Hall et al v. Ocwen Loan Servicing, LLC et al

Filing 17

MEMORANDUM DECISION. Signed by Judge B. Lynn Winmill. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (cjs)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
ANNETTE HALL and BYRON HALL,

Case No. 4:14-cv-00106-BLW

Plaintiffs,
v.
MEMORANDUM DECISION
OCWEN LOAN SERVICING, LLC;
FREDDIE MAC MULTICLASS
CERTIFICATES SERVICE 3071;
MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC.;
NORTHWEST TRUSTEE SERVICES,
INC.; and JOHN DOES 1-5,
Defendants.

INTRODUCTION
The Court has before it a motion to amend filed by plaintiffs – Byron and Annette
Hall – and a motion to dismiss filed by defendants that the Court previously reserved
ruling upon, giving plaintiffs an opportunity to amend their complaint. The motions are
fully briefed and at issue. For the reasons explained below, the Court will deny the
motion to amend and grant the motion to dismiss.
LITIGATION BACKGROUND
The Halls are years behind on their house payments but allege that they are not in
default because of irregularities in the manner in which their deed of trust and promissory
note were handled by defendants. They claim that the defendants split the deed of trust

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from the promissory note and thus lost all right to collect the money they loaned to the
Halls.
When the defendants began foreclosure proceedings, the Halls filed this lawsuit
seeking to stop the foreclosure and have their promissory note and deed of trust declared
invalid. The defendants filed motions to dismiss under Rule 12(b)(6) alleging that the
Halls failed to state a cognizable claim because the foreclosure is proper as a matter of
law.
The Court issued a decision holding that although the Halls’ claims were subject
to dismissal as pled, the Court would give them an opportunity to amend their complaint.
See Memorandum Decision (Dkt. No. 13). Specifically, the Court offered the Halls an
opportunity to plead more specifically their vague claims that mortgage documents had
been altered or forged:
The Halls’ counsel, Aaron Tolson, alleges in his briefing, that “documents
were purportedly altered and other irregularities or worse occurred with this
mortgage.” See Response Brief (Dkt. No. 11) at p. 8. These are serious
charges made by an officer of the Court. The Court therefore assumes that
Tolson has facts and specific allegations to back up those charges. While
he failed to include them in his original complaint – an odd omission given
the importance of such claims – the Circuit nevertheless directs this Court
to generally give plaintiffs at least one chance to amend, as discussed
above. And allegations of falsification of mortgage documents – if made
with the requisite specificity – have been held sufficient to overcome a Rule
12(b)(6) dismissal. See In re Mortgage, 754 F.3d at 783-84. In that case,
the debtors alleged that (1) they did not sign the documents purportedly
obligating them on the debt at issue, and (2) repeated signatures of a certain
individual varied so much that it raised suspicions whether that individual
actually was the signatory for each signature. Id. That case will dictate the
level of specificity necessary in this case.
Id. at p. 7 (emphasis in original).

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ANALYSIS
The Halls responded to the Court’s decision by filing the motion to amend that is
now before the Court. The motion was not accompanied by a proposed amended
complaint but rather by a brief with 11 attachments. The brief does not set forth any
amended claims, but rather asks the Court to review the 11 attachments: “If the court
does not believe in its legal analysis that the attached information creates material issues
of fact and that the legal work done by the mortgage processing industry behind this case
was deficient, they [the Halls] don’t have anything further to do in this case, and would
accept the dismissal.” See Brief (Dkt. No. 14) at p. 2. The 11 attachments include an
unsigned document entitled “Facts of Evidence for Bryon Hall and Annette Hall
Mortgage Loan from 2005-2013,” along with various mortgage documents and letters.
Plaintiffs are represented by counsel. Counsel understands that the Court is not a
regulatory agency charged with monitoring the mortgage industry. Instead, the Court
resolves claims that are pled in a complaint. To resolve a motion to amend a complaint,
the Court needs a proposed amended complaint. The Court’s Local Rule 15.1 requires
that “[t]he proposed amended pleading must be submitted at the time of filing a motion to
amend.” No such proposed amended pleading was filed by plaintiffs. The Court’s earlier
decision identified the flaws in the original complaint, and the Court can find nothing in
the materials submitted indicating that those flaws have been cured. Consequently, the

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motion to amend must be denied, and the motion to dismiss must be granted. The Court
will enter a separate Judgment as required by Rule 58(a).1

DATED: February 6, 2015

_________________________
B. Lynn Winmill
Chief Judge
United States District Court

1

There is a pending motion for Temporary Restraining Order (docket no. 3) that was rendered moot by a Stipulation
entered into by the parties and approved by the Court.

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