Barry et al v. EMC Mortgage et al

Filing 41

MEMORANDUM OPINION. Signed by Chief Judge Deborah K. Chasanow on 8/17/12. (sat, Chambers)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
TIMOTHY BARRY, et al.
:
v.

:

Civil Action No. DKC 10-3120

:
EMC MORTGAGE CORPORATION
:
MEMORANDUM OPINION
Presently pending and ready for resolution in this case is
a motion for summary judgment filed by JPMorgan Chase Bank, N.A.
(“Chase”).

(ECF No. 38).1

The relevant issues have been briefed

and the court now rules pursuant to Local Rule 105.6, no hearing
being

deemed

necessary.

For

the

reasons

that

follow,

this

motion will be granted in part and denied in part.
I.

Background
A.

Factual Background

The following facts are either uncontroverted or considered
in the light most favorable to Plaintiffs Timothy and Susan
Barry.

1

In October 2006, Plaintiffs obtained a $481,600 loan

After the complaint was filed, Defendant EMC Mortgage
Corporation reorganized as EMC Mortgage, LLC, which assigned
certain servicing rights to Chase. It is undisputed that Chase
is currently the servicer of the loan at issue in this case.
Chase assumed EMC’s position in the lawsuit as of the time the
answer was filed, but neither party has moved for substitution
or joinder; thus, pursuant to Fed.R.Civ.P. 25(c), the action is
continued against EMC.
Notably, EMC and Chase are represented
by the same counsel.

from Southstar Funding, LLC, to refinance the mortgage on their
home in Severn, Maryland.

(ECF No. 17-1).2

The loan was secured

by a deed of trust granting Southstar a security interest in the
property.

(ECF No. 17).

Defendant EMC Mortgage Corporation

(“EMC”) later became the servicer of the loan.3
At

some

point,

Plaintiffs

discovered

they

were

making

interest-only payments on a negatively amortizing loan, and Mr.
Barry contacted EMC to discuss modifying its terms.

On or about

January 6, 2009, Plaintiffs entered into a loan modification
agreement with EMC (“modification agreement”).

(ECF No. 17-2).

2

In the complaint, Plaintiffs alleged that the refinancing
loan was obtained from First Ohio Banc and Lending, Inc. (“First
Ohio”), which was named as a defendant along with EMC Mortgage
Corporation.
In support of a subsequent motion to dismiss,
however, EMC submitted a deed of trust and promissory note
identifying Southstar as the lender.
(ECF Nos. 17, 17-1).
There is no dispute that these are the loan documents underlying
the modification at issue.
It is unclear what role, if any,
First Ohio had in this process.
Nevertheless, all claims
against that defendant have been dismissed on limitations
grounds.
It also bears mention that the case appears to have been
improperly assigned to the court’s southern division, as
Plaintiffs reside in Anne Arundel County.
See Local Rule
501.4.b.
This error was facilitated by Plaintiffs’ failure to
identify their current address in the complaint or their county
of residence in the civil cover sheet. Plaintiffs’ omissions in
this regard, combined with the vague factual allegations in the
complaint, purportedly contributed to EMC’s difficulty in
identifying the loan documents at issue. (ECF No. 6, n. 2).
3

The complaint recites that “First Ohio Bank eventually
sold the loan to EMC Mortgage, which both owns and services the
loan.” (ECF No. 1 ¶ 31). The evidence reflects, however, that
EMC was the servicer of the loan during the relevant time
period. (ECF No. 38-4).
2

Under the modification agreement, Plaintiffs’ monthly payments
increased from $2,400 to $2,841.90, but the interest rate on the
loan was significantly reduced.

This “result[ed] in a fully

amortizing loan payment that reduced the principal balance of
the loan.”

(ECF No. 38-2, Plaintiffs’ response to request for

admission no. 2).

Plaintiffs, however, “failed to timely pay

the installments called for under that agreement.”

(Id. at

response no. 1).
Mr.

