Grant v. McCurdy & Candler, L.L.C. et al

Filing 5

ORDER AND OPINION granting [3,4] Defendants' Motions to Dismiss. Plaintiffs federal claims are DISMISSED WITH PREJUDICE; her state law claims area DISMISSED WITHOUT PREJUDICE. Signed by Judge Julie E. Carnes on 9/28/13. (ddm)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION

FELICIA D. GRANT,
Plaintiff,
CIVIL ACTION NO.
v.

1:12-cv-4232-JEC

MCCURDY & CANDLER, LLC, LUCILA
GUZMAN, ANTHONY DEMARIO, CHASE
HOME FINANCE, and TONEY IBARRA,
Defendants.
ORDER & OPINION
This case is before the Court on defendants’ Motions to Dismiss
[3] and [4].

The Court has reviewed the record and the arguments of

the parties and, for the reasons set out below, concludes that
defendants’ Motions to Dismiss [3] and [4] should be GRANTED.
BACKGROUND
This case arises out of an allegedly wrongful foreclosure.
(Compl. [1] at 3.)

Plaintiff Felicia D. Grant (“plaintiff”) entered

into a loan transaction with defendant JPMorgan Chase Bank, N.A.
(“JPMorgan”)

on

June

8,

2007,

secured

by

real

property

(the

“Property”) located at 1961 Evergreen Drive SW, Austell, Georgia
30106. (See Def.’s Mot. to Dismiss [4] at Ex. A.)

At some point,

plaintiff defaulted on the note (the “Note”), and JPMorgan commenced

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non-judicial foreclosure proceedings, as provided for in the security
deed (the “Security Deed”).

(Id. at ¶ 22.)

After receiving notice

from JPMorgan’s attorneys, defendant McCurdy & Candler, LLC (“McCurdy
& Candler”), plaintiff apparently attempted to settle the Note by
personal check sent to JPMorgan by certified mail on July 27, 2012.
(See Compl. [1] at Exs. B and C.)
because of insufficient funds.

The check, however, was rejected

(Pl.’s Aff. [1] at ¶ 7.)

It might

also have been rendered non-negotiable due to plaintiff’s additional
writing on the check, particularly the words “NOT FOR DEPOSIT EFT
ONLY FOR DISCHARGE OF DEBT.”

(See id. at Ex. B; Def.’s Mot. to

Dismiss [3] at 5.)
Plaintiff then, on September 4, 2012, filed for Chapter 13
bankruptcy in the United States Bankruptcy Court, Northern District
of Georgia.

(See Compl. [1] at Ex. G; In re Felicia Daphne Grant,

No. 12-bk-72214-jrs, Dkt. No. 1 (Bankr. N.D. Ga. Sep. 4, 2012).) The
bankruptcy petition was subsequently dismissed on October 30, 2012
for failure to pay the filing fee.

(Id. at Dkt. No. 17.)

On December 7, 2012, plaintiff instituted the present action in
this Court against JPMorgan, McCurdy & Candler, and defendants Tony
Ibarra (an employee of JPMorgan), Lucila Guzman (an employee of
McCurdy & Candler), and Anthony Demario (also an employee of McCurdy
& Candler).

(See Compl. [1].)

Defendants moved to dismiss the

action under Federal Rule 12(b)(6).
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(See Defs.’ Mot.’s to Dismiss

[3] and [4].)
DISCUSSION
I.

MOTION TO DISMISS STANDARD
In deciding a motion to dismiss under Federal Rule 12(b)(6), the

Court assumes that all of the allegations in the complaint are true
and construes all of the facts in favor of the plaintiff.
Scott, 610 F.3d 701, 705 (11th Cir. 2010).

Randall v.

That said, in order to

survive a motion to dismiss, a complaint “must contain sufficient
factual matter, accepted as true, to ‘state a claim [for] relief that
is plausible on its face.’”

