West v. Wells Fargo Bank, N.A.
Filing
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OPINION AND ORDER adopting Magistrate Judge Alan J. Bavermans Final Report and Recommendation 6 and granting Defendants Motion to Dismiss 3 . It is further ordered that this action is dismissed with prejudice. Signed by Judge William S. Duffey, Jr on 1/27/17. (ddm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
HERETTA L. WEST,
Plaintiff,
v.
1:16-cv-393-WSD
WELLS FARGO BANK, N.A.,
Defendant.
OPINION AND ORDER
This matter is before the Court on Magistrate Judge Alan J. Baverman’s
Final Report and Recommendation [6] (“R&R”).
I.
BACKGROUND1
On April 20, 2007, Plaintiff Heretta West (“Plaintiff”) obtained a loan from
MortgageIT, Inc. (“MortgageIT”) in the amount of $743,200.00. ([3.2]). To
secure repayment of the promissory note, Plaintiff executed a security deed which
conveyed legal title and power of sale of the real property located at 2398 Monte
Villa Court, Marietta, Georgia 30062 (the “Property”) to Mortgage Electronic
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The facts are taken from the R&R and the record. The parties have not
objected to any specific facts in the R&R, and the Court finds no plain error in
them. The Court thus adopts the facts set out in the R&R. See Garvey v. Vaughn,
993 F.2d 776, 779 n.9 (11th Cir. 1993).
Registration Systems, Inc. (“MERS”) as nominee for MortgageIT. (Id.). On
January 20, 2012, MERS transferred and assigned its rights, title, and interest in
the security deed to HSBC Bank USA, National Association as Trustee For
MortgageIT Securities Corp. Mortgage Loan Trust Series 2007-1, Mortgage PassThrough Certificates (“HSBC”). Wells Fargo is the servicer of the loan on behalf
of HSBC. ([1] at 9, ¶ 3; [3.1] at 2).
On November 27, 2013, Plaintiff, proceeding pro se, filed a complaint in the
Superior Court of Cobb County. See West v. Wells Fargo Bank, N.A., Case No.
13-1-10266-34.3 (“West I”). ([3.4]). On April 9, 2014, Plaintiff voluntarily
dismissed that complaint. ([3.5]). On October 1, 2014, again proceeding pro se,
Plaintiff filed a another complaint in the Superior Court of Cobb County that was
nearly identical to the complaint filed in West I. See West v. Wells Fargo Bank,
N.A., Case No. 14-1-7667-53 (“West II”). ([3.6]). On December 2, 2014, Plaintiff
voluntarily dismissed West II. ([3.7]).
On January 9, 2015, Plaintiff, proceeding pro se, filed a third complaint in
the Superior Court of Cobb County. See West v. Wells Fargo Bank, N.A., Case
No. 15-1-175-52 (“West III”). ([3.8]). In West III, Plaintiff asserted claims
against Defendant for conversion, attempted wrongful foreclosure, breach of good
faith and fair dealing, unfair and deceptive business practices, fraud, violations
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under the Real Estate Settlement Procedures Act (“RESPA”), unjust enrichment,
“adequate assurances of performance,” unconscionability, and sought a declaratory
judgment and reasonable attorney’s fees. ([3.8]). On December 21, 2015, the
Cobb County Superior Court dismissed Plaintiff’s claims with prejudice. ([3.9]).
On February 9, 2016, Plaintiff, proceeding pro se, filed a complaint in this
Court. ([1]). Plaintiff’s Complaint asserts claims against Defendant for violation
of the Fair Debt Collections Practices Act (“FDCPA”) (Count I), violation of the
Fair Credit Reporting Act (“FCRA”) (Count II), negligence (Count III), intentional
infliction of emotion distress (“IIED”) (Count IV), declaratory judgment/quiet title
(Count V), injunctive relief, (Count VI), wrongful foreclosure (Count VII), and
violation of the Georgia Fair Business Practices Act (“GFBPA”) (Count VIII). She
seeks equitable and injunctive relief, compensatory and punitive damages, and
attorney’s fees. (Compl. at 36-37).
