McCray v. Wells Fargo Bank, NA, et al.

Filing 43

MEMORANDUM OPINION. Signed by Judge George Levi Russell, III on 1/24/2014. (c/m 1/24/2014 aos, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
RENEE L. MCCRAY,

:

Plaintiff,

:

v.

:
Civil Action No. GLR-13-1518

FEDERAL HOME LOAN MORTGAGE
CORPORATION, et al.,

:
:

Defendants.
:
MEMORANDUM OPINION
Pending before the Court are Defendants Wells Fargo Bank,
N.A.

(“Wells

Fargo”)

and

Federal

Home

Loan

Mortgage

Corporation’s (“Freddie Mac”) Motion to Dismiss Plaintiff Renee
L. McCray’s Amended Complaint or in the Alternative Motion for
Summary Judgment (ECF No. 8), and Defendants Samuel I. White,
P.C.

(“SIWPC”)

and

individually

named

Substitute

Trustees’1

(jointly, the “SIWPC Defendants”) Motion to Dismiss the Amended
Complaint (ECF No. 13).

Also pending are McCray’s Motion to

Strike the SIWPC Defendants’ Exhibit 4 and Request for Sanctions
(ECF No. 26), Motion for Leave to File Amended Complaint (ECF
No.

35),

and

Motions

for

leave

to

file

surreplies

to

the

Defendants’ motions for summary judgment (ECF Nos. 37, 38).
1

SIWPC is a Virginia debt collection law firm.
McCray
includes the firm and six of its attorneys, John E. Driscoll,
III, Robert E. Frazier, Jana M. Gantt, Laura D. Harris,
Kimberley Lane, and Deena L. Reynolds, among the defendants in
the first three counts.
The Court will refer to the six
attorneys collectively as “Substitute Trustees.”

McCray brought this action pro se alleging the Defendants
attempted to foreclose on her property without proving they have
a legal right to do so in violation of the Fair Debt Collection
Practices Act (“FDCPA”), 15 U.S.C. §§ 1692 et seq. (2012) (Count
I), the Maryland Fair Debt Collection Act (“MFDCA”), Md. Code
Ann., Com. Law §§ 14-201 et seq. (West 2014) (Count II), the
Maryland Consumer Protection Act (“MCPA”), Md. Code Ann., Com.
Law §§ 13-101 et seq. (West 2014) (Count III), the Truth in
Lending Act (“TILA”), 15 U.S.C. § 1641(g) (2012) (Count IV), and
the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C.
§§ 2601 et seq. (2012) (Count V).

It is important to note that

McCray does not directly challenge the foreclosure proceeding
itself, currently pending in the Circuit Court for Baltimore
City,

Maryland,

on

any

grounds.

She

challenges

only

the

Defendants’ legal right to foreclose without having established
ownership of the Note.
Having reviewed the pleadings and supporting documents, the
Court finds no hearing necessary.
2011).

See Local Rule 105.6 (D.Md.

For the reasons below, the Court will rule as follows:

(1) McCray’s Motion for Leave to File Amended Complaint will be
granted, (2) McCray’s Motion to Strike and Request for Sanctions
will

be

denied,

and

(3)

McCray’s

Motions

for

leave

to

file

surreplies will be denied.

Further, (1) the SIWPC Defendants’

Motion

granted,

to

Dismiss

will

be

2

and

(2)

Wells

Fargo

and

Freddie Mac’s Motion to Dismiss will be granted in part and
denied in part.
BACKGROUND2

I.
A.

The Promissory Note and Deed of Trust
McCray executed a Promissory Note and Deed of Trust with

American Home Mortgage Corporation (“AHMC”) on October 7, 2005,
to refinance her home in Baltimore, Maryland.

The Note provided

that AHMC could transfer the Note, and that anyone who obtained
the Note by transfer was entitled to receive payments under the
Note as the Note Holder.

(Compl. Ex. A, at 1, ECF No. 1-2).

A

copy of the Note filed in the foreclosure action also evidences
endorsements by AHMC and Wells Fargo, making the Note payable to
Wells Fargo as the Note Holder.

(Defs.’ Mem. Supp. Mot. to

Dismiss Am. Compl. or Alt. Mot. for Summ. J. [“Defs.’ Mem. I”]
Ex. 1, at 3, ECF No. 8-2).
The Deed of Trust recognizes AHMC as the original lender
but

also

Systems,

identifies
Inc.

(“MERS”)

successors and assigns.”
B.

the
“as

Mortgage
nominee

Electronic
for

Lender

Registration
and

Lender’s

(Compl. Ex. B, at 3, ECF No. 1-3).

McCray’s Attempts to Seek Validation and Proof of Ownership
of the Note
On

June

14,

2011,

McCray

sent

Wells

Fargo

a

qualified

written request (“QWR”) disputing the amount owed in a monthly
2

Unless otherwise noted, the following facts are stated as
alleged in the Amended Complaint. (ECF No. 6).
3

billing statement.

In the QWR, McCray specifically requested

(1) a complete payment history of her loan, (2) a breakdown of
the

alleged

arrears,

(3)

proof

of

any

and

all

assignments,

sales, and transfers of the Note, (4) the payment dates, purpose
of payment, and recipients of all escrow items charged to her
account, (5) a breakdown of the current escrow charges with
explanations for any increases, and (6) copies of any escrow
statements, and notices of shortages, deficiencies, or surpluses
sent to her throughout the life of her loan.
3, ECF No. 8-4).

(Defs.’ Mem. I Ex.

She also acknowledged Wells Fargo as the

servicer of her loan.

(Id.)

McCray alleges Wells Fargo failed to respond timely, and
that she sent Wells Fargo numerous follow-up requests to respond
to her six inquiries point by point to no avail.

