Laverpool v. Taylor Bean and Whitaker Mortgage Corporation et al

Filing 9

OPINION AND ORDER that Taylor, Bean & Whitaker Mortgage Corporation's, RoundPoint Mortgage Service Corporation's, and Mortgage Electronic Registration Systems, Inc.'s Motion to Dismiss 3 is GRANTED. IT IS FURTHER ORDERED that Plaintiff Keith Laverpool's Motion to Stay 7 is DENIED AS MOOT. Signed by Judge William S. Duffey, Jr on 12/7/2015. (anc)

debt and seeking to delay foreclosure on, and dispossession from his home,
following his default on his loan obligations.1
On June 29, 2007, Plaintiff obtained a loan in the amount of $177,219.00
from TBW. Repayment of the loan was secured by a deed (“Security Deed”) to
real property located at 1580 Smithson Court, Lithonia, Georgia (the “Property”).
(Security Deed [2.3] at 2). Plaintiff executed the Security Deed in favor of MERS,
as nominee for TBW and TBW’s successors and assigns. Under the terms of the
Security Deed, Plaintiff “grant[ed] and convey[ed] to MERS (solely as nominee

1

Plaintiff has filed at least four bankruptcy cases in the Northern District of
Georgia since obtaining his mortgage: (i) No. 13-61963, filed June 1, 2013, and
dismissed June 13, 2013, for failure to pay the filing fee; (ii) No. 13-73766, filed
November 1, 2013, and dismissed on January 16, 2014, for failure to pay the filing
fee; (iii) No. 14-56989, filed April 5, 2014, and dismissed July 14, 2014, for failure to
comply with the court’s order; and (iv) No. 14-68254, filed September 17, 2014, and
dismissed December 31, 2014, for failure to file required financial information and
failure to attend the meeting of creditors. In Plaintiff’s most recent bankruptcy action,
on November 25, 2014, the United States Bankruptcy Court for the Northern
District of Georgia granted RoundPoint relief from the automatic stay provisions of
the Bankruptcy Code to foreclose on Plaintiff’s home. See See Order granting
RoundPoint Relief from Stay, In re Laverpool, No. 14-68254, Doc. 23 (Bankr.
N.D. Ga. Nov. 25, 2014) (detailing Plaintiff’s pattern of filing bankruptcy petitions
to avoid scheduled foreclosure sales).
On December 3, 2014, Plaintiff also filed a complaint in the Superior Court of
DeKalb County, seeking quiet title to the Property based on similar theories that he
raises in this action. On January 9, 2015, Defendants removed the DeKalb County
Action to this Court. Plaintiff voluntarily dismissed the action on January 16, 2015.
See Laverpool v. Taylor, Bean & Whittaker Mortg. Corp., No. 1:15-cv-078 (N.D. Ga.
Jan. 16, 2015).

2

for [TBW] and [TBW’s] successors and assigns), and the successors and assigns of
MERS, with power of sale, the [Property].” (Security Deed at 1-2).
On September 23, 2009, RoundPoint became the servicer of Plaintiff’s loan.
([7.1] at 9).
On August 2, 2011, MERS, as nominee for TBW, assigned the Security
Deed to TBW (the “Assignment”). (Assignment [2.3] at 12).
At some point, Plaintiff defaulted on his loan obligations. On December 29,
2014, Rubin Lublin, LLC, on behalf of TBW, sent Plaintiff a letter indicating that
Plaintiff had defaulted on his loan obligations and that a foreclosure sale of the
Property was scheduled for February 3, 2015. (Compl. ¶ 13).
On January 8, 15, 22, and 29, 2015, TBW published a Notice of Sale Under
Power (“NSUP”), which states:
By virtue of a Power of Sale contained in [the Security Deed] from
Keith Laverpool to [MERS] as nominee for [TBW]. . . . said Security
Deed having been last sold, assigned and transferred to
[TBW], . . . [The Property will be sold at] public outcry to the highest
bidder for cash . . . on the first Tuesday in February, 2015. . .
The entity having the full authority to negotiate, amend or modify all
terms of the loan . . . is: ROUNDPOINT MORTGAGE SERVICING
CORPORATION.
(NSUP [2.3 at 17]).

