Figueroa et al v. Bank of America, N.A.
Filing
34
ORDER: Defendant Bank of America's Motion to Dismiss Plaintiffs' Amended Complaint (Doc. # 29 ) is granted in part and denied in part. Bank of America is directed to file an answer to the surviving claim within 14 days. Signed by Judge Virginia M. Hernandez Covington on 5/15/2018. (AHG)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
DAVID FIGUEROA and LAZARA SOSA,
Plaintiffs,
v.
Case No. 8:17-cv-2637-T-33TGW
BANK OF AMERICA, N.A.,
Defendant.
_____________________________/
ORDER
This matter comes before the Court upon consideration of
Defendant Bank of America, N.A.’s Motion to Dismiss Plaintiffs’
Amended Complaint (Doc. # 29), filed on March 28, 2018. Plaintiffs
David Figueroa and Lazara Sosa filed their response in opposition
on April 12, 2018. (Doc. # 31). The Amended Complaint, (Doc. #
22), represents Plaintiffs’ fourth attempt at pleading in this
case. For the reasons below, the Court grants Bank of America’s
Motion to Dismiss in part and denies in part. Finding that leave
to amend at this juncture would be futile, Plaintiffs may not file
a second amended complaint.
I.
Background
On June 27, 2017, over 70 plaintiffs sued Bank of America in
one action in the Middle District of Florida. Torres, et al. v.
Bank of America, N.A., No. 8:17-cv-1534, (M. D. Fla. June 27,
2017), Doc. # 1. Plaintiffs David Figueroa and Lazara Sosa were
two of the many plaintiffs in the original lawsuit. Plaintiffs
alleged Bank of America (BOA) committed common law fraud in its
administration of the Home Affordable Modification Program. HAMP
was implemented by the Federal Government in March of 2009, to
help homeowners facing foreclosure. (Doc. # 22 at ¶ 9). BOA entered
into
a
Servicer
Participation
Agreement
with
the
Federal
Government in which BOA was required to use reasonable efforts to
effectuate any modification of a mortgage loan under HAMP. (Id. at
¶ 10). The Federal Government, in exchange for BOA’s participation
in HAMP, agreed to compensate BOA for part of the loss attributable
to each modification. (Id. at ¶ 11). Plaintiffs’ claims were all
based on their attempts to secure a loan modification with BOA
under HAMP.
In the original lawsuit, BOA filed a Motion to Dismiss under
Fed. R. Civ. P. 12(b)(6), (Torres Doc. # 12), and Plaintiffs
amended their complaint. (Torres Doc. # 16). Following BOA’s second
Motion to Dismiss, (Torres Doc. # 17), the presiding judge severed
the claims and required Plaintiffs to sue separately. (Torres Doc.
# 19). Plaintiffs David Figueroa and Lazara Sosa filed a separate
complaint on November 3, 2017. (Doc. # 1). Three months later, on
March 7, 2018, Plaintiffs filed an Amended Complaint. (Doc. # 22).
Thus, the operative complaint in this matter is Plaintiffs’ fourth
attempt to properly plead their cause of action.
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The Amended Complaint alleges BOA committed four fraudulent
acts: (1) falsely telling Plaintiffs that “they have to be in
default to qualify for a HAMP loan modification” and failing to
tell Plaintiffs that they could qualify for HAMP if default was
reasonably foreseeable (“HAMP Eligibility Claim”); (2) falsely
telling Plaintiffs the requested supporting financial documents
Plaintiffs
had
submitted
to
BOA
were
incomplete
(“Supporting
Documents Claim”); (3) falsely telling Plaintiffs that they were
approved for a HAMP modification and needed to start making trial
payments (“HAMP Approval Claim”); and (4) fraudulently omitting
how inspection fees charged to Plaintiffs’ account would be applied
(“Inspection Fee Claim”). (Doc. # 22 at ¶¶ 38, 41, 48, 55).