She also

alleges that she solicited assistance or information from ten
attorneys,

law

firms,

government

agencies,

and

private

organizations to get a more satisfactory response from Wells
Fargo.
Fargo

Consequently, on September 14, 2011, McCray sent Wells
a

“Certificate

of

Non-Response/Notice

of

Default”

indicating it had failed to respond to her QWR within sixty
days.
Wells Fargo finally responded to McCray’s QWR on October
10, 2011, providing her a summary of her loan payment history,
an escrow analysis, and copies of the Note and Deed of Trust.
4

(Defs.’ Mem. I Ex. 5, at 1, ECF No. 8-6).
responded

to

McCray’s

“Certificate

of

Wells Fargo also

Non-Response/Notice

Default” two weeks later on October 25, 2011.
Wells

Fargo

informed

McCray

that

all

of

In its response,

inquiries

should

be

addressed to it as servicer of the loan, identified Freddie Mac
as the investor of the loan, and again provided McCray copies of
the Note and Deed of Trust.
On

June

26,

2012,

(Defs.’ Mem. I Ex. 6, ECF No. 8-7).
Wells

Fargo

entered

a

Corporate

Assignment of Deed of Trust in the Circuit Court for Baltimore
City,

Maryland,

conveying

from

MERS

to

Wells

“beneficial interest under the Deed of Trust.”
at 1, ECF No. 1-5).

Fargo

the

(Compl. Ex. D,

Later, on August 20, 2012, Wells Fargo sent

McCray a notice that she had defaulted on her mortgage loan.
response,

McCray

requested

validation

of

the

alleged

In

debt.

Again, McCray alleges she never heard from Wells Fargo about her
requested validation.
On October 4, 2012, SIWPC sent McCray a Notice of Intent to
Foreclose.

Two days later, McCray requested validation of the

debt from SIWPC and alleges, once more, that she never received
a response.

SIWPC initiated the Foreclosure Action on February

23, 2013, filing an Order to Docket and four affidavits.
first

affidavit

certified

that

Freddie

Mac

owns

the

The
loan

evidenced by the Note, and that it authorized Wells Fargo as the
Note

Holder

for

the

purposes

of
5

conducting

the

foreclosure

action.

(Defs.’

Mem.

I

Ex.

8,

ECF

No.

8-9).

The

second

affidavit certified that Wells Fargo possesses the Note and is
responsible for pursuing any delinquencies.
9, ECF No. 8-10).
defaulted

on

her

(Defs.’ Mem. I Ex.

The third affidavit confirmed that McCray
loan

on

May

2,

2012,

by

failing

to

make

payments, and the final affidavit certified that the copies of
the Deed of Trust and Substitution of Trustee filed with the
Order to Docket were true and accurate reproductions of their
originals.

(Defs.’ Mem. I Ex. 10, ECF No. 8-11; Defs.’ Mem. I

Ex. 11, ECF No. 8-12).
On February 25, 2013, in response to finding a Notice of
Foreclosure
requested

Action

posted

validation

of

to

the

her

debt

front
from

door,

SIWPC,

McCray
the

again

Substitute

Trustees, and Freddie Mac’s chief financial officer but still
received no response.
McCray then attempted to receive validation for the debt
three more times.

On March 8, 2013, three days after sending

Wells Fargo another QWR, McCray filed a Notice of Dispute and a
Request

for

Validation

City.

Afterward,

she

with

the

Circuit

sent

another

Court

letter

to

for

Baltimore

Wells

Fargo,

requesting it answer additional questions about her debt and its
validation on April 8, 2013.

McCray alleges that Wells Fargo

never validated the debt and failed to address her questions

6

point by point.

Nevertheless, McCray received another Notice of

Foreclosure Action on April 20, 2013.
C.

Procedural Background
McCray filed her initial five-count, pro se Complaint in

this Court on May 23, 2013, against Freddie Mac, Wells Fargo,
SIWPC, the Substitute Trustees, and twenty unknown individuals
or entities that may claim an interest in her property, listed
in the Complaint as “John Does 1-20.”

(Compl. ¶ 6(j)).

13,

Complaint

bolstering

requested

to

2013,

McCray

allegations

and

filed

reducing

an

Amended

the

award

On June
her

$62,068.39.

Wells Fargo and Freddie Mac filed their Motion to Dismiss or in
the Alternative Motion for Summary Judgment on July 1, 2013.
The SIWPC Defendants filed their Motion to Dismiss the same day.
McCray filed a series of motions over the following two
months.

On August 20, 2013, McCray filed a Motion to Strike

Exhibit 4 of

the

SIWPC

Defendants’

memorandum in support of

their Motion to Dismiss, as well as a request for sanctions
against them for filing a false document.

McCray then filed a

Motion for Leave to file a Second Amended Complaint on September
3,

2013.

Motions

Finally,
for

Leave

on
to

September
File

9,

2013,

Sur-Reply,

one

McCray
for

filed
the

two

SIWPC

Defendants’ Motion to Dismiss, and the other for Wells Fargo and
Freddie Mac’s Motion to Dismiss.
these motions below.
7

The Court will address each of

II.
A.

DISCUSSION

McCray’s Motion for Leave to File Amended Complaint
1.

Leave to File Second Amended Complaint

The Court will grant McCray’s Motion for Leave to file her
Second

Amended

Complaint.

The

decision

to

grant

McCray’s

Motion, however, will not moot the Defendants’ pending Motions
to Dismiss.
court

Under Federal Rule of Civil Procedure 15(a), “[t]he

should

justice

so

freely

give

requires.”

leave

[to

Fed.R.Civ.P.

amend

a

complaint]

15(a)(2).

Although

when
the

federal rules favor granting leave to amend, the decision lies
within the sound discretion of the district court.

Medigen of

Ky., Inc. v. Pub. Serv. Comm’n of W. Va., 985 F.2d 164, 167–68
(4th

Cir.

1993).

Leave

to

amend

is

properly

denied

when

amendment would prejudice the opposing party, the moving party
has exhibited bad faith, or amendment would be futile.

Edell &

Assocs., P.C. v. Law Offices of Peter G. Angelos, 264 F.3d 424,
446 (4th Cir. 2001).
The most significant change McCray makes in her proposed
Second Amended Complaint is withdrawing Counts II and III of her
Amended Complaint.
Inc.

d/b/a

She also adds Wells Fargo Home Mortgage,

America’s

Mortgage”)

as

a

additional

facts

Servicing

defendant

and

discovered

Company
augments

“upon

(“Wells
her

continued

Fargo

Home

allegations

with

investigation.”

(Pl.’s Mot. Leave to File Am. Compl. at 2, ECF No. 35).
8

Because

the Defendants consent to McCray withdrawing Counts II and III
of her Amended Complaint, the Court will allow her to do so.3
2.

