Mejia v. OCWEN Loan Servicing LLC
Filing
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ORDER granting 12 Motion to Dismiss for Failure to State a Claim. Closing Case. Motions Terminated: 12 Defendant's MOTION TO DISMISS 1 Notice of Removal (State Court Complaint) FOR FAILURE TO STATE A CLAIM with Prejudice filed by OCWEN Loan Servicing LLC. Signed by Judge Beth Bloom on 9/1/2016. (lan) NOTICE: If there are sealed documents in this case, they may be unsealed after 1 year or as directed by Court Order, unless they have been designated to be permanently sealed. See Local Rule 5.4 and Administrative Order 2014-69.
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 16-cv-81269-BLOOM/Valle
DAVID MEJIA,
Plaintiff,
v.
OCWEN LOAN SERVICING, LLC,
Defendant.
_________________________________/
ORDER
THIS CAUSE is before the Court upon Defendant Ocwen Loan Servicing’s
(“Defendant”) Motion to Dismiss Complaint with Prejudice, ECF No. [12] (the “Motion”),
Plaintiff David Mejia’s (“Plaintiff”) Complaint, ECF No. [1] (the “Complaint”). The Local
Rules provide: “Each party opposing a motion shall serve an opposing memorandum of law no
later than fourteen (14) days after service of the motion.” S.D. Fla. L.R. 7.1(c). Defendant filed
the instant Motion on August 1, 2016. Therefore, Plaintiff was required to respond by August
15, 2016 – or, at the very latest, August 18, 2016, providing extra time for mailing. To date,
Plaintiff has not responded, nor has he requested extra time to do so. Ordinarily, the failure to
comply with the response timeframe provided by the Local Rules is sufficient cause for granting
the motion by default. See id. The Court has, nevertheless, carefully reviewed the Motion, the
record, and the applicable law, and is otherwise fully advised. For the following reasons,
Defendant’s Motion to Dismiss is granted.
I. Background
Plaintiff initially filed this action on June 8, 2016 in the Fifteenth Judicial Circuit in and
for Palm Beach County, Florida, seeking relief for Defendant’s alleged violation of the Real
Case No. 16-cv-81269-BLOOM/VALLE
Estate Settlement Procedures Act, 12 U.S.C. § 2601, et seq. (“RESPA”), and its implementing
regulation, 12 C.F.R. § 1024, et seq. (“Regulation X”). See Compl. ¶¶ 1-2. Specifically,
Plaintiff seeks remedies for Defendant’s alleged failure to comply with § 2605(k) of RESPA and
§ 1024.36 of Regulation X. See id. at ¶ 3. Defendant timely removed the matter to this Court,
and now moves to dismiss the Complaint with prejudice.
Plaintiff alleges that he mailed a written Request for Information to Defendant pursuant
to Regulation X. Id. ¶ 14; Ex. A, ECF No. [1-1] at 16 (the “RFI”). Plaintiff sent his RFI by
certified mail, which Plaintiff and his counsel tracked through the certified mailing tracking
number. See Compl. ¶ 15. The RFI was delivered to Defendant on March 19, 2016, with a
certified return receipt (the “Certified Receipt”). See Certified Receipt, Ex. B, ECF No. [1-1] at
21. Plaintiff does not claim that he did not receive the Certified Receipt, and it would appear that
he did in fact receive the Receipt, as Plaintiff attached a copy of it to his Complaint. See id.
Defendant responded to the RFI. See Compl. ¶ 17. Plaintiff alleges that he did not receive an
adequate written response to the RFI within the required timeframe and, therefore, sent a follow
up Notice of Error letter (“NOE”) to Defendant. Id. ¶¶ 17-18.
Plaintiff brings two counts against Defendant for its alleged violation of 12 U.S.C. §
2605(k). In Count I, Plaintiff alleges that Defendant violated RESPA § 2605(k) through its
violation of Regulation X, 12 C.F.R. § 1024.36(d), by failing to provide sufficient written
response. 1 See Compl. ¶ 22. In Count II, Plaintiff alleges that “[t]hrough its own conduct and
1
Count I also contains vague allegations regarding the timeliness of both Defendant’s written
acknowledgment of the RFI and response to it See Compl. ¶¶ 22-23, 26. The Court notes that
Defendant timely acknowledged receipt of Plaintiffs’ RFI by signing the Certified Receipt. This Court
has previously held that a certified mail receipt constitutes a “written response” within the meaning of
section 1024.36(c). See Meeks v. Ocwen Loan Servicing LLC, No. 16-CV-81003, 2016 WL 3999570, at
*6 (S.D. Fla. July 26, 2016). Furthermore, the less vague allegations pertain to the adequacy, and
not timeliness, of Defendant’s response to the RFI. Since Plaintiff failed to respond to the
Motion to make a timeliness argument, the Court declines to make it for him now.
