United States District Court, S.D. New York
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Kathryn Grace Jordan, also known as Kathryn Christine Jordan, Plaintiff, Pro se.
For Chase Manhattan Bank, Chase Bank USA National Association, JP Morgan Chase & Company, also known as JP Morgan Acquisition Trust 2007 -CH3; JPMMAC 2007-CH3), Deutch Bank National Trust Company, Defendants: Michael Edmund Blaine, Buckley Madole, P.C., New York, NY.
OPINION & ORDER
Paul A. Engelmayer, United States District Judge.
Plaintiff Kathryn Grace Jordan, proceeding pro se, brings this action against defendants Chase Manhattan Bank, Chase Bank USA National Association, JPMorgan Chase & Co., JPMorgan Acquisition Trust 2007, and Chase Home Finance (collectively, " Chase" or " JPMC" ); Deutsche Bank AG and Deutsche Bank National Trust Company (collectively, " Deutsche Bank" ); and Shutts & Bowen, a law firm in Miami, Florida (collectively, " defendants" ). Jordan asserts numerous federal
and state law claims arising out of the 2008 refinancing of her mortgage on a property in Palm Beach, Florida, the 2009 foreclosure of that property, and a 2012 garnishment action brought against Jordan in Florida state court. The crux of Jordan's federal-law claims is that defendants discriminated against her in various ways because she is disabled and receives disability benefits.
In 2014, defendants moved to dismiss Jordan's earlier First Amended Complaint (" FAC" ), pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted, In a decision issued on July 31, 2014, the Court granted that motion, but gave Jordan leave to amend. Jordan thereafter filed an amended pleading. Now pending before the Court is defendants' motion to dismiss Jordan's amended pleading for failure to state a claim. For the following reasons, that motion is granted.
A. Factual Background
In 2006, Jordan entered into an agreement to buy a condominium in Palm Beach, Florida (the " Palm Beach property" ). Pl. Aff. 5. To finance that purchase, Jordan obtained a mortgage from Chase. See Dkt. 79 (" Pl. Br." ), at 10-11. In 2008, Jordan fell behind on her mortgage payments. See id. She therefore sought to refinance the mortgage. Pl. Aff. 4. Jordan alleges that Chase verbally promised to maintain the same loan duration in the refinanced mortgage as in the original, at a loan rate competitive with those of other banks in the area. FAC at 3. Before the transaction was completed, however, Jordan noticed that the " Title Agent had swapped out the loan for a shorter term [adjustable-rate mortgage]." Id. at 3-4. Jordan informed Chase of that discrepancy, but Chase did not modify the loan documents. Id. at 4-5. Jordan also claims that Chase " expressed concerns and biases" and " initially refus[ed] the application" as a result of " irrational fears about the reliability of [Jordan's] income as a disabled person." Id. at 15.
In 2009, Chase and Deutsche Bank, in " collusion" with the condominium association, foreclosed Jordan's Palm Beach property. Pl. Aff. 4. During the foreclosure process, Chase was obliged to disclose " all options available to [Jordan] particularly given her Disability status," but Chase " never disclosed any HAMP [Home Affordable Modification Program] programs." FAC at 16. Jordan alleges that Chase " failed to do so due to their discriminatory animus toward her as a Disabled person." Id. For Jordan, the foreclosure led to years of housing and financial instability. Pl. Aff. 4-5. Chase also delayed reporting the foreclosure to credit agencies, " knowing it would extend her credit deficits for several years." Id. at 5.
At some point, Jordan sued James Pappas, the person who sold her the Palm Beach property, in Florida state court. Id. at 3-10. Jordan accused Pappas of HUD violations and fraud based on, inter alia, repeated delays in the closing date and concealed defects in the unit. Pl. Br. 4. Jordan's case against Pappas was dismissed,
Pl. Aff. at 3-4, and the Florida court awarded legal fees to Pappas's counsel, id. at 11. In 2012, Pappas's attorneys commenced a garnishment action against Jordan, also in Florida state court. Id. at 4. In the course of the garnishment proceedings, the Florida court " made increasingly abusive invasions into [Jordan's] financial privacy," and an attorney from Shutts & Bowen, which represented Chase, engaged in " collusive threats and schemes . . . to try to gain illicit access to [Jordan's] Chase assets." FAC at 9.