Defendant moved to dismiss Plaintiff’s complaint on two primary grounds:
(1) Plaintiff’s claims are barred by the doctrines of res judicata, collateral estoppel,
and the “two dismissal” rule; and (2) Plaintiff’s complaint fails to state a claim
upon which relief can be granted. ([3.1]).
On January 4, 2017, the Magistrate Judge issued his R&R. The Magistrate
Judge determined that the doctrine of res judicata barred all of Plaintiff’s claims
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except Counts II and III. He further found that Count VII (wrongful foreclosure) is
also barred on the grounds of collateral estoppel. The Magistrate Judge
recommends the Court grant Defendant’s Motion to Dismiss on all of Plaintiff’s
claims for failure to state a claim. No party filed objections to the R&R.
II.
DISCUSSION
A.
Legal Standard
After conducting a careful and complete review of the findings and
recommendations, a district judge may accept, reject, or modify a magistrate
judge’s report and recommendation. 28 U.S.C. § 636(b)(1); Williams
v. Wainwright, 681 F.2d 732, 732 (11th Cir. 1982) (per curiam). A district judge
“shall make a de novo determination of those portions of the report or specified
proposed findings or recommendations to which objection is made.” 28 U.S.C.
§ 636(b)(1). Where, as here, no party has objected to the report and
recommendation, the Court conducts only a plain error review of the record.
United States v. Slay, 714 F.2d 1093, 1095 (11th Cir. 1983) (per curiam).
B.
Analysis
1.
Res Judicata
“Res judicata, or more properly claim preclusion, is a judicially made
doctrine with the purpose of both giving finality to parties who have already
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litigated a claim and promoting judicial economy.” In re Atlanta Retail, Inc., 456
F.3d 1277, 1284 (11th Cir. 2006). Res judicata “not only bars matters actually
litigated in the earlier action; when it applies, res judicata also bars every claim
which might have been presented in the earlier action.” Langermann v. Dubbin,
613 F. App’x 850, 853 (11th Cir. 2015) (emphasis in original) (citing Atlanta
Retail, 456 F.3d at 1285). Res judicata applies if four elements are met: (1) a final
judgment on the merits; (2) rendered by a court of competent jurisdiction;
(3) between the same parties, or their privies; and (4) the causes of action involved
in both cases are the same. Id. (citing Ragsdale v. Rubbermaid, Inc., 193 F.3d
1235, 1238 (11th Cir. 1999)).
Applying these factors, the Magistrate Judge found that West III resulted in
the entry of a final judgment on the merits by a court of competent jurisdiction. In
December 2015, the Cobb County Superior Court dismissed Plaintiff’s claim with
prejudice for failure to state a claim. ([3.9]). A dismissal for failure to state a
claim is a judgment on the merits. SFM Holdings, Ltd. v. Banc of America
Securities, LLC, 764 F.3d 1327, 1344 (11th Cir. 2014). There is no dispute that
the Cobb County Superior Court is a court of competent jurisdiction, and the
Magistrate Judge found the parties were identical in each action.
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With respect to the final element, under Georgia law, all claims for relief
that concern “the same subject matter” must be raised in the first action because
“[a]ny claims for relief concerning the same subject matter that are not raised are
thereafter barred under O.C.G.A. § 9-12-40.” Bennett v. Cotton, 536 S.E.2d 802,
804 (Ga. Ct. App. 2000). Thus, res judicata may not be avoided merely by
requesting different relief in a subsequent suit. McBride v. Chilivis, 255 S.E.2d
80, 81 (Ga. Ct. App. 1979). The Magistrate Judge noted that both lawsuits are
premised on Plaintiff’s allegations that Defendant does not have the authority to
foreclose on the Property because Defendant was not the secured creditor, and that
Defendant acted improperly as the loan servicer on behalf of HSBC. He
determined that, except for Counts II and III, Plaintiff’s causes of action are barred
by res judicata, because they arise out of the same set of operative facts that were
brought against Defendant in West III. With respect to Counts II and III, he
Magistrate Judge found that it is unclear when the conduct of which Plaintiff
complains occurred, and thus Defendant did not meet its burden to establish that
res judicata applies to those claims. The Court finds no plain error in these
findings and recommendation, and all of Plaintiff’s causes of action except for
Counts II and III are barred by res judicata. See Slay, 714 F.2d at 1095.