Barry

again

modification.”

(ECF

interrogatory no. 4).

called

EMC

No.

“to

38-2,

try

to

Plaintiffs’

secure
answer

a
to

On or about November 17, 2009, he spoke

with an unidentified representative who proposed restructuring
the modified loan.

During that phone call, Mr. Barry and the

EMC

“agreed

representative

to

a

trial

period

modification

whereby Plaintiffs would . . . make four trial payments, and
upon the completion of those four payments, Plaintiffs would
receive a restructuring of their mortgage with monthly payments
in line with the trial modification plan” (“oral restructure
agreement”).

(Id.).

The portion of that agreement calling for

four trial payments was reduced to writing, which Mr. Barry
signed on December 14, 2009 (“trial modification plan”).
No. 38-4).
terms
future

(ECF

The trial modification plan, however, contained no

proposing

a

modification,

“restructuring”

of

nor

did

Plaintiffs’
3

it

contemplate

mortgage.

To

any
the

contrary, it was expressly a “repayment agreement” designed to
collect a “delinquent amount due” for “October 1, 2009 through
(Id.).4

December 1, 2009 mortgage payments and fees.”

The

agreement reflected that Plaintiffs owed a total past due amount
of

$8,809.90,

installments
(Id.).

of

which

they

$2,415.61

were

from

to

pay

December

in

2009

four
to

monthly

March

2010.

It does not reflect that payments of any additional

amounts were due during the trial period.
Despite the fact that Plaintiffs made those payments in
full and on time, they did not receive a permanent modification
of

their

mortgage.

Rather,

“[i]n

March

2010,

[Mr.]

received a statement from [EMC] demanding $11,367.60.”
38-2,

at

answer

to

interrogatory

no.

6).5

In

Barry

(ECF No.

response,

he

4

The trial modification plan was not expressly a Trial
Period Plan (“TPP”) agreement under the Home Affordable
Modification Program (“HAMP”). The absence of any allegation or
evidence related to a HAMP application or TPP agreement appears
to be the only thing distinguishing this case from a group of
complaints in multi-district litigation currently pending in the
District of Massachusetts involving Chase and EMC.
See In re
JPMorgan Chase Mortg. Modification Litigation, --- F.Supp.2d ---, 2012 WL 3059377, at *2-3 (D.Mass. July 27, 2012) (describing
“Group 2” plaintiffs as those who were promised a TPP agreement,
but “were sent either a Forbearance Agreement or a Repayment
Agreement” and told that “upon completion of the preliminary
‘plans’ outlined in these Agreements, they would be notified as
to whether they qualified for a mortgage modification.”).
5

The $2,841.90 monthly amount that Plaintiffs were required
to pay under the modification agreement, multiplied by four
months (i.e., for monthly payments from December 2009 to March
2010), equates to $11,367.60.
4

contacted EMC and was told he had not been paying the full
amount of his mortgage and that “the accumulation of the unpaid
amounts

had

to

be

immediately

paid

back.”

(Id.).

When

Plaintiffs were unable to pay this amount, their mortgage fell
into default.
B.

Procedural History

Plaintiffs commenced this action on November 30, 2010, by
filing a complaint setting forth thirty counts against EMC and
First Ohio Banc and Lending, Inc.

In response, EMC filed a

motion for more definite statement as to counts I (breach of
contract)

and

Protection

Act

counts.

