Rojas-Roberts v. Ocwen Loan Servicing, LLC
Filing
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MEMORANDUM. Signed by Judge William M Nickerson on 8/25/2015. (jnls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
YVONNE ROJAS-ROBERTS
v.
OCWEN LOAN SERVICING, LLC
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Civil Action No. WMN-15-01074
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MEMORANDUM
Before the Court is Plaintiff Yvonne Rojas-Roberts’ Motion
to Remand to state court, ECF No. 11, and Defendant Ocwen Loan
Servicing, LLC’s Motion to Dismiss.
ripe.
ECF No. 10.
The motions are
Upon a review of the pleadings and the applicable case
law, the Court determines that no hearing is necessary, Local
Rule 105.6, and that Plaintiff’s motion to remand will be denied
and Defendant’s motion to dismiss will be granted.
I. FACTUAL AND PROCEDURAL BACKGROUND
This case arises from a dispute between Plaintiff, a
borrower who executed a promissory note (“Note”) to obtain the
$254,000.00 purchase price of a home, and Defendant, the current
servicer of that Note.
Plaintiff executed the Note on May 12,
2004, but subsequently fell behind on repayment of the note.
August 13, 2012, Defendant sent a letter stating that it
On
participates in the Home Affordable Modification Program (HAMP),1
among other mortgage assistance programs; that Plaintiff could
apply to “find out what assistance you qualify for;” and that
once she submitted her application, it would “conduct a thorough
review of your financial situation, and first verify for [sic]
your eligibility for the HAMP program.”
ECF No. 17-3 at 2.
If
Plaintiff did not qualify for HAMP, Defendant would “work to
match your situation to our own mortgage modification and
assistance programs.”
Id.
On September 2, 2012, Plaintiff applied for the loan
modification, including with her application a home appraisal
procured at a cost of $75.00.
Plaintiff included in her
application that she had a gross monthly income of $2,680.11.
Defendant denied Plaintiff’s application by correspondence on
September 19, 2012.
The letter stated the modification was
unavailable because “we are unable to create a monthly payment
that is between 25% and 42% of your monthly gross income.”
No. 17-6 at 2.
ECF
Plaintiff subsequently paid a private forensic
mortgage auditor $750.00 to determine why Defendant had denied
her application.
The mortgage auditor concluded that Defendant
could, in fact, have created a monthly payment of $842.53 that
was between 25% and 42% of Plaintiff’s monthly gross income.
1
HAMP is a program overseen by the U.S. Treasury pursuant to the
Emergency Economic Stabilization Act, 12 U.S.C. § 5201 et seq.
2
From this mortgage audit, Plaintiff concluded that Defendant
must have lied in its September 19 rejection letter and never
processed her application.
On February 13, 2015, Plaintiff filed
suit in the Circuit Court for Anne Arundel County, Maryland,
alleging (1) that Defendant promised to process her application
under HAMP and that Plaintiff relied on that promise to her
detriment (Count I – Detrimental Reliance); (2) that this promise
constituted an unfair or deceptive trade practice in violation of
Maryland law (Count II – Violations of the Maryland Consumer
Protection Act); and (3) that Defendant violated its duty to
Plaintiff arising from “the intimate nexus created by the
contractual relationship, Plaintiff’s vulnerability to harm and
dependence . . . and the foreseeable risk of physical injury”
(Count III – Negligence).
ECF No. 2 ¶ 43.
Defendant timely
removed the action to this Court on April 14, 2015.
II. PLAINTIFF’S MOTION TO REMAND
A defendant may remove an action brought in state court to a
United States district court if the district court would have had
original jurisdiction over the matter.
28 U.S.C. § 1441(a).
The
district court must be located in the same district and division
as the pending action.
Id.
A district court may have original
jurisdiction based on diversity of citizenship if all plaintiffs
and defendants are citizens of different states, and the amount
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in controversy exceeds $75,000.00, exclusive of interests and
costs.
28 U.S.C. § 1332 (a)(1).
Generally, the amount alleged in the complaint is the amount
in controversy.
353 (1961).
Horton v. Liberty Mut. Ins. Co., 367 U.S. 348,
Because a plaintiff may recover only once for her
injuries, “multiple counts based upon the same facts or
circumstances but asserting different legal theories upon which
the plaintiff may recover the same damages, constitute one
claim.”
Kelly v. Bank of Am., N.A., Civ. No. CCB-12-2850, 2013
WL 3168018, at *3 (D. Md. June 18, 2013). Therefore, a defendant
may not aggregate the amounts alleged in each count to reach the
required amount in controversy if the plaintiff’s claims stem
from the same set of facts or circumstances.
Id.
