QUASEBARTH et al v. GREEN TREE SERVICING LLC

Filing 71

ORDER granting in part and denying in part 31 Motion for Summary Judgment. Ordered by US DISTRICT JUDGE CLAY D LAND on 2/3/2016. (VCP)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
COLUMBUS DIVISION
JIM QUASEBARTH, and ROBYN
QUASEBARTH,

*
*

Plaintiffs,
*
vs.

CASE NO. 4:14-CV-223 (CDL)
*

GREEN TREE SERVICING, LLC,
*
Defendant.
*
O R D E R
The final pretrial conference in this case is scheduled for
tomorrow.

The Court has not yet ruled on Defendant Green Tree

Servicing,

LLC’s

motion

for

summary

judgment.

Although

the

Court has thoroughly studied the pending motion and has reached
a decision on its resolution, the Court is unable to finish a
detailed

written

conference.

order

prior

to

tomorrow’s

final

pretrial

Finding it more important to inform the parties of

the Court’s decision prior to the pretrial conference than to
craft a comprehensive order, the Court enters this abbreviated
order.
BACKGROUND
Viewed in the light most favorable to the Quasebarths, the
record reveals the following.
The Quasebarths claim that Green Tree failed to provide
them with an opportunity to cure their default on their mortgage

loan and thus avoid foreclosure on their home.

On October 16,

2012, a law firm retained by Green Tree sent a letter to the
Quasebarths
proceeding.

explaining

that

it

was

commencing

a

foreclosure

The letter instructs the Quasebarths to fill out a

borrower response package so that Green Tree could consider them
for a loan modification.
that

[Green

Tree]

is

The letter also states: “Please note
not

agreeing

at

this

time

to

stop

foreclosure proceedings and is under no obligation to do so,
even if you provide all the requested information to [Green
Tree].”

Def.’s Mot. for Summ. J. Ex. 11, Letter to James and

Robyn Quasebarth 2, from Ellis, Painter, Ratterre & Adams, LLP,
(Oct. 16, 2012) ECF No. 31-18.

When Mr. Quasebarth received the

letter, he called Green Tree and asked about the status of a
borrower response package that he had submitted a few months
prior.
was

A Green Tree representative told him that the package

missing

and

that

he

needed

to

submit

Quasebarth Dep. 80:6-13, ECF No. 34.

another

one.

J.

A few days later, on

November 1, the Quasebarths received a letter stating that Green
Tree would sell their home at a foreclosure sale on December 4
if

they

did

not

cure

the

default

on

their

mortgage.

Mr.

Quasebarth then sent a completed borrower response package to
Green Tree on November 8.
Approximately a week later, on November 15, Green Tree sent
a letter to the Quasebarths notifying the couple that it had

2

received

their

borrower

solicitation

package.

The

letter

states:
If your account was prevlously [sic] referred to
foreclosure, we will continue the foreclosure process
while we evaluate your account for a foreclosure
prevention
alternative . . . .
However,
no
foreclosure sale will be conducted and you will not
lose your home if Green Tree is reviewing a completed
borrower response package . . . .
If the borrower
response package was received less than 37 days prior
to a scheduled foreclosure sale, we will evaluate the
account for a foreclosure prevention alternative and
suspend the foreclosure sale, if appropriate.
Pl.’s Statement of Material Facts Ex. P, Letter from Green Tree,
to R. Quasebarth & J. Quasebarth 2 (Nov. 15 2012), ECF No. 4116.

The next day, November 16, Green Tree sent another letter

explaining

that

it

was

missing

three

documents

from

the

Quasebarths’ borrower response package and could not evaluate
the package.

The letter states: “It is your responsibility to

send

[missing]

in

the

documentation

by

12/21/2012.”

Pl.’s

Statement of Material Facts, Ex. Q, Letter from Green Tree, to
R. Quasebarth and J. Quasebarth (Nov. 16, 2012), ECF No. 41-17.
Thus, Green Tree promised to stop a foreclosure sale only if it
was reviewing a
letter

states

complete.

completed
that

the

application.

And the November 16

Quasebarths’

application

was

not

Nevertheless, the Quasebarths assert that they read

the letters and believed that Green Tree was promising to cancel
the December 4 foreclosure sale and give them until December 21
to

submit

the

missing

documents.

3

Green

Tree

called

the

Quasebarths on November 27 and 28 urging them to provide the
missing documents.

The Quasebarths did not send the documents

before the scheduled foreclosure on December 4.
received

a

completed

borrower

solicitation

Having not

package

or

any

payment to cure the default, Green Tree purportedly sold the
home at a foreclosure sale on December 4.
only

bidder,

and

it

bought

the

home.