As a result of the garnishment proceedings, Jordan alleges, a $75,000 lien was filed on her Chase account, and Chase froze Jordan's assets, including disability benefit payments that, Jordan claims, are exempt from garnishment. Pl. Aff. at 7-8. Jordan was therefore unable to " buy food, medication, pay for housing, and travel to her physicians." FAC at 8. Also in 2012, Chase closed Jordan's overdraft line of credit without notice, causing further financial instability. Pl. Aff. 5, 35. According to Jordan, " [i]t is apparent from the long patter[n] of facts, that Chase was excessively anxious about [Jordan] as a Disabled person," FAC at 17, and that its conduct " clearly was related to Chase's long biases against [Jordan] as a disabled person," id. at 19.
B. Procedural History
On December 19, 2013, Jordan filed her initial complaint. Dkt. 1. On January 9, 2014, defendants moved to dismiss for lack of jurisdiction. Dkt. 5-7. On March 26, 2014, after several extensions, Jordan filed her Amended Complaint. Dkt. 21 (" FAC" ). It consisted of six " counts," which the Court construed to assert claims under: (1) § 407 of the Social Security Act (" SSA" ), 42 U.S.C. § 407; (2) the Emergency Economic Stabilization Act of 2008 (" EESA" ), 12 U.S.C. § 5201 et seq., specifically, the Home Affordable Modification Program (" HAMP" ), id. § 5219a; the Consumer Credit Protection Act (" CCPA" ), specifically, (3) the restrictions on garnishment contained in 15 U.S.C. § 1673, and (4) the equal credit opportunity provisions in 15 U.S.C. § 1691; (5) the Fair Housing Act (" FHA" ), 42 U.S.C. § 3601 et seq.; and (6) New York and Florida law.
On April 17, 2014, defendants renewed their motion to dismiss the Amended Complaint. Dkt. 29-30. On July 31, 2014, after briefing, the Court granted defendants' motion. Dkt. 49 (" July 31 Opinion" ), reported at Jordan v. Chase Manhattan Bank, No. 13 Civ. 9015 (PAE), 2014 WL 3767010 (S.D.N.Y. July 31, 2014). The Court held that Jordan's first three claims were not viable because § 407 of the SSA, the HAMP provisions in the EESA, and § 1673 of the CCPA do not create private rights of action. [WL] at 10-13. The Court also held that some of Jordan's claims under § 1691 of the CCPA were barred by the statute of limitations, and that Jordan's allegations of discrimination were too conclusory to sustain the timely claims. [WL] at 17-19. Similarly, the Court held that some of Jordan's FHA claims were time-barred, and the timely claims did not pertain to residential real-estate transactions, as required for the statute to apply. [WL] at 13-17. As to Jordan's state-law claims, the Court held that it lacked diversity jurisdiction because both Jordan and defendant Chase reside in New York. [WL] at 8-9. The Court declined to exercise supplemental jurisdiction over Jordan's state-law claims and dismissed her complaint. [WL] at 20-21. This dismissal was without prejudice: The Court authorized Jordan to file a Second Amended Complaint (" SAC" ), " this time stating a legally adequate basis for federal jurisdiction." [WL] at 21.
The original deadline for Jordan's SAC was September 29, 2014. See id. at 21; see also Dkt. 51, 55. On September 30, 2014, the Court extended the deadline until October 13, 2014. Dkt. 63. On October 7, 2014, the Court extended the deadline until October 31, 2014 but noted that, " [a]bsent extraordinary circumstances," it would not grant a further extension of time. Dkt. 66. On November 1, 2014, Jordan filed a 41-page " affidavit in support of second amended complaint," which is listed on the docket as an amended complaint. Dkt. 67 (" Pl. Aff" ). There, Jordan added factual allegations and requested another extension to file a formal amended pleading. Id. The Court denied Jordan's request for a third extension of time and instead construed the affidavit, along with Jordan's FAC, as her SAC. Dkt. 69.
