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George v. Nationstar Mortgage, LLC

United States District Court, E.D. New York

August 2, 2017

DERRICK GEORGE, Plaintiff,
v.
NATIONSTAR MORTGAGE, LLC and DAVIDSON FINK LLP, Defendants.

          MEMORANDUM & ORDER

          MARGO K. BRODIE, United States District Judge

         Plaintiff Derrick George, proceeding pro se, commenced the above-captioned action against Defendants Nationstar Mortgage LLC (“Nationstar”) and Davidson Fink LLP, alleging that Defendants violated the Federal Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”), when Nationstar was assigned Plaintiff's mortgage and when Defendants failed to validate his mortgage debt in connection with a foreclosure proceeding in state court. (Compl., Docket Entry No. 1.) Plaintiff seeks damages as well as a declaratory judgment that Defendants' conduct violated the FDCPA and “judgment from the court that [Defendants] cease[] any further debt collection activity.” (Id. at 6.) Defendants move to dismiss the Complaint for lack of subject matter jurisdiction under Rule 12(b)(1) of the Federal Rules of Civil Procedure and for failure to state a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. (Nationstar Mem. in Supp. of Mot. to Dismiss (“Nationstar Mem.”), Docket Entry No. 18-5; Davidson Fink Mem. in Supp. of Mot. to Dismiss (“Davidson Fink Mem.”), Docket Entry No. 22-1.) For the reasons set forth below, the Court grants Defendants' motions.

         I. Background

         For the purposes of this Memorandum and Order, the Court assumes the truth of the facts alleged in the Complaint. On April 10, 2008, Plaintiff executed a note in the amount of $328, 961 with Golden First Mortgage Corporation and, on the same day, secured the note with property located at 4413 Clarendon Road in Brooklyn, New York (the “Property”). (Compl. ¶ 8; Defs. State Court Record (“State Court R.”) 36-49, Docket Entry No. 18-4.)[1] The mortgage by which Plaintiff secured the note (the “Mortgage”) was recorded on May 7, 2008. (State Court R. 39.)

         On July 8, 2013, Mortgage Electronic Registration Systems (“MERS”), as nominee for Golden First, assigned the Mortgage to Nationstar. (See Assignment of Mortgage, annexed to Compl. as Ex. A.) Nationstar recorded the Assignment of Mortgage with the New York City Register's Office on July 25, 2013. (State Court R. 51.) On October 15, 2013, Nationstar, through Davidson Fink as foreclosure counsel, initiated a “debt collection action masquerading as a ‘foreclosure' action” in the Supreme Court of New York, Kings County, stating that Plaintiff defaulted on the Mortgage as of April 1, 2013. (Compl. ¶¶ 9, 14; State Court R. 2-11.)

         On November 4, 2013, Plaintiff answered the foreclosure complaint, challenging Nationstar's standing to foreclose on the Property and the amount of the loan secured by the Property. (State Court R. 25-27.) Nationstar moved for summary judgment and, on April 20, 2015, the state court judge granted Nationstar's motion and appointed a referee to ascertain the amount due to Nationstar on the Mortgage. (Id. at 47-74.) Plaintiff alleges that on September 1, 2015, he “served/dispatched” a Notice of Dispute pursuant to section 1692(g)(a)(1)(2) of the FDCPA, requiring Defendants to obtain verification and to “validate the alleged debt from the creditor.” (Id. ¶ 15; Notice of Dispute, annexed to Compl. as Ex. C.) Plaintiff did not receive verification of the debt, and the “debt collection” continued unabated. (Id. ¶ 16.) On January 13, 2016, Nationstar moved for a judgment of foreclosure and sale, which the state court granted on May 20, 2016 and entered on June 16, 2016. (Id. at 74-88.)

         Plaintiff alleges that Defendants “engaged in abusive behavior” and “trespass[ed] in [his] private commercial affairs”; failed to provide the requisite disclosure upon “initial communication, ” as required under 15 U.S.C. § 1692e(11), when they were assigned the Mortgage in July of 2013; and continued to “collect the alleged debt without ceasing their collection actions” despite Plaintiff's request for proper verification and validation under 15 U.S.C. § 1692g(b). (Id. ¶¶ 18, 27, 29.)

         II. Discussion

         a. Standards of review

         i. Rule 12(b)(1)

         A district court may dismiss an action for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure when the court “lacks the statutory or constitutional power to adjudicate it.” Cortlandt St. Recovery Corp. v. Hellas Telecomms., S.À.R.L., 790 F.3d 411, 416-17 (2d Cir. 2015) (quoting Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000)); Shabaj v. Holder, 718 F.3d 48, 50 (2d Cir. 2013) (quoting Aurecchione v. Schoolman Transp. Sys., Inc., 426 F.3d 635, 638 (2d Cir. 2005)); see also Chau v. S.E.C., 665 F. App'x 67, 70 (2d Cir. 2016). The plaintiff has the burden to prove that subject matter jurisdiction exists, and in evaluating whether the plaintiff has met that burden, “‘[t]he court must take all facts alleged in the complaint as true and draw all reasonable inferences in favor of plaintiff, ' but ‘jurisdiction must be shown affirmatively, and that showing is not made by drawing from the pleadings inferences favorable to the party asserting it.'” Morrison v. Nat'l Austl. Bank Ltd., 547 F.3d 167, 170 (2d Cir. 2008) (citations omitted), aff'd, 561 U.S. 247 (2010). A court may consider matters outside of the pleadings when determining whether subject matter jurisdiction exists. M.E.S., Inc. v. Snell, 712 F.3d 666, 671 (2d Cir. 2013); Romano v. Kazacos, 609 F.3d 512, 520 (2d Cir. 2010).