First

VIII

(violation

(“MCPA”))
Ohio

and

for

separately

against it as time-barred.

of

the

Maryland

dismissal

moved

to

of

the

dismiss

Consumer
remaining

all

counts

By a memorandum opinion and order

issued July 6, 2011, the court granted both motions to dismiss,
but denied EMC’s motion for more definite statement.6

6

With respect to the breach of contract claim, the court
explained that “EMC had made a strong case for requiring
Plaintiffs to provide certain details that are necessary to
enable EMC to respond to the complaint allegations,” but
“undercut its own argument . . . [by] attach[ing] copies of a
deed of trust and other documentation pertinent to the
refinancing.” (ECF No. 22, at 8). The court further explained
that, “[b]y confirming that [the modification agreement] is an
accurate copy, Plaintiffs have provided EMC with the address of
the property at issue and the full names of the parties and EMC
can now search its own records and public land records for any
additional information it needs to formulate its answer.” (Id.
at 8-9).
5

With only counts I and VIII remaining, Chase – identifying
itself

as

the

“successor

servicer

to

EMC”

–

answered

the

complaint, purporting to raise a number of affirmative defenses.
Plaintiffs

moved

to

strike

the

affirmative

defenses,

arguing

that Chase had failed to comply with the pleading requirements
of Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and
Ashcroft v. Iqbal, 556 U.S. 662 (2009).

The court partially

granted that motion, striking, inter alia, a statute of frauds
defense asserted by Chase without prejudice to its right to move
for leave to amend the answer within twenty-one days.
Chase did not move for leave to amend its answer.

Instead,

it filed, within twenty-one days after the prior order, a motion
for judgment on the pleadings, arguing that Plaintiffs failed to
state a claim for breach of any written contract or violation of
the MCPA.

(ECF No. 33).

To the extent the agreement at issue

was not in writing, Chase asserted that the breach of contract
claim was barred by the statute of frauds.

In opposing that

motion, Plaintiffs argued that Chase’s statute of frauds defense
had been stricken, and that the defense was waived because Chase
failed to move for leave to amend.

Plaintiffs also clarified

that the modification agreement with EMC was not the contract
that was allegedly breached.

Rather, they identified the oral

restructure agreement as the subject of their breach of contract
claim:
6

This binding agreement or contract is
referred to in paragraphs 39 to 41 of the
[c]omplaint whereby the parties agreed to a
monthly payment of $2400 . . . for [four]
months, and if Plaintiffs timely made these
[four] payments, the trial modification
would become permanent. Plaintiffs accepted
this offer and made [four] payments in good
faith under this agreement as consideration
[] under the contract. Therefore, a binding
contract existed between Plaintiffs and
Defendant.
Defendant breached this agreement by
demanding a payment greater than what was
originally agreed upon.
(ECF No. 34, at 4 (internal record citations omitted)).7

They

also provided some clarification of the contours of their MCPA
claim:
The [c]omplaint paints a perfectly clear
picture of the Trial Plan Fraud Scheme that
Defendant perpetrated upon Plaintiffs: Mr.
and Mrs. Barry were having trouble making
their
payments
of
$2850.00
under
the
[modification agreement] . . . [s]o, they
contacted Defendant in an effort to come to
an
agreement
on
an
affordable
monthly
payment.
Plaintiffs and Defendant agreed
upon [the oral restructure agreement] where
Plaintiffs would pay their original monthly
payment of $2400 per month for [four]
months,
and
Defendant
represented
to
7

Plaintiffs’ opposition papers failed to distinguish
between the trial modification plan (i.e., the written agreement
to make four trial period payments) and the oral restructure
agreement (i.e., the prior agreement that making those payments
on time would result in a permanent restructuring of the loan).
Indeed, that distinction was not fleshed out until the motion
for summary judgment was filed. Moreover, while Plaintiffs have
repeatedly alleged that the trial modification plan involved six
monthly payments, the written document calls for four; thus,
that number has been substituted, in brackets, here.
7

Plaintiffs that if they paid this amount on
time and in full for [four] months, that
this modification would become permanent.
Plaintiffs fulfilled their end of this
agreement, but Defendant did not.
Instead,
Defendant demanded an exorbitant payment
amount that seemingly ignored the agreedupon
[oral
restructure
agreement].
Plaintiffs were unable to make this payment,
and thus defaulted on their mortgage.
(Id. at 9 (internal record citations omitted)).
While the motion for judgment on the pleadings was still
pending, Chase filed its motion for summary judgment, raising
essentially the same arguments, but attaching as exhibits the
trial

modification

responses.