3

On January 9, 2015, at the earliest, Plaintiff applied for a loan modification
with RoundPoint. ([2.3] at 18-20).2
On January 26, 2015, Plaintiff filed his Complaint in the Superior Court of
DeKalb County, Georgia, asserting claims for attempted wrongful foreclosure
(Count One) and injunctive relief (Count Two). Plaintiff appears to assert that
Defendants lack standing to foreclose on the Property based on perceived defects
in the Assignment because his application for a loan modification is still pending.
Plaintiff seeks injunctive relief, compensatory and punitive damages, attorney’s
fees and litigation costs. On February 3, 2015, after Plaintiff initiated this action,
the Property was sold, at a foreclosure sale, to TBW ([7.1] at 12).
On February 23, 2015, TBW initiated a separate action in the Superior Court
of DeKalb County to confirm and approve the February 3, 2015, foreclosure sale
(the “Confirmation Action”). See Taylor Bean & Whitaker Mortg. Corp.
v. Laverpool, No. 15cv2569-3 ([7.1] at 10-14).
2

Plaintiff attached to his Complaint a “Uniform Borrower Assistance Form”
and a “Dodd-Frank Certification,” signed by Plaintiff and dated January 9, 2015; a
January 18, 2015, email from Plaintiff to RoundPoint in which Plaintiff states that
he “sent all of the required documents and [is] looking forward to receiving a fair
loan modification;” a second January 18, 2015, email from Plaintiff to RoundPoint
which states only “more documents;” and a January 20, 2015, email from
Roundpoint to Plaintiff stating that RoundPoint “received the paperwork [Plaintiff]
sent in and it has been sent to [their] loss mitigation inbox for set up.” ([2.3] at
18-20; [2.4] at 17; [2.5] at 1-4).
4

On February 26, 2015, Defendants removed the DeKalb County Action to
this Court based on diversity of citizenship [1].
On March 5, 2015, Defendants moved to dismiss Plaintiff’s Complaint for
failure to state a claim.
On September 18, 2015, Plaintiff filed his Motion to Stay. Plaintiff claims
that the Consumer Financial Protection Bureau Investigation (“CFPB”) is
“investigating certain [m]ortgage procedures surrounding the foreclosure of his
home by TBW and RoundPoint Mortgage.” ([7] at 2). Plaintiff requests that this
action be stayed pending the “outcome of the CFPB Investigation” and resolution
of the Confirmation Action. (Id.).
II.

DISCUSSION
A.

Legal Standard

Dismissal of a complaint, pursuant to Rule 12(b)(6), is appropriate “when,
on the basis of a dispositive issue of law, no construction of the factual allegations
will support the cause of action.” Marshall Cnty. Bd. of Educ. v. Marshall Cnty.
Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993). In considering a motion to
dismiss, the Court accepts the plaintiff’s allegations as true and considers the
allegations in the complaint in the light most favorable to the plaintiff. See
Hishon v. King & Spalding, 467 U.S. 69, 73 (1984); Watts v. Fla. Int’l Univ.,

5

495 F.3d 1289, 1295 (11th Cir. 2007); see also Bryant v. Avado Brands, Inc.,
187 F.3d 1271, 1273 n.1 (11th Cir. 1999). The Court is not required to accept a
plaintiff’s legal conclusions as true. See Sinaltrainal v. Coca-Cola Co., 578 F.3d
1252, 1260 (11th Cir. 2009) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)),
abrogated on other grounds by Mohamad v. Palestinian Auth., — U.S. —,
132 S. Ct. 1702 (2012). The Court also will not “accept as true a legal conclusion
couched as a factual allegation.” See Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555 (2007). The complaint, ultimately, is required to contain “enough facts to state
a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570.3
To state a plausible claim for relief, the plaintiff must plead factual content
that “allows the Court to draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Iqbal, 556 U.S. at 678. “Plausibility” requires more
than a “sheer possibility that a defendant has acted unlawfully,” and a complaint
that alleges facts that are “merely consistent with” liability “stops short of the line
between possibility and plausibility of ‘entitlement to relief.’” Id. (citing
3

The Supreme Court explicitly rejected its earlier formulation for the Rule
12(b)(6) pleading standard: “‘[T]he accepted rule [is] that a complaint should not
be dismissed for failure to state a claim unless it appears beyond doubt that the
plaintiff can prove no set of facts in support of his claim which would entitle him
to relief.’” Twombly, 550 U.S. at 577 (quoting Conley v. Gibson, 355 U.S. 41,
45-46 (1957)). The Court decided that “this famous observation has earned its
retirement.” Id. at 563.
6

