Farrell v. Federal National Mortgage Association et al
Filing
33
OPINION AND ORDER deeming Impac Funding, Wells Fargo Bank, N.A., Ocwen Loan Servicing, Christian Hancock, Monica Wilson, and Federal National Mortgage Association to have waived formal service of process; granting 28 Motion to Dismiss; granting 11 Motion to Dismiss. The Complaint is dismissed without prejudice to plaintiff filing an Amended Complaint within 14 days this Opinion and Order. No further amendments will be permitted. Plaintiff shall show cause within 14 days for failure t o execute service on the remaining defendants. The requirement to file a Case Management Report is suspended until 30 days after the date of the first answer. See Opinion and Order for details. Signed by Judge John E. Steele on 9/25/2015. (RKR)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
PATRICK LORNE FARRELL,
Plaintiff,
v.
Case No: 2:15-cv-20-FtM-29CM
FEDERAL NATIONAL MORTGAGE
ASSOCIATION,
BANK
OF
AMERICA, previously known as
Countrywide, IMPAC FUNDING,
WELLS FARGO BANK NA, OCWEN
LOAN SERVICING, previously
known as GMACM, PINNACLE
FINANCIAL,
ROBERTSON
ANSCHUTZ,
CHRISTIAN
W.
HANCOCK, MONICA WILSON, and
NATHAN SCHWARTZ,
Defendants.
OPINION AND ORDER
This matter comes before the Court on review of defendants
Impac Funding, Wells Fargo Bank, N.A., Ocwen Loan Servicing,
Christian Hancock, and Monica Wilson’s Joint Motion to Dismiss
(Doc. #11) filed on January 22, 2015, and Federal National Mortgage
Association’s Motion to Dismiss Plaintiff’s Complaint (Doc. #28)
filed on April 2, 2015.
No responses have been filed to either
motion, and the time to respond has expired.
For the reasons
stated below, the motions are due to be granted with leave to
amend.
I.
Under Federal Rule of Civil Procedure 8(a)(2), a Complaint
must contain a “short and plain statement of the claim showing
that the pleader is entitled to relief.”
Fed. R. Civ. P. 8(a)(2).
This obligation “requires more than labels and conclusions, and a
formulaic recitation of the elements of a cause of action will not
do.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)
(citation omitted).
To survive dismissal, the factual allegations
must be “plausible” and “must be enough to raise a right to relief
above the speculative level.”
Id. at 555.
See also Edwards v.
Prime Inc., 602 F.3d 1276, 1291 (11th Cir. 2010).
“more
than
an
accusation.”
unadorned,
Ashcroft
v.
This requires
the-defendant-unlawfully-harmed-me
Iqbal,
556
U.S.
662,
678
(2009)
(citations omitted).
In deciding a Rule 12(b)(6) motion to dismiss, the Court must
accept all factual allegations in a complaint as true and take
them in the light most favorable to plaintiff, Erickson v. Pardus,
551 U.S. 89 (2007), but “[l]egal conclusions without adequate
factual support are entitled to no assumption of truth,”
v.
Berzain,
omitted).
654
F.3d
1148,
1153
(11th
Cir.
Mamani
2011)(citations
“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice.”
Iqbal, 556 U.S. at 678.
“Factual allegations that are merely
2
consistent
with
a
facially plausible.”
defendant’s
liability
fall
short
of
being
Chaparro v. Carnival Corp., 693 F.3d 1333,
1337 (11th Cir. 2012) (internal quotation marks and citations
omitted).
Thus, the Court engages in a two-step approach: “When
there are well-pleaded factual allegations, a court should assume
their veracity and then determine whether they plausibly give rise
to an entitlement to relief.”
Iqbal, 556 U.S. at 679.
II.
Liberally construing 1 and taking all the allegations as true,
the Complaint and Request for Declaratory Judgment (Doc. #2)
alleges that plaintiff was the victim of mortgage fraud, appraisal
fraud, foreclosure fraud, and contract breaches resulting from an
unconscionable loan.
The “RICO complaint” is based on the Final
Judgment of Foreclosure entered in the state court in 07-CA-16767,
and currently on appeal.
(Id., ¶¶ 2-3.)
Plaintiff alleges an
injury date as of April 13, 2011, when the United States Senate
published a report regarding the causes of the financial crisis,
1
This is not by any means Mr. Farrell’s first trip through
federal court, and the allegations are somewhat disjointed and
rambling. However, Mr. Farrell is entitled to some deference based
on his pro se status. On August 21, 2014, the Court issued an
Opinion and Order in Farrell v. GMAC Mortgage, 2:13-cv-140-FTM29DNF, 2014 WL 4146891 (M.D. Fla. Aug. 21, 2014), dismissing
plaintiff’s Amended Complaint regarding the same mortgage loan
with prejudice as to certain claims, but without prejudice as to
the RICO claims.