Green Tree was the
That

same

Quasebarth faxed the missing documents to Green Tree.

day,

Mr.

Stanley

Decl. ¶ 42, ECF No. 31-4 (declaring that Green Tree received
only two of three missing documents); J. Quasebarth Dep. 109:1022

(testifying

that

he

sent

Green

Tree

all

three

missing

documents).
The Quasebarths were surprised to learn that their home was
sold on December 4.

Mr. Quasebarth testified that he could have

borrowed money from a family member to cure the default on the
loan, but did not do so because he was relying on Green Tree’s
alleged promise not to foreclose until it made a decision about
his eligibility for a loan modification.
Mr.

Quasebarth

called

Green

Tree

and

After the foreclosure,
the

firm

handling

the

foreclosure (EPRA) on multiple occasions and was repeatedly told
that the foreclosure sale was final and that there was nothing
he could do to keep the home.

On December 11, EPRA sent the

Quasebarths a letter demanding immediate possession of the home
and ordering the family to vacate the home within three days.

4

EPRA

brought

a

dispossessory

evict the Quasebarths.

proceeding

in

late

December

to

The Quasebarths then agreed to move out

on January 6.
The Quasebarths now contend that Green Tree knew or should
have known that the December sale was not final and that the
Quasebarths were still the rightful owners of the home, for two
reasons.

First, Green Tree never recorded a deed memorializing

the sale.

Stanley Dep. 231:23-232:4, ECF No. 36.

Second, Green

Tree knew as of January 4 that the foreclosure sale was not
final because of an IRS tax lien on the property.
planned

to

“re-foreclose”

Stanley Dep. 211:8-24.

on

the

home

to

clear

Green Tree
the

title.

But the Quasebarths contend that they

were, in the meantime, still the lawful owners of the home.
Green Tree never relayed this information to the Quasebarths.
Instead,

Green

Tree

entered

Quasebarths on January 6.

into

an

agreement

with

the

In the agreement, the Quasebarths

released all their claims to the home in exchange for $1,050.
The Quasebarths signed the agreement in reliance on Green Tree’s
representation that the sale was final.

That same day, the

Quasebarths moved out of their home.
Shortly
received

after

additional

the

Quasebarths

confusing

vacated

letters

the

regarding

home,
the

they
home.

First, they received a letter from EPRA dated January 29, 2013
stating

that

the

Quasebarths’

5

home

would

be

sold

at

a

foreclosure sale on March 5 if they did not cure the default on
the

mortgage.

Of

course,
Tree

Quasebarths

had

already

were

sold

under

the

that

December.

Mr. Quasebarth called EPRA and Green Tree and was
December foreclosure sale was final,

Green Tree simply needed to refile the paperwork.
Dep. 111:19-24; 152:5-11.

home

the

impression

told that the

Green

the

in

and that

J. Quasebarth

Thus, Mr. Quasebarth continued to

believe that he could not save his home.

In February, the

Quasebarths received another letter from EPRA informing them of
alternatives to the March 5 foreclosure.
Green Tree sold the home on March 5, 2013.
recorded

a

foreclosure

Quasebarths

deed

eventually

memorializing

discovered

that

On May 23, EPRA

the

sale.

Green

Tree

misrepresented that the December foreclosure was final.
attorney

sent

a

letter

to

Green

Tree

on

The

September

had
Their

11,

2013

rescinding the contract that the Quasebarths signed releasing
their claims to the home, and returning the $1,050.
DISCUSSION
The
failing

Quasebarths
to

provide

contend
them

that

with

an

Green

Tree’s

opportunity

conduct

to

cure

in

their

default prior to the purported December 4, 2012 foreclosure and
Green

Tree’s

foreclosure

subsequent
sale

was

misrepresentation

final

and

thus

that

again

the

December

preventing

the

Quasebarths from curing the default and avoiding the March 5,

6

2013

foreclosure

Georgia

law

for

provides
fraud,

them

with

tortious

causes

of

interference

action
with

under

property

rights, intentional infliction of emotional distress, negligence
per

se,

and

Georgia

RICO

violations.

The

Court

finds

that

factual disputes exist as to the Quasebarths’ claims for fraud,
tortious

interference

with

property

rights,

intentional

infliction of emotional distress, and negligence.

Therefore,

Green Tree’s motion for summary judgment is denied as to those
claims.1
Order,

For the reasons explained in the remainder of this
the

Court

does

find

that

Green

Tree

is

entitled

to

summary judgment on the Quasebarth’s RICO claims.
The Quasebarths allege that Green Tree violated Georgia’s
RICO statute by engaging in mail fraud and wire fraud when it
misrepresented that they would have an opportunity for a loan
modification in December and that the December 4 foreclosure
sale was final.
that

the

RICO

See O.C.G.A. § 16-14-4(a).
claim

fails

as

a

matter

of

Green Tree argues
law

because

the

Quasebarths do not present evidence that Green Tree engaged in a
“pattern of racketeering activity.”

