Galle v. Nationstar Mortgage, LLC
Filing
43
ORDER granting in part and denying in part 24 Plaintiff's Motion to Strike Defendant's Affirmative Defenses; denying 32 Defendant's Motion to Strike Jury Trial Demand. See Order for details. Signed by Magistrate Judge Carol Mirando on 3/6/2017. (HJ)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
MARCIA GALLE,
Plaintiff,
v.
Case No: 2:16-cv-407-FtM-38CM
NATIONSTAR MORTGAGE, LLC,
Defendant.
ORDER
This matter comes before the Court upon review of Plaintiff's Motion to Strike
Defendant's Affirmative Defenses (Doc. 24) and Defendant’s Motion to Strike Jury
Trial Demand (Doc. 32).
Defendant opposes Plaintiff’s motion to strike (Doc. 24),
and Plaintiff opposes Defendant’s motion to strike (Doc. 32).
Docs. 29, 33.
Defendant filed a reply brief in response to Plaintiff’s response (Doc. 33), and Plaintiff
filed a sur-reply.
Docs. 36, 42.
Plaintiff also filed a Notice of Filing Supplemental
Authority in support of her opposition to Defendant’s motion to strike.
Defendant filed a response to Plaintiff’s filing of supplemental authority.
I.
Doc. 40.
Doc. 41.
Background
On May 24, 2016, Plaintiff filed a Verified Complaint and Demand for Jury
Trial against Defendant.
Doc. 1. On August 31, 2016, with leave of Court, Plaintiff
filed a First Amended Complaint and Demand for Jury Trial (“Amended Complaint”)
that includes a claim for punitive damages.
Docs. 16, 17, 18.
The Amended
Complaint alleges that Defendant violated the Fair Debt Collection Practices Act
(“FDCPA”), 15 U.S.C. §§ 1692 – 1692p, and the Florida Consumer Collection Practices
Act (“FCCPA”), sections 559.55 to 559.785 of the Florida Statutes.
Doc. 17 ¶ 2.
Plaintiff is a resident of Collier County, and Defendant is a foreign limited liability
company operating in Texas.
Id. ¶¶ 4-5. Plaintiff alleges that Defendant is a debt
collector under the definitions of the federal and state statutes.
Id. ¶ 5.
According to the Amended Complaint, Plaintiff filed a voluntary Chapter 7
bankruptcy petition with this District’s bankruptcy court.
Id. ¶ 6. Plaintiff states
that in the schedules filed with her bankruptcy petition, she listed a debt in the
amount of $185,219.20 on a first mortgage on real property located in Naples, Florida
owed to Countrywide Home Loans Servicing LP (“Countrywide”).
Id.
Plaintiff
alleges that she clearly indicated her intention to surrender the mortgaged property,
and Countrywide was included in the mailing matrix filed with Plaintiff’s bankruptcy
petition.
Id. ¶¶ 8-9. Accordingly, Plaintiff states that the Clerk of Court issued a
written notice of filing and of the creditors’ meeting to all parties on the master
mailing matrix.
Id. ¶ 10.
Plaintiff claims that Countrywide did not attend the
creditors’ meeting, and the bankruptcy case discharged Plaintiff’s debts.
Id. ¶ 12.
Plaintiff alleges that on or about May 1, 2013, Countrywide transferred
servicing of Plaintiff’s discharged mortgage loan to Defendant, which subsequently
sent a notice of transfer to Plaintiff.
Id. ¶ 14. Defendant also allegedly sent a loan
statement dated May 21, 2013, which stated that Plaintiff owed a mortgage loan in
the amount of $72,285.75 to Defendant.
Id. ¶ 15.
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Plaintiff claims that upon receiving the notice and the statement, Plaintiff filed
a lawsuit against Defendant for violating the discharge injunction under the federal
bankruptcy code.
Id. ¶ 16. Plaintiff argues that the parties amicably resolved the
proceedings by entering into a settlement agreement.
