, dated April 19, 2010. In support of this argument, Defendant cites to two exhibits to the Joseph Affidavit: a letter from Plaintiff to BANA, dated ...


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