Since,
however, a plaintiff may be allowed to aggregate her own claims
in order to reach the required amount in controversy, Shanaghan
v. Cahill, 58 F.3d 106, 109 (4th Cir. 1995), some jurisdictions
have held that a defendant may aggregate separate ad damnum
amounts in order to reach the minimum requirement, McClendon v.
Liberty Nat. Life Ins. Co., No. 3:11-CV-1018-WKW, 2013 WL
5913850, at *3 (M.D. Ala. Nov. 4, 2013).
If the complaint does
not state an amount in controversy, the defendant may allege the
damages he or she would incur.
Id.
The defendant must prove the
recoverable amount exceeds the minimum requirement by a
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preponderance of the evidence in order for removal to be proper.
Id.
Defendant’s notice of removal contends that the amount in
controversy exceeds the requirement amount because “Plaintiff
seeks at least a total of $225,000.00 in damages, as Counts I-III
all seek $75,000.00 in damages . . . .”2
ECF No. 1 ¶ 14.
It
further contends that the damages it would incur if forced to
modify the loan through injunctive relief (Count IV) would likely
equal at least the original balance of the loan ($254,000.00).
In response, Plaintiff’s motion to remand states that the amount
in controversy has not been met because “[t]he complaint seeks
$75,000.00 in damages, and does not seek more than one penny more
than $75,000.00.
This amount includes counsel fees . . . .”
ECF
No. 11 ¶ 3.
Defendant’s first argument that the amount in controversy
has been met is based on the premise that the ad damnum clauses
in each of Plaintiff’s first three counts may be aggregated.
Defendant’s second argument is based on the premise that, because
Plaintiff’s count of injunctive relief does not state an amount
in controversy, it may claim the total damages it would incur.
As noted above, Defendant claims it would lose the value of the
2
Neither party contests there is complete diversity of
citizenship, as required by 28 U.S.C. § 1332 (a)(1).
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original loan if forced to offer a loan modification, and asserts
$254,000.00 in damages.
In her reply, Plaintiff addresses only Defendant’s second
argument.
She contends that issuing injunctive relief in the
form of a loan modification would not necessarily cause Defendant
any damages and that, even if it did, Defendant has not proved
these damages by a preponderance of the evidence.
Plaintiff is
correct that Defendant has not sufficiently proven it would incur
damages, with an equivalent monetary value, if an injunction were
issued.
Defendant’s claims that modifying the loan would
necessarily impact the total amount due, or might force Defendant
to repurchase the loan are speculative and Defendant provides no
evidence to support these assertions.
Plaintiff, is incorrect, however, that counsel fees may not
be included in the amount in controversy for all her claims.
Attorney’s fees, as opposed to interests and costs, may be
included in determining the jurisdictional amount in controversy.
Attorney’s fees may be included if (1) such fees are provided for
in a contract, or (2) a statute requires or allows payment of
attorney’s fees.
Francis v. Allstate Ins. Co., 709 F.3d 362, 368
(4th Cir. 2013).
The second exception applies to Plaintiff’s
Count II under the MCPA.
See Md. Code Ann., Com. Law § 13-408(b)
(“Any person who brings an action to recover for injury or loss
under this section and who is awarded damages may also seek . . .
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reasonable attorney’s fees.”).
Plaintiff may not, however,
include attorney’s fees in the amount in controversy for Counts I
or III.
This results in damages less than $75,000.00 for Counts
I and III.
This consequence is ultimately insignificant, however,
because the Court finds that Count III of Plaintiff’s Complaint
is premised on a distinct set of facts or circumstances than
Count I or Count II.
Counts I and II are based on the facts and
circumstances surrounding the “false promise” of the August 13
letter.
Count III is premised on Defendant’s failure to take due
care in managing the contractual relationship that existed
between Plaintiff and Defendant.
Plaintiff specifically alleges
that a duty was owed due to the “contractual relationship,
Plaintiff’s vulnerability to harm and dependency on Defendant,
and the foreseeable risk of physical injury.”
ECF No. 2 ¶ 43.
The breach alleged is Defendant’s failure to give her a HAMPmodified loan.
Sustaining this allegation would require an
inquiry into facts and circumstances distinct from the issue of
what Defendant promised in the August 13 letter.
Accordingly,
although Counts I and II cannot be aggregated because they
constitute alternating theories of liability from the same set of
circumstances, Count III’s $75,000.00 may be added to the
$75,000.00 of Counts I and II to produce an amount in controversy
of $150,000.00.
As the amount of controversy is over $75,000.00
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and the two parties have conceded diversity of citizenship,
Plaintiff’s motion to remand is denied.