In its Motion to Dismiss, BOA argues that Plaintiffs’ fraud
claims are barred by the statute of limitations and banking statute
of frauds. (Doc. # 29 at 6, 11). BOA also contends that Plaintiffs’
Amended
Complaint
violates
Rule
9(b)
by
failing
to
allege
circumstances constituting fraud with sufficient particularity.
(Id. at 14). These arguments are addressed in turn.
II.
Legal Standard
On a Rule 12(b)(6) motion to dismiss, this Court accepts as
true all the allegations in the Complaint and construes them in
the light most favorable to the plaintiff. Jackson v. Bellsouth
Telecomms., 372 F.3d 1250, 1262 (11th Cir. 2004). Further, the
Court favors the plaintiff with all reasonable inferences from the
3
allegations in the Complaint. Stephens v. Dep’t of Health & Human
Servs., 901 F.2d 1571, 1573 (11th Cir. 1990) (“On a motion to
dismiss, the facts stated in [the] complaint and all reasonable
inferences therefrom are taken as true.”). However, the Supreme
Court explains that:
While a complaint attacked by a Rule 12(b)(6) motion to
dismiss does not need detailed factual allegations, a
plaintiff’s obligation to provide the grounds of his
entitlement to relief requires more than labels and
conclusions, and a formulaic recitation of the elements
of a cause of action will not do. Factual allegations
must be enough to raise a right to relief above the
speculative level.
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal
citations omitted). In addition, courts are not “bound to accept
as true a legal conclusion couched as a factual allegation.”
Papasan
v.
Allain,
478
U.S.
265,
286
(1986).
Furthermore,
“[t]hreadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice.” Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009).
Generally, “[t]he scope of review must be limited to the four
corners of the complaint.” St. George v. Pinellas Cty., 285 F.3d
1334, 1337 (11th Cir. 2002). “There is an exception, however, to
this general rule. In ruling upon a motion to dismiss, the district
court may consider an extrinsic document if it is (1) central to
the plaintiff’s claim, and (2) its authenticity is not challenged.”
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SFM Holdings, Ltd. v. Banc of Am. Sec., LLC, 600 F.3d 1334, 1337
(11th Cir. 2010).
III. Analysis
A. Statute of Limitations
Under Florida law, there is a four-year statute of limitations
for any “legal or equitable action founded on fraud.” Fla. Stat.
§ 95.11(3)(j). The time period to sue begins running when the
plaintiff discovers, or should have discovered with due diligence,
the facts giving rise to the fraud. Fla. Stat. § 95.031(2)(a). In
its Motion to Dismiss, BOA argues that all of Plaintiffs’ claims
are barred by the statute of limitations. The Court disagrees;
only Plaintiffs’ Inspection Fee Claim may be barred.
Arguing that Plaintiffs should have discovered the basis for
their fraud claim “when the relevant statements were made,” BOA
submits that each of Plaintiffs’ claims should be barred. (Doc. #
29 at 6). BOA points to a document it calls the Supplemental
Directive posted on the Treasury Department’s website and posits
that the posted guidelines for HAMP eligibility gave Plaintiffs an
opportunity to discover with due diligence any facts giving rise
to fraud. (Doc. # 29 at 7-8).
But,
the
Court
is
not
convinced
that
the
Supplemental
Directive should be taken into account in determining whether the
statute of limitations has barred Plaintiffs’ claims. “A document
attached to a motion to dismiss may be considered by the court
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. . . only if the attached document is: (1) central to the
plaintiff’s claim; and (2) undisputed.” Horsley v. Feldt, 304 F.3d
1125, 1134 (11th Cir. 2002). The Supplemental Directive is not
attached
either
Furthermore,
to
the
the
Amended
Supplemental
Complaint,
Directive
is
nor
not
the
Motion.
central
to
Plaintiffs’ fraud claims. Plaintiffs’ claims are based on the
alleged false statements and omissions made by BOA to Plaintiffs
through the HAMP process. While the Supplemental Directive may be
central to BOA’s statute of limitations defense, it is not central
to Plaintiffs’ claims.