The Effect on the Defendants’ Pending Motions

The Defendants remain neutral as to whether McCray’s other
proposed changes merit amendment.

They argue only that their

pending Motions to Dismiss should remain unaffected if the Court
grants leave because Wells Fargo Home Mortgage is not a new
party and McCray’s additional allegations are restatements of
the allegations already contained in the Amended Complaint.

The

Court agrees.
When a plaintiff files an amended complaint, it generally
moots

any

pending

motions

complaint is superseded.

to

dismiss

because

the

original

See Pac. Bell Tel. Co. v. Linkline

Commc’ns, Inc., 555 U.S. 438, 456 n.4 (2009) (“Normally, an
amended

complaint

supersedes

the

original

complaint.”).

In

certain instances, however:
Defendants should not be required to file a new motion
to dismiss simply because an amended pleading was
introduced while their motion was pending. If some of
the defects raised in the original motion remain in
the new pleading, the court simply may consider the
motion as being addressed to the amended pleading. To
hold otherwise would be to exalt form over substance.

3

The Court notes that claims against John Does 1-20 remain
in the Second Amended Complaint.
As a result, McCray has 120
days from the date of the accompanying Order to serve John Does
1-20. See Fed.R.Civ.P. 4(m). If McCray fails to file proof of
service within 120 days, the Court will dismiss this action as
to John Does 1-20 without further notice.
9

Buechler v. Your Wine & Spirit Shoppe, Inc., 846 F.Supp.2d 406,
415 (D.Md. 2012) (quoting 6 Charles Alan Wright et al., Federal
Practice & Procedure § 1476 (3d ed. 2010) (internal quotation
marks omitted)).
Although the Court will grant McCray’s Motion for Leave to
File

Amended

Complaint,

the

Court

will

not

Defendants to file new motions to dismiss.
other

proposed

Motions.

changes

materially

require

the

None of McCray’s

affect

the

Defendants’

McCray adds Wells Fargo Home Mortgage as a defendant

but concedes it is “a division of Wells Fargo Bank, N.A.,” which
is

already

a

defendant

in

this

action.

Wells

Fargo

Home

Mortgage is not a separately incorporated entity and thus is not
a new party.
existing

The remaining proposed allegations either restate

allegations

or

fail

to

address

the

Defendants raise in their Motions to Dismiss.
Court

will

consider

their

Motions

to

arguments

the

As a result, the

Dismiss

as

addressing

McCray’s Second Amended Complaint.4
B.

McCray’s Motion to Strike and Request for Sanctions
McCray moves this Court to strike Exhibit 4 attached to the

SIWPC Defendants’ memorandum in support of its Motion to Dismiss
4

Regarding futility, although the Second Amended Complaint
otherwise adds nothing of substance, the Court will grant
McCray’s Motion in light of the fact she voluntarily seeks to
withdraw two counts with the Defendants’ consent. Granting her
Motion “avoid[s] an unnecessary procedural issue.” West v. CSX
Corp., No. JFM-05-3256, 2006 WL 373843, at *1 n.1 (D.Md. Feb.
16, 2006).
10

and

requests

submitting

a

sanctions
false

against

document.5

the

SIWPC

Although

the

Defendants
Court

will

for
deny

McCray’s Motion and request for sanctions, it will also decline
to

consider

Exhibit

4

in

determining

the

SIWPC

Defendants’

Motion to Dismiss because McCray challenges its authenticity.
Exhibit 4 is a letter from SIWPC to McCray dated December
3, 2012.

(See SIWPC Defs.’ Mem. Supp. Mot. to Dismiss Am.

Compl. Ex. 4, ECF No. 13-5).

In it, SIWPC acknowledges having

received McCray’s October 6, 2012 letter in which she requested
validation of her debt from SIWPC.

SIWPC also affirms her debt

is due and identifies itself as a debt collector attempting to
collect her debt.

The letter indicates SIWPC sent it by regular

and certified mail, and includes a twenty-digit “Return Receipt
Requested N[umber].”

(Id.)

McCray argues the letter is a false document intended to
discredit her and dismiss her claims.

She avers that she never

received the letter and that the United States Postal Service
has no record of the twenty-digit receipt number it bears.

The

SIWPC Defendants contend their records indicate the opposite.
According

to

the

SIWPC

Defendants,

5

under

the

firm’s

mailing

McCray cites federal criminal statute 18 U.S.C. § 1623(a)
on false declarations before a grand jury or court.
Private
individuals cannot bring civil claims under federal criminal
statutes. Betts v. Montgomery Cnty., No. 12–cv–3802–AW, 2013 WL
4478192, at *9 n.10 (D.Md. Aug. 16, 2013). Regardless, McCray’s
requests merit discussion.
11

procedures at the time, mailed letters

were scanned as

documents and uploaded to their system.

.pdf

The SIWPC Defendants

argue Exhibit 4 was scanned and uploaded per those procedures,
indicating it had been mailed.

They insinuate that the twenty-

digit receipt number is a typo.

The Court is persuaded by the

SIWPC Defendants because an inconsistent receipt number does not
inescapably signal a false document.
McCray’s allegations are no small matter.

See Green v.

Mayor & City Council of Balt., 198 F.R.D. 645, 647 (D.Md. 2001)
(“‘Once a litigant chooses to practice fraud, that misconduct
infects his cause of action . . . .’” (quoting Aoude v. Mobil
Oil Corp., 892 F.2d 1115, 1121 (1st Cir. 1989))).
certifies

to

the

best

of

his

“knowledge,

Every party

information,

and

belief” that any writing he submits to the Court has evidentiary
support

and

is

not

submitted

Fed.R.Civ.P. 11(b)(1), 11(b)(3).
conclude

Exhibit

4

is

a

for

any

improper

purpose.

But it is a logical fallacy to

false

document

because

the

Postal

Service has no record of the twenty-digit receipt number it
contains.
mailing

Given that Exhibit 4 follows the SIWPC Defendants’

procedure,

and

no

viable

reason

has

been

raised

to

indicate otherwise, the SIWPC Defendants can reasonably conclude
the letter was mailed to the best of their knowledge.

The Court

will thus deny McCray’s Motion to Strike Exhibit 4 and decline
her request for sanctions.
12

McCray nevertheless implicates the standard for considering
documents
challenging

attached
Exhibit

to

a

4’s

defendant’s

motion

authenticity.