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the conduct of its designated counsel[,] Defendant has shown a pattern of disregard to the
requirements imposed upon Defendants” by Regulation X. Id. ¶ 35. As to damages, Plaintiff
claims that as a “direct and proximate result of Defendant’s failure to comply with Regulation X
and RESPA,” Plaintiff has “incurred actual damages in certified postage costs of less than
$100.00 for mailing the RFI and NOE, and attorney’s fees and costs.” Id. ¶ 29. Plaintiff also
claims that he is entitled to statutory damages for Defendant’s violation as alleged in Count II.
See id. ¶¶ 36-37. Defendant filed the instant Motion on August 1, 2016, asserting that Plaintiff
has failed to state a claim.
II. Legal Standard
A pleading in a civil action 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). Although a complaint
“does not need detailed factual allegations,” it must provide “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); see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (explaining
that Rule 8(a)(2)’s pleading standard “demands more than an unadorned, the-defendantunlawfully-harmed-me accusation”). Nor can a complaint rest on “‘naked assertion[s]’ devoid of
‘further factual enhancement.’” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557
(alteration in original)). “To survive a motion to dismiss a complaint must contain sufficient
factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Id.
(quoting Twombly, 550 U.S. at 570).
When reviewing a motion under Rule 12(b)(6), a court, as a general rule, must accept the
plaintiff’s allegations as true and evaluate all plausible inferences derived from those facts in
favor of the plaintiff. See Miccosukee Tribe of Indians of Fla. v. S. Everglades Restoration
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Alliance, 304 F.3d 1076, 1084 (11th Cir. 2002); AXA Equitable Life Ins. Co. v. Infinity Fin. Grp.,
LLC, 608 F. Supp. 2d 1349, 1353 (S.D. Fla. 2009). However, this tenet does not apply to legal
conclusions, and courts “are not bound to accept as true a legal conclusion couched as a factual
allegation.” Twombly, 550 U.S. at 555; see Iqbal, 556 U.S. at 678; Thaeter v. Palm Beach Cnty.
Sheriff’s Office, 449 F.3d 1342, 1352 (11th Cir. 2006). Moreover, “courts may infer from the
factual allegations in the complaint ‘obvious alternative explanations,’ which suggest lawful
conduct rather than the unlawful conduct the plaintiff would ask the court to infer.” Am. Dental
Ass’n v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010) (quoting Iqbal, 556 U.S. at 682). A
court considering a Rule 12(b) motion is generally limited to the facts contained in the complaint
and attached exhibits, including documents referred to in the complaint that are central to the
claim. See Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 959 (11th Cir. 2009); Maxcess, Inc.
v. Lucent Technologies, Inc., 433 F.3d 1337, 1340 (11th Cir. 2005) (“[A] document outside the
four corners of the complaint may still be considered if it is central to the plaintiff’s claims and is
undisputed in terms of authenticity.”) (citing Horsley v. Feldt, 304 F.3d 1125, 1135 (11th Cir.
2002)).
III. Discussion
Defendant moves to dismiss the Complaint on a number of grounds. First, Defendant
argues that Plaintiff has failed to state a cognizable claim for relief because the failure to provide
a phone number does not create a cause of action under 12 C.F.R. § 1024.36(d)(2)(i)(A).
Defendant next argues that Plaintiff failed to allege actual harm as the result of Defendant’s
response to the RFI, and, in any event, Plaintiff has not alleged facts sufficient to support a claim
for statutory damages under RESPA. Motion at 1-2. Defendant moves for dismissal with
prejudice due to these deficiencies, and because this lawsuit “makes a mockery of statutory
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consumer protection measures and is an unmitigated sham meant solely to generate attorney’s
fees.” Id. at 2. The Court addresses Defendant’s arguments in turn.