(ECF

plan

No.

and

38).8

Plaintiffs’
Plaintiffs

initial

opposed

discovery

that

motion,

presenting no additional evidence (ECF No. 39), and Chase filed
a reply (ECF No. 40).
II.

Standard of Review
A court may enter summary judgment only if there is no

genuine issue as to any material fact and the moving party is
entitled
56(a);

to

judgment

Celotex

Corp.

as

a

matter

v.

Catrett,

of
477

law.
U.S.

See
317,

Fed.R.Civ.P.
322

Emmett v. Johnson, 532 F.3d 291, 297 (4th Cir. 2008).

(1986);
Summary

judgment is inappropriate if any material factual issue “may

8

Because discovery has now closed and evidence has been
submitted in support of a motion for summary judgment, the court
declines to consider a motion addressed to the sufficiency of
allegations contained in the complaint. Accordingly, the motion
for judgment on the pleadings will be denied.
8

reasonably be resolved in favor of either party.”

Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 250 (1986); JKC Holding Co.
LLC v. Wash. Sports Ventures, Inc., 264 F.3d 459, 465 (4th Cir.
2001).
“A party opposing a properly supported motion for summary
judgment ‘may not rest upon the mere allegations or denials of
[the]

pleadings,’

but

rather

must

‘set

forth

specific

showing that there is a genuine issue for trial.’”

facts

Bouchat v.

Balt. Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir.
2003) (quoting former Fed.R.Civ.P. 56(e)).
proof

.

.

.

will

not

suffice

to

“A mere scintilla of

prevent

summary

judgment.”

Peters v. Jenney, 327 F.3d 307, 314 (4th Cir. 2003).

“If the

evidence is merely colorable, or is not significantly probative,
summary judgment may be granted.”
249–50 (citations omitted).
construe

the

facts

that

Liberty Lobby, 477 U.S. at

At the same time, the court must
are

presented

in

the

light

most

favorable to the party opposing the motion. See Scott v. Harris,
550 U.S. 372, 378 (2007); Emmett, 532 F.3d at 297.
III. Analysis
A.

Breach of Contract

The evidence presented by Chase in support of its motion
for

summary

three

judgment

alleged

establishes

agreements

that

involved

in

there
this

are

essentially

case:

(1)

the

modification agreement, which Plaintiffs entered into with EMC
9

on January 6, 2009, providing for an increased monthly payment
and a reduction of the interest rate on the mortgage (ECF No.
17-2); (2) the trial modification plan, signed by Mr. Barry on
December 14, 2009, which called for Plaintiffs to pay delinquent
amounts that accrued from October through December 2009 (ECF No.
38-4); and (3) the oral restructure agreement, entered between
Mr. Barry and an unknown EMC representative on or about November
17, 2009, providing that if Plaintiffs performed under the trial
modification

plan,

(ECF No. 38-2).

EMC

would

permanently

modify

the

mortgage

It is now clear that the breach of contract

claim relates solely to the oral restructure agreement, which
EMC allegedly breached when it did not restructure the mortgage
after

Plaintiffs

complied

with

the

terms

of

the

trial

modification plan and, instead, demanded payment of past due
amounts.

As

a

result,

Plaintiffs

were

assessed

certain

penalties, their loan fell into default, and they “lost credit
opportunities” and suffered “emotional distress.”

(ECF No. 38-

2, at answers to interrogatories nos. 9, 17).
Chase argues that EMC is entitled to summary judgment on
this claim because “the alleged oral agreement . . . is barred
by Maryland’s Statute of Frauds for two distinct reasons: (1) it
cannot be performed fully within one year [see Md. Code Ann.,
Cts. & Jud. Proc. § 5-901(3)]; and (2) it involves an interest
in real estate [see Md. Code Ann., Real Prop. § 5-104].”
10

(ECF

No. 38-1, at 7).