See

to

dismiss

Chesapeake

by
Bay

Found., Inc. v. Severstal Sparrows Point, LLC, 794 F.Supp.2d
602, 611 (D.Md. 2011)

(“[A]

court may consider [an attached

document] in determining whether to dismiss the complaint . . .
if the plaintiffs do not challenge its authenticity.” (quoting
Am. Chiropractic Ass’n v. Trigon Healthcare, Inc., 367 F.3d 212,
234

(4th

Cir.

2004)

(internal

quotation

marks

omitted))).

Because McCray challenges its authenticity, the Court will not
consider Exhibit 4 in determining whether to dismiss her Second
Amended Complaint.
C.

McCray’s Motions for Leave to File a Surreply
McCray has also moved for leave to file surreplies to the

Defendants’

Motions

to

Dismiss,

arguing

correct alleged misstatements of the facts.

they

are

needed

to

The Court will deny

the Motions because they are unnecessary.
“Unless otherwise ordered by the Court, surreply memoranda
are not permitted to be filed.”

Local Rule 105.2(a) (2011).

“Surreplies may be permitted when the moving party would be
unable to contest matters presented to the court for the first
time in the opposing party’s reply.”

Khoury v. Meserve, 268

F.Supp.2d 600, 605 (D.Md. 2003) (citing Lewis v. Rumsfeld, 154
F.Supp.2d 56, 61 (D.D.C. 2001)).
13

The Defendants’ replies do not

raise any new issues.
McCray

presented

in

They directly address the contentions
her

responses.

Conversely,

McCray’s

“factual” concerns are mostly disputes over conclusions of law
that she addresses by reiterating arguments she previously made
in her responses to the Defendants’ Motions to Dismiss.

Because

McCray had an adequate opportunity to address those concerns,
the Court will deny her Motions for leave to file surreplies.
D.

The Defendants’ Motions to Dimiss or, in the Alternative,
for Summary Judgment
1.
To

Standard of Review
survive

a

Federal

Rule

of

Civil

Procedure

12(b)(6)

motion, the complaint must allege facts that, when accepted as
true, “state a claim to 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)) (internal quotation
marks omitted).

A claim is plausible on its face when “the

plaintiff pleads factual content that allows the Court to draw
the reasonable inference that the defendant is liable for the
misconduct alleged.”

Id. (citing Twombly, 550 U.S. at 556).

Legal conclusions or conclusory statements do not suffice and
are

not

entitled

to

the

assumption

Twombly, 550 U.S. at 555).

of

truth.

Id.

(citing

Thus, the Court “must determine

whether it is plausible that the factual allegations in the
complaint

are

enough

to

raise

14

a

right

to

relief

above

the

speculative level.”

Monroe v. City of Charlottesville, 579 F.3d

380, 386 (4th Cir. 2009) (quoting Andrew v. Clark, 561 F.3d 261,
266 (4th Cir. 2009)) (internal quotation marks omitted).
In determining whether to dismiss, the Court must examine
the complaint as a whole, consider the factual allegations in
the complaint as true, and construe the factual allegations in
the light most favorable to the plaintiff.

Albright v. Oliver,

510 U.S. 266, 268 (1994); Lambeth v. Bd. of Comm’rs of Davidson
Cnty., 407 F.3d 266, 268 (4th Cir. 2005).

The Court, however,

may consider documents integral to, or specifically referenced
by, the complaint without converting the motions into ones for
summary judgment.

Tellabs, Inc. v. Makor Issues & Rights, Ltd.,

551 U.S. 308, 322 (2007).

It may also consider public real

estate records when ruling on a motion to dismiss.

Terry v.

Mortg. Elec. Registration Sys., Inc., No. 8:13–cv–00773–AW, 2013
WL 1832376, at *2 n.1 (D.Md. Apr. 30, 2013) (citing Sec’y of
State for Defence v. Trimble Navigation Ltd., 484 F.3d 700, 705
(4th

Cir.

2007)).

converting

the

As

such,

Defendants’

the

Motions

Court
to

will

proceed

Dismiss

into

without

ones

for

summary judgment.
2.

Special Consideration for Pro Se Litigants

Pro se pleadings are liberally construed and held to a less
stringent standard than pleadings drafted by lawyers.

Erickson

v. Pardus, 551 U.S. 89, 94 (2007) (quoting Estelle v. Gamble,
15

429 U.S. 97, 106 (1976)); accord Brown v. N.C. Dep’t of Corr.,
612

F.3d

720,

724

(4th

Cir.

2010).

Pro

se

complaints

are

entitled to special care to determine whether any possible set
of facts would entitle the plaintiff to relief.
449 U.S. 5, 9–10 (1980).

Hughes v. Rowe,

But even a pro se complaint must be

dismissed if it does not allege “a plausible claim for relief.”
Forquer v. Schlee, No. RDB-12-969, 2012 WL 6087491, at *3 (D.Md.
Dec. 4, 2012) (citations and internal quotation marks omitted).
“While pro se complaints may represent the work of an untutored
hand requiring special judicial solicitude, a district court is
not required to recognize obscure or extravagant claims defying
the most concerted efforts to unravel them.”

Weller v. Dep’t of

Soc. Servs. for the City of Balt., 901 F.2d 387, 391 (4th Cir.
1990) (quoting Beaudett v. City of Hampton, 775 F.2d 1274, 1277
(4th Cir. 1985)) (internal quotation marks omitted).
3.

Analysis
a.

Subject Matter Jurisdiction and Standing

As a preliminary matter, the SIWPC Defendants argue the
Second Amended Complaint should be dismissed under Federal Rule
of Civil Procedure 12(b)(1) for lack of a justiciable case or
controversy,
McCray

and

admitted

properly
mediation

brought
in

because
the
by

state

McCray

lacks

underlying
requesting

court.

They
16

standing.

foreclosure
a

loan
also

They

proceeding

modification
argue

argue

McCray

was

through
has

not

sustained damages or injury because she remains in her house and
does not deny that her underlying debt is in default and subject
to foreclosure.

McCray responds that she does not concede any

alleged

and

default

similarly

disputed

the

debt

during

still-pending foreclosure proceeding in state court.

the

She does

not address the SIWPC Defendants’ assertion that she has not
suffered an injury.

