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

Filing 97

MEMORANDUM OPINION. Signed by Judge George Levi Russell, III on 3/31/2017. (GLR 16-cv-0934). (c/m 3/31/17 bas, Deputy Clerk).

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

*

Plaintiff,

*

v.

*

SAMUEL I. WHITE, P.C., et al.,

*

Defendants.

Civil Action No. GLR-16-934

*
MEMORANDUM OPINION

THIS MATTER is before the Court on Defendants’1 Motion to
Dismiss under Federal Rule of Civil Procedure 12(b)(6) or, in the
alternative, for Summary Judgment under Rule 56.

(ECF No. 7).

The

Motion is ripe for disposition, and no hearing is necessary.

See

Local Rule 105.6 (D.Md. 2016).

For the reasons outlined below, the

Court will grant in part and deny without prejudice in part the
Motion.
I.

BACKGROUND2

This is the third action Plaintiff Renee L. McCray has filed
in this Court to challenge the attempted foreclosure of her home at
109 North Edgewood Street, Baltimore, Maryland (the “Property”).3
1

“Defendants” include those defendants the Court defined in
McCray v. Federal Home Loan Mortgage Corporation (McCray I), No.
GLR-13-1518 (D.Md. filed May 23, 2013) as the “SIWPC Defendants.”
They include Samuel I. White, P.C. and the six individually named
Substitute Trustees: John E. Driscoll, III, Robert E. Frazier, Jana
M. Gantt, Laura D. Harris, Kimberley Lane, and Deena L. Reynolds.
2
The Court draws the facts that follow from McCray’s Complaint
and documents attached to her Complaint.
3
The other two actions are McCray I and McCray v. Wells Fargo,
N.A. (McCray II), No. GLR-14-3445 (D.Md. closed Oct. 14, 2015).
McCray also attempted to remove the state foreclosure action filed
against her in the Circuit Court for Baltimore, City, Maryland.

Subject to one exception that the Court will outline below, in this
action, McCray focuses on the conduct of Defendants after the
United States Bankruptcy Court for the District of Maryland (the
“Bankruptcy Court”) granted her a discharge in 2014.4

Though

McCray alleged in previous actions that Defendants violated the
Fair Debt Collection Practices Act (“FDCPA”)5 in attempting to
foreclose on the Property, she asserts that this action arises out
of “new and continuous violations of the FDCPA.”
ECF

No.

1).

McCray

maintains

that

(Compl. ¶¶ 3, 16,

Defendants

“continue

to

foreclose on [the Property] without providing verified evidence
[that] they have a legal right to do so.”

(Id. ¶ 16).

In September 2013, while a foreclosure was pending on the
Property, McCray filed for Chapter 13 bankruptcy in the Bankruptcy
Court.

(Id. ¶ 24).

The Bankruptcy Court later converted McCray’s

bankruptcy petition into one under Chapter 7.

(Id. ¶ 26).

2014,

McCray’s

the

discharged.

Bankruptcy

Court

(Id. ¶ 27).

ordered

that

In July

debts

be

In December 2015, the Bankruptcy Court

(See Driscoll v. McCray (McCray III), No. GLR-16-1791(D.Md. removed
June 2, 2016). On March 20, 2017, the Court remanded that case for
lack of subject matter jurisdiction. (See McCray III, ECF No. 77)
4
For a discussion of the facts underlying McCray’s mortgage
transaction, see this Court’s January 24, 2014 memorandum opinion
in McCray I. McCray v. Fed. Home Loan Mortg. Corp., No. GLR-131518, 2014 WL 293535 (D.Md. Jan. 24, 2014), aff’d in part, rev’d in
part and remanded, 839 F.3d 354 (4th Cir. 2016). The terms “Note”
and “Deed of Trust” retain their definitions from that opinion.
Also, all references to “Wells Fargo” are references to the “Wells
Fargo Bank, NA” that McCray sued in McCray I.
5
15 U.S.C. §§ 1692 et seq. (2012).
2

issued a final decree and closed McCray’s bankruptcy case.

(Id. ¶

28).
On January 11, 2016, Defendants filed in McCray’s state
foreclosure case a “Notice of Termination of Automatic Stay of 11
U.S.C. Section 362.”
decree

from

intended

to

(Id. ¶ 29).

McCray’s
resume

Defendants attached the final

bankruptcy

foreclosure

case

and

asserted

proceedings.

that

(Id.).

received Defendants’ January 11 notice on January 13, 2016.
30).

they

McCray
(Id. ¶

That same day, McCray sent Defendants a “Notice to Debt

Collector”

in which she afforded

Defendants ten days to (1)

“provide verified evidence that they had a right to continue the
foreclosure action after the bankruptcy discharge,” (id. ¶ 31); (2)
rebut her notice “line by line,” (id.); (3) “cease and desist any
and all foreclosure actions that have not been rendered by a
judgment issued through a court of record,” (id. ¶ 32); and (4)
“provide a verified proof of claim that indicates that you are the
holder in due course,” (ECF No. 1-2 at 4).