Id. ¶ 17.
According to
Plaintiff, as a material condition of the settlement agreement, Defendant agreed to
cease and desist any further collection activity with the mortgage loan in dispute.
Id.
Despite the settlement agreement, Plaintiff asserts that Defendant sent
statements demanding her payment on the discharged debt for over a year.
Id. ¶ 19.
Plaintiff argues that Defendant’s actions constitute the violations of the FDCPA and
the FCCPA.
Id. ¶ 28.
On June 16, 2016, Defendant filed a motion to dismiss Plaintiff’s complaint
(Doc. 1), which United States District Judge Sheri Polster Chappell denied.
Docs.
10, 14. On October 4, 2016, the Court entered a Case Management and Scheduling
Order (“CMSO”) setting the mediation deadline to April 27, 2017, the deadlines to
disclose expert reports for Plaintiff to May 5, 2017 and for Defendant to May 19, 2017,
the discovery deadline to June 9, 2017, the deadline for dispositive motions to July
14, 2017, and a trial term of November 6, 2017. Doc. 23 at 1-2.
II.
Plaintiff’s Motion to Strike Defendant’s Affirmative Defenses (Doc. 24)
On September 15, 2016, Defendant filed an Answer and Affirmative Defenses
to Plaintiff’s First Amended Complaint (“Answer”).
Doc. 22.
The Answer alleges
six affirmative defenses: failure to state a claim, compliance with law, preclusion and
preemption, failure to mitigate damages, no intent, and reservation.
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Id. at 7.
Plaintiff seeks to strike five of Defendant’s enumerated affirmative defenses.
Doc. 24.
Plaintiff argues that Defendant’s affirmative defenses do not satisfy Rule
8(a) of the Federal Rules of Civil Procedure.
Id. at 3. Plaintiff asserts that many
of Defendant’s affirmative defenses do not provide proper notice of the defenses’
nature because they are inadequate, vague, and conclusory.
Id. at 4. Plaintiff also
claims that Defendant does not allege sufficient facts to support its affirmative
defenses.
Id. Furthermore, Plaintiff argues that to the extent that the affirmative
defenses concern the cause of action under the FDCPA, the FDCPA provides three
available statutory defenses: bona fide error, statute of limitations, and conformity
with an advisory opinion of the Federal Trade Commission.
Id. at 4-5.
“District courts have broad discretion in disposing of motions to strike under
Fed. R. Civ. P. 12(f).”
Microsoft Corp. v. Jesse's Computers & Repair, Inc., 211
F.R.D. 681, 683 (M.D. Fla. 2002) (internal citations omitted).
A motion to strike,
however, is a “drastic remedy, which is disfavored by the courts.”
Hansen v. ABC
Liquors, Inc., No. 3:09-CV-966-J-34MCR, 2009 WL 3790447, at *1 (M.D. Fla. Nov. 9,
2009).
Pursuant Fed. R. Civ. P. 12(f), the Court “may strike from a pleading an
insufficient defense or any redundant, immaterial, impertinent, or scandalous
matter.”
of law.
An affirmative defense will be stricken only if it is insufficient as a matter
Microsoft Corp., 211 F.R.D. at 683. An affirmative defense is insufficient
as a matter of law “only if: (1) on the face of the pleadings, it is patently frivolous, or
(2) it is clearly invalid as a matter of law.” Id.
The Eleventh Circuit has noted that
the “[t]he party asserting an affirmative defense usually has the burden of proving
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it.”
In re Rawson Food Serv., Inc., 846 F.2d 1343, 1349 (11th Cir. 1988).
In
evaluating a motion to strike affirmative defenses, “the court must treat all well
pleaded facts as admitted and cannot consider matters beyond the pleadings.”
Microsoft Corp., 211 F.R.D. at 683.
“An affirmative defense is generally a defense that, if established, requires
judgment for the defendant even if the plaintiff can prove his case by a preponderance
of the evidence.”