Nevertheless, the Court will refuse to

dismiss on these grounds.
Rule
subject

12(b)(1)

matter

governs

motions

jurisdiction.

to

While

dismiss

the

for

plaintiff

lack
bears

of
the

burden of proving the court has jurisdiction over the claim or
controversy at issue, a 12(b)(1) motion should only be granted
if the “material jurisdictional facts are not in dispute and the
moving

party

is

entitled

to

prevail

as

a

matter

of

law.”

Ferdinand–Davenport v. Children’s Guild, 742 F.Supp.2d 772, 777
(D.Md. 2010).

In a motion to dismiss for lack of subject matter

jurisdiction, the pleadings should be regarded as “mere evidence
on the issue,” and courts “‘may consider evidence outside the
pleadings without converting the proceeding to one for summary
judgment.’”

Evans v. B.F. Perkins Co., a Div. of Standex Int’l

Corp., 166 F.3d 642, 647 (4th Cir.

1999)

(quoting

Richmond,

Fredericksburg & Potomac R.R. Co. v. United States, 945 F.2d
765, 768 (4th Cir. 1991)).

17

The

Court

jurisdiction.

will

decline

to

dismiss

for

subject

matter

Although the foreclosure proceeding is currently

pending in state court, McCray raises three federal claims here.
There

is

no

indication

addressed

by

the

argument

that

state

McCray

these

issues

court.

As

conceded

the

have

to

been

the

or

SIWPC

foreclosure

will

be

Defendants’

proceeding

was

properly brought, the record shows McCray requested mediation as
an

alternate

foreclosure

means

and

not

of

resolving

because

she

her
sought

contentions
a

loan

with

the

modification.

(See Pl.’s Resp. Opp’n Defs.’ Mot. to Dismiss Am. Compl. Ex. H,
at 1, ECF No. 18-5).

In attempting to use mediation to dispute

the foreclosure action, McCray did not concede its validity and
may still proceed here.
Similarly, the Court will also refuse to dismiss for lack
of

standing.

To

establish

standing,

the

plaintiff

must

demonstrate that: (1) she has suffered an injury in fact that is
concrete,

particularized,

and

imminent;

(2)

that

injury

is

fairly traceable to, or caused by, the challenged action of the
defendant; and (3) it is likely, rather than conjectural, that
the injury will be redressed by a favorable decision.
Defenders of Wildlife, 504 U.S. 555, 560–61 (1992).

Lujan v.
Absent an

evidentiary hearing, the court accepts the relevant allegations
of the complaint as true.
(4th Cir. 1982).

Adams v. Bain, 697 F.2d 1213, 1219

The burden, however, remains on the plaintiff
18

to

establish

standing.
(1990)

the

allegations

are

sufficient

to

support

See FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 231

(noting

invoking
“facts

that

the

that

it

court’s

demonstrating

is

“long-settled”

jurisdiction
that

he

is

bears
a

that

the

burden

proper

of

party

person
alleging

to

invoke

judicial resolution of the dispute” (quoting Warth v. Seldin,
422 U.S. 490, 518 (1975)).
Other than noting that she “accrued considerable expense”
during her failed attempts to compel the Defendants to respond
to

her

QWRs,

McCray

does

injuries.

Instead,

against

Defendants

the

not

McCray
for

expressly

requests
their

allege

alleged

concrete

$62,068.39

a

any

judgment

violations

of

the

FDCPA, equivalent to the amount owed on her Note as of November
2012.

(Defs.’ Mem. I Ex. 9, at 1, ECF No. 8-10).

remains,
amount

however,

she

that

allegedly

McCray

owes

to

faces
the

imminent

Defendants.

The fact

injury
As

a

in

the

result,

McCray has sufficiently demonstrated standing and the Court will
not dismiss her action on these grounds.
b.

FDCPA Violations
i.

The

Court

Applicability
Defendants

will

grant

the

Dismiss McCray’s FDCPA claim.
against all Defendants.

of

the

SIWPC

FDCPA

to

Defendants’

the

SIWPC

Motion

to

McCray brings her FDCPA claim

She specifically alleges the Defendants

19

violated §§ 1692g(b), 1692e(2)(A), 1692e(5), and 1692f(1) of the
FDCPA by proceeding with the foreclosure without validating her
debt,

falsely

representing

the

amount,

character,

and

legal

status of her debt, threatening to take an action on her debt
that

cannot

legally

be

taken,

and

attempting

to

collect

an

amount on her debt not authorized by an agreement.
To

state

a

claim

under

the

FDCPA,

plaintiffs

must

sufficiently allege (1) they were the object of a collection
activity arising from a consumer debt, (2) the defendant is a
debt collector as defined by the FDCPA, and (3) the defendant
engaged in an act or omission prohibited by the FDCPA.

Dikun v.

Streich, 369 F.Supp.2d 781, 784–85 (E.D.Va. 2005) (citing Fuller
v.

Becker

&

Poliakoff,

192

F.Supp.2d

1361

(M.D.Fla.

2002)).

“Debt collector” under the FDCPA generally encompasses anyone
“who

regularly

collects

or

attempts

to

collect,

directly

or

indirectly, debts owed or due or asserted to be owed or due
another.”

15 U.S.C. § 1692a(6).

The Court must distinguish

between debt collectors, on the one hand, and creditors, on the
other, because the FDCPA does not apply to creditors.

Schlosser

v. Fairbanks Capital Corp., 323 F.3d 534, 536 (7th Cir. 2003).
“Creditors” include “any person who offers or extends credit
creating

a

debt

or

to

whom

a

1692a(4).

20

debt

is

owed.”

15

U.S.C.

§

The SIWPC Defendants argue the claim should be dismissed as
to them because they are not debt collectors under the FDCPA.
McCray responds that the SIWPC Defendants are debt collectors
because their activities exceeded those required to foreclose on
her property, evidenced by a foreclosure notice SIWPC sent her
containing, “This is an attempt to collect a debt.”
Compl. ¶ 30, ECF No. 35-1).

(Second Am.

Critical for the SIWPC Defendants

is whether that notice was in fact a demand for payment and thus
an attempt to collect a debt.
Trustees,

LLC,

No.