Defendants failed to

respond to McCray’s January 13, 2016 notice.

(Compl. ¶ 34).

On February 25, 2016, McCray received from Defendants a notice
dated

February

22,

foreclosure sale.

2016

that

(Id. ¶ 35).

her

home

would

be

sold

in

a

The notice provided the following:

“Pursuant to Maryland Rule 14-210 and pursuant to Section 7-105.2
of the Real Property Article of the Maryland Code, we are hereby
notifying you that the foreclosure sale of [the Property] has been
3

scheduled.”

(ECF No. 1-4 at 3).

Defendants attached a copy of the

newspaper advertisement that they intended to run to set forth the
time,

place,

and

“Advertisement”).

terms

of

the

(Compl. ¶ 35).

foreclosure

sale

(the

The Advertisement states that

“the holder of the indebtedness secured by this Deed of Trust [has]
appointed [Defendants]” to carry out the foreclosure sale.
No.

1-4

at

4).

McCray

alleges

that

Defendants

(ECF

ran

the

Advertisement in The Daily Record on March 4, 11, and 18, 2016 in
the “Public Notice” section.

(Compl. ¶ 45).

She further alleges

that between March 4 and March 21, 2016, Defendants advertised the
foreclosure sale of the Property on the website of Harvey West
Auctioneers, LLC.

(Id. ¶ 44).

On March 2, 2016, McCray sent Defendants a “Demand Notice to
Cease and Desist Foreclosure Sale.”

(Id. ¶ 38).

In addition to

ceasing and desisting from selling her home, McCray’s notice
contained two demands.

First, Defendants must “provide within 72

hours verification of the debt they were collecting, since the
alleged debt was discharged on July 14, 2014 in [the Bankruptcy
Court].”

(Id. ¶ 39).

Second, Defendants must “provide within 72

hours, verification that [the] SIWPC Defendants had an enforceable
security

interest

to

take

any

non-judicial

action

to

effect

dispossession or disablement of [the Property].” (Id. ¶ 40).
When Defendants did not respond to McCray’s March 2, 2016
notice, on March 14, 2016, she sent them a “Notice of Fault and
4

Opportunity to Cure – Demand Notice to Cease and Desist and
Violations of the [FDCPA].”

(Id. ¶ 41).

that Defendants validate the debt.

McCray again requested

(ECF No. 1-5 at 3).

When

Defendants failed to respond, on March 21, 2016, McCray sent them a
“Notice of Default in Dishonor and Consent to Judgment and Notice
of Pending Lawsuit to Enforce Violations of the [FDCPA].”
1-6).

(ECF No.

In her March 21, 2016 notice, McCray appears to assert that

she is entitled to a default judgment that Defendants violated
multiple sections of the FDCPA.

(Id.).

Near the end of her Complaint, McCray abruptly returns to
events that occurred in 2013.

She alleges that in February 2013,

Defendants filed “an illegal substitution of trustee document” in
her state foreclosure case.

(Compl. ¶ 48).

McCray does not,

however, elaborate on why the substitution was illegal.
McCray sued Defendants in this Court on April 4, 2016.
No. 1).

(ECF

She alleges that Defendants violated seven subsections of

Section 1692 of the FDCPA: (1) c(a); (2) c(b); (3) c(c); (4)
e(2)(A); (5) f(6)(A); (6) g(b); and (7) j(a).

Defendants filed

their Motion on May 27, 2016.

McCray filed an

opposition on July 1, 2016.

(ECF No. 7).

(ECF No. 11).

no record that Defendants replied.

5

To date, the Court has

II.
A.

DISCUSSION

Standard of Review
1.

Rule 12(d)

Defendants style their Motion as a motion to dismiss under
Rule 12(b)(6) or, in the alternative, for summary judgment under
Rule 56.

A motion styled in this manner implicates the Court’s

discretion under Rule 12(d).

See Kensington Vol. Fire Dept., Inc.

v. Montgomery Cty., 788 F.Supp.2d 431, 436–37 (D.Md. 2011), aff’d
sub nom., Kensington Volunteer Fire Dep’t, Inc. v. Montgomery Cty.,
684 F.3d 462 (4th Cir. 2012).

This Rule provides that when

“matters outside the pleadings are presented to and not excluded by
the court, the [Rule 12(b)(6)] motion must be treated as one for
summary judgment under Rule 56.”

Fed.R.Civ.P. 12(d).