III. DEFENDANT’S MOTION TO DISMISS
A. Legal Standard
Defendant’s motion is governed by Fed. R. Civ. P. 12(b)(6).
In evaluating a motion to dismiss filed pursuant to Rule
12(b)(6), the Court must accept as true all well-pled allegations
of the complaint and construe the facts and reasonable inferences
derived therefrom in the light most favorable to the plaintiff.
See Ibarra v. United States, 120 F.3d 472, 474 (4th Cir. 1997).
To survive dismissal, “a complaint must contain sufficient
factual matter . . . to ‘state a claim to relief that is
plausible on its face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atlantic v. Twombly, 550 U.S. 554, 570
(2007)).
“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.”
U.S. at 556).
Iqbal, 556 U.S. at 678 (citing Twombly, 550
A court need not accept a plaintiff’s legal
conclusions as true, as “[t]hreadbare recitals of the elements of
a cause of action, supported by mere conclusory statements, do
not suffice.”
Id.
Thus, “[d]etermining whether a complaint
states a plausible claim for relief will . . . be a context-
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specific task that requires the reviewing court to draw on its
judicial experience and common sense.”
Id. at 679.
B. Discussion
Defendant argues that HAMP does not provide a private right
of action and Plaintiff accordingly does not have standing in
this Court.
Defendant is correct that there is no private right
of action under HAMP.
See, e.g., Allen v. CitiMortgage, Civ. No.
CCB-10-2740, 2011 WL 3425665, at *4 (D. Md. Aug. 4, 2011).
This
does not mean, however, that Defendant is “wholly immunized for
[its] conduct so long as the subject of the transaction is
associated with HAMP.”
Vida v. OneWest Bank, FSB, Civ. No. 10-
987-AC, 2010 WL 5148473, at *5 (D. Or. Dec. 13, 2010).
State law
claims may be proper vehicles for bringing claims associated with
HAMP.
See Allen, 2011 WL 3425665, at *5.
Accordingly, the Court
will analyze each of Plaintiff’s claims, which are brought under
state law.
See Legore v. OneWest Bank, FSB, 898 F. Supp. 2d 912,
917-18 (D. Md. Oct. 15, 2012).
1. Count I: Detrimental Reliance
In Maryland, the doctrine of promissory estoppel – or
detrimental reliance – is used as a “device for contractual
recovery, when an element of a traditional bilateral contract is
lacking.”
Whiting-Turner Contracting Co. v. Liberty Mut. Ins.
Co., 912 F. Supp. 2d 321 (D. Md. 2012) (citations omitted).
To
state a claim for detrimental reliance, Plaintiff must allege:
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(1) that a clear and definite promise was made; (2) that the
promisor reasonably expected his or her promise would induce
action or forbearance by the promise; (3) that the promise
induced actual and reasonable action or forbearance by the
promise; and (4) a resulting detriment which can only be avoided
by the enforcement of the promise.
Pavel Enters. v. A.S. Johnson
Co., 342 Md. 143, 158-60 (Md. 1996); Konover Prop. Trust, Inc. v.
WHE Assocs., 142 Md. App. 476, 484 (Md. Ct. Spec. App. 2002).
Plaintiff alleges that the promise was “to process Plaintiff’s
application for a loan modification under HAMP.”
ECF No. 2 ¶ 23.
In order to grant relief, however, Plaintiff must allege
that Defendant did not follow through with the obligation in its
alleged promise.
Here, Defendant, appears to have fulfilled its
promise to process Plaintiff’s application, in that it sent to
Plaintiff a letter stating “[b]ased on our review of the
documentation you provided, you are not eligible for a Home
Affordable Modification.”
ECF No. 17-6 at 2.
Plaintiff does not
directly allege any facts to support a conclusion that Defendant
did not process the application.
Instead, Plaintiff attaches to
her complaint the third-party mortgage audit that allegedly
states Plaintiff is eligible for a modified mortgage payment of
$842.53 under the HAMP program.
A third party evaluation of
Plaintiff’s application to the HAMP program, however, is an
insufficient factual foundation upon which to sufficiently allege
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that Defendant did not fulfill its promise.
First, the report
contains no direct conclusion that Defendant did not process
Plaintiff’s HAMP application.
Second, the report itself includes
a disclaimer that “[t]he findings generated by this report are
not evidence of . . . a guarantee of participation in any federal
. . . mortgage loan modification program.”
ECF No. 17-7 at 5.
And finally, and most significantly, to evaluate the sufficiency
of the audit and compare it to Defendant’s conduct would require
an engagement with HAMP standards tantamount to an impermissible
private right of action under HAMP.
The remainder of Plaintiff’s
complaint amounts to conclusory statements and recitations that
Defendant must not have followed through with its promise to
process her application.