They rely on Blagogee v. Equity

1:10-CV-13

(GBL-IDD),

2010

WL

2933963

(E.D.Va. July 26, 2010), to argue they are excluded under the
FDCPA because they were merely acting within their fiduciary
capacity.

The Court agrees.

Blagogee

distinguished

between

notice

letters

used

to

initiate foreclosure proceedings and those amounting to indirect
attempts to collect a debt.

Even when a communication includes,

“This is an attempt to collect a debt,” it is not an attempt to
collect a debt unless there is an express demand for payment and
other “specific information about the debt, including the amount
of

the

debt,

the

creditor

to

whom

the

debt

is

owed,

the

procedure for validating the debt, and to whom the debt should
be paid.”

Id. at *5–6 (quoting Wilson v. Draper & Goldberg,

PLLC, 443 F.3d 373, 375 (4th Cir. 2006)) (internal quotation

21

marks

omitted);

accord

Moore

v.

Commonwealth

Trs.,

LLC,

No.

3:09CV731, 2010 WL 4272984, at *4 (E.D.Va. Oct. 25, 2010).
Here, McCray does not allege any facts indicating the SIWPC
Defendants were engaged in any attempt to collect her debt.

She

does not allege that SIWPC’s notice letter contained any express
demand for payment or specific information about her debt.

Nor

does she allege the letter contained the amount of her debt, the
creditor to whom her debt is owed, the procedure for validating
the debt, or to whom her debt should be paid.
claim

will

be

dismissed

as

to

the

SIWPC

Accordingly, this
Defendants

because

McCray fails to allege sufficiently that the SIWPC Defendants
are debt collectors under the FDCPA.
ii.

Applicability of the FDCPA to Wells Fargo
and Freddie Mac

The Court will also grant Wells Fargo and Freddie Mac’s
Motion to Dismiss as to FDCPA claim.

Wells Fargo and Freddie

Mac also argue they are not debt collectors under the FDCPA and
that, regardless, McCray fails to allege any plausible FDCPA
violation.

McCray’s

response

walks

a

fine

line:

For

the

purposes of this count, she contends, relying on Schlosser v.
Fairbanks Capital Corporation, 323 F.3d 534 (7th Cir. 2003),
that Wells Fargo is a debt collector
assigned

Wells

defaulted.

Fargo

McCray

because

the

Deed

of

makes

this

argument

22

Trust

MERS

allegedly

she

allegedly

after
despite

insisting

no

record

exists

of

her

Note

ever

being

sold,

transferred to Wells Fargo or Freddie Mac.

assigned,

or

She also maintains

that Freddie Mac has yet to prove it owns her Note and is, at
best,

a

third-party

debt

collector.

Nonetheless,

the

Court

agrees with Wells Fargo and Freddie Mac.
Neither can be held liable under the FDCPA because they are
creditors,

not

debt

collectors.

See

Wilson

v.

Draper

&

Goldberg, P.L.L.C., 443 F.3d 373, 379 n.2 (4th Cir. 2006) (“[A]
company’s own efforts to collect overdue payments from its own
delinquent clients would not ordinarily make it a debt collector
under the Act, which specifically refers to those who collect
debts

owed

(quoting

15

or

due
U.S.C.

or

asserted

§

to

1692a(6))

be

owed

or

(internal

due

another.”

quotation

marks

omitted)); Townsend v. Fed. Nat’l Mortg. Ass’n, 923 F.Supp.2d
828, 840 (W.D.Va. 2013) (noting that creditors are not debt
collectors and are exempt from liability under the FDCPA).
While the FDCPA “treats assignees as debt collectors if the
debt sought to be collected was in default when acquired by the
assignee,”

McCray’s

reliance

on

Schlosser

is

misplaced.

Schlosser, 323 F.3d at 536; see 15 U.S.C. § 1692a(6)(F)(iii)
(excluding persons collecting a debt not already in default at
the time they obtained that debt).

In Schlosser, the United

States Court of Appeals for the Seventh Circuit held that a loan
servicing company was a debt collector under the FDCPA when it
23

knowingly acquired a debt in default and initiated collection
activities based on that understanding.
court

noted

borrower

as

the
a

relationship

key

between

Id. at 537–38.

distinction

between

the

assignee

debt

The

and

the

collectors

and

creditors under the FDCPA, explaining that, “If the loan is in
default, no ongoing relationship is likely [between the assignee
and borrower] and the only activity will be collection.”

Id. at

538.
Here, Wells Fargo has maintained an ongoing relationship
with

McCray

extending

far

beyond

debt

collection

activities.

For example, although it is unclear when Wells Fargo acquired
McCray’s debt from AHMC, Wells Fargo has been servicing her loan
since at least June 2011, nearly a year before she defaulted in
May 2012.

(See Defs.’ Mem. I Ex. 3).

For years, it accepted

McCray’s payments, informed her when payments were late, and
provided a copy of her payment history when asked.

Not only did

Wells Fargo acquire a debt not in default, but it had also done
so as more than simply a debt collector.

The same could be said

for Freddie Mac, which acquired its interest in McCray’s loan at
some point prior to October 2011.
Wells Fargo and Freddie Mac are not debt collectors under
the statutory definition, and McCray, therefore, fails to state
a claim under the FDCPA.

The claim will be dismissed as to

Freddie Mac, Wells Fargo, and the SIWPC Defendants.
24

c.

TILA Violation

McCray

next

brings

her

TILA

claim

Wells Fargo, and John Does 1-20.

against

Freddie

Mac,

She alleges she was never

notified that MERS assigned her Deed of Trust to Wells Fargo on
July 3, 2012, and despite their ownership claims, there is no
public record indicating that Freddie Mac and John Does 1-20 own
her Note.

As a result, she claims, Freddie Mac, Wells Fargo,

and John Does 1-20 violated 15 U.S.C. § 1641(g).
Freddie Mac and Wells Fargo argue the July 3, 2012 transfer
from

MERS

does

not

implicate

§

1641(g)

because

assigned its beneficial interest in the loan.

MERS

only

The Court agrees

and will dismiss the TILA claim as to Freddie Mac and Wells
Fargo.