3
in asserting his RICO claims.
(Id., ¶¶ 24-25.)
Plaintiff seeks
to have his October 2005 mortgage loan, originated by defendants,
declared illegal, null, and void based on the fraud perpetrated by
defendants during the execution of the mortgage note.
(Id., ¶¶
33-41, 50, 75-76.)
Plaintiff alleges that defendant financial institutions are
an
“association-in-fact
enterprise”
existing
for
the
shared
purpose of profiting from mortgage lending, and that defendants
originated an inflated mortgage loan by procuring an inflated
appraisal to create an illusion of equity in real property to
obtain loan approval and to lure secondary market investors to
purchase the loan.
(Id., ¶¶ 110-115, 144.)
Plaintiff alleges
that the securitized mortgages were all done by wire and then
recorded with the county through the mail.
(Id., ¶ 116.)
In Count 1, plaintiff seeks a declaratory judgment against
all defendants declaring that his 2005 mortgage loan is illegal
and
against
public
policy
interests
based
racketeering alleged in the subsequent counts.
on
defendants
(Id., ¶¶ 162-167.)
Plaintiff seeks to have the promissory note and mortgage cancelled
as null and void based on the inflated value of the real property
at the time of the loan in 2005.
(Id., ¶¶ 184-185.)
In Count 2,
plaintiff alleges a RICO claim against Pinnacle Financial doing
business as Tri-Star Lending, Inc., and Ocwen Loan Servicing and
4
Wells Fargo as purchasers of plaintiff’s note and mortgage.
In
Count 3, plaintiff incorporates all previous factual allegations
and
Count
partners.
2
against
Pinnacle
Financial
and
its
undisclosed
In Count 4, plaintiff alleges a RICO conspiracy as to
the named individuals Christian Hancock, Monica Wilson of Bradley
Arant,
Nathan
Schwartz,
and
incorporation of the facts.
Robertson
Anschtuz,
without
any
These defendants are identified in
the caption of the Complaint but not listed or described under the
heading of “Defendants”.
(Doc. #2, ¶ 7.)
Plaintiff seeks damages
as to all counts representing the difference between the inflated
value and the actual value of the property as of the date of the
closing in 2005, with a multiplier, attorney’s fees, and postjudgment interest.
III.
A. Service of Process
The Notice of Removal was filed by Impac Funding, Wells Fargo
Bank, N.A., Ocwen Loan Servicing, LLC, Christian W. Hancock, and
Monica
Wilson
(Impac
Defendants)
and
contains
the
paragraph:
Impac Defendants reserve the right to assert
any defense to the Complaint, whether pursuant
to Fed. R. Civ. P. 8(c), Fed. R. Civ. P. 12,
or otherwise, including, but not limited to,
the
defenses
of
insufficient
process,
insufficient service of process, failure to
state a claim upon which relief can be
5
following
granted, res judicata, or other factual or
affirmative defenses.
(Doc. #1, ¶ 14.)
The Impac defendants did file a Joint Motion to
Dismiss (Doc. #11) in response to the Complaint (Doc. #2), however
no argument is presented with regard to the failure to serve
process other than the following footnote:
“The Defendants note
that Plaintiff has thus far failed to properly serve the Defendants
pursuant to the requirements of Federal Rule of Civil Procedure
4.”
(Doc. #11, p. 5 n.5.)
Finding no motion to dismiss for
failure to serve timely process, this issue will be deemed waived.
Fed. R. Civ. P. 12(h)(1).
Service on defendant Bank of America, N.A. was quashed on
February
25,
attempted
2015,
service
and
again.
otherwise long expired.
National
Mortgage
there
is
The
no
evidence
deadline
to
serve
Fed. R. Civ. P. 4(m).
Association’s
Motion
to
that
plaintiff
process
has
Defendant Federal
Dismiss
Plaintiff’s
Complaint (Doc. #28) does not argue improper service of process,
and the Court will assume that this defendant was served, or waived
service of process.
and
there
is
no
The remaining defendants have not appeared
evidence
that
Financial,
plaintiff
Robertson
served
Pinnacle
Schwartz.
Plaintiff will be required to show cause as to these
B. Motions to Dismiss
6
and
on
defendants
defendants.
Anschutz,
process
Nathan
In his Affidavit and Motion to Strike-Notice of Fraud Upon
the Court, Motion to Reserve Ruling, plaintiff asks that the Court
“grant leave to amend if need be.”
(Doc. #17, p. 2.)