         ii. Rule 12(b)(6)

         In reviewing a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a court must construe the complaint liberally, “accepting all factual allegations in the complaint as true and drawing all reasonable inferences in the plaintiff's favor.” Concord Assoc's, L.P. v. Entm't Prop. Trust, 817 F.3d 46, 52 (2d Cir. 2016) (quoting Chambers v. Time Warner Inc., 282 F.3d 147, 152 (2d Cir. 2002)); see also Tsirelman v. Daines, 794 F.3d 310, 313 (2d Cir. 2015) (quoting Jaghory v. N.Y. State Dep't of Educ., 131 F.3d 326, 329 (2d Cir. 1997)). A complaint must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Matson v. Bd. of Educ., 631 F.3d 57, 63 (2d Cir. 2011) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)); see also Pension Ben. Guar. Corp. ex rel. St. Vincent Catholic Med. Ctrs. Ret. Plan v. Morgan Stanley Inv. Mgmt. Inc., 712 F.3d 705, 717-18 (2d Cir. 2013). Although all allegations contained in the complaint are assumed true, this principle is “inapplicable to legal conclusions” or “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements.” Iqbal, 556 U.S. at 678.

         In reviewing a pro se complaint, the court must be mindful that a plaintiff's pleadings should be held “to less stringent standards than formal pleadings drafted by lawyers.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam) (quoting Estelle v. Gamble, 429 U.S. 97, 104-105 (1976)); see Wiley v. Kirkpatrick, 801 F.3d 51, 62 (2d Cir. 2015) (holding that courts must liberally construe papers submitted by pro se litigants “to make the strongest arguments they suggest”); Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009) (noting that even after Twombly, the court “remain[s] obligated to construe a pro se complaint liberally”).

         iii. Documents considered

         “In determining the adequacy of a claim under Rule 12(b)(6), consideration is limited to facts stated on the face of the complaint, in documents appended to the complaint or incorporated in the complaint by reference, and to matters of which judicial notice may be taken.” Wilson v. Kellogg Co., 628 F. App'x 59, 60 (2d Cir. 2016) (quoting Allen v. WestPoint-Pepperell, Inc., 945 F.2d 40, 44 (2d Cir. 1991)). In addition, courts may consider “documents that, although not incorporated by reference, are integral to the complaint.” L-7 Designs, Inc. v. Old Navy, LLC, 647 F.3d 419, 422 (2d Cir. 2011) (internal quotation marks omitted) (quoting Sira v. Morton, 380 F.3d 57, 67 (2d Cir. 2004)). A court need not consider other information outside the pleadings, but where a court does not exclude extraneous information, it must give notice to the parties and convert the motion to one for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Fed.R.Civ.P. 12(d); see also Parada v. Banco Indus. De Venezuela, C.A., 753 F.3d 62, 68 (2d Cir. 2014) (noting that before converting a motion to dismiss into a motion for summary judgment, the court should “give sufficient notice to an opposing party and an opportunity for that party to respond”); Nakahata v. N.Y.-Presbyterian Healthcare Sys., Inc., 723 F.3d 192, 202-03 (2d Cir. 2013) (“[T]he conversion of a Rule 12(b)(6) motion into one for summary judgment under Rule 56 when the court considers matters outside the pleadings is strictly enforce[d] and mandatory.”).

         b. The Rooker-Feldman doctrine does not deprive the Court of jurisdiction

         Defendants move to dismiss the Complaint for lack of jurisdiction under the Rooker- Feldman doctrine, arguing that Plaintiff is asking the Court to review and reject the state court summary judgment decision and entry of foreclosure. (Nationstar Mem. 12; Davidson Fink Mem. 1 (incorporating arguments).) Plaintiff argues in opposition that he is not “conflating” his “proper consumer protection case under federal law” with the foreclosure. (Pl. Opp'n to Davidson Fink Mot. to Dismiss (“Pl. Opp'n to Davidson Fink”) 1, Docket Entry No. 23.)

         In Rooker v. Fidelity Trust Company, 263 U.S. 413, 415-16 (1923) and District of Columbia Court of Appeals v. Feldman, 460 U.S. 462, 486-87 (1983), the Supreme Court held that federal district courts lack subject matter jurisdiction over disputes where a plaintiff essentially seeks review of a state-court decision. Feldman, 460 U.S. at 482 (“[A] United States District Court has no authority to review final judgments of a state court in judicial proceedings.”); Rooker, 263 U.S. at 416 (holding that “no court of the United States other than [the Supreme Court] could entertain a proceeding to reverse or modify [a state court's] judgment for errors”); see also Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 283-84 (2005) (holding that Rooker-Feldman bars “cases brought by state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review and rejection of those judgments”); Vossbrinck v. Accredited Home Lenders, Inc., 773 F.3d 423, 426 (2d Cir. 2014) (“Under the Rooker-Feldman doctrine, federal district courts lack jurisdiction over cases that essentially amount to appeals of state court judgments.” (citing Exxon Mobil Corp., 544 U.S. at 284)); McKithen v. Brown, 626 F.3d 143, 154 (2d Cir. 2010) (“[T]he Rooker-Feldman doctrine deprives a federal court of jurisdiction to consider a plaintiff's claim, ” which applies to “cases brought by state-court losers complaining of injuries caused by state-court judgments rendered before the district court proceedings commenced and inviting district court review of those judgments.” (citations and internal quotation marks omitted)). “Underlying the Rooker-Feldman doctrine is the principle, expressed by ...


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