The Court

“has ‘complete discretion to determine whether or not to accept the
submission of any material beyond the pleadings that is offered in
conjunction with a Rule 12(b)(6) motion and rely on it, thereby
converting the motion, or to reject it or simply not consider it.’”
Wells-Bey v. Kopp, No. ELH-12-2319, 2013 WL 1700927, at *5 (D.Md.
Apr. 16, 2013) (quoting 5C Wright & Miller, Federal Practice &
Procedure § 1366, at 159 (3d ed. 2004, 2012 Supp.)).
The United States Court of Appeals for the Fourth Circuit has
articulated two requirements for proper conversion of a Rule
12(b)(6) motion to a Rule 56 motion: notice and a reasonable
opportunity for discovery.

See Greater Balt. Ctr. for Pregnancy
6

Concerns, Inc. v. Mayor of Balt., 721 F.3d 264, 281 (4th Cir.
2013).

When the movant expressly captions its motion “in the

alternative” as one for summary judgment and submits matters
outside the pleadings for the court’s consideration, the parties
are deemed to be on notice that conversion under Rule 12(d) may
occur.

See Moret v. Harvey, 381 F.Supp.2d 458, 464 (D.Md. 2005).

The Court “does not have an obligation to notify parties of the
obvious.”

Laughlin v. Metro. Wash. Airports Auth., 149 F.3d 253,

261 (4th Cir. 1998).
Ordinarily,

summary

judgment

is

inappropriate

when

“the

parties have not had an opportunity for reasonable discovery.”
E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435,
448 (4th Cir. 2011).
‘cannot

complain

Yet, “the party opposing summary judgment

that

summary

judgment

was

granted

without

discovery unless that party had made an attempt to oppose the
motion on the grounds that more time was needed for discovery.’”
Harrods Ltd. v. Sixty Internet Domain Names, 302 F.3d 214, 244 (4th
Cir. 2002) (quoting Evans v. Techs. Applications & Serv. Co., 80
F.3d 954, 961 (4th Cir. 1996)).

To raise sufficiently the issue

that more discovery is needed, the non-movant must typically file
an affidavit or declaration under Rule 56(d), explaining the
“specified reasons” why “it cannot present facts essential to
justify its opposition.”

Fed.R.Civ.P. 56(d).

7

The Fourth Circuit has warned that it “‘place[s] great weight
on the Rule 56[d] affidavit’ and that ‘a reference to Rule 56[d]
and the need for additional discovery in a memorandum of law in
opposition to a motion for summary judgment is not an adequate
substitute for a Rule 56[d] affidavit.’”
(quoting Evans, 80 F.3d at 961).

Harrods, 302 F.3d at 244

Failing to file a Rule 56(d)

affidavit “is itself sufficient grounds to reject a claim that the
opportunity for discovery was inadequate.”
F.3d at 961).

Id. (quoting Evans, 80

Nevertheless, the Fourth Circuit has indicated that

there are some limited instances in which summary judgment may be
premature notwithstanding the non-movants’ failure to file a Rule
56(d) affidavit.

See id.

A court may excuse the failure to file a

Rule 56(d) affidavit when “fact-intensive issues, such as intent,
are involved” and the nonmovant’s objections to deciding summary
judgment without discovery “serve[] as the functional equivalent of
an affidavit.”

Id. at 245 (quoting First Chicago Int’l v. United

Exch. Co., 836 F.2d 1375, 1380–81 (D.C.Cir. 1988)).
Here,

the

Court

concludes

conversion are satisfied.

that

both

requirements

for

The parties were on notice that the

Court might resolve Defendants’ Motions under Rule 56 because
Defendants style their Motions in the alternative for summary
judgment and present extensive extra-pleading material for the
Court’s consideration.

See Moret, 381 F.Supp.2d at 464.

McCray

neither objects to converting Defendants’ Motion nor presents a
8

Rule 56(d) affidavit, or a functional equivalent, expressing a need
for discovery.

Instead, she attaches her own extra-pleading

material for the Court’s consideration.

Accordingly, the Court

will construe Defendants’ Motion as one for summary judgment.
2.

Rule 56

In reviewing a motion for summary judgment, the Court views
the facts in a light most favorable to the nonmovant, drawing all
justifiable inferences in that party’s favor.

Ricci v. DeStefano,

557 U.S. 557, 586 (2009); Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255 (1986) (citing Adickes v. S.H. Kress & Co., 398 U.S. 144,
158–59 (1970)).

Summary judgment is

proper when the movant

demonstrates, through “particular parts of materials in the record,
including
information,

depositions,
affidavits

documents,
or

electronically

declarations,

stipulations

stored
.

.

.

admissions, interrogatory answers, or other materials,” that “there
is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a),
(c)(1)(A).
Once a motion for summary judgment is properly made and
supported, the burden shifts to the nonmovant to identify evidence
showing there is genuine dispute of material fact.

See Matsushita

Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87
(1986).

The nonmovant cannot create a genuine dispute of material

fact “through mere speculation or the building of one inference
9

upon another.”

Beale v. Hardy, 769 F.2d 213, 214 (4th Cir. 1985)

(citation omitted).
A “material fact” is one that might affect the outcome of a
party’s case.