Wright v. Southland Corp., 187 F.3d 1287, 1303 (11th Cir. 1999).
Thus, an “an affirmative defense is established only when a defendant admits the
essential facts of a complaint and sets up other facts in justification or avoidance.”
Morrison v. Executive Aircraft Refinishing, Inc., 434 F. Supp. 2d 1314, 1318 (S.D. Fla.
2005).
On the other hand, an affirmative defense “which points out a defect in the
plaintiff's prima facie case is not an affirmative defense.”
In re Rawson Food Serv.,
Inc., 846 F.2d at 1349.
Affirmative defenses are subject to the general pleading requirements of Fed.
R. Civ. P. 8(b)(1)(A), which requires a party to “state a short and plain terms its
defenses to each claim asserted against it.
“As with any pleading, an affirmative
defense must provide ‘fair notice’ of the nature of the defense and the grounds upon
which it rests, and state a plausible defense.”
Biller v. Cafe Luna of Naples, Inc.,
No. 2:14-CV-659-FTM, 2015 WL 1648888, at *1 (M.D. Fla. Apr. 13, 2015) (citing Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) and Ashcroft v. Iqbal, 556 U.S. 662,
679 (2009)).
Nevertheless, “a defendant must do more than make conclusory
allegations.
If the affirmative defense comprises of no more than bare bones
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conclusory allegations, it must be stricken.”
Microsoft Corp, 211 F.R.D. at 683.
With these guiding principles in mind, the Court turns to the five affirmative defenses
that Plaintiff wishes to strike.
a. First Affirmative Defense: Failure to State a Claim
Defendant’s first affirmative defense is that Plaintiff fails to state a claim for
which relief can be granted.
Doc. 22 at 7.
Plaintiff argues that she clearly has
stated her claims, and failure to state a claim is not a proper affirmative defense.
Doc. 24 at 7.
Furthermore, Plaintiff asserts that Defendant moved to dismiss
Plaintiff’s Complaint, which Judge Chappell denied.
Docs. 10, 14.
Defendant
responds that failure to state a claim is a proper affirmative defense, and Judge
Chappell’s denial of its motion to dismiss does not affect this affirmative defense.
Doc. 29 at 3-5.
Although failure to state a claim upon which relief may be granted is a proper
affirmative defense, Defendant merely states its allegation without any specifics and
recites the legal standard under Rule 12(b)(6) of the Federal Rules of Civil Procedure.
Muschong v. Millennium Physician Grp. LLC, No. 2:13-cv-705-FtM-38CM, 2014 WL
1268574, at *7 (M.D. Fla. Mar. 27, 2014) (striking the defendant’s affirmative
defense, “[s]ome or all Plaintiffs’ allegations fail to state a claim for which relief can
be granted,” because it recited the standard for a motion to dismiss under Rule
12(b)(6) and did not provide any specifics); Colon v. Wal-Mart Stores, Inc., No. 2:13cv-464-FtM-29DNF, 2014 WL 1588463, at *3 (M.D. Fla. Apr. 14, 2014) (“Failure to
state a claim upon which relief may be granted is a proper affirmative defense.”).
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Plaintiffs’ motion to strike the first affirmative defense, therefore, is due to be
granted, without prejudice, to amend in order to comply with Fed. R. Civ. P.
8(b)(1)(A).
See Perales v. Schear Corp., No. 2:09-cv-669-FtM-29DNF, 2010 WL
1839295, at *1 (M.D. Fla. May 10, 2010).
b. Second Affirmative Defense: Compliance with Law
As its second affirmative defense, Defendant alleges that it has complied with
all applicable federal or state laws, statutes, and regulations and has not committed
any violation to Plaintiff.
Doc. 22 at 7.
Plaintiff argues that this affirmative
defense is not supported by facts and also does not provide fair notice to Plaintiff.
Doc. 24 at 8. Furthermore, Plaintiff asserts that this affirmative defense is a denial
of Plaintiff’s allegations.
Id.