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2.
Failure to State a Claim
a)
FCRA Claim (Count II)
With respect to Plaintiff’s FCRA claim (Count II), Plaintiff alleges
Defendant misrepresented to unidentified credit reporting agencies that it had
Plaintiff’s consent to obtain Plaintiff’s reports and that Defendant furnished
negative information about Plaintiff’s credit. (Compl. ¶¶ 95-99). The FCRA
makes it unlawful for a person to “knowingly and willfully obtain [] information
on a consumer from a consumer reporting agency under false pretenses.” See 15
U.S.C. §1681q. The Magistrate Judge noted that there are no factual allegations in
the Complaint that Defendant obtained Plaintiff’s credit report under any false
pretenses.
The FCRA also provides protection to consumers like Plaintiff against
furnishers of credit information who submit incorrect information. See 15 U.S.C.
§§ 1682a(c), (f); id. § 1681s-2(a). This protection breaks down into two duties on
the part of furnishers of credit information: “[f]irst, §1681s-2(a) requires
furnishers to submit accurate information to [credit reporting agencies],” and
“[s]econd, §1681s-2(b) requires furnishers to investigate and response promptly to
notices of customer disputes.” Green v. RBS Nat. Bank, 288 F. App’x 641, 642
(11th Cir. 2008). However, violations of the first kind, the submission of
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inaccurate information does not create a private right of action, and to recover for
violations of the second kind, a plaintiff must allege that the furnisher in question
received notice of the dispute. Steed v. EverHome Mortg. Co., 308 F. App’x 364,
369-70 (11th Cir. 2009). Because Plaintiff did not allege that she disputed any
inaccurate information contained in her credit report or that Defendant received
notice of any such dispute, the Magistrate Judge determined that Plaintiff failed to
state a claim for relief. Accordingly, he recommends the Court grant Defendant’s
Motion to Dismiss Plaintiff’s FCRA claim for failure to state a claim. The Court
finds no plain error in these findings and recommendation, and Defendant’s
Motion to Dismiss Plaintiff’s FCRA claim (Count II) is granted. See Slay, 714
F.2d at 1095.
b)
Negligence (Count III)
Plaintiff’s negligence claim is premised upon alleged violations of the
FCRA, specifically that Defendant used misrepresentations to obtain credit
information and failed to correct inaccurate information. The FCRA preempts
“negligence [claims] with respect to the reporting of any information
against . . . any user of information, or any person who furnishes information”
except when “false information [is] furnished with malice or willful intent.” 15
U.S.C. § 1682h(e). Because Plaintiff did not allege any facts to support that
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Defendant acted with malice or willful intent, the Magistrate Judge recommends
that the Court grant Defendant’s Motion to Dismiss Plaintiff’s negligence claim for
failure to state a claim. The Court finds no plain error in these findings and
recommendation, and Defendant’s Motion to Dismiss Plaintiff’s negligence claim
(Count III) is granted. See Slay, 714 F.2d at 1095.2
III.
CONCLUSION
For the foregoing reasons,
IT IS HEREBY ORDERED that Magistrate Judge Alan J. Baverman’s
Final Report and Recommendation [6] is ADOPTED.
IT IS FURTHER ORDERED that Defendant’s Motion to Dismiss [3] is
GRANTED.
IT IS FURTHER ORDERED that this action is DISMISSED WITH
PREJUDICE.
SO ORDERED this 27th day of January, 2017.
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The Court also finds no plain error in the Magistrate Judge’s findings and
recommendation that the remainder of Plaintiff’s claims should be dismissed for
failure to state a claim, and that collateral estoppel bars Plaintiff’s wrongful
foreclosure claim (Count VII). See Slay, 714 F.2d at 1095.
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