Anderson, 477 U.S. at 248; see also JKC Holding Co.

v. Wash. Sports Ventures, Inc., 264 F.3d 459, 465 (4th Cir. 2001)
(citing Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th Cir.
2001)).

Whether

a

fact

is

considered

to

be

“material”

is

determined by the substantive law, and “[o]nly disputes over facts
that might affect the outcome of the suit under the governing law
will properly preclude the entry of summary judgment.”
477 U.S. at 248; accord Hooven-Lewis, 249 F.3d at 265.

Anderson,
A “genuine”

dispute concerning a “material” fact arises when the evidence is
sufficient to allow a reasonable jury to return a verdict in the
nonmoving party’s favor.

Anderson, 477 U.S. at 248.

If the

nonmovant has failed to make a sufficient showing on an essential
element of her case where she has the burden of proof, “there can
be ‘no genuine [dispute] as to any material fact,’ since a complete
failure of proof concerning an essential element of the nonmoving
party’s case necessarily renders all other facts immaterial.”
Celotex Corp. v. Catrett, 477 U.S. 317, 322–23 (1986).
A party challenging the material cited to support or dispute a
fact may object that the material “cannot be presented in a form
that would be admissible in evidence.”

Fed.R.Civ.P. 56(c)(2).

If

a party presents affidavits or declaration to support or oppose a
10

motion for summary judgment, they “must be made on personal
knowledge, set out facts that would be admissible in evidence, and
show that the affiant or declarant is competent to testify on the
matters stated.”
B.

Fed.R.Civ.P. 56(c)(4).

Analysis
Defendants

first

argue

that

McCray’s

FDCPA

claims

are

precluded as a matter of law because once the Bankruptcy Court
discharged her debt, the Bankruptcy Code became McCray’s sole
source of remedy.

The Court disagrees.

In Gamble v. Fradkin & Weber, P.A., the defendant attempted to
collect a debt after a bankruptcy judge discharged the debt.
F.Supp.2d 377, 379 (D.Md. 2012).

846

The plaintiff sued the defendant

for violations of the Bankruptcy Code’s discharge injunction and
the FDCPA.

Id. at 379–80.

The defendants in Gamble, like

Defendants here, argued that “even if [the plaintiff] states a
claim under the FDCPA,” he cannot pursue it in federal district
court “because the Bankruptcy Code provides the exclusive remedy
available to him.”

Id. at 380.

This Court rejected that argument

and denied the defendant’s motion to dismiss the FDCPA claim,
concluding that “there is no reason to believe that Gamble should
be allowed only to recover under the Bankruptcy Code and not under
the FDCPA.”

Id. at 382.

The Court highlighted that the conduct at

issue there, like the conduct at issue here, occurred after the
bankruptcy discharge.

Id. at 382–83.
11

The Court also characterized

Walls v. Wells Fargo, N.A.6 -- the principal case upon which
Defendants rely in this case -- as “an outlier.”

Id. at 382.

Based on Gamble, the Court concludes that McCray’s FDCPA claims are
not precluded.
To prevail on her FDCPA claims, McCray must prove three
elements: (1) she was the object of a collection activity arising
from a consumer debt; (2) Defendants are debt collectors as defined
by the FDCPA; and (3) Defendants engaged in an act or omission
prohibited by the FDCPA.

Webster v. ACB Receivables Mgmt., Inc.,

15 F.Supp.3d 619, 625 (D.Md. 2014).
of these elements.
1.

Defendants contest all three

The Court reviews them in turn.

Debt Collection and Debt Collector

The Court addresses the first two elements jointly.

The FDCPA

defines consumer “debt” as “any obligation or alleged obligation of
a consumer to pay money arising out of a transaction in which the
money, property, insurance, or services which are the subject of
the transaction are primarily for personal, family, or household
purposes, whether or not such obligation has been reduced to
judgment.”

15

U.S.C.

§

1692a(5).

The

FDCPA

defines

“debt

collector” as “any person [1] who uses any instrumentality of
interstate commerce or the mails in any business the principal
purpose of which is the collection of any debts, or [2] who
regularly collects or attempts to collect . . . debts owed or due
6

276 F.3d 502 (9th Cir. 2002).
12

or asserted to be owed or due another.” Id. § 1692a(6).

The

definition of debt collector excludes “any person collecting or
attempting to collect any debt owed or due or asserted to be owed
or due another to the extent such activity . . . is incidental to a
bona fide fiduciary obligation.”

Id. § 1692a(6)(F)(i).

Defendants advance two principal arguments for why this Court
cannot conclude that under the FDCPA, Defendants engaged in debt
collection activity as debt collectors.
made any demands for payment.

First, Defendants never

Rather, the actions that Defendants

allegedly took after the bankruptcy discharge are merely activities
in furtherance of “an in rem proceeding to condemn the [asset]
pledged as collateral.”

(ECF No. 7-1 at 18).