Plaintiffs contend, in opposition, that Chase

“has waived its right to raise the Statute of Frauds as an
affirmative defense” and, in any event, that the statute of
frauds does not apply.

(ECF No. 39, at 3).

Initially, it must be determined whether Chase may raise
the statute of frauds defense that was previously stricken from
its answer.

Pursuant to Federal Rule of Civil Procedure 8(c),

“a party must affirmatively state any avoidance or affirmative
defense” in a responsive pleading.
so constitutes waiver.

Generally, the failure to do

See Brinkley v. Harbour Recreation Club,

180 F.3d 598, 612 (4th Cir. 1999), overruled on other grounds by
Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003)).
unfair

surprise

or

prejudice,”

however,

“some

“Absent

courts

have

allowed a party to raise an affirmative defense for the first
time as late as trial, but only where the evidence supporting
the defense is introduced without objection.”

Innovative Legal

Marketing, LLC v. Market Masters-Legal, --- F.Supp.2d ----, 2012
WL 1081180, at *3 (E.D.Va. Mar. 30, 2012) (citing 5 Charles Alan
Wright, Arthur R. Miller, Mary Kay Kane, Richard L. Marcus,
Federal Practice and Procedure § 1238 (3d ed. 2011)).

In fact,

even where the defendant does not raise an affirmative defense,
“a sua sponte grant of summary judgment on that ground may still
be appropriate ‘so long as the losing party was on notice that
she had to come forward with all of her evidence.’”
11

Innovative

Legal Marketing, 2012 WL 1081180, at *3 (quoting Rutecki v. CSX
Hotels, Inc., 290 Fed.Appx. 537, 542 (4th Cir. 2008)); see also
Hughes v. Bedsole, 48 F.3d 1376, 1381 (4th Cir. 1995) (“‘district
courts are widely acknowledged to possess the power to enter
summary judgments sua sponte, so long as the losing party was on
notice that she had to come forward with all of her evidence.’”
(quoting Celotex, 477 U.S. at 326)).
Here, Plaintiffs were on notice of their obligation to come
forward
judgment,

with

evidence

see

opposing

Fed.R.Civ.P.

Chase’s

56(c),

and

motion
have

for

summary

presented

none.

Moreover, they do not claim unfair surprise or prejudice, nor
could they under the facts of this case, as Chase filed a motion
asserting

a

statute

of

frauds

defense

within

the

same

time

period allotted for it to move for amendment of its answer.
Indeed, it was not until Plaintiffs propounded their discovery
responses, well after the motion for judgment on the pleadings
was filed (ECF No. 38-2, at 14), that Chase could have known
with

certainty

that

the

breach

of

contract

claim

related

entirely to an oral agreement.
Notably, one of the arguments presented by Plaintiffs in
opposition to the motion for summary judgment is that “the terms
of the oral agreement . . . remain in dispute.”
1).

(ECF No. 39,

Although the record reflects otherwise – the only evidence

regarding the terms of the purported oral agreement is set forth
12

by Plaintiffs in their discovery responses (ECF Nos. 38-2, 38-3)
– this is precisely the kind of problem that the statute of
frauds is meant to avoid.

Considering that the parties have had

two rounds of briefing on the issue, and that due to certain
procedural irregularities in the case it has only recently been
revealed that the breach of contract claim relates entirely to
an

oral

agreement,

judgment.

Chase

may

raise

the

defense

on

summary

See Brinkley, 180 F.3d at 613 (finding no waiver

where the plaintiff “had fair warning that the [affirmative]
defense was likely to arise . . . [and] had ample opportunity to
respond to [the defendant’s] summary judgment motion in which it
initially

raised

[it]”);

Cornell

v.

