Davis-Brown et al v. Gruenber et al

Filing 4

ORDERED that Plaintiff is to file an amended 1 Complaint filed by Walter J. Brown, Jr. within 21 days of the day this Order is served. ( Compliance due by 10/26/2016.) Wheaton Street should now be dismissed. Signed by Magistrate Judge G. R. Smith on 10/4/16. (wwp)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA
wsiTkLIij

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Plaintiffs,

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V.

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CV416-240

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FEDERAL DEPOSIT INSURANCE
CORPORATION (FDIC), et al,,

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Defendants.

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ORDER
Proceeding pro Se, plaintiffs Mary Davis Brown, Walter Brown, Jr.,
and B's Thoroughbred Motors filed this civil rights action under 42
U.S.C. § 1983 against the Federal Deposit Insurance Corporation (FDIC),
Seneca Mortgage Servicing, and the Bank of New York Mellon Trust
Company, N.A.' Doc. 3. Plaintiffs allege violations of the Fourteenth
Amendment, the Americans with Disabilities Act (AIJA), and the
Rehabilitation Act, assert a claim for breach of contract, and seek
damages plus attorney's fees and costs of litigation.
1

Id.

The Court now

As plaintiffs no longer name defendants Marton J. Gruenber (agency executive),
James Depalin (president of Seneca Mortgage Servicing, and Susan Reid (general
counsel at the Law Firm of McCalla Raymner, LLC), see doc. 1 at 1, defendants
Gruenber, Depaim, and Reid should now be DISMISSED from the case, the caption
amended accordingly, and all subsequent filings should so conform.

preliminarily screens plaintiffs' complaint.'
A. Background
Plaintiffs allege that in 2006 plaintiff Brown, Jr., opened a line of
credit and obtained several loans with First National Bank, secured in
part against a house on Capital Street in Savannah, Georgia. Doc. 3 at 2.
Shortly thereafter, the FDIC closed First National and seized "files,
customer accounts, and other documents."

Id. FDIC officials met with

plaintiffs and assured them "that their outstanding loans with the Bank
would be placed at a much lower interest rate and terms."

Id.

After Brown, Jr., became "disabled" (requiring a knee replacement),
the "FDIC took advantage of this disability and colluded with defendant
Seneca Mortgage Service to have Seneca acquire the loans with onerous

Id. at 2-3. In 2015, plaintiffs

terms imposed upon plaintiffs."

negotiated an agreement with Seneca to avoid foreclosure on the Capital

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District courts have the inherent power to dismiss sua sponte frivolous lawsuits,
even those where the plaintiff pays the full filing fee. See Cuyler v. Aurora Loan
Services, LLC, 2012 WL 10488184 at * 2 (11th Cir. 2012) (notwithstanding filing fee
payment, "a district court has the inherent authority to dismiss a patently frivolous
complaint"); Jefferson Fourteenth Assocs. v, Wometco de Puerto Rico, Inc., 695 F.2d
524, 526 n. 3 (11th Cir. 1983) (noting that courts may sua sponte dismiss actions for
lacking merit "if the proper procedural steps are taken and if the determination is
correct on the merits"); Wilkerson v. Georgia, 2014 WL 3644179 at * 1 (S.D. Ga. July
21, 2014) (dismissingpro se complaint on frivolity grounds even though plaintiff paid
full filing fee), rev'd on other grounds 618 F. App'x 610 (11th Cir. 2015).
2

Street home. Because of disagreements about the interest rates, several
modifications of the agreement ensued, and plaintiffs continued making
their payments. Seneca then foreclosed upon the property in August
2016.
B. Analysis
Courts are obligated to liberally construe pro se complaints, but they
may not serve "as de facto counsel for the litigant or rewrite an otherwise
deficient pleading in order to sustain an action."

Campbell i'. Air

Jamaica Ltd., 760 F.3d 1165, 1168 (11th Cir. 2014). Here, plaintiffs
haven't given the Court much in support of their federal claims.
Although mostly factual (a good thing), their recitation of events tells the
Court nothing about how each defendant violated the Fourteenth
Amendment, the ADA, or the Rehabilitation Act.
1. ADA and Rehabilitation Act
The ADA and the Rehabilitation Act are federal laws that both
broadly protect disabled individuals from adverse actions motivated by
their disability.

See 28 U.S.C. § 12101 et seq. (ADA), 29 U.S.C. § 701 et

seq. (Rehabilitation Act). There is nothing in the complaint indicating
either plaintiff was: (1) "disabled" or "handicapped" within the meaning
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of the Acts; (2) employed by any of the defendants; or (3) adversely
treated solely because of his or her handicap in violation of the Acts.
Plaintiffs plead no facts to connect Brown, Jr.'s knee-replacement with
the foreclosure action, much less establish how either Act applies to a
foreclosure action.

See Baylor v. Day-Petrano, 2013 WL 1010754 (N.D.

Fla. Feb. 22, 2103) (noting the ADA has nothing to do with foreclosures),

atrd 596 F. App'x 741 (11th Cir. 2014). These claims are dead in the
water.
1. Fourteenth Amendment
Plaintiffs do not allege that defendants Seneca and the Bank of New
York are state actors. Because the Fourteenth Amendment applies only
to government action, not purely private conduct, there is no legal basis to
pursue a claim for violation of the Fourteenth Amendment against these
defendants.