Second, in pursuing

the foreclosure actions that McCray alleges, Defendants were merely
acting incidental to a bona fide fiduciary obligation.
28).

(Id. at

The Court is not persuaded by either argument.
The Court finds McCray v. Fed. Home Loan Mortg. Corp. (McCray

I), 839 F.3d 354 (4th Cir. 2016) to be instructive.

There, the

Fourth Circuit considered whether McCray adequately alleged that
under the FDCPA, Defendants’ were debt collectors that engaged in
debt collection activities.

In her complaint, McCray alleged that

Defendants pursued a foreclosure sale of her home by (1) sending
her a letter that they had been retained to initiate foreclosure
proceedings,

(2)

sending

her

a

formal

notice

of

intent

to

foreclose, and (3) filing an order to docket a foreclosure action
13

in the Circuit Court for Baltimore City, Maryland.

Id. at 357.

This Court granted Defendants’ Motion to dismiss McCray’s FDCPA
claims.

Id. at 358.

On appeal, Defendants raised the same two arguments that they
raise here: Defendants are not, as a matter of law, debt collectors
that engaged in debt collection because (1) they never made any
express demands for payment and (2) their actions in pursuing a
foreclosure

sale

were

incidental

obligation.

Id. at 358–59.

to

a

bona

fide

fiduciary

The Fourth Circuit rejected both of

these arguments.
The Fourth Circuit first concluded that “nothing in [the]
language

[of

the

FDCPA]

requires

that

a

debt

collector’s

misrepresentation [or other violative actions] be made as part of
an express demand for payment or even as part of an action designed
to induce the debtor to pay.”

Id. at 359 (quoting Powell v.

Palisades Acquisition XVI, LLC, 782 F.3d 119, 123 (4th Cir. 2014)
(internal quotation marks omitted)).

Rather, “to be actionable

under . . . the FDCPA, a debt collector needs only to have used a
prohibited practice in connection with the collection of any debt
or in an attempt to collect any debt.”
F.3d at 124).

Id. (quoting Powell, 782

The Fourth Circuit then highlighted that in Wilson

v. Draper & Goldberg, P.L.L.C., 443 F.3d 373 (4th Cir. 2006), the
Court explicitly rejected the argument “that foreclosure by a
trustee under a deed of trust is not the enforcement of an
14

obligation to pay money or a ‘debt,’ but is [merely] a termination
of the debtor’s equity of redemption relating to the debtor’s
property.”

Id. at 360 (quoting Wilson, 443 F.3d at 376).

Indeed,

a plaintiff’s “‘debt’ remain[s] a ‘debt’ even after foreclosure
proceedings commence[]” and “[d]efendants’ actions surrounding [a]
foreclosure proceeding [are] attempts to collect that debt.”

Id.

(quoting Wilson, 443 F.3d at 376).
As for Defendants’ second argument, the Fourth Circuit also
rejected it based on Wilson.

In Wilson, the Fourth Circuit

concluded that foreclosure is “central” -- not incidental -- to the
trustee’s fiduciary obligation under the deed of trust.
(quoting Wilson, 443 F.3d at 377).

After rejecting both of

Defendants’ arguments, the Fourth Circuit
complaint
collectors

adequately
and

that

allege[d]
their

that

actions

Id. at 361

held “that McCray’s

[Defendants]
in

pursuing

were

debt

foreclosure

constituted a step in collecting debt and thus debt collection
activity that is regulated by the FDCPA.”

Id.

Here, McCray presents the Notice of Termination of Automatic
Stay that Defendants filed in McCray’s state foreclosure case.
(See ECF No. 1-1).

This notice states that Defendants “intend to

resume foreclosure proceedings.”

(Id.).

She also offers the

February 22, 2016 letter from Defendants in which they informed
McCray that they had scheduled the Property for foreclosure sale.
(ECF No. 1-4).

Attached as an exhibit to the February 22 letter is
15

a copy of the Advertisement, which notified the public of the
foreclosure sale.

(Id. at 4–6).

Based on these exhibits, the

Court concludes that it is undisputed that like in McCray I,
Defendants

pursued

a

foreclosure

sale

of

McCray’s

home.

Accordingly, based on the Fourth Circuit’s reasoning in McCray I,
the Court concludes as a matter of law that under the FDCPA,
Defendants were debt collectors pursuing debt collection activity.
2.

Acts or Omissions Prohibited by the FDCPA
a.

15 U.S.C. § 1692c

Section 1692c of the FDCPA governs communication in connection
with debt collection.
(a), (b), and (c).

McCray alleges violations of subsections
She first asserts that Defendants violated

subsection (a) when they communicated with her without her consent.
McCray

appears

to

misinterpret

the

statute.