Even if the Supplemental Directive were to be considered
alongside the Amended Complaint, it is not clear that, with due
diligence, Plaintiffs should have discovered the basis of their
fraud
allegations.
BOA
argues
that
Plaintiffs
should
have
consulted this document to understand the guidelines of HAMP and
thus discover any misrepresentations. (Doc. # 29 at 7). But the
Supplemental
Directive
is
a
38-page
document
filled
with
complicated financial and legal requirements. This document, which
is intended to be used by banking professionals, does not establish
a reasonable expectation that Plaintiffs should have discovered
the basis of their fraud allegations earlier. See Order Granting
in Part and Denying in Part Motion to Dismiss, Carmenates, et al.
v. Bank of America, N.A., No. 8:17-cv-2635-T-23JSS, (M.D. Fla.
Feb. 1, 2018), Doc. # 12.
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BOA has not met its burden of showing that Plaintiffs knew,
or should have known, that the statements relating to the HAMP
Eligibility, HAMP Approval or Supporting Documents claims were
false. A statute of limitations defense is an affirmative defense
and BOA bears the burden of proof. La Grasta v. First Union
Securities, Inc., 358 F.3d 840, 845 (11th Cir. 2004). BOA has not
shown
that
Plaintiffs
knew,
or
should
have
known,
that
the
statements were false regarding HAMP’s eligibility requirements or
their HAMP approval. Additionally, BOA has failed to establish
that Plaintiffs knew, or should have known, that the financial
documents they submitted to BOA were not actually missing. Thus,
the statute of limitations has not run with respect to the HAMP
Eligibility, HAMP Approval or Supporting Documents claims.
Finally, with respect to the Inspection Fee Claim, the statute
of limitations began to run when Plaintiffs’ account was charged.
There is no reason that a diligent mortgagor would not and could
not check his or her bank account and notice the fees. (Carmenates
Order at 6). Plaintiffs claim the inspection fees were last charged
in 2013. (Doc. # 22 at ¶ 55). However, Plaintiffs do not allege a
specific date in 2013 on which the fees were charged, precluding
determination of the statute of limitations. Even if the statute
of limitations does not bar the claim, Plaintiffs’ Inspection Fee
Claim is nonetheless dismissed, as it violates Rule 9(b).
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B. Banking Statute of Frauds
Florida’s
Banking
Statute
of
Frauds
requires
credit
agreements to be signed and in writing. Fla. Stat. § 687.0304. A
credit agreement is “an agreement to lend or forbear repayment of
money, goods, or things in action, to otherwise extend credit, or
to
make
any
other
financial
accommodation.”
Fla.
Stat.
§
687.0304(1)(a). As recognized by the Court in Bloch v. Wells Fargo
Home
Mortg.,
to
the
extent
verbal
conversations
add
“to
the
purported ‘promise’, such addition is barred by . . . ‘Florida’s
Banking Statute of Frauds.’” 755 F.3d 886, 889 (11th Cir. 2014).
The banking statute of frauds is applicable to fraud claims
where the borrower has alleged that the lender orally agreed to
make financial accommodations to the borrower. Coral Reef Drive
Land Dev., LLC v. Duke Realty Ltd. P’ship, 45 So.3d 897, 902-03
(Fla. 3d DCA 2010). Only Plaintiffs’ HAMP Approval Claim involves
an oral statement regarding a credit agreement under the banking
statute of frauds. Because Plaintiffs’ other claims do not involve
a credit agreement as defined by the statute, they are not barred.
Therefore,
Plaintiffs’
HAMP
Approval
Claim
is
dismissed
with
prejudice.
C. Rule 9(b)
Rule 9(b) requires a plaintiff alleging fraud to “state with
particularity
the
circumstances
constituting
the
fraud
or
mistake.” Fed. R. Civ. P. 9(b). In Florida, to state a claim for
8
fraud, a “plaintiff must allege: (1) the defendant made a false
representation of material fact, (2) the defendant knew that the
representation
was
false,
(3)
the
defendant
made
the
representation for the purpose of inducing the plaintiff to act in
reliance thereon, and (4) the plaintiff’s injury was caused by
justifiable reliance on representation.” Berkey v. Pratt, 390 Fed.