Ashcroft v. Iqbal, 556 U.S. 662, 678

(2009)(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
A claim is “facial[ly] plausib[le]” when it is supported with facts
that “allow[] the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”

Id.

Courts will

“eliminate any allegations in the complaint that are merely legal
conclusions.”

Am. Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1290

(11th Cir. 2010). “Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice.”
Iqbal, 556 U.S. at 678.
II.

PLAINTIFF’S COMPLAINT
Plaintiff’s complaint is enigmatic, making it difficult for the

Court to determine the facts alleged and legal theories upon which
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recovery is premised.

Plaintiff is a pro se litigant, however, and

“‘[p]ro se pleadings are held to a less stringent standard than
pleadings drafted by attorneys and will, therefore, be liberally
construed.’”

Hughes

v.

Lott,

350

F.3d

1157,

1160

(11th

Cir.

2003)(quoting Tannenbaum v. United States, 148 F.3d 1262, 1263 (11th
Cir. 1998)).

But there are limits: “this leniency does not give a

court license to serve as de facto counsel for a party, or to rewrite
an otherwise deficient pleading in order to sustain an action.”

GJR

Invs., Inc. v. Cnty. of Escambia, Fla., 132 F.3d 1359, 1369 (11th
Cir.

1998)(citations

omitted),

overruled

on

other

grounds

as

recognized in Randall v. Scott, 610 F.3d 701, 706 (11th Cir. 2010).
Thus, the Court reads plaintiff’s complaint charitably, within the
limits imposed by the Eleventh Circuit.
On its face, plaintiff’s complaint attempts to formulate an
action under 42 U.S.C. § 1983, alleging unspecific violations of
various constitutional rights, including most of the Bill of Rights.1
That statute provides a right of action for a plaintiff who has been
deprived of federal statutory or constitutional rights by a defendant
acting “under color of” state law.

42 U.S.C. § 1983.

It is well

established, however, that “most rights secured by the Constitution

1

The complaint also states that “Defendants’ actions are
tantamount to nothing less than CRIMINAL TREASON against the united
[sic] States Constitution and the People of the United States.”
(Compl. [1] at 3.) This Court assumes this is gratuitous commentary.
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are protected only against infringement by governments.”
Bros., Inc. v. Brooks, 436 U.S. 149, 156 (1978).
§

1983

is

generally

municipal

used

governments

in

and

suits

against

officials,

and

Flagg

For this reason,

state

officials

“[o]nly

in

or

rare

circumstances can a private party be viewed as a ‘state actor’ for
section 1983 purposes.”2

Harvey v. Harvey, 949 F.2d 1127, 1130 (11th

Cir. 1992).
“The Eleventh Circuit recognizes three tests for establishing
state action by what is otherwise a private person or entity: the
public function test, the state compulsion test, and the nexus/joint
action test.”

Id. (citing NBC v. Commc’n Workers of Am., AFL-CIO,

860 F.2d 1022, 1026 (11th Cir. 1988).

Because no state law compels

any party to foreclose on a security deed when the loan is in
default, the state compulsion test is inapplicable here.

See Id.,

949

involves

F.2d

at

1130-31.

“The

nexus/joint

action

test

situations where the government has ‘so far insinuated itself into a
position of interdependence with the [private party] that it was a
joint participant in the enterprise.”
F.2d at 1026).

Id. at 1131 (quoting NBC, 860

As this test has not been met by such extensively

2

The complaint seems to have been copied wholesale, with only
the slightest of modifications, from a boilerplate civil rights
complaint against a municipality.
Plaintiff twice neglected to
change the formulaic references to “Defendant City.” (See Compl. [1]
at ¶¶ 11-12.)
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regulated private actors as nursing homes and hospitals, it is
inapplicable in the case of a private holder of a security deed, who
pursues non-judicial foreclosure solely under the terms of a private
agreement with the borrower.

See Id.

All the government has done is

pass a statute permitting such foreclosures.