Defendant argues that this affirmative defense
provides fair notice to Plaintiff, but does not contest the argument that this is a denial
of Plaintiff’s allegations.
Doc. 29 at 5-6.
The Court finds that the second affirmative defense is not an affirmative
defense but a denial.
Muschong, 2014 WL 1268574, at *7 (holding that the
defendant’s affirmative defense of acting in good faith and complying with applicable
statutes and regulations is not an affirmative defense but a denial).
Because
Defendant incorrectly labeled a negative averment as an affirmative defense, “the
proper remedy is not to strike the claim but rather to treat it as a specific denial.”
Id. As a result, the Court will not strike the second affirmative defense, but treat it
as a denial.
See id.
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c. Third Affirmative Defense: Preclusion and Preemption
Defendant withdraws its third affirmative defense without prejudice.
at 6.
Doc. 29
Hence, this affirmative defense is withdrawn.
d. Fourth Affirmative Defense: Failure to Mitigate Damages
Defendant alleges that Plaintiff failed to mitigate damages because she did not
call Defendant’s number to request that Defendant cease sending statements to
Plaintiff.
Doc. 22 at 7.
Plaintiff argues that this affirmative defense ignores
certain facts contained in the Amended Complaint.
Doc. 24 at 11.
Plaintiff also
asserts that whether Plaintiff called Defendant’s phone number to make a request is
irrelevant to this case.
Id. At this stage, the Court will assume the truth of the
facts alleged in both the Amended Complaint and the Answer and not resolve factual
disputes.
Muschong, 2014 WL 1268574, at *2.
Defendant’s fourth affirmative
defense survives Plaintiff’s motion to strike.
e. Fifth Affirmative Defense: No Intent
Defendant asserts that its “alleged violation of the FDCPA or FCCPA by the
sending of the mortgage loan statement at issue, if indeed it occurred, was not
intentional and the result of a bona fide error notwithstanding the maintenance of
procedures reasonably adapted to avoid any such error.”
Doc. 22 at 7.
Plaintiff
argues that Defendant does not plead sufficient facts to support its defense and
therefore, does not provide fair notice of the defense to Plaintiff.
Doc. 24 at 12.
Plaintiff also asserts that this affirmative defense does not satisfy Rule 9(b) because
it does not state circumstances showing a mistake with particularity.
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Id.
Furthermore, Plaintiff claims that Defendant’s intent is irrelevant to the FDCPA.
Id. at 13. Defendant responds that this defense is permitted under the FDCPA as
well as being a proper affirmative defense.
Doc. 29 at 6.
As Defendant correctly notes, the FDCPA permits the defense of a bona fide
Nobles v. Convergent Healthcare Recoveries, Inc., No. 8:15-cv-1745-T-
error.
30MAP, 2015 WL 5098877, at *2 (M.D. Fla. Aug. 31, 2015).
The court in Nobles also
affirmed that the similar affirmative defense stating in part, “any violation of the
FDCPA . . . would have resulted from a bona fide error notwithstanding the
maintenance of policies and procedures that are in place to ensure that the proper
creditor is named when information is furnished to any consumer credit reporting
agency,” provides fair notice of the defense and the defense’s grounds.
Id.
In
addition, the proper legal standard for stating an affirmative defense is under Rule
8(b)(1)(A), not Rule 9(b).
“special matters.”
Fed. R. Civ. P. 8(b)(1)(A).
Rule 9 concerns pleading
Fed. R. Civ. P. 9. Plaintiff’s fifth affirmative defense will not be
stricken.
III.
Defendant’s Motion to Strike Jury Trial Demand (Doc. 32)
Defendant argues that when Plaintiff secured her loan with a mortgage on her
home in Naples, Florida, the mortgage agreement contained a jury trial waiver.
Doc. 32 at 1.
In support, Defendant provides a copy of the mortgage agreement,
which contains a clause that Plaintiff “hereby waives any right to a trial by jury in
any action, proceeding, claim, or counterclaim, whether in contract or tort, at law or
in equity, arising out of or in any way related to this Security Instrument or the Note.”