No separate
motion to amend has been filed, and no formal responses were filed
to defendants’ motions to dismiss.
The Court will consider the
motions as to the defendants who have appeared and filed motions,
and whether an amendment would be appropriate.
Shotgun Pleading
“The typical shotgun complaint contains several counts, each
one
incorporating
by
reference
the
allegations
of
its
predecessors, leading to a situation where most of the counts
(i.e., all but the first) contain irrelevant factual allegations
and legal conclusions.”
Strategic Income Fund, L.L.C. v. Spear,
Leeds & Kellogg Corp., 305 F.3d 1293, 1295 (11th Cir. 2002).
The
Eleventh Circuit has consistently frowned upon shotgun pleadings
such as the one presented herein, and shotgun pleadings “exact an
intolerable toll on the trial court’s docket.”
117 F.3d 1258, 1263 (11th Cir. 1997).
Cramer v. Florida,
See also Davis v. Coca-Cola
Bottling Co. Consol., 516 F.3d 955, 979 n.54 (11th Cir. 2008)
(collecting
cases).
Accordingly,
the
Eleventh
Circuit
has
established that when faced with a shotgun pleading, a district
court should require the parties to file an amended pleading rather
7
than allow such a case to proceed to trial.
Byrne v. Nezhat, 261
F.3d 1075, 1130 (11th Cir. 2001).
Counts 1 and 2 of the Complaint (Doc. #2) incorporate all
factual
allegations,
and
allegations and Count 2.
Count
3
incorporates
all
factual
Count 4 incorporates no facts or counts.
Incorporating all factual allegations, or incorporating another
count into a subsequent count, renders the pleading meaningless
and fails to provide a short, plain statement.
The Complaint will
be dismissed as a shotgun pleading, without prejudice to replead.
Wagner v. First Horizon Pharm. Corp., 464 F.3d 1273, 1280 (11th
Cir. 2006) (“the proper remedy was to order repleading”).
Failure to State a Claim
Plaintiff’s claims are all based on the Racketeer Influenced
and Corrupt Organizations Act or “RICO”.
RICO claims must be pled
with particularity pursuant to Fed. R. Civ. P. 9(b).
“To satisfy
the Rule 9(b) standard, RICO complaints must allege: (1) the
precise statements, documents, or misrepresentations made; (2) the
time and place of and person responsible for the statement; (3)
the
content
and
manner
in
which
the
statements
misled
the
Plaintiffs; and (4) what the Defendants gained by the alleged
fraud.”
Ambrosia Coal & Constr. Co. v. Pages Morales, 482 F.3d
1309, 1316-17 (11th Cir. 2007) (citing Brooks v. Blue Cross & Blue
Shield of Fla., Inc., 116 F.3d 1364, 1380-81 (11th Cir. 1997)).
8
RICO
makes
it
unlawful
“for
any
person
employed
by
or
associated with any enterprise engaged in, or the activities of
which
affect
participate,
interstate
directly
or
or
foreign
commerce,
indirectly,
in
the
to
conduct
conduct
of
or
such
enterprise’s affairs through a pattern of racketeering activity.
. . .” 18 U.S.C. § 1962(c).
To establish a claim, plaintiff must
show conduct, of an enterprise, through a pattern, of racketeering
activity, and also show an injury to business or property “by
reason of” the RICO violation.
Williams v. Mohawk Indus., Inc.,
465 F.3d 1277, 1282 (11th Cir. 2006).
racketeering
activity,
plaintiff
must
To show a pattern of
establish
distinct but related acts of racketeering activity.
F.3d
at
1283.
The
RICO
Act
defines
at
least
two
Williams, 465
“racketeering
activity”
comprehensively in 18 U.S.C. § 1961(1) to include a variety of
enumerated criminal offenses.
In this case, plaintiff alleges
mail fraud (18 U.S.C. § 1341), wire fraud (18 U.S.C. § 1343),
and/or financial institution fraud (18 U.S.C. § 1344).
The Court previously summarized a RICO conspiracy claim as
follows:
Section 1962(d) of the RICO Act makes it
unlawful to conspire to violate any of the
provisions
under
the
other
subsections,
including (c). Under Section 1962(c) of the
RICO Act, it is unlawful “for any person
employed by or associated with any enterprise
engaged in, or the activities of which affect,
interstate or foreign commerce, to conduct or
9
participate, directly or indirectly, in the
conduct of such enterprise's affairs through
a pattern of racketeering activity.”
18
U.S.C. § 1962(c). A civil RICO conspiracy
claim requires the commission of an overt act
in furtherance of the conspiracy.
Beck v.
Prupis, 162 F.3d 1090, 1098 (11th Cir. 1998)
(citing Bivens Gardens Office Bldg., Inc. v.