For similar reasons, outlined below, the Court will also

dismiss the TILA claim as to John Does 1–20.
As

to

McCray’s

Wells

Fargo,

mortgage

interest.

loan

it

did

when

not

MERS

become
conveyed

a

new
its

owner

of

beneficial

Section 1641(g) of TILA requires new mortgage loan

owners or assignees to notify borrowers within thirty days of
any sale, transfer, or assignment of the mortgage loan to a
third party.

15 U.S.C. § 1641(g)(1).

A creditor is not a new

owner of the mortgage loan under § 1641(g), however, “unless the
creditor acquires legal title to, or otherwise assumes, the debt
underlying the mortgage.”
where

MERS

is

only

a

Terry, 2013 WL 1832376, at *2.

nominal

beneficiary
25

under

the

Thus,

deed

of

trust, it does not hold legal title and an assignment of its
beneficial interest to the holder of the underlying mortgage
does not implicate § 1641(g).

Id. at *3.

Here, the Deed of Trust denotes MERS as “[t]he beneficiary
of this Security Instrument . . . solely as nominee for Lender
and

Lender’s

successors

and

assigns,”

establishing

that

held only a beneficial interest in the Deed of Trust.
Ex. B, at 3).

MERS

(Compl.

Thus, MERS conveyed its beneficial interest, not

legal title, to Wells Fargo in its July 3, 2012 assignment, and
the assignment

does not implicate § 1641(g).

McCray’s TILA

claim, therefore, will be dismissed as to Wells Fargo.
As to McCray’s allegations against Freddie Mac, Wells Fargo
and Freddie Mac argue McCray fails to allege any sale, transfer,
or

assignment

Congress

of

amended

her

loan

TILA

to

to
add

Freddie
the

Mac

notice

after

2009,

when

requirement.

See

Helping Families Save Their Homes Act of 2009, Pub. L. No. 11122, 123 Stat. 1632 (codified as amended in scattered sections of
15 U.S.C.) (adding TILA’s notice requirement).

They also argue

McCray was notified of Freddie Mac’s involvement no later than
October 25, 2011, and that her claim should be barred by TILA’s
one-year

statute

of

limitations.

See

15

U.S.C.

§

1640(e)

(“[A]ny action under this section may be brought . . . within
one year from the date of the occurrence of the violation.”).

26

McCray’s response is curious.
exists

of

her

Note

ever

She contends that no record

having

been

sold,

assigned,

or

transferred to Freddie Mac, which implies that Freddie Mac has
no interest in her loan and, if accepted by the Court, would
nullify her TILA claim.

Her next argument assumes the opposite,

reiterating that she never received notice of when Freddie Mac
allegedly received ownership of her Note.

Lastly, McCray argues

the statute of limitations has not lapsed because she was not
aware of when the violations occurred.

The Court finds Wells

Fargo and Freddie Mac to be more persuasive.
Nowhere in her Complaint or subsequent briefings to the
Court does McCray allege any sale, transfer, or assignment of
her loan to Freddie Mac after Congress amended TILA to require
notice.

Nor does the record indicate precisely when Freddie Mac

became the investor of the loan.

The earliest documentation of

Freddie Mac’s involvement is the October 25, 2011 letter Wells
Fargo sent McCray naming Freddie Mac as the investor.

Because

McCray received the letter in 2011, after TILA was amended to
require notice, she may have possibly established a TILA claim
against Freddie Mac at that time.

The window to file that

claim, however, lapsed one year later, well before she initiated
this action on May 23, 2013.
As a consequence, the Court will dismiss this claim as to
Freddie Mac because the statute of limitations bars McCray from
27

bringing

a

TILA

claim

based

on

the

one

concrete

levied against it, the October 25, 2011 letter.

allegation

To the extent

other possible TILA claims exist against Freddie Mac, McCray
alleges no facts giving rise to a viable TILA claim against
Freddie Mac subsequent to when Congress amended TILA in 2009 to
require notice of a transfer, sale, or assignment.
Finally, although they have yet to be served and do not
join in Wells Fargo and Freddie Mac’s Motion to Dismiss, the
Court will also dismiss the TILA claim as to John Does 1–20.
The Court may dismiss a complaint for failure to state a claim
sua sponte if it plainly fails to state a claim for relief on
its face.

Eriline Co. S.A. v. Johnson, 440 F.3d 648, 655 n.10

(4th Cir. 2006) (citing 5A Wright & Miller, Federal Practice &
Procedure § 1357 (2d ed. 1990)).
possible

interest

transferred

As previously discussed, any
from

MERS

would

have

been

beneficial and, to date, the land records show only one transfer
subsequent to the TILA amendment.
parties were made.

No other transfers to third

Nor were John Does 1–20 involved in any

transfer during the applicable period.

McCray alleges no set of

facts giving rise to any possible notice claim against John Does
1–20 under TILA.
d.

RESPA Violations

The Court will dismiss McCray’s RESPA claim to the extent
it

references

the

Notice

of

Default
28

and

seeks

damages

for

emotional distress.
seek

and

For the reasons outlined below, McCray may

recover

only

her

actual

damages

for

Wells

Fargo’s

undisputed RESPA violations.
McCray brings her RESPA claim against only Wells Fargo,
based

on

three

instances

in

which

violated 12 U.S.C. § 2605(e).

she

alleges

Wells

Fargo

The first instance involves the

QWR McCray mailed Wells Fargo on June 14, 2011.

She alleges

Wells Fargo failed to respond to that QWR within sixty days.
The

second

instance

implicates

mailed on September 14, 2011.

the

Notice

of

Default

McCray

She alleges Wells Fargo neither

acknowledged its receipt within five business days nor responded
substantively

to

it

within

thirty

days.

Lastly,

the

third

instance concerns the QWR McCray mailed on March 5, 2013, to
which she alleges Wells Fargo failed to respond point by point.
She

also

alleges

that

she

incurred

considerable

expense

and

emotional distress in attempting to receive a response.
Wells

Fargo

and

Freddie

Mac

concede

responded untimely to McCray’s first QWR.

that

Wells

Fargo

They also note Wells

Fargo responded timely to her second QWR, albeit not “point by
point.”

Nevertheless,

they

maintain

that

McCray’s

claim

is

insufficient because she fails to allege any specific damages
caused by the delay
emotional distress.

and

makes no allegation of demonstrable

They also argue the Notice of Default was

29

an attempt to avoid making payments rather than an effort to
obtain information about her loan.
McCray does not respond directly to Wells Fargo and Freddie
Mac’s

contention

that

she

does

not

allege

specific

damages.