Twombly, 550 U.S. at 557); see also Arthur v. JP Morgan Chase Bank, NA,
569 F. App’x 669, 680 (11th Cir. 2014) (noting that Conley’s “no set of facts”
standard has been overruled by Twombly, and a complaint must contain “sufficient
factual matter, accepted as true, to state a claim for relief that is plausible on its
face.”). “A complaint is insufficient if it ‘tenders naked assertions devoid of
further factual enhancement.’” Tropic Ocean Airways, Inc. v. Floyd,
598 F. App’x 608, 609 (11th Cir. 2014) (quoting Iqbal, 556 U.S. at 678).
“To survive a motion to dismiss, plaintiffs must do more than merely state
legal conclusions; they are required to allege some specific factual bases for those
conclusions or face dismissal of their claims.” Jackson v. BellSouth Telecomms.,
372 F.3d 1250, 1263 (11th Cir. 2004); see also White v. Bank of America, NA,
597 F. App’x 1015, 1017 (11th Cir. 2014) (“[C]onclusory allegations, unwarranted
deductions of facts or legal conclusions masquerading as facts will not prevent
dismissal.”) (quoting Oxford Asset Mgmt., Ltd. v. Jaharis, 297 F.3d 1182, 1188
(11th Cir. 2002)).4
B.

Analysis

4

Federal Rule of Civil Procedure 8(a)(2) requires the plaintiff to state “a short
and plain statement of the claim showing that the pleader is entitled to relief.”
Fed. R. Civ. P. 8(a)(2). In Twombly, the Supreme Court recognized the liberal
minimal standards imposed by Federal Rule 8(a)(2) but also acknowledged that
“[f]actual allegations must be enough to raise a right to relief above the speculative
level . . . .” Twombly, 550 U.S. at 555.
7

1.

Wrongful Foreclosure (Count One)5

To state a claim for wrongful foreclosure under Georgia law, a plaintiff must
show “a legal duty owed to it by the foreclosing party, a breach of that duty, a
causal connection between the breach of that duty and the injury it sustained, and

5

Wrongful foreclosure and attempted wrongful foreclosure are two different
causes of action under Georgia law. Compare All Fleet, 634 S.E.2d at 807 (To
state a claim for wrongful foreclosure, plaintiff must show a “legal duty owed to it
by the foreclosing party, a breach of that duty, a causal connection between the
breach of that duty and the injury it sustained, and damages”) with Jenkins v.
McCalla Raymer, LLC, 492 F. App’x 968, 972 (11th Cir. 2012) (To state a claim
for attempted wrongful foreclosure, plaintiff must show “a knowing and intentional
publication of untrue and derogatory information concerning the debtor’s financial
condition, and that damages were sustained as a direct result of this publication.”).
Although titled “Attempted Wrongful Foreclosure” in his Complaint, it
appears that Plaintiff intended to assert a claim for wrongful foreclosure to enjoin
the foreclosure sale and challenge Defendants’ authority to foreclose. See Jenkins,
492 F. App’x at 971-72 (plaintiff may maintain cause of action for wrongful
foreclosure where plaintiff seeks to enjoin actual foreclosure sale from being
completed, rather than only seeking damages; but plaintiff seeking damages must
show property was actually sold at foreclosure) (citing Morgan v. Ocwen Loan
Serv., LLC, 796 F. Supp. 2d 1370, 1377 (N.D. Ga. 2011)).
To the extent he intended to assert a claim for attempted wrongful
foreclosure, Plaintiff does not identify the purported “untrue and derogatory
information concerning [his] financial condition” Plaintiff alleges that Defendants
published. Plaintiff thus fails to allege facts sufficient to support a claim for
attempted wrongful foreclosure. See id.; see also Peterson v. Merscorp Holdings,
Inc., No. 1:12-cv-00014-JEC, 2012 WL 3961211, at *5 (N.D. Ga. Sept. 10, 2012)
(plaintiffs failed to state a claim for attempted wrongful foreclosure where they
alleged only that defendant misrepresented itself as the secured creditor on
foreclosure notice).
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damages.” All Fleet Refinishing, Inc. v. W. Georgia Nat’l Bank, 634 S.E.2d 802,
807 (Ga. Ct. App. 2006).
Here, Plaintiff argues that Defendants lack authority to foreclose on the
Property. It is undisputed that Plaintiff executed the Security Deed and granted to
MERS, as nominee for TBW and TBW’s successors and assigns, title to the
Property, with the power of sale. (Security Deed at 1-2). On August 2, 2011,
MERS assigned its rights under the Security Deed to TBW. (Assignment at 1).
TBW is thus entitled to exercise the power of sale in the Security Deed.6
To the extent Plaintiff argues that Defendants lack standing to foreclose on
the Property because they do not hold Plaintiff’s promissory note and Security
Deed and are not his “secured creditor,” the Supreme Court of Georgia has
expressly rejected this argument and held that “the holder of a deed to secure debt
6

