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Saunders v. Bank of America

United States District Court, S.D. New York

September 22, 2014

DEBORAH A. SAUNDERS, et al., Plaintiffs,
BANK OF AMERICA, et al., Defendants.


GEORGE B. DANIELS, District Judge.

Fifteen pro se Plaintiffs bring this action against Defendants Bank of America, N.A. ("BofA"), Citi Mortgage. Inc. ("Citi"), JP Morgan Chase Bank, N.A. ("JP Morgan"), Wells Fargo Bank, N.A. ("Wells Fargo"), Deutsche Bank National Trust Company ("Deutsche Bank"), U.S. Bank, National Association ("U.S. Bank"), and WRI Capital Group LLP ("WRI") (collectively, "Defendants"), alleging a variety of civil claims[1] in connection with residential mortgages issued or serviced by Defendants. Plaintiffs' Amended Complaint seeks more than four billion dollars in damages; costs and attorneys' fees; and the issuance of an unspecified permanent injunction for Defendants' alleged participation in "racketeer practices of banking conspiracy to defraud American homeowners to seize their real estate." (Am. Compl., ECF No. 14 at 8. 24.) Defendant Deutsche Bank moved to dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(h)(2), (3), and (6). (ECF No. 71.) Defendants BofA, Citi, JP Morgan, U.S. Bank, and Wells Fargo (the "BofA Defendants") moved to sever and dismiss the Amended Complaint pursuant to Federal Rules of Civil Procedure 8(a)(2), 9(b), 12(b)(6), 20(a), and 21 (ECF No. 166), a motion in which Defendant WRI later moved to join (ECF No. 327). Before this Court is Magistrate Judge Ronald L. Ellis's Report and Recommendation ("Report"), in which he recommended that this Court grant: (1) Deutsche Bank's motion to dismiss; (2) the BofA Defendants' motion to sever; (3) the BofA Defendants' motion to dismiss Plaintiff Deborah A. Saunders's Amended Complaint; and (4) WRI's motion to join in the BofA Defendants' motion to dismiss, and therefore dismiss the Amended Complaint. (Report at 11.) Magistrate Judge Ellis's Report is adopted. Defendants' motions are GRANTED. The instant action is DISMISSED.

Relevant Facts

Plaintiffs are homeowners from several states (including Georgia, Utah, and Colorado) who claim they were defrauded by Defendants through a "pattern and practice of racketeering" involving the origination of and servicing of residential loans. (Report at 1-2; Am. Compl., ECF No. 14 at 8.) As generally described in the Amended Complaint, the Defendants' scheme "was set-up [as] a program for homeowner[] victims to fail, " whereby Defendants would notify Plaintiffs that they were in default of their loans and subsequently "grab" Plaintiffs' land. ( See Am. Compi., ECF No. 14 at 7, 12.) Plaintiffs do not allege facts specifying how they were individually harmed, nor do they identify which Defendants were responsible for the wrongdoings of which they complain. (Report at 2.)

Standard of Review

This Court may accept, reject, or modify, in whole or in part, the findings set forth in the Report. 28 U.S.C. § 636(b)(1)(C). When there are objections to the Report. the Court must make a de novo determination of those portions of the Report to which objections are made. Id; see also Rivera v. Barnhart, 423 F.Supp.2d 271, 273 (S.D.N.Y. 2006). The district judge may also receive further evidence or recommit the matter to the magistrate judge with instructions. See Fed.R.Civ.P. 72(b); 28 U.S.C. § 636(b)(1)(C). The Court need not conduct a de novo hearing on the matter. See United States v. Raddatz, 447 U.S. 667, 675-76 (1980). Rather, it is sufficient that the Court "arrive at its own, independent conclusion" regarding those portions of the Report to which objections were made. Nelson v. Smith, 618 F.Supp. 1186, 1189-90 (S.D.N.Y. 1985) (quoting Hernandez v. Estelle, 711 F.2d 619, 620 (5th Cir. 1983)). When no party files objections to a Report, the Court may adopt the Report if "there is no clear error on the face of the record." Adee Motor Cars, LLC v. Amato, 388 F.Supp.2d 250, 253 (S.D.N.Y. 2005) (citation omitted).

Magistrate Judge Ellis advised the parties that failure to file timely objections to the Report would constitute a waiver of those objections on appeal. (Report at 11; see also 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b).) No party objected to the Report. As there is no clear error on the face of the record. this Court adopts the Report in its entirety.

Deutsche Bank's Motion to Dismiss

Magistrate Judge Ellis correctly found that Plaintiffs' inadequate service of process justified granting Deutsche Bank's motion to dismiss. ( See Report at 4-5.) On a motion to dismiss for deficient service of process, "the plaintiff bears the burden of establishing that service was sufficient." Khan v. Khan, 360 F.Appx. 202, 203 (2d Cir. 2010). Because Plainti Ifs served their summons and Amended Complaint to "Deutsche Bank" at 60 Wall Street, New York, New York-and not to the registered address of Deutsche Bank National Trust Company at 300 South Grand Avenue, 41st Floor, Los Angeles, California[2]-proper service has not been effected. ( See ECF No. 103; Report at 5.) Plaintiffs have had ample time to serve the Defendant and have failed to do so; dismissal of their suit against Deutsche Bank is therefore warranted.

BofA Defendants' Motion to Sever and Dismiss

Magistrate Judge Ellis properly determined that the Plaintiffs in this action are misjoined. ( See Report at 7-8.) Joinder of plaintiffs is permitted if they claim relief "with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences" and "any question of law or fact common to all plaintiffs will arise in the action." Fed.R.Civ.P. 20(a)(1). The Court may sever any claim against a party and drop a party from an action. See Fed.R.Civ.P. 21. Joinder is inappropriate here because Plaintiffs make sweeping allegations-concerning separate mortgage transactions for properties located in multiple states and managed by different Defendants-and do not explain how their claims arose out of the same transaction or occurrence, let alone which common questions link their claims. ( See Report at 7.) Judge Ellis's recommendation to sever and dismiss all claims except those of the first named Plaintiff, Saunders, was therefore not in error.

The Report further determined that Saunders's Amended Complaint should be dismissed for failure to state a claim. (Report at 9-10.) To survive a motion to dismiss on this ground, the plaintiff must "plead[] factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. lybal, 556 U.S. 662, 678 (2009). Complaints that contain "only conclusory, vague or general allegations" are insufficient. See Detko v. Blimpies Rest., 924 F.Supp. 555, 557 (S.D.N.Y. 1996). In this case, Magistrate Judge Ellis properly concluded that the Amended Complaint is devoid of specific facts establishing which Defendant violated Saunders's rights; when and in what manner the violation occurred; and why Saunders was entitled to relief.[3] ( See Report at 9-10.) Absent these facts, Saunders's "conclusory, vague or general allegations" cannot withstand the BofA Defendants' motion to dismiss. See Detko, 924 F.Supp. at 557.

Finally, because the Court has granted the BofA Defendants' motion to sever and dismiss, and because WRI incorporated the BofA Defendants' arguments and requests for relief in its papers ( see WRI Mot., ECF No. 327 at 2), the Court hereby GRANTS WRI's request ...

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