Instead, she repeats that Wells Fargo violated RESPA and that
the types of damages she requests are recoverable under the
statute.
Second

Moreover,

Amended

though

Complaint,

not

specifically

McCray

alludes

alleged

that

she

in

can

her
also

recover damages as a result of Wells Fargo’s pattern or practice
of noncompliance.
RESPA requires the servicer of a federally related mortgage
loan to acknowledge receipt of a QWR within five business days.
12 U.S.C. § 2605(e)(1)(A).

Within thirty business days, and

following an investigation, the servicer must provide a written
explanation

containing

a

host

of

information,

including

the

“information requested by the borrower or an explanation of why
the information requested is unavailable or cannot be obtained
by the servicer.”6

Id. § 2605(e)(2)(C)(i).

6

McCray seems to believe her first QWR is subject to
RESPA’s pre-amendment requirements.
Prior to 2010, servicers
had sixty days to respond to QWRs.
Dodd-Frank Wall Street
Reform and Consumer Protection Act, Pub. L. No. 111-203, §
1463(c), 124 Stat 1376, 2185 (2010) (codified as amended in
scattered sections of 12 U.S.C.).
Because McCray mailed her
first QWR in 2011, however, it falls under the amended RESPA
requirements in which Wells Fargo had thirty business days to
respond.
30

At the outset, the Court must determine whether McCray’s
Notice of Default constitutes a QWR subject to RESPA response
times.

The Court concludes it does not.

Section

2605

defines

a

“qualified

written

request”

as

follows:
For purposes of this subsection, a qualified written
request shall be a written correspondence, other than
notice on a payment coupon or other payment medium
supplied by the servicer, that-(i) includes, or otherwise enables the servicer
to identify, the name and account of the
borrower; and
(ii) includes a statement of the reasons for the
belief of the borrower, to the extent applicable,
that the account is in error or provides
sufficient detail to the servicer regarding other
information sought by the borrower.
12 U.S.C. § 2605(e)(1)(B).
Although the Notice of Default provides McCray’s name, it
lacks the remaining information necessary to be a QWR.

Nowhere

does it list McCray’s account number or state the reasons why
she believes her account is in error.

It also does not provide

sufficient

information

detail

as

to

the

account

she

sought.

Rather, the Notice of Default explains that McCray mailed a QWR
on June 14, 2011, and that Wells Fargo failed to respond.
Notice

of

Default,

therefore,

is

not

considered as part of her RESPA claim.

31

a

QWR

and

cannot

The
be

With respect to her actual QWRs, because Wells Fargo and
Freddie Mac have not, at this stage, disputed non-compliance
with

RESPA,

the

remaining

issue

is

whether

McCray

alleges

damages and emotional distress sufficient to state a claim.

The

Court believes she does, in part.
RESPA authorizes plaintiffs to recover actual damages “as a
result of” the defendant’s specific RESPA violation.
§

2605(f)(1)(A).

Tantamount

here

is

whether

12 U.S.C.

McCray

alleges

actual, demonstrable damages causally related to Wells Fargo’s
failure to respond to her QWRs.
Chase

Bank

N.A.,

No.

(S.D.Ohio Dec. 4, 2012).

See Tsakanikas v. JP Morgan

2:11–CV–888,

2012

WL

6042836,

at

*2

McCray alleges she accrued expenses in

her attempts to receive responses to her QWRs, including sending
certified mail, traveling to and from the post office, copying
documents,

and

recoverable

researching

under

RESPA

information.

and

are

These

sufficiently

expenses

alleged.

are
See

Rawlings v. Dovenmuehle Mortg., Inc., 64 F.Supp.2d 1156, 1164
(M.D.Ala. 1999) (concluding the plaintiff could recover out of
pocket expenses under RESPA for correspondence and travel).
McCray also alleges she endured enormous undue stress and
frustration.

Courts, particularly in this circuit, are split on

whether plaintiffs can recover damages for emotional distress
under RESPA.

Compare Carter v. Countrywide Home Loans, Inc.,

No. 3:07CV651, 2009 WL 1010851, at *5 (E.D.Va. Apr. 14, 2009)
32

(holding that emotional distress damages are recoverable under
RESPA), with Luther v. Wells Fargo Bank, No. 4:11cv00057, 2012
WL

4405318,

2012)

(concluding

emotional distress is not recoverable under RESPA).

Regardless,

that

at

McCray

*7

n.6

simply

(W.D.Va.

alleges

Aug.

6,

emotional

distress,

without

supporting facts, “is insufficient to satisfy the specificity by
which emotional distress claims must be stated.”

Luther, 2012

WL 4405318, at *7 n.6; accord Ross v. FDIC, 625 F.3d 808, 818
(4th

Cir.

2010)

suffered

(“[C]onclusory

emotional

distress

compensatory damages.”

statements

do

not

that

support

the

plaintiff

an

award

of

(citation and internal quotation marks

omitted)).
As a result, the Court will dismiss McCray’s RESPA claim in
part, to the extent it relies on her Notice of Default and seeks
relief for emotional distress.
III. CONCLUSION
For
Order,

the

(1)

Complaint,

foregoing

GRANT
(2)

reasons,

McCray’s

DENY

the

Motion

McCray’s

Court

for

Motion

will,

Leave
to

to

by

separate

File

Amended

Strike

the

SIWPC

Defendants’ Exhibit 4 and Request for Sanctions, and (3) DENY
McCray’s Motions for leave to file surreplies.

Moreover, the

Court will (1) GRANT the SIWPC Defendants’ Motion to Dismiss
McCray’s Second Amended Complaint, and (2) GRANT in part and
DENY in part Wells Fargo and Freddie Mac’s Motion to Dismiss
33

McCray’s Second Amended Complaint.

The Court will GRANT the

Motion in part as to McCray’s FDCPA and TILA claims, and to the
extent her RESPA claim relies on the Notice of Default and seeks
damages for emotional distress.

The Court will DENY the Motion

as to what remains of McCray’s RESPA claim.

Lastly, the Court

will dismiss McCray’s TILA claim as to John Does 1–20.
Entered this 24th day of January, 2014
/s/
_____________________________
George L. Russell, III
United States District Judge

34