To the extent Plaintiff argues that the Assignment is defective or fraudulent,
Plaintiff is not a party to the Assignment and he therefore lacks standing to
challenge its validity. See Montgomery v. Bank of Am., 740 S.E.2d 434, 436
(Ga. Ct. App. 2013) (because assignment of security deed was contractual, plaintiff
lacked standing to contest its validity because he was not a party to the assignment)
(citing O.C.G.A. § 9-2-20(a), which provides that an action based on a contract can
be brought only by a party to the contract); Edward v. BAC Home Loans Serv.,
L.P., No. 12-15487, 2013 WL 4400102, at *2 (11th Cir. Aug. 16, 2013) (citing
Montgomery). Even if he did have standing to challenge the Assignment,
Plaintiff’s conclusory assertion that the Assignment is not valid because the former
chairman of TBW was convicted of fraud and “the U.S. Department of Justice
ordered [TBW] Cease and Desist [sic] from ALL mortgage activity,” is not
sufficient to support a claim for relief.

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is authorized to exercise the power of sale in accordance with the terms of the deed
even if it does not also hold the note or otherwise have any beneficial interest in
the debt obligation underlying the deed.” You v. JP Morgan Chase Bank, 743
S.E.2d 428, 431-433 (Ga. 2013); see also O.C.G.A. § 23-2-114 (“[u]nless the
instrument creating the power specifically provides to the contrary, a . . . successor
of the grantee in a mortgage, deed of trust, deed to secure debt, bill of sale to
secure debt, or other like instrument, or an assignee thereof, or his personal
representative, heir, heirs, legatee, devisee, or successor may exercise any power
therein contained.”). The Court notes further that TBW was Plaintiff’s original
lender, and there is no evidence to support that an entity other than TBW ever held
Plaintiff’s note. Thus, at the time Plaintiff received the December 29, 2014, Notice
of Foreclosure, and on February 3, 2015, when TBW actually foreclosed on the
Property, TBW held both Plaintiff’s note and the Security Deed.
Plaintiff next argues that foreclosure is wrongful because he submitted loan
modification paperwork and a “loss mitigation application,” and, “[u]nder the
Consumer Financial Protection Bureau . . . a mortgage servicer cannot start the
foreclosure process if a loss mitigation application is pending.” (Compl. ¶¶ 18-22

10

& Exs. D, E).7 Plaintiff appears to base his claim on 12 C.F.R. § 1024.41(g),
which provides:
If a borrower submits a complete loss mitigation application after
[foreclosure proceedings are first initiated,] but more than 37 days
before a foreclosure sale, a servicer shall not . . . conduct a
foreclosure sale, unless:
(1) The servicer [informs] the borrower that [he or she] is not
eligible for any loss mitigation option . . . ;
(2) The borrower rejects all loss mitigation options offered by the
servicer; or
(3) The borrower fails to perform under an agreement on a loss
mitigation option.
12 C.F.R. § 1024.41(g) (emphasis added).8 “Nothing in § 1024.41 imposes a duty
on a servicer to provide any borrower with any specific loss mitigation option.”
12 C.F.R. § 1024.41(a).
Here, the foreclosure sale was scheduled for, and conducted on,
February 3, 2015. For Section 1024.41 to apply, Plaintiff was required to submit a
complete loss mitigation application more than 37 days before the February 3,

7

12 C.F.R. § 1024.41 was enacted by the Consumer Financial Protection
Bureau, which was established by the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010.
8
It appears that Plaintiff defaulted on his loan payments in January 2009, and
Defendants first initiated foreclosure proceedings in 2013. See In re Laverpool,
No. 14-68254, Doc. 23 (detailing Plaintiff’s pattern of filing bankruptcy petitions
to avoid scheduled foreclosure sales).
11