This leaves the public

function test, which finds state action “only when private actors are
given powers (or perform functions) that are ‘traditionally the
exclusive prerogative of the State.’”

Harvey, 949 F.2d at 1131

(quoting Jackson v. Metro. Edison Co., 419 U.S. 345, 353 (1974)).
Although

some

states

require

judicial

process

for

mortgage

foreclosures, this hardly makes foreclosure the exclusive prerogative
of the state, and Georgia has permitted non-judicial foreclosure
since the nineteenth century.3

Thus, it is not the case that

foreclosures are a public function of the state.
This Circuit’s predecessor made it clear that non-judicial
foreclosure sales do not implicate the Constitution, and provided an
explanation that warrants extended quotation:
A sale under a deed of trust, to be an effective creditor
remedy, must of course pass good title. The contract that
provides for a power of sale thus relies, ultimately, on
the state's acknowledgment of the legal effect of the
involuntary change in ownership brought about by the
exercise of the power of sale.
That the state merely
recognizes the legal effect of such private arrangements

3

The current statute, O.C.G.A. § 44-14-60, can be traced to

1871.
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does not convert them into state acts for Fourteenth
Amendment purposes. This principle is implicit in our UCC
cases. It is explicit in the decisions of other circuits
holding that a secured party, to enable it to sell an
automobile repossessed through self-help, and permitting
the sale to convey good title, does not significantly
implicate the state in the termination of the debtor's
property interest.
Virtually all formal private
arrangements assume, at some point, the supportive role of
the state.
To hold that the state, by recognizing the
legal effect of those arrangements, converts them into
state acts for constitutional purposes would effectively
erase to a significant extent the constitutional line
between private and state action and subject to judicial
scrutiny under the Fourteenth Amendment virtually all
private arrangements that purport to have binding legal
effect.
Barrera v. Sec. Bldg. & Inv. Corp., 519 F.2d 1166, 1170 (5th Cir.
1975)(citations omitted).4

Under this or a similar rationale, the

former Fifth Circuit held that “there is no sufficient nexus to
transform the private mortgagee’s act [of non-judicial foreclosure]
into that of the federal government.”

Roberts v. Cameron-Brown Co.,

556 F.2d 356, 358 (5th Cir. 1977).

Likewise the Georgia Supreme

Court held that a non-judicial foreclosure is “a purely contractual
matter between two parties in the exercise of private property
rights.

There is insufficient meaningful government involvement to

constitute state action . . . .”

Coffey Enters. Realty & Dev. Co.,

Inc. v. Holmes, 233 Ga. 937, 938 (1975); Nat’l Cmty. Bldrs., Inc. v.

4

Decisions of the former Fifth Circuit rendered prior to
October 1, 1981 are binding precedent in the Eleventh Circuit. Bonner
v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981)(en banc).
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Citizens & S. Nat’l Bank, 232 Ga. 594, 596 (1974)(“Georgia’s realty
foreclosure statutes...are constitutional, and a foreclosure pursuant
to them does not violate procedural due process rights.”).

Thus,

controlling and persuasive authorities have found no constitutional
rights implicated in non-judicial foreclosure sales.
From the above it is clear that plaintiff’s civil rights
complaint must fail.

The Court sets it aside and instead focuses on

what other causes of action she might have under a reasonable
construal of her pleadings.5
B.

Chapter 13 Bankruptcy Filing

On September 4, 2012, plaintiff filed for bankruptcy under
Chapter 13 in the United States Bankruptcy Court, Northern District
of Georgia.

(See Compl. [1] at Ex. G.)

Filing for Chapter 13

bankruptcy normally imposes an immediate stay upon debt collection
and related actions by the filer’s creditors, the violation of which
can support a civil action for damages.