See Littlejohn v. Citimortgage Inc., 2016 WL 1638237 at *4

(M.D. Fla. Feb. 3, 2016),

adopted, 2016 WL 1627076 (M.D. Fla. Apr. 25,

2016) (citing Jagia v. Lasalle Bank, 253 F. App'x 597, 599 (7th Cir. 2007)).
And plaintiffs have failed to demonstrate that they are entitled to
pursue a due process claim against defendant FDIC, as there is no
indication that they first exhausted the requisite FDIC administrative

claims process.

See 12 U.S.C. § 1821; Piacida Prof Center, LLC v.

F.D.I.C., 512 F. App'x 938, 948-49 (11th cir. 2013) (plaintiff could seek
judicial review only after exhausting administrative claims process prior
to foreclosure); Freeman v. F.D.I.C., 56 F.3d 1394, 1402-03 (D.C. cir.
1995) (while plaintiffs had a "constitutionally protected interest in their
home," and were "entitled to pre-deprivation notice and opportunity to be
heard," their failure to pursue administrative remedies under H 1821(d)
and (j) prior to foreclosure barred judicial review of their foreclosure
proceedings).
3. Breach of Contract
Finally, just like foreclosure proceedings in general, breach of
contract actions are ordinarily creatures of state law. For a federal court
to acquire jurisdiction over such a state law claim, plaintiffs' complaint
must either arise under federal law or diversity jurisdiction requirements
must be met. 28 U.S.C. H 1331 and 1332. As discussed above, there is
no federal claim, but -- as currently pled, at least -- there is complete
diversity between the parties. It is unclear, however, that plaintiffs have
shown that they can sustain a breach of contract claim. They had an
obligation to continue making mortgage and loan payments they knew
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they owed, and any nonpayment is fatal to their claim for breach of
contract "as [their] alleged injury was solely attributable to [their] own
acts or omissions." Rourk v. Bank of American Nat. Assn, 587 F. App's
597 1 600 (11th Cir. 2014) (quoting Heritage Creek Dcv. Corp. v. colonial

Bank, 268 Ga. App. 369 (2004). Plaintiffs acknowledge that on at least
one occasion in 2015 foreclosure proceedings were initiated for
nonpayment, which forced them to negotiate a payment plan. As pled,
the amended complaint fails to show that they made all payments owed
and therefore are without fault in the initiation of foreclosure
proceedings.
4. Leave to Amend
Nevertheless, because of their pro se status, and in view of Fed. R.
Civ. P. 15(a)'s admonition that leave to amend shall be freely given "when
justice so requires," the Court will afford plaintiffs another crack at
explaining the facts surrounding their claims. This time, however, they
must include a coherent "short and plain statement of the claim showing"
that they are entitled to the relief sought. Fed. R. Civ. P. 8(a)(2)
(emphasis added). That means plaintiffs must present the Court with
the factual allegations that support their constitutional and
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discrimination claims. See Bell Ati. Corp. v. Twombly, 550 U.S. 544, 555

(2007) (complaints must contain factual allegations "sufficient to raise a
right to relief above the speculative level"). Mere conclusions that
defendants violated the law are not enough.

See Ashcroft v. Iqbai, 556

U.S. 662, 679 (2009).
To that end, plaintiffs are ORDERED to file an Amended
Complaint within 21 days of the day this Order is served or face a
recommendation of dismissal. The Amended Complaint must contain
facts establishing each claim against each defendant. Plaintiffs are
advised that their amended complaint will supersede the original
complaint and therefore must be complete in and of itself.' Once they file
an amended complaint, the original complaint will no longer serve any
function in the case.
5 Corporations Must Be Represented By Counsel
Lastly, plaintiff B's Thoroughbred Motors cannot continue to be a
party in this case unless it is represented by an attorney.

Palazzo v. Gulf

See Malowney v. Fed. Collection Deposit Grp, 193 F.3d 1342, 1345 n. 1 (11th Cir.
1999) ("An amended complaint supersedes an original complaint"); Varnes v. Local 91,
Glass Bottle Blowers Ass'n of U.S. & Canada, 674 F.2d 1365, 1370 n. 6 (11th Cir. 1982)
("As a general rule, an amended complaint supersedes and replaces the original
complaint unless the amendment specifically refers to or adopts the earlier pleading").
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Oil Corp., 764 F.2d 1381, 1385 (11th Cir. 1985) (a corporation or
partnership may only be represented by licensed counsel in a judicial
proceeding). Plaintiff Brown, Jr., signing on its behalf as its "registered
agent," will not suffice. Id. at 1386 (a corporation's claims cannot be
assigned to its pro se co-plaintiff). The Court cannot and will not
entertain any pleadings filed by plaintiff B's Thoroughbred until it has
obtained counsel.

See N. Augusta Mgmt. Grp., LLC v. Sw. Golf Grp.,

Inc., No. CV 110-061, 2011 WL 1151128, at *1 (S.D. Ga. Mar. 28, 2011).
SO ORDERED this 4th day of October, 2016.

UNiTED STATES MAGISTRATE JUDGE
SOUTHERN DISTRICT OF GEORGIA

As plaintiff Wheaton Street Business Exchange is no longer listed as a plaintiff in
the amended complaint, it does not need to be represented by counsel. Along with
defendants Gruenber, Depalm, and Reid, see supra, fn. 1, plaintiff Wheaton Street
should now be DISMISSED (leaving Mary Davis Brown and Walter Brown, Jr. as the
only plaintiffs), the caption amended accordingly, and all subsequent filings should so
conform.
rs