A. Count I – Violation of 12 C.F.R. 1024.36(d)(2)(i)(A)
Plaintiff claims that Defendant violated RESPA § 2605(k) through its violation of
Regulation X. See Complaint ¶¶ 22-23, 26-27. Section 2605 of RESPA governs the “servicing
of mortgage loans and administration of escrow accounts,” and implicates Regulation X by
providing in relevant part that “[a] servicer of a federally related mortgage shall not . . . fail to
comply with any other obligation found by the Bureau of Consumer Financial Protection, by
regulation, to be appropriate to carry out the consumer protection purposes of this chapter.” See
12 U.S.C. § 2605(k)(1)(E). Section 1024.36(d) of Regulation X provides that a servicer must
respond “[n]ot later than 10 days (excluding legal public holidays, Saturdays, and Sundays) after
the servicer receives an information request for the identity of, and address or other relevant
contact information for, the owner or assignee of a mortgage loan . . . .”
12 C.F.R.
1024.36(d)(2)(i)(A).
The parties do not dispute that Plaintiff made a request for the identity and contact
information of the owner or assignee of the loan. Nor do the parties dispute that Defendant
responded to the request. Rather, Plaintiff alleges that the response provided by Defendant was
insufficient because it failed to include the phone number for the investor of the subject loan.
Compl. ¶ 17. Defendant argues that neither Regulation X nor RESPA require servicers to
provide a phone number.
Whether Count I must be dismissed turns entirely on whether “other relevant contact
information” includes a phone number within the context of 12 C.F.R. § 1024.36(d). Defendant
argues that it does not, and further, that the phrase is not defined in Regulation X or in RESPA.
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A regulation’s silence, of course, does not end the inquiry.
“The first rule in statutory
construction is to determine whether the language at issue has a plain and unambiguous meaning
with regard to the particular dispute. If the statute’s meaning is plain and unambiguous, there is
no need for further inquiry.” United States v. Silva, 443 F.3d 795, 797-98 (11th Cir. 2006)
(internal quotations omitted). “This is so because ‘[t]he plain language is presumed to express
congressional intent and will control a court’s interpretation.’” Moss v. GreenTree-Al, LLC, 378
B.R. 655, 658 (S.D. Ala. 2007) (quoting United States v. Fisher, 289 F.3d 1329, 1338 (11th Cir.
2002) (alternations in the original).
“A court ‘should not interpret a statute in a manner
inconsistent with the plain language of the statute, unless doing so would lead to an absurd
result.’” Id. (quoting Silva, 443 F.3d at 798). This analysis applies to review of Regulation X, as
“‘[r]egulations, like statutes, are interpreted according to the cannons of construction.’”
O’Shannessy v. Doll, 566 F. Supp. 2d 486, 491 (E.D. Va. 2008) (quoting Black & Decker Corp.
v. Comm’r, 986 F.2d 60, 65 (4th Cir. 1993)).
Although the regulation does specify that a servicer must provide “contact information,
including a telephone number, for further assistance,” this same inclusion is conspicuously
missing from the applicable provision specifying the information that must be included in
response to a request for the identity of the owner or assignee of the loan. See 12 C.F.R. §
1024.36(d)(1)(i)-(ii). As such, the Court declines to read into the regulation a requirement that
servicers must provide a phone number for the owner or assignee in order to satisfy the statutory
requirements. Indeed, under the plain meaning of 12 C.F.R. § 1024.36(d), the regulation does
not contain a requirement with respect to providing a phone number for the owner or assignee of
a loan. Plaintiff has not cited to—nor has the Court identified—any legal authority stating
otherwise.
Although RESPA is a remedial statute, the Court need not construe it (or its
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implementing regulation) so liberally as to create a cause of action where none exists. Therefore,
Plaintiff’s claim with respect to the failure to provide a telephone number must fail, and Count I
of the Complaint is dismissed with prejudice.
B. Count II – Statutory Damages
For related reasons, the Court must also dismiss Count II, Plaintiff’s “pattern or practice”
claim for statutory damages. “The following damages are recoverable under RESPA for a
section 2605 violation: ‘(A) any actual damages to the borrower as a result of the failure; and (B)
any additional damages, as the court may allow, in the case of a pattern or practice of
noncompliance with the requirements of this section, in an amount not to exceed $1,000.’”