Appx. 904, 909 (11th Cir. 2010).
Furthermore, Rule 9(b) requires that “a complaint identify
(1) the precise statements, documents or misrepresentations made;
(2)
the
time
and
place
of
and
persons
responsible
for
the
statement; (3) the content and manner in which the statements
misled the plaintiff; and (4) what the Defendants gain[] by the
alleged fraud.” W. Coast Roofing and Waterproofing, Inc. v. Johns
Manville, Inc., 287 Fed. Appx. 81, 86 (11th Cir. 2008) (citing
Ambrosia Coal & Const. Co. v. Pages Morales, 482 F.3d 1309, 131617 (11th Cir. 2007)).
1. HAMP Eligibility Claim
In their attempt to obtain a loan modification, Plaintiffs
allege BOA falsely informed them that “they have to be in default.”
(Doc. # 22 at ¶ 38). However, in order to qualify for a HAMP loan
modification, a mortgagor need not be in default, as default need
only
be
reasonably
foreseeable.
(Id.).
In
their
Complaint,
Plaintiffs provide the name of the BOA representative that told
them the false statement, as well as the date the statement was
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made. (Id.). According to Plaintiffs, the BOA representative made
the false statement to induce Plaintiffs’ reliance, triggering
their purposeful default on their mortgage. (Id. at ¶¶ 38, 40).
Their loss of home equity and “money paid as trial payments” to
BOA demonstrate damage resulting from the false statements. (Id.).
At
this
juncture,
Plaintiffs
have
stated
a
claim
for
HAMP
Eligibility that survives the Motion to Dismiss.
2. Supporting Documents Claim
When applying for a HAMP loan modification, Plaintiffs sent
financial documents to BOA and were then told that the documents
were incomplete. (Doc. # 22 at ¶ 42). While the Complaint alleges
this statement by BOA was false, (Id. at ¶ 43), Plaintiffs have
failed to support the allegation with well-pleaded and specific
facts. Plaintiffs state only in a conclusory fashion that the
statement was false. But Rule 9(b) requires more than conclusory
statements. United States ex rel. Clausen v. Lab Corp. of America,
Inc., 290 F.3d 1301, 1313 (11th Cir. 2002). Despite multiple
pleading attempts, Plaintiffs have failed to satisfy Rule 9(b) and
thus, the Supporting Document Claim is dismissed with prejudice.
3. Inspection Fee Claim
In their fourth pleading attempt, Plaintiffs allege that BOA
acted fraudulently by omitting information regarding “fraudulent
inspection fees.” (Doc. # 22 at ¶¶ 56, 57). However, the Complaint
does not contain well-pleaded and specific facts to support this
10
allegation. Several key facts are absent from Plaintiffs’ claim,
including the date of the omission and the individual responsible.
While Plaintiffs state that BOA intended to apply their trial
payment funds to inspection fees, Plaintiffs do not allege that
this ever actually occurred. Therefore, the Inspection Fee Claim
violates Rule 9(b) and is dismissed with prejudice.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
(1)
Defendant Bank of America’s Motion to Dismiss Plaintiffs’
Amended Complaint (Doc. # 29) is GRANTED in part and DENIED
in part.
(2)
Plaintiffs’
Supporting
Documents
Claim
is
DISMISSED
WITH
PREJUDICE.
(3)
Plaintiffs’ HAMP Approval Claim is DISMISSED WITH PREJUDICE.
(4)
Plaintiffs’ Inspection Fee Claim is DISMISSED WITH PREJUDICE.
(5)
Plaintiffs’ HAMP Eligibility Claim survives. BOA is directed
to file an answer to the surviving claim within 14 days.
DONE and ORDERED in Chambers in Tampa, Florida, this 15th day
of May, 2018.
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