To

be

sure,

subsection (a) provides that “[w]ithout the prior consent of the
consumer given directly to the debt collector or the express
permission of a court of competent jurisdiction, a debt collector
may

not

communicate

with

collection of any debt.”
outline

the

three

a

consumer

in

connection

with

the

But subsection (a) then goes on to

specific

forms

of

communication

prohibited without consent:
(1) [communication] at any unusual time or
place or a time or place known or which should
be known to be inconvenient to the consumer .
. . .;” (2) [communication] if the debt
collector knows the consumer is represented by
an attorney with respect to such debt and has
16

that

are

knowledge of, or can readily ascertain, such
attorney’s name and address, . . .; or (3)
[communication] at the consumer’s place of
employment if the debt collector knows or has
reason to know that the consumer’s employer
prohibits the consumer from receiving such
communication.
McCray presents no evidence that Defendants communicated with
McCray

under

any

of

these

three

specific

circumstances.

Accordingly, the Court will grant Defendants’ Motion as to McCray’s
claim under subsection (a).
McCray next asserts that Defendants violated subsection (b)
when they published the Advertisement in The Daily Record and the
website of Harvey West Auctioneers, LLC.

Subsection (b) provides

that without the consumer’s consent, a debt collector “may not
communicate, in connection with the collection of any debt, with
any person other than the consumer, his attorney, a consumer
reporting agency if otherwise permitted by law, the creditor, the
attorney of the creditor, or the attorney of the debt collector.”
Defendants direct the Court to the Deed of Trust and argue it
shows that McCray consented to Defendants contacting third parties
in connection with a foreclosure sale of the Property.

The Court

notes that McCray alleges she signed the Deed of Trust, the Deed of
Trust appears to bear McCray’s signature, and McCray does not
dispute the authenticity of the Deed of Trust.
(ECF No. 7-6 at 14).

(See Compl. ¶ 17);

Section 22 of the Deed of Trust provides that

“[i]f Lender invokes the power of sale, . . . Trustee shall give
17

notice of sale by public advertisement and by such other means as
required by Applicable Law.”

(ECF No. 7-6 at 13).

As for the

“Applicable Law” mentioned in Section 22, Maryland statutory law
provides that before selling real property in a foreclosure sale,
the individual authorized to make the sale shall publish notice of
the sale in a newspaper of general circulation in the county in
which the foreclosure action is pending.

See Md.Code Ann., Real

Prop. § 7-105.1(o) (West 2017); Md. Rule 14-210(a).

To the extent

Maryland law does not expressly provide that a foreclosure trustee
may publish a notice of foreclosure sale on an auctioneer’s
website,

the

print-outs

from

the

website

of

of

Harvey

West

Auctioneers, LLC that McCray offers do not list the Property as a
home to be sold.
Because

it

(See ECF No. 11-10 at 13–15).
is

uncontroverted

that

McCray

consented

to

communication with third parties in connection with the collection
of her debt, the Court will grant Defendants’ Motion as to McCray’s
claim under subsection (b).
McCray also asserts that Defendants violated subsection (c)
when they refused her multiple demands to cease and desist selling
her home.

Like with subsection (a), it appears that McCray

misunderstands the statute.

Subsection (c) provides that a debt

collector must cease communicating with a consumer after the
consumer notifies the debt collector that she “wishes the debt
collector

to

cease

further

communication
18

with

the

consumer.”

(Emphasis added.).

McCray does not present any evidence that she

ever requested that Defendants cease communicating with her.

Quite

to the contrary, on several occasions she actually demanded that
Defendants communicate with her to, among other actions, validate
her debt.

(See ECF Nos. 1-2, 1-5).

Because McCray fails to create

a genuine dispute that Defendants refused any requests from McCray
to cease communicating with her, the Court will grant Defendants’
Motion as to McCray’s claim under subsection (c).
b.

15 U.S.C. § 1692e

Section 1692e of the FDCPA proscribes false, deceptive, or
misleading representations in connection with the collection of a
debt.

McCray alleges that Defendants violated subsection (2)(A),

which prohibits false representations regarding the “character,
amount, or legal status of any debt.”
McCray asserts that the Advertisement falsely represents the
legal status of a debt in two ways.

First, the Advertisement

falsely states that McCray owes a debt.
allegation,

however,

belies

the

(Compl. ¶ 57).

undisputed

language

of

This
the

Advertisement, which does not mention McCray’s name or declare that
she owes a debt.

(See ECF No. 1-4 at 4–6).

The Advertisement

provides merely that the holder of the Note secured by the Deed of
Trust appointed Defendants as substitute trustees and requested
that they sell the Property in a foreclosure sale.

19

(Id. at 4).

Second, the Advertisement states falsely that the holder of
the Note appointed Defendants as substitute trustees because Wells
Fargo does not hold the Note.

(Compl. ¶ 57).