Council

of

Unit

Owners

Hawaiian Village Condominiums, Inc., 983 F.Supp. 640, 643 (D.Md.
1997)

(finding

no

waiver

where

the

plaintiff

“filed

a

comprehensive response to the pending summary judgment motion,
demonstrating his thorough understanding of the principles of
law and fact”).
The

question

of

whether

the

oral

restructure

agreement

falls within the scope of the Maryland statute of frauds is more
clear-cut.

Pursuant to Md. Code Ann., Real Prop. (“RP”) § 5-

104, “[n]o action may be brought on any contract for the sale or
disposition of land or of any interest in or concerning land
unless the contract on which the action is brought, or some
memorandum or note of it, is in writing and signed by the party
13

to be charged or some other person lawfully authorized by him.”
The

evidence

proposed

reflects

permanent

that

the

modification

oral
of

restructure
an

existing

agreement
mortgage.

Because a mortgage is a contract concerning land, it follows
that the oral restructure agreement falls within the statute of
frauds.

See

(holding

that

Calomiris
a

v.

“mortgage

Woods,

353

contract

.

Md.

425,

.

falls

.

445

(1999)

within

the

Statute of Frauds . . . and strict enforcement of the Statute of
Frauds should apply to prevent the admission of parol evidence
inconsistent

with

the

terms

of

the

contract.”);

Campbell

v.

Indymac Bank, FSB, Civ. No. CCB-09-3182, 2010 WL 419387, at *2
(D.Md. Jan. 29, 2010) (finding, under Maryland law, that an
“oral contract” which “modified [the plaintiff’s] home loan . .
.

concerned

an

interest

in

real

property”

and

could

not

be

enforced under the statute of frauds); 10 Williston on Contracts
§ 29:46 (Thomas Reuters, 4th ed. 2012) (“It is a well-recognized
principle that where a Statute requires a contract must be in
writing, or evidenced by a written memorandum, the terms of that
contract

cannot

be

varied

by

subsequent

oral

agreements.”)

(internal marks omitted).
The statute of frauds set forth at RP § 5-104 required that
the oral restructure agreement be in writing.

14

Because it was

not,

it

is

unenforceable,

and

EMC

is

entitled

to

summary

judgment on the breach of contract claim.9
B.

Maryland Consumer Protection Act

The MCPA, codified at Md. Code Ann., Comm. Law (“CL”) §§
13-101, et seq., “was intended to provide minimum standards for
the

protection

of

consumers

in

[Maryland].”

Motors Corp., 397 Md. 108, 140 (2007).
passed

the

increase

Act

“existing

of

deceptive

federal

coordinated

“in

and

and
not

response

to

State
widely

and

laws
known

v.

Gen.

The Maryland legislature

mounting

practices”

Lloyd

concern

because

[were]
or

it

over
felt

inadequate,

adequately

the
that

poorly

enforced.”

Morris v. Osmose Wood Preserving, 340 Md. 519, 536-37 (1995).
The

Act

achieve

is
its

intended
consumer

to

be

liberally

protection

construed

order

to

See

objectives.

in

State

v.

Cottman Transmissions Sys., Inc., 86 Md.App. 714, 743 (1991).
Under the MCPA, “a person may not engage in any unfair or
deceptive

trade

practice”

related

extension of consumer credit.”

to,

inter

CL § 13-303.

9

alia,

“[t]he

Section 13-301(1)

Chase also argues that the oral restructure agreement is
unenforceable under Md. Code Ann., Cts. & Jud. Proc. § 5-901(3),
because it cannot be performed within one year.
The one-year
provision only applies, however, where the parties either
“expressly and specifically” agree that the oral contract will
not be performed within one year, or “when it is impossible by
the terms of the contract for it to be performed fully within
one year.”
Griffith v. One Inv. Plaza Assos., 62 Md.App. 1, 5
(1985).
The record does not reflect that either of those
situations is presented here.
15

prohibits any “[f]alse, falsely disparaging, or misleading oral
or

written

statement,

visual

description,

or

other

representation of any kind which has the capacity, tendency, or
effect of deceiving or misleading consumers.”
In moving for summary judgment on this count, Chase argues:
(1)

that

practices;