See 11 U.S.C. § 362(k)(1)

(“[A]n individual injured by any willful violation of [the automatic
stay] shall recover actual damages, including costs and attorneys’
fees,

and,

damages.”)

in

appropriate

circumstances,

may

recover

punitive

A violation is “willful” when the creditor knows of the

5

Because plaintiff’s grievances against defendants Guzman,
Demario, and Ibarra seem to be premised solely upon those parties
being “government officials” subject to § 1983, the remaining
discussion excludes them.
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automatic stay and intended to violate it. See, e.g., In re Jove
Eng’g, Inc. v. I.R.S., 92 F.3d 1539, 1555 (11th Cir. 1996).
It is not clear from the bankruptcy court docket that any stay
was actually issued, perhaps due to the fact that plaintiff failed to
file all the necessary documentation with her petition.
Felicia Daphne Grant, 12-bk-72214-jrs at Dkt. No. 15.

See In re

In any case,

plaintiff’s failure to pay the filing fee eventually led to the
dismissal of her case on October 30, 2012.

There are no facts

alleged in the pleadings, nor evidence in the record, to suggest that
any of the defendants in any way violated the stay (if in fact there
was one) during the period from September 4 to October 30.

As the

bankruptcy court has since dismissed plaintiff’s case, it does not
seem to be of any further relevance in the present action.
C.

Plaintiff’s Other Claims

Generally, at this point, the Court would consider what other
causes

of

action

might

charitably

plaintiff’s factual allegations.
likely to be state law claims.

be

derived

from

a

pro

se

However, those claims are all

As plaintiff’s federal claims have

been removed from the case, § 1367(c)(3) applies.

That section

states

to

that

"[t]he

district

courts

may

decline

exercise

supplemental jurisdiction over a claim under subsection (a) if . . .
the district court has dismissed all claims over which it has
original jurisdiction."

28 U.S.C. § 1367(c)(3).
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The Supreme Court

has observed that:
a federal court should consider and weigh in each case, and
at every stage of the litigation, the values of judicial
economy, convenience, fairness, and comity in order to
decide whether to exercise jurisdiction over a case brought
in that court involving pendant state-law claims. When the
balance of these factors indicates that a case properly
belongs in state court, as when the federal-law claims have
dropped out of the lawsuit in its early stages and only
state-law claims remain, the federal court should decline
the exercise of jurisdiction by dismissing the case without
prejudice.
Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988)(footnote
omitted).

See also Hardy v. Birmingham Bd. of Educ., 954 F.2d 1546,

1550 (11th Cir. 1992).
The

Court

plaintiff’s

concludes

potential

that

state

it

law

is

inappropriate

claims

in

this

to

address

case

because

plaintiff’s federal claims have been dismissed. Because there is not
complete diversity of citizenship6 between the parties, those federal
claims are the only basis for this Court’s jurisdiction over the
case.

Moreover, a “[n]eedless decision[] of state law should be

avoided both as a matter of comity and to promote justice between the
parties, by procuring for them a surer[-]footed reading of applicable
law. . . [Certainly,] if the federal claims are dismissed before
trial, even though not insubstantial in a jurisdictional sense, the
state claims should be dismissed as well.”

6

United Mine Workers of

Plaintiff shares Georgia citizenship at least with McCurdy &
Candler, and perhaps other defendants as well.
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Am. v. Gibbs, 383 U.S. 715, 726 (1966).

Accordingly, the Court

declines to exercise supplemental jurisdiction in order to address
plaintiff’s potential state law claims.
CONCLUSION
Because plaintiff’s pleadings are inadequate to support any
federal cause of action against any of the defendants, even after
very liberal construal of the allegations, this Court hereby GRANTS
defendants’ Motions to Dismiss [3] and [4].

Plaintiff’s federal

claims are DISMISSED WITH PREJUDICE; her state law claims area
DISMISSED WITHOUT PREJUDICE.

SO ORDERED, this 28th day of September, 2013.

/s/ Julie E. Carnes
JULIE E. CARNES
CHIEF UNITED STATES DISTRICT JUDGE

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