McLean v. GMAC Mortgage Corp., 595 F. Supp. 2d 1360, 1365 (S.D. Fla. 2009), aff’d, 398 F.
App’x 467 (11th Cir. 2010) (quoting 12 U.S.C. § 2605(f)(1)). “[D]amages are an essential
element in pleading a RESPA claim.” Renfroe v. Nationstar Mortgage, LLC, 822 F.3d 1241,
1246 (11th Cir. 2016). In Renfroe, the Eleventh Circuit recently “observe[d] without ruling on
the question, that the use of ‘additional’” at § 2605(f)(1) “seems to indicate that a plaintiff cannot
recover pattern-or-practice damages in the absence of actual damages.” Id. at 1247 n.4. Shortly
thereafter, the Supreme Court issued its decision in Spokeo, Inc. v. Robins, instructing lower
courts as to the standing requirements necessary for a claim asserting a statutory violation. As
the Supreme Court explained, standing requires a plaintiff to have “(1) suffered an injury in fact,
(2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be
redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016)
as revised (May 24, 2016) (internal citations omitted). “To establish injury in fact, a plaintiff
must show that he or she suffered ‘an invasion of a legally protected interest’ that is ‘concrete
and particularized’ and ‘actual or imminent, not conjectural or hypothetical.’” Id. at 1548
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(quoting Lujan v. Defs. of Wildlife, 504 U.S. 555, 560 (1992)).
“For an injury to be
particularized, it must affect the plaintiff in a personal and individual way.” Id. (quotations
omitted). As to the “concrete” requirement, the Supreme Court explained that
A “concrete” injury must be “de facto”; that is, it must actually exist. See Black’s
Law Dictionary 479 (9th ed. 2009). When we have used the adjective “concrete,”
we have meant to convey the usual meaning of the term—“real,” and not
“abstract.” Webster’s Third New International Dictionary 472 (1971); Random
House Dictionary of the English Language 305 (1967). Concreteness, therefore,
is quite different from particularization.
Id. Importantly, “Article III standing requires a concrete injury even in the context of a statutory
violation.” Id. at 1549. Here, and as explained above, Plaintiff has not suffered a concrete injury
in fact.
Therefore, pursuant to the Eleventh Circuit’s persuasive dicta in Renfroe and the
Supreme Court’s guidance in Spokeo, Plaintiff cannot assert a statutory violation, and Count II is
dismissed.
Moreover, courts have interpreted the term “pattern or practice” in accordance with the
usual meaning of the words, suggesting “a standard or routine way of operating.” McLean, 595
F. Supp. 2d at 1365 (quoting In re Maxwell, 281 B.R. 101, 123 (Bankr. D. Mass. 2002)). Failure
to respond to one, or even two qualified written requests does not amount to a “pattern or
practice.” See id.; In re Tomasevic, 273 B.R. 682 (Bankr. M.D. Fla. 2002). In Renfroe, the
Eleventh Circuit held that statutory damages may be sufficiently plead where, in addition to the
alleged RESPA violation against a plaintiff, the complaint alleges unrelated RESPA violations.
See 822 F.3d at 1247. While a plaintiff need not plead the “identities of other borrowers, the
dates of the letters, and the specifics of their inquiries” to survive dismissal, Iqbal and Twombly
still require that a plaintiff plead “enough facts to state a claim to relief that is plausible on its
face.” Id. (quoting Twombly, 550 U.S. at 570). In this case, Plaintiff has alleged merely that
“[t]hrough its own conduct and the conduct of its designated counsel Defendant has shown a
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pattern of disregard to the requirements imposed upon Defendants by Federal Reserve
Regulation X.” Complaint ¶ 35. This does not provide sufficient facts to plausibly allege an
impermissible “standard or routine way of operating,” and Count II is dismissed. See McLean,
595 F. Supp. 2d at 1365.
IV. Conclusion
For the reasons stated herein, it is ORDERED AND ADJUDGED that Defendant’s
Motion to Dismiss, ECF No. [12], is GRANTED. The Complaint is DISMISSED WITH
PREJUDICE. The CLERK is directed to CLOSE this case.
DONE AND ORDERED in Miami, Florida, this 1st day of September, 2016.
_________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
cc: counsel of record
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