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Doc. 39-2 at 13.
Defendant asserts that the present lawsuit is subject to this waiver
because the Amended Complaint does not fall outside the scope of the mortgage
agreement.
Doc. 32 at 2.
Furthermore, Defendant argues that a jury trial waiver is common in loan
agreements and is enforceable if agreed upon knowingly and voluntarily. Id. at 3.
Defendant claims that Plaintiff agreed to a jury waiver in the mortgage agreement
and must show evidence if she did not knowingly or voluntarily enter into the
mortgage agreement.
Id. at 4.
Regardless, Defendant asserts that Plaintiff
knowingly and voluntarily waived a jury trial.
Id. at 4-6.
Plaintiff responds that Defendant’s motion to strike is untimely under Rule
12(f).
Doc. 33 at 3. Plaintiff argues that Defendant should have moved to strike
before filing its Answer or within twenty-one days after Defendant was served with
Plaintiff’s complaints. Id.
the validity of the mortgage.
Furthermore, Plaintiff asserts that Defendant assumes
Id. at 4. Plaintiff alleges that Plaintiff’s obligations
under the mortgage agreement did not survive the bankruptcy charge.
Id. at 4-6.
Lastly, Plaintiff argues that her claim does not rise out of the mortgage agreement
but out of Defendant’s unlawful collection efforts.
Id. at 7-9.
In its reply brief, Defendant claims that its motion to strike jury demand is
governed by Rule 39(a)(2), not Rule 12(f).
Doc. 36 ta 1-2. Defendant also asserts
that Plaintiff’s bankruptcy action only discharged her personal liability and did not
affect her non-monetary contractual obligations including a jury trial waiver.
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Id. at
2-5.
Moreover, Defendant responds that Plaintiff’s action relates to the mortgage
agreement.
Id. at 6-7.
Plaintiff alleges in her sur-reply that Defendant’s motion is untimely and moot
because Defendant agreed to a jury trial when the parties filed a Case Management
Report.
Docs. 21 at 2, 42 at 2-3.
Plaintiff relies on Senior United States District
Judge John E. Steele’s Opinion and Order in Roth v. Nationstar Mortgage, LLC, No.
2:15-cv-783-FtM-29MRM, 2016 WL 7473818, at *2 (M.D. Fla. Dec. 29, 2016) (denying
the defendant’s motion to strike jury trial demand because the defendant failed to
object to the plaintiffs’ jury demands in the original and amended complaints and
consented to the jury trial option in the case management report).
3.
Docs. 40-2, 42 at
Furthermore, Plaintiff argues that Defendant is attempting to enforce the
promissory note by seeking to collect the discharged debt from Plaintiff.
5.
Doc. 42 at
Plaintiff asserts that her bankruptcy case invalidated the promissory note.
Id.
In addition to the above arguments, Plaintiff reiterates her argument that her action
arises out of the FDCPA and the FCCPA, not out of contractual duties based on the
mortgage agreement.
Id. at 6-7.
The Court finds that Judge Steele’s Opinion and Order in Roth is instructive
and controlling. 2016 WL 7473818, at *1-2.
Roth presents very similar facts and
procedural history: the plaintiff named Defendant as a defendant, alleging
Defendant’s violations of the FDCPA, the FCCPA, and the parties’ settlement
agreement because Defendant attempted to collect on a mortgage debt discharged in
bankruptcy.
Id. Defendant moved to strike jury demand in that case, although
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Defendant did not object to the plaintiff’s demand for jury trial in the original and
amend complaints.
Id.
Defendant’s counsel also signed the case management
report agreeing to a jury trial estimated to last two days. Id.
As a result, Judge
Steele entered a case management and scheduling order setting a jury trial in Roth,
to which Defendant did not object.