To the extent McCray

asks the Court to conclude that Wells Fargo does not hold the Note,
the Court must abstain under Younger from resolving this issue.
See Younger v. Harris, 401 U.S. 37 (1971). The Younger abstention
doctrine requires a federal court to abstain from interfering in
state proceedings, even if jurisdiction exists, when there is: “(1)
an ongoing state judicial proceeding, instituted prior to any
substantial progress in the federal proceeding; that (2) implicates
important, substantial, or vital state interests; and (3) provides
an adequate opportunity for the plaintiff to raise the federal . .
. claim advanced in the federal lawsuit.”

Laurel Sand & Gravel,

Inc. v. Wilson, 519 F.3d 156, 165 (4th Cir. 2008) (quoting Moore v.
City of Asheville, 396 F.3d 385, 390 (4th Cir. 2005)).
Here, all three elements of the Younger test are satisfied.
First, McCray’s state foreclosure case is ongoing and Defendants
initiated it in February 2013 -- three years before McCray filed
this case.
important

(See ECF No. 7-3 at 2).
state

interest

in

Second, “[t]here is an

adjudicating

foreclosure

pertaining to real property located within a state.”

matters
Toney v.

LaSalle Bank Nat. Ass’n, 896 F.Supp.2d 455, 476 (D.S.C. 2012),
aff’d, 512 F.App’x 363 (4th Cir. 2013).

Third, the docket sheet

that Defendants attach to their Motion shows that McCray has had
20

ample opportunity in her state foreclosure case to contest whether
Wells Fargo has a valid security interest in the Property.
ECF No. 7-3).

(See

McCray filed a Motion to Stay the Sale and Dismiss

the Action and a Motion to Strike Affidavit Certifying Ownership of
Debt Instrument.

(Id. at 5, 6).

Motion to Stay and to Dismiss.7

The circuit court denied the

(Id. at 5).

McCray also moved for

reconsideration of the order denying her motion to stay and to
dismiss.

(Id. at 6).

(Id. at 7).

The circuit court also denied that motion.

Because the Younger test is satisfied, the Court will

grant Defendants’ Motion as to McCray’s claim under 15 U.S.C. §
1692e(2)(A).8
c.

15 U.S.C. § 1692f

Section 1692(f) of the FDCPA prohibits debt collectors from
employing unfair or unconscionable means to collect or attempt to
collect

a

debt.

Subsection

(6)(A)

proscribes

“[t]aking

or

threatening to take any nonjudicial action to effect dispossession
or disablement of property if . . . there is no present right to
possession

7

of

the

property

claimed

as

collateral

through

an

It appears the circuit court may not have had an opportunity
to rule on McCray’s Motion to Strike before McCray filed for
bankruptcy. (See ECF No. 7-3).
8
Even if the Court was not required to abstain under Younger,
the record is uncontroverted that Wells Fargo holds the Note and
appointed Defendants as substitute trustees. Defendants present a
sworn affidavit from Wells Fargo’s Vice President of Loan
Documentation in which he states that Wells Fargo holds the Note.
(ECF No. at 7–7 at 4–5). Defendants also present a document titled
“Substitution of Trustee,” which shows that in 2012, Wells Fargo
21

enforceable security interest.”
violated

this

subsection

McCray alleges that Defendants

when

they

filed

in

McCray’s

state

foreclosure case a notice of their intent to resume foreclosure
proceedings.

McCray asserts that filing this notice is a violation

of subsection (6) because Defendants “never had an enforceable
security interest in [the Property].”

(Compl. ¶ 58).

Defendants,

however, have never maintained that they have an enforceable
security interest in the property.

Rather, they contend that Wells

Fargo has the enforceable security interest because they hold the
Note.
To the extent McCray contests whether Wells Fargo has an
enforceable

security

interest

in

the

Property,

the

Younger

abstention doctrine precludes the Court from resolving this issue.
As discussed above, all three elements of the Younger test are
satisfied.

Thus, the Court will grant Defendants’ Motion as to

McCray’s claim under 15 U.S.C. § 1692f(6)(A).9

See Ward v. Branch

Banking & Trust Co., No. ELH-13-01968, 2014 WL 2707768, at *14
(D.Md. June 13, 2014) (dismissing under Younger plaintiffs’ 15
U.S.C. § 1692(f)(6)(A) claim because the enforceability of bank’s

appointed Defendants as substitute trustees.
(ECF No. 7-2).
McCray offers no evidence to contradict either of these documents.
9
Even assuming the Court could resolve whether Wells Fargo
has an enforceable security interest in the Property, McCray fails
to create a genuine dispute of material fact. She does not attach
the Note, Deed of Trust, or any other documents that could prove to
a reasonable jury that someone other than Wells Fargo has an
enforceable security interest in the Property.
22

security interest in real property must be determined in state
foreclosure action).
d.

15 U.S.C. § 1692g

Section 1692g of the FDCPA governs validation of debts.
Subsection (b) provides that all debt collection activities shall
cease when the borrower disputes the debt and requests validation.
In foreclosure cases, there are three elements of a claim under
subsection (b): (1) the plaintiff sent the defendant a request for
debt validation; (2) the defendant did not respond; and (3) the
defendant nevertheless continued debt collection actions by going
through the foreclosure process.