2015, foreclosure sale—that is, Plaintiff was required to submit a complete loss
mitigation application on or before December 28, 2014. The documents Plaintiff
attached to his Complaint show that Plaintiff submitted a loss mitigation
application, at the earliest, on January 9, 2015—just thirty-two (32) days before the
February 3, 2015, foreclosure sale. (See Compl. at Ex. E, [2.5] at 1-4). To the
extent noncompliance with Section 1024.41 could support a claim for wrongful
foreclosure,9 Section 1024.41 simply does not apply here. See 12 C.F.R.
§ 1024.41(g); See Obazee v. Bank of New York Mellon, No. 3:15-cv-1082-D,
2015 WL 4602971, at *2-3 (N.D. Tex. July 31, 2015); Deming-Anderson v. PNC
Mortg., No. 15-cv-11688, 2015 WL 4724805, at *4 (E.D. Mich. Aug. 10, 2015)
(dismissing plaintiff’s claims against loan servicer for fraud based on violations of
Section 1024.41, including because loan servicer “was under no obligation to
review application, given that it was submitted fewer than thirty-seven days before
scheduled foreclosure sale).
Finally, Plaintiff does not allege, and it does not appear, that he is current on
his loan obligations. Failure to make the proper loan payments or tender the
amount due defeats any claim for wrongful foreclosure. See, e.g., Harvey
9

12 C.F.R. § 1024.41(a) provides that “[a] borrower may enforce the
provisions of [Section 1024.41] pursuant to section 6(f) of RESPA (12 U.S.C.
§ 2605(f)).”

12

v. Deutsche Bank Nat’l Trust Co., No. 1:12-cv-1612, 2012 WL 3516477, at *2
(N.D. Ga. Aug. 14, 2012) (“When the borrower cannot show that the alleged injury
is attributable to the lender’s acts or omissions, the borrower has no claim for
wrongful foreclosure.”); Heritage Creek Dev. Corp. v. Colonial Bank, 601 S.E. 2d
842 (Ga. Ct. App. 2004) (plaintiff’s injury was “solely attributable to its own acts
or omissions both before and after the foreclosure” because it defaulted on the loan
payments, failed to cure the default, and did not bid on the property at the
foreclosure sale); cf. Austin v. Bank of Am., N.A., No. 1:11–CV–3346–RWS,
2012 WL 928732, at *1 (N.D .Ga. Mar. 16, 2012) (dismissing claim for wrongful
attempted foreclosure where plaintiffs admitted they were in default and did not
allege that defamatory statements were published against them); Sellers v. Bank of
Am., Nat’l Ass’n, No. 1:11-cv-3955-RWS, 2012 WL 1853005, at *3 (N.D. Ga.
May 21, 2012) (dismissing attempted wrongful foreclosure claim; while plaintiffs
alleged that defendants lacked authority to foreclose, plaintiffs failed to allege
sufficient facts to show that they suffered any damage as a result). Plaintiff’s claim
for wrongful foreclosure is required to be dismissed for this additional reason.
2.

Injunctive Relief (Count Two)

A claim for preliminary injunctive relief requires a showing of “a
substantial likelihood of success on the merits of the underlying case,” Grizzle

13

v. Kemp, 634 F.3d 1314, 1320 (11th Cir. 2011), while a permanent injunction
requires actual success on the merits, United States v. Endotec, Inc., 563 F.3d
1187, 1194 (11th Cir. 2009). Because Plaintiff fails to state a viable claim for
relief, his claim for injunctive relief is required to be dismissed.10
III.

CONCLUSION
Accordingly, for the foregoing reasons,
IT IS HEREBY ORDERED that Taylor, Bean & Whitaker Mortgage

Corporation’s, RoundPoint Mortgage Service Corporation’s, and Mortgage
Electronic Registration Systems, Inc.’s Motion to Dismiss [3] is GRANTED.
IT IS FURTHER ORDERED that Plaintiff Keith Laverpool’s Motion to
Stay [7] is DENIED AS MOOT.

SO ORDERED this 7th day of December, 2015.

_______________________________
WILLIAM S. DUFFEY, JR.
UNITED STATES DISTRICT JUDGE

10

Having determined that Plaintiff’s Complaint fail to state a viable claim for
relief, and because the Court grants Defendants’ Motion to Dismiss, Plaintiff’s
Motion to Stay is denied as moot.

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