Id. Ten weeks after Judge Steele entered the
case management and scheduling order, Defendant filed a motion to strike jury
demand, alleging what it alleges here: “the plaintiff waived her right to a jury trial
pursuant to jury-waiver provisions contained in her mortgage [agreement.]”
Id.
Judge Steele denied Defendant’s motion to strike because “by signing the
parties’ [c]ase [m]anagement [r]eport selecting the ‘jury trial’ option, [Defendant]
consented to a jury trial and thus waived the right to subsequently invoke the
waivers.”
Id. at 2. Judge Steele noted that “once a jury trial has been properly
demanded, . . . a plaintiff is entitled to proceed before a jury on all claims for which
there is a ‘federal right to a jury trial.’”
Id. Defendant, however, did not argue in
Roth that the Seventh Amendment foreclosed the plaintiff’s jury demand. Id. Nor
did Judge Steele find that the Seventh Amendment foreclosed the plaintiff’s jury
demand in Roth.
Id. As a result, Judge Steele denied Defendant’s motion to strike.
Id.
Similarly, Plaintiff here included a jury demand in both the original and the
Amended Complaints.
to any.
Docs. 1 at 11, 17 at 11.
Defendant, however, did not object
Furthermore, the parties filed the Case Management Report on September
6, 2016, which indicated that they consented to a jury trial.
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Doc. 21 at 2.
Accordingly, on October 4, 2016, the Court entered a CMSO, setting a jury trial
estimated to last two days to proceed before Judge Chappell.
Defendant did not object to the CMSO.
Doc. 23.
Again,
On November 18, 2016, nearly six weeks
after the Court entered the CMSO, Defendant filed the present motion, setting forth
the same arguments that it alleged in Roth: Plaintiff is subject to a jury trial waiver
contained in the mortgage agreement.
Doc. 32.
Defendant also has not alleged
that Plaintiff’s right to a jury trial is foreclosed by the Seventh Amendment.
32, 36.
Docs.
Given the nearly identical facts and arguments, as Judge Steele in Roth held,
the Court finds that Defendant waived its right to invoke the jury trial waiver in the
mortgage agreement, and Plaintiff is entitled to proceed before a jury on all claims.
Roth, 2016 WL 7473818, at *1-2.
Defendant argues that it did not have an opportunity to respond to Plaintiff’s
argument of having waived Defendant’s objection to a jury trial.
Doc. 41 at 1.
Defendant further asserts that the Opinion and Order in Roth is not final because
Defendant filed a motion for reconsideration and Judge Steele has not yet ruled on
the motion.
Id. at 2.
Defendant negates its own argument that it lacked an opportunity to respond
by filing a Response to Plaintiff’s Notice of Filing Supplemental Authority.
Doc. 41.
Plaintiff’s filing of supplemental authority (Doc. 40) contains a copy of Judge Steele’s
Opinion and Order, and Defendant responded to Plaintiff’s filing by presenting the
above argument as well as a copy of its motion for reconsideration filed in Roth.
41-1.
Doc.
Furthermore, Defendant may file a motion for reconsideration of this Order
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and to notify the Court if and when Judge Steele grants its motion to reconsideration
in Roth and enters a contrary holding.
ACCORDINGLY, it is hereby
ORDERED:
1.
Plaintiff's Motion to Strike Defendant's Affirmative Defenses (Doc. 32) is
GRANTED in part and DENIED in part.
2.
Plaintiff’s Motion to Strike Defendant’s first affirmative defense is
GRANTED, without prejudice, with leave to amend.
Defendant shall have up to and
including March 13, 2017 to amend the first affirmative defense in compliance with
this Order.
3.
Defendant’s third affirmative defense is hereby WITHDRAWN.
Defendant shall have up to and including March 13, 2017 to amend the third
affirmative defense.
4.
Defendant’s Motion to Strike Jury Trial Demand (Doc. 32) is DENIED.
DONE and ORDERED in Fort Myers, Florida on this 6th day of March, 2017.
Copies:
Counsel of record
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