Barnett Bank of Fla., Inc., 906 F.2d 1546,
1550 n.7 (11th Cir. 1990)). “A plaintiff can
establish a RICO conspiracy claim in one of
two ways: (1) by showing that the defendant
agreed to the overall objective of the
conspiracy; or (2) by showing that the
defendant agreed to commit two predicate
acts.” Am. Dental Ass'n v. Cigna Corp., 605
F.3d 1283, 1293 (11th Cir. 2010) (citations
and quotation marks omitted).
Farrell v. GMAC Mortgage, No. 2:13-CV-140-FTM-29, 2014 WL 4146891,
at *4 (M.D. Fla. Aug. 21, 2014).
There are no specific statements as to the Federal National
Mortgage
Association
allegations
of
(“Fannie
general
Mae”).
involvement
in
The
a
Court
RICO
finds
the
enterprise
are
insufficient to provide notice of the claims against Fannie Mae,
or to meet the heightened requirements of Rule 9.
Plaintiff does
not identify any specific conduct of Fannie Mae in the enterprise
other than as a co-conspirator, and there is no indication that
Fannie Mae had an interest in the underlying state court litigation
regarding plaintiff’s property.
Therefore, the motion will be
granted and this defendant will be dismissed.
As
to
the
Impac
defendants,
plaintiff
has
alleged
an
enterprise, an injury to his property, and the necessary predicate
10
acts, but plaintiff fails to allege with any particularity what
role each defendant played, the specific conduct attributable to
each defendant that caused injury, how the allegations against
Pinnacle Financial d/b/a as Tri-Star Lending, Inc. transfer to
Wells Fargo or Ocwen Loan Servicing, LLC, or how any of the
individual defendants played a role in the pattern of activity.
The RICO conspiracy count alleges that Monica Wilson and
Nathan Schwartz argued the summary judgment motion in state court,
and the presiding state court judge granted summary judgment on
April 30, 2014.
Defendants Monica Wilson, Nathan Schwartz, and
Christian Hancock relied on a fraudulent assignment of mortgage
that was filed 1 year after Impac went out of business on January
31, 2008. On March 24, 2009, Wells Fargo obtained summary judgment
that was vacated by Monica Wilson and Christian Hancock in November
2010, due to the fraudulent assignment.
On November 19, 2014, the
Consumer
drafted
Financial
Protection
certain mortgage regulations.
Loan
Servicing
defendants
never
Bureau
and
Amendment
to
Plaintiff alleges that since Ocwen
confirmed
Bradley-Arant
an
its
Robertson
ownership
Anschutz
interest
through
and
their
agents, violated RICO by trying to collect on an unlawful debt.
The Court cannot determine what agreement was reached as part of
the conspiracy, or what overt act was committed by a particular
defendant.
Additionally, if the named individuals are in fact
11
counsel from the state court case, it is unclear how plaintiff
could assert a claim that would not be barred by some litigation
privilege or immunity.
The motion to dismiss will be granted,
with leave to amend.
Accordingly, it is now
ORDERED:
1.
Defendants Impac Funding, Wells Fargo Bank, N.A., Ocwen
Loan Servicing, Christian Hancock, Monica Wilson, and
Federal National Mortgage Association are deemed to have
waived formal service of process.
2.
Defendants Impac Funding, Wells Fargo Bank, N.A., Ocwen
Loan Servicing, Christian Hancock, and Monica Wilson’s
Joint Motion to Dismiss (Doc. #11) and defendant Federal
National
Mortgage
Plaintiff’s
Association’s
Complaint
(Doc.
#28)
Motion
are
to
Dismiss
GRANTED.
The
Complaint is dismissed without prejudice to plaintiff
filing an Amended Complaint within FOURTEEN (14) DAYS of
this Opinion and Order. If no Amended Complaint is filed,
the Court will deem the dismissal to be with prejudice as
to all counts and enter judgment.
No further amendments
will be permitted thereafter.
3.
Plaintiff shall show cause within FOURTEEN (14) DAYS of
this Order for failure to execute service of process on
12
the remaining defendants, or indicate that they will not
be named in the Amended Complaint.
The failure to show
good cause will result in the dismissal of defendants
Pinnacle
Anschutz,
Financial
and
d/b/a
Nathan
Tri-Star
Schwartz
Lending,
without
Robertson
prejudice
and
without further notice.
4.
The requirement to confer and file a Case Management
Report is suspended until THIRTY (30) DAYS after the date
of the first answer filed.
DONE AND ORDERED at Fort Myers, Florida, this
September, 2015.
Copies:
Plaintiff
Counsel of record
13
25th
day of
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