See Blick v. Shapiro & Brown,

LLP, No. 3:16-CV-00070, 2016 WL 7046842, at *9 (W.D.Va. Dec. 2,
2016) (concluding plaintiff adequately pled claim for violation of
15 U.S.C. § 1692g when plaintiff alleged he wrote letter to
defendant requesting validation of debt, but defendant did not to
respond and continued debt collection actions by going through
foreclosure process).
McCray creates a genuine dispute of material fact for this
claim.

It is undisputed that she requested debt validation.

McCray offers notices dated January 13 and March 2, 2016 in which
she requested explicitly that Defendants validate the debt.
Nos. 1-2, 1-5).
these

notices.

(ECF

Defendants do not dispute whether they received
Rather,

they

direct

the

Court

to

a

letter

purportedly showing that in December 2012, they validated McCray’s
23

debt.

(See ECF No. 11-3).

But in her competing exhibit, McCray

denies receiving this letter.
to

create

a

genuine

dispute

(See ECF No. 11-5).
as

to

the

second

This suffices
element

of

a

subsection (b) claim because McCray could put the contents of her
letter in admissible form by testifying that she did not receive
the December 2012 letter.

See Fed.R.Civ.P. 56(c)(2).

McCray also

presents a February 22, 2016 letter from Defendants in which they
advise McCray that a foreclosure sale of the Property had been
scheduled and Defendants would be advertising the sale.
No. 1-4).

(See ECF

This letter is uncontroverted evidence that Defendants

continued to foreclose on the property after McCray sent her
January 13, 2016 letter requesting debt validation.
Because McCray creates a genuine dispute of material fact,
Defendants are not entitled to judgment as a matter of law, and the
Court will deny without prejudice Defendants’ Motion as to McCray’s
claim under 15 U.S.C. § 1692g(b).
e.

15 U.S.C. § 1692j

Section 1692j of the FDCPA proscribes furnishing deceptive
forms.

Subsection (a) provides:
It is unlawful to design, compile, and furnish
any form knowing that such form would be used
to create the false belief in a consumer that
a person other than the creditor of such
consumer is participating in the collection of
or in an attempt to collect a debt such
consumer allegedly owes such creditor, when in
fact such person is not so participating.

24

McCray’s allegations supporting her claim under subsection (a)
are

totally

conclusory.

She

alleges

merely

that

Defendants

violated subsection (a) when they filed an “illegal substitution of
trustee” document in McCray’s state foreclosure case.
48, 61).

(Compl. ¶¶

Construing this allegation in the light most favorable

to McCray, she appears to assert that the substitution of trustee
document violates subsection (a) because it provides that Wells
Fargo holds the note when American Home Mortgage, McCray’s original
lender, actually holds the note.

But McCray presents no evidence

whatsoever to attempt to dispute that Wells Fargo does not hold the
note.

And even if she did, for the reasons discussed above, the

Court must abstain under Younger from resolving who holds the
note.10

The Court will, therefore, grant Defendants’ Motion as to

McCray’s claim under 15 U.S.C. § 1692j(a).
III. CONCLUSION
For the foregoing reasons, the Court will construe Defendants’
Motion (ECF No. 7) as one for summary judgment and GRANT it IN PART
and DENY it WITHOUT PREJUDICE IN PART.

The Court will GRANT the

Motion and ENTER JUDGMENT for Defendants as to McCray’s claims
under 15 U.S.C. §§ 1692c(a), c(b), c(c), e(2)(A), f(6)(A), and
10

Furthermore, to the extent the Court could even consider
McCray’s claim under subsection (a), the claim is barred by the
statute of limitations.
The FDCPA has a one-year statute of
limitations. 15 U.S.C. § 1692k(d). It is undisputed that SIWPC
filed the substitution of trustee document in McCray’s state
foreclosure case in 2013. (See ECF No. 7-7 at 1). McCray filed
this action in 2016 -- well outside the one-year statute of
25

j(a). The Court will DENY the Motion WITHOUT PREJUDICE as to
McCray’s claim under 15 U.S.C. § 1692g(b).

The Court will also

issue a scheduling order and direct the Clerk to consolidate this
case with McCray I, No. GLR-13-1518.11

A separate Order follows.

Entered this 31st day of March, 2017
/s/
____________________________
George L. Russell, III
United States District Judge

limitations.
11
See Plimpton v. Cooper, 141 F.Supp.2d 573, 575 (W.D.N.C.
2001) (“District courts have the inherent authority to order
consolidation sua sponte.” (citing Pickle v. Char Lee Seafood,
Inc., 174 F.3d 444 (4th Cir. 1999))), aff’d, 21 F.App’x 159 (4th
Cir. 2001).
26