EMC

did

(2)

not

that

engage

in

Plaintiffs

unfair

or

not

within

are

deceptive
the

trade

class

of

persons the Act was designed to protect; and (3) that Plaintiffs
have not sustained a specific injury or loss.
provided,

however

responses,

which

–

were

i.e.,

The only evidence

Plaintiffs’

submitted

by

Chase

initial
in

discovery

support

of

its

motion – supports that EMC misrepresented to Mr. Barry, on or
about

November

17,

2009,

that

if

he

made

full

and

timely

payments under the trial modification plan, “Plaintiffs would
receive a restructuring of their mortgage with monthly payments
in line with the trial modification plan.”

(ECF No. 38-2, at

answer

is

to

interrogatory

Plaintiffs
occurred.

fully

no.

performed

4).
and

There
that

no

such

evidence

that

modification

While it is true, as Chase observes, that the trial

modification

plan

contains

no

terms

suggesting

that

it

was

intended to restructure the mortgage, it is also true that it
contains no terms directing Plaintiffs to continue making their
regular monthly payments in addition to the arrearages over the
four-month term.

Yet, those amounts are precisely what EMC
16

demanded at the end of the four months, and it is at least
plausible, based on the sparse record presented, that EMC made
oral misrepresentations that induced Plaintiffs to believe they
were only required to make the trial period payments knowing
that Plaintiffs would likely default when later presented with a
demand for four months of regular payments.
Chase appears to concede that there is sufficient evidence
that a misrepresentation was made, but argues that Plaintiffs
cannot show that they were “induced to enter into the December
8,

2009[,]

Agreement

representation.”

based

on

(ECF No. 40, at 7).

Chase’s

alleged

oral

Chase relies on Bank of

America, N.A. v. Jill P. Mitchell Living Trust, 822 F.Supp.2d
505, 532 (D.Md. 2011), for the proposition that “[c]onsumers
must prove that they relied on the misrepresentation,” and that
“[a]

consumer

relies

on

a

misrepresentation

when

the

misrepresentation substantially induces the consumer’s choice.”
(Id. (quoting Jill P. Mitchell Living Trust, 822 F.Supp.2d at
532)).
the

Judge Williams made clear in that case, however, that

question

of

“[w]hether

a

misrepresentation

substantially

induces a consumer’s choice is ordinarily a question of fact for
the trier of fact.”
398, 416 (1994)).
a

fact-finder

Id. (citing Nails v. S & R, Inc., 334 Md.

Moreover, “[t]he quantum of evidence on which

could

reasonably

conclude

that

an

alleged

misrepresentation substantially induces a consumer’s choice is
17

relatively low.”

Id.

Here, there is a sufficient basis upon

which a fact finder could determine that Plaintiffs relied on
EMC’s misrepresentation.10
Chase further argues that Plaintiffs do not fall within the
class of persons protected under the MCPA because “the record
does not contain any facts supporting . . . that Chase’s alleged
wrongful

acts

occurred

during

the

origination

loan (i.e., the extension of credit).”

of

Plaintiffs’

(ECF No. 38-1, at 12).

It cites no case law suggesting that the “extension of credit”
referred to by Act is limited to the original loan, and at least
one

court

context.

has

found

that

the

MCPA

may

apply

in

a

similar

See Allen v. CitiMortgage, Inc., Civ. No. CCB-102740,

2011 WL 3425665, at *9 (D.Md. Aug. 4, 2011) (denying motion to
dismiss
regarding

MCPA

claims

modification

related
of

an

to

alleged

existing

10

misrepresentations

loan).