1

Id.

The Court agrees.

The Court is skeptical as to whether Green Tree’s alleged promise to
postpone the December foreclosure, standing alone, would support any
of the Quasebarths claims. But the Court cannot at this stage of the
proceedings find that Green Tree is entitled to judgment as a matter
of law given the connection of that promise to postpone the December
sale to Green Tree’s subsequent representations regarding the finality
of the December foreclosure sale.
The Court also finds that factual
disputes clearly exist as to whether the Quasebarths’ rescission of
their release was timely.

7

“To state a Georgia RICO claim, a plaintiff must identify a
‘pattern

of

racketeering

activity,’

which

is

defined

as

‘engaging in at least two interrelated acts that have the same
or similar intents, results, accomplices, victims, or methods of
commission

indictable

federal law.’”

under

Martin,

(2008)).

LLP,
“A

categories

of

state

or

Rowe v. U.S. Bancorp, 569 F. App’x 701, 704

(11th Cir. 2014) (per curiam)
&

certain

293

Ga.

pattern

predicate offenses.”

App.

(quoting Smith v. Morris, Manning
153,

requires

165,

at

666

least

S.E.2d
two

683,

695

interrelated

Brown v. Freedman, 222 Ga. App. 213, 217,

474 S.E.2d 73, 77 (1996).

“A pattern of racketeering activity

cannot be based on a single transaction.”

Rowe, 569 F. App’x at

704.
The Court finds that Green Tree’s actions ultimately amount
to

one

extended

transaction—Green

Quasebarths’ home.
that

each

separate

Tree

foreclosing

on

the

The Court rejects the Quasebarths’ argument
act

involved

in

that

process

should

be

considered a separate predicate act for purposes of establishing
a pattern of racketeering activity.
The Court also rejects the Quasebarths’ reliance on Green
Tree’s foreclosure on another home owned by Maxwell and Cynthia
Jones,

as

evidence

of

a

predicate

act

for

establishing a pattern of racketeering activity.

purposes

of

Mr. and Mrs.

Jones contend that they defaulted on their mortgage, and then

8

Green Tree promised not to foreclose on their home if they made
payments to cure the default.

The Joneses allege that they made

the payments, but Green Tree nevertheless foreclosed on their
home.

The Quasebarths further contend that Green Tree committed

mail fraud when it unlawfully sought to collect the deficiency
on the Joneses’ mortgage after the foreclosure sale.
these

acts

Quasebarths.

are

related

to

Green

Tree’s

acts

None of

towards

the

The Quasebarths do not allege that they attempted

to make payments on their mortgage after it went into default,
nor do they contend that

Green Tree unlawfully attempted to

collect payment from them after the foreclosure in March.

Thus,

Green Tree’s actions towards the Joneses are not sufficiently
interrelated to Green Tree’s acts towards the Quasebarths to
demonstrate a pattern of unlawful behavior.2
In
evidence
genuine

sum,
of

the
a

factual

Quasebarths

pattern

of

dispute.

have

not

racketeering
Thus,

2

they

presented
activity
cannot

to

make

sufficient
create
out

a

this

The Quasebarths also point to Green Tree’s consent order with the
Federal Trade Commission and Consumer Financial Protection Bureau as
evidence that Green Tree engaged in a pattern of racketeering
activity.
But the consent order does not prove that Green Tree
engaged in any misconduct related to foreclosures because the order
specifically states that “[Green Tree] neither admits nor denies any
of the allegations” brought by the Federal Trade Commission.
Id. at
2. Nor does the record contain evidence that Green Tree has violated
the consent order since it was entered. Finally, the consent order is
inadmissible under Federal Rule of Evidence 408, as it is a statement
made pursuant to settlement.
Therefore, the Court finds that the
consent order is not evidence demonstrating that Green Tree engaged in
a pattern of racketeering.

9

essential

element

of

their

RICO

claim,

and

Green

Tree

is

entitled to summary judgment on this claim.
CONCLUSION
The Court grants Green Tree’s motion for summary judgment
as to the Quasebarths’ RICO claim.

The Court denies the motion

as to all of the remaining claims (ECF No. 31).
IT IS SO ORDERED, this 3rd day of February, 2016.
S/Clay D. Land
CLAY D. LAND
CHIEF U.S. DISTRICT COURT JUDGE
MIDDLE DISTRICT OF GEORGIA

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