Plaintiff has not sufficiently alleged
that Defendant made an unfulfilled promise through which the
Court may grant relief.
2. Count II: Violation of the Maryland Consumer Protection Act
The Maryland Consumer Protection Act (MCPA), Md. Code Ann.,
Com. Law § 13-301 et seq., prohibits the commission of unfair or
deceptive trade practices, which include making a “false . . . or
misleading oral or written statement . . . or other
representation of any kind which has the capacity, tendency, or
effect of deceiving or misleading consumers.”
Id. § 13-301(l).
To bring an action under the MCPA, Plaintiff must allege “(1) an
unfair or deceptive practice or misrepresentation that (2) is
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relied upon, and (3) causes her actual injury.”
Bierman, 859 F. Supp. 2d 754, 768 (D. Md. 2012).
Stewart v.
Because an MCPA
claim sounds in fraud, Plaintiff’s allegations must be analyzed
under the heightened pleading standard of Rule 9(b) of the
Federal Rules of Civil Procedure.
Rule 9(b) requires a
plaintiff, in the complaint, to “state with particularity the
circumstances constituting fraud or mistake.”
9(b).
Fed. R. Civ. P.
“These ‘circumstances’ include ‘the time, place, and
contents of . . . false representations, as well as the identity
of the person making the misrepresentation and what he obtained
thereby.’”
Allen, 2011 WL 3425665, at *9 (quoting Harrison v.
Westinghouse Savannah River Co., 176 F.3d 776, 784 (4th Cir.
1999)).
In Allen, the court found that the heightened Rule 9(b)
pleading had been met because “plaintiffs have pled the dates and
contents of numerous contradictory letters sent by [defendant]”
which “when taken in combination allege . . . that [defendant]
sent false or misleading statements.”
2011 WL 3425665, at *9.
Plaintiff here has pled that the contents of Defendant’s August
13th and September 19th correspondences were unfair and
deceptive.
On their face, though, each letter is not deceptive,
and when taken together, the letters reflect a consistent course
of action.
Defendant said it would process her application and
then notified Plaintiff that, upon doing so, it came to the
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conclusion that a HAMP modification was unavailable.
Plaintiff’s
only proffered allegation that these statements were fraudulent
or misleading is that the private mortgage auditor concluded that
a HAMP modification was available.
The fact that an independent
party used, ostensibly, the same procedure as Defendant and
arrived at a different conclusion regarding Plaintiff’s HAMP
eligibility supports a speculation of fraud or misrepresentation,
at best.
Such speculation is insufficient to sustain a pleading
under Rule 9(b).
Further, even if the Court were to find such speculation
sufficient, Plaintiff fails to adequately plead what Defendant
obtained by making the allegedly false statement.
Plaintiff
alleges that, since a HAMP modification cancels late fees that
accrue to a loan servicer, a “successful loan modification under
HAMP is never in a servicer’s financial interest” and Defendant
“therefore, had a financial motive to deny the application . . .
in order to pursue revenue from foreclosure.”
15.4.
ECF No. 2 ¶¶ 15.3-
This allegation is speculative, as it pins onto Defendant
an apparent motive that is not demonstrated through underlying
facts.
It is also inconsistent with Defendant’s expressed
willingness to assign an employee to help Defendant avoid
foreclosure through alternative means.
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See ECF No. 17-6 at 2.3
To the extent that Plaintiff’s MCPA claim could be construed to
extend to Defendant’s August 13 letter inviting Plaintiff to
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Plaintiff has conceded her count of negligence (Count III).
ECF No. 12-1 at 2.
Thus, only her claim for injunctive relief
requiring Defendant to offer a loan modification and preventing
foreclosure (Count IV) remains.
Injunctive relief is a form of
remedy for independent causes of action, not a cause of action
unto itself.
Fare Deals Ltd. v. World Choice Travel.Com, Inc.,
180 F. Supp. 2d 678, 682 n.1 (D. Md. 2001).
Because Counts I-III
will be dismissed, there is no remaining cause of action to which
to apply injunctive relief.
Therefore, Count IV will also be
dismissed.
IV. CONCLUSION
For the above-stated reasons, the Court will deny
Plaintiff’s Motion to Remand and grant Defendant’s Motion to
Dismiss.
Accordingly, this action is dismissed in its entirety.
A separate order will issue.
____________/s/___________________
William M. Nickerson
Senior United States District Judge
DATED: August 25, 2015
apply for a HAMP modification, the Court finds that such claim is
simply an effort to enforce HAMP guidelines. To allow Plaintiff
“to recover on this basis would effectively create a private
right of action, which Congress has declined to do.” Legore, 898
F. Supp. 2d at 920.
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