In

its

reply

Chase makes much of a statement made by Plaintiffs in
their discovery responses that, after the November 17, 2009,
oral restructure agreement, “Plaintiff Tim Barry signed the
agreement of December 8, 2009.”
(ECF No. 38-2, at answer to
interrogatory no. 4).
It appears to read this as an admission
that the terms of the oral restructure agreement were reduced to
writing in the trial modification plan, and then cites the fact
that the trial modification plan contains none of the alleged
provisions
of
the
oral
agreement
as
evidence
that
no
misrepresentation was made. In considering a motion for summary
judgment, however, the court must look at the evidence in the
light most favorable to the non-moving party.
See Scott, 550
U.S. at 378; Emmett, 532 F.3d at 297.
The clear thrust of
Plaintiffs’ discovery responses is that oral restructure
agreement called for EMC to modify the loan permanently after
performance under the trial modification plan.
18

papers,

Chase

contends

that

Allen

and

other

cases

cited

by

Plaintiffs are inapposite because they do not “speak[] to the
issue in contention, which . . . is whether the December 8, 2009
Agreement constitutes ‘an extension of consumer credit’ under
Section 13-303 of the Act.”

(ECF No. 40, at 9).

The “issue in

contention,” however, is not whether the trial modification plan
constitutes an extension of credit; rather, it is whether the
oral restructure agreement, which purported to modify the terms
of Plaintiffs’ mortgage, was such an extension.

While the MCPA

does not expressly define “extension of credit,” the term is
defined

under

the

Maryland

Credit

Services

Businesses

Act

(“CSBA”) as “the right to defer payment of debt or to incur debt
and

defer

its

payment,

offered

or

granted

personal, family, or household purposes.”

primarily

for

CL § 14-1901(f); see

also CL § 14-1914(a) (any violation of the CSBA “is an unfair or
deceptive trade practice under [the MCPA]”); Gomez v. Jackson
Hewitt,

Inc.,

427

Md.

128,

178

(2012).

The

oral

misrepresentations allegedly made by EMC clearly relate to an
extension of credit under this definition.
Finally, Chase urges that summary judgment in favor of EMC
is

appropriate

specific
private

because

injury
right

of

or

loss.

action

Plaintiffs
Because
only

where

have
the
an

not
MCPA

sustained
provides

individual

any

for

seeks

a

“to

recover for injury or loss sustained by him as the result of a
19

practice prohibited by this title,” CL § 13-408, the Court of
Appeals of Maryland has “clarified that an individual may only
bring a claim . . . if she can ‘establish the nature of the
actual injury or loss that he or she has allegedly sustained as
a result of the prohibited practice.’”

Willis v. Countrywide

Home

CCB-09-1455,

Loans

Servicing,

L.P.,

Civ.

No.

2009

WL

5206475, at *6 (D.Md. Dec. 23, 2009) (quoting Lloyd, 397 Md. at
148);

see

(1992).

also
The

Citaramanis

record

v.

reflects

Hallowell,
that

328

Plaintiffs

Md.

142,

were

152

assessed

penalties in the form of Chase’s demand for “$11,367.60 and all
charges flowing from that demand,” that Plaintiffs “lost credit
opportunities

as

a

result

of

Defendant’s

violation

[MCPA],” and that they suffered “emotional distress.”
38-2, at answers to interrogatories nos. 8, 9, 17).

of

the

(ECF No.
See Allen,

2011 WL 3425665, at *10 (finding the plaintiff’s allegations of
“damage

to

[her]

credit

score

[and]

emotional

damages”

sufficient to allege “an actual injury or loss as a result of a
prohibited practice under the MCPA”).

Chase points to no case

law supporting that this evidence does not constitute an actual
injury or loss under the MCPA, nor does it present any evidence
in rebuttal.
In sum, Chase has not demonstrated that EMC is entitled to
judgment as a matter of law on the MCPA claim.

Accordingly, its

motion for summary judgment as to this claim will be denied.
20

IV.

Conclusion
For

the

foregoing

reasons,

Chase’s

motion

judgment will be granted in part and denied in part.

for

summary

A separate

order will follow.

________/s/_________________
DEBORAH K. CHASANOW
United States District Judge

21