On November 21, 2014, defendants filed a motion to dismiss the SAC, Dkt. 76, along with a memorandum of law, Dkt. 77 (" Def. Br." ), and a declaration, Dkt. 78 (" Def. Deck ). On December 10, 2014, Jordan submitted her opposition, styled as a motion to dismiss defendants' motion to dismiss. Dkt. 79 (" Pl. Br." ). On January 2, 2015, defendants filed their reply. Dkt. 80 (" Def. Reply" ). On February 26, 2015, Jordan filed a letter responding to defendants' reply. Dkt. 84.
II. Applicable Legal Standards
To survive a motion to dismiss under Rule 12(b)(6), a complaint must plead " enough facts to state a claim to relief that is plausible on its face." Bell A. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A claim will only have " 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." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A complaint is properly dismissed where, as a matter of law, " the allegations in a complaint, however true, could not raise a claim of entitlement to relief." Twombly, 550 U.S. at 558. Accordingly, a district court must accept as true all well-pled factual allegations in the complaint, and draw all inferences in the plaintiff's favor. See ATSI Commc'ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir. 2007). However, that tenet " is inapplicable to legal conclusions." Iqbal, 556 U.S. at 678. A pleading that offers only " labels and conclusions" or " a formulaic recitation of the
elements of a cause of action will not do." Twombly, 550 U.S. at 555.
District courts are " obligated to construe pro se complaint[s] liberally," Harris, 572 F.3d at 72, interpreting them " to raise the strongest arguments that they suggest," Triestman v. Fed. Bureau of Prisons, 470 F.3d 471, 474 (2d Cir. 2006). Courts may not, however, read into pro se submissions claims inconsistent with the pro se litigant's allegations, Phillips v. Girdich, 408 F.3d 124, 127 (2d Cir. 2005) (citation omitted), or arguments that the submissions themselves do not " suggest," Pabon v. Wright, 459 F.3d 241, 248 (2d Cir. 2006). Pro se status " does not exempt a party from compliance with relevant rules of procedural and substantive law." Traguth v. Zuck, 710 F.2d 90, 95 (2d Cir. 1983) (citation omitted).
Jordan asks the Court to take two other steps in light of her status as a pro se and disabled plaintiff. First, Jordan asks the Court to apply a " gentle approach," Pl. Br. 6, 35-36, that was used by the Seventh Circuit in Swanson v. Citibank, N.A., 614 F.3d 400 (7th Cir. 2010). There, the Seventh Circuit held that, to survive a motion to dismiss, " the plaintiff must give enough details about the subject-matter of the case to present a story that holds together. In other words, the court will ask itself could these things have happened, not did they happen." Id. at 404. Sitting in the Second Circuit, this Court is bound to apply Second Circuit (and Supreme Court) law and cannot rely on out-of-circuit authority inconsistent with the precedents of those courts. It is unclear to the Court whether the " could . . . have happened" standard for evaluating a pro se complaint articulated in Swanson is in accord with the Supreme Court's decision in Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). See Swanson, 614 F.3d at 407 (Posner, J., dissenting in part). However, the Court has reviewed Jordan's SAC mindful of the duty to review pro se complaints liberally. And the outcome the Court reaches here would be the same even under the Seventh Circuit's Swanson standard.
Second, Jordan asks the Court to consider new factual allegations contained in her opposition to the motion to dismiss. See Pl. Br. 1, 24. " [I]t is axiomatic that the Complaint cannot be amended by the briefs in opposition to a motion to dismiss." Weir v. City of New York, No. 05 Civ. 9268 (DFE), 2008 WL 3363129, at *9 (S.D.N.Y. Aug. 11, 2008) (citation omitted). However, as discussed below, see infra pp. 24-25, the Court has considered these allegations in determining whether to grant Jordan leave to file a Third Amended Complaint. Had these new allegations, considered in conjunction with her existing allegations, stated a claim, the ...