Hasan v. Friedman & Macfadyen, P.A. Trustees et al
Filing
21
MEMORANDUM OPINION (c/m to Plaintiff 7/20/12 sat). Signed by Chief Judge Deborah K. Chasanow on 7/20/12. (sat, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
MALINA HASAN
:
v.
:
Civil Action No. DKC 11-3539
:
FRIEDMAN & MACFADYEN, P.A.,
et al.
:
MEMORANDUM OPINION
Presently pending and ready for resolution in this case is
a motion to remand filed by Plaintiff Malina Hasan (ECF No. 181) and motions to dismiss filed by Defendants Bank of New York
Mellon (ECF No. 7) and Friedman & MacFadyen, P.A. (ECF No. 11).
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, Plaintiff’s motion will be denied
and Defendants’ motions will be granted.
I.
Background
The following facts are either set forth in the complaint,
evidenced
by
documents
referenced
or
relied
upon
in
the
complaint, or are matters of public record of which the court
may take judicial notice.1
1
“Although as a general rule extrinsic evidence should not
be considered at the 12(b)(6) stage,” the court may consider
such evidence where the plaintiff has notice of it, does not
dispute its authenticity, and relies on it in framing the
complaint.
American Chiropractic Ass’n v. Trigon Healthcare,
In
September
2005,
Plaintiff
Malina
Hasan
obtained
a
$162,000 loan from First Horizon Home Loan Corporation for the
purchase of real property in Upper Marlboro, Maryland.
11, Ex. 6, promissory note).
trust
granting
First
(ECF No.
The loan was secured by a deed of
Horizon
a
security
interest
in
the
property, and the deed of trust was recorded among the land
records
trust).
of
Prince
Defendant
George’s
Bank
of
County.
New
York
(ECF
No.
Mellon
7-1,
deed
of
(“BNY
Mellon”)
subsequently became the payee of the promissory note.
At some
point, Plaintiff “ceased [making] her regular monthly mortgage
payment[s] on the loan to [BNY Mellon] . . . after she mailed .
. . a document with a series of questions . . . [and] stated
that [she] did not intend to make payments until her questions
Inc., 367 F.3d 212, 234 (4th Cir. 2002); see also Douglass v.
NTI-TSS, Inc., 632 F.Supp.2d 486, 490 n. 1 (D.Md. 2009). Here,
Defendants have attached numerous documents – including a deed
of trust, promissory note, and deed of removal and appointment
of substitute trustees – which are referenced or relied upon in
the complaint.
In her opposition papers, Plaintiff generally
“rejects all the contentions made by [Defendants]” (ECF No. 15,
at 2), but does not challenge the authenticity of the attached
documents.
Thus, the court may consider them in resolving the
pending motions to dismiss.
Furthermore, “a federal court may consider matters of
public record such as documents from prior . . . court
proceedings in conjunction with a Rule 12(b)(6) motion.” Walker
This is
v. Kelly, 589 F.3d 127, 139 (4th Cir. 2009).
particularly true where, as here, Defendants seek dismissal
pursuant to the doctrine of res judicata. See Brooks v. Arthur,
626 F.3d 194, 200 (4th Cir. 2010) (“[W]hen entertaining a motion
to dismiss on the ground of res judicata, a court may take
judicial notice of facts from a prior judicial proceeding when
the res judicata defense raises no disputed issue of fact.”
(internal marks and citation omitted)).
2
were
answered.”
(Id.
at
¶
11).
Consequently,
Plaintiff
defaulted on her loan.
On
May
6,
2010,
following
Plaintiff’s
discharge
from
chapter 7 bankruptcy, BNY Mellon appointed Kenneth J. MacFadyen,
a principal of the law firm Friedman & MacFadyen, P.A., among
others, as a substitute trustee under the deed of trust.
(ECF
No. 7-6, deed of removal and appointment of successor trustees).2
Two weeks later, the substitute trustees initiated foreclosure
proceedings in the Circuit Court for Prince George’s County,
Maryland.
Plaintiff filed an emergency motion to enjoin the
foreclosure sale, naming as defendants the substitute trustees,
First Horizon Home Loans, and MetLife Home Loans.
7).
(ECF No. 7-
Plaintiff sought an order enjoining the foreclosure sale,
arguing
“original
that
wet
the
ink
defendants
note”
were
associated
not
the
with
holders
the
of
property
therefore, that they had no authority to foreclose.
the
and,
(Id. at ¶
24).
The circuit court denied Plaintiff’s motion the following
day.
(ECF No. 7-9, circuit court memorandum and order, at 2).
2
Plaintiff has erroneously named Mr. MacFadyen’s law firm,
Friedman & MacFadyen, P.A., rather than Mr. MacFayden himself,
as a defendant in this case.
This oversight is understandable
in light of the fact that the circuit court appears to have made
the same mistake.
(ECF No. 7-9, memorandum and order, at 2
(“The Trustees in this case are Friedman & MacFadyen and not as
the claimant asserts, Trustees Curran and O’Sullivan”)).
The
firm correctly asserts that it has been improperly joined in
this action.
(ECF No. 11-1, at 7).
Given that the complaint
will be dismissed on other grounds, however, the misnomer is of
no real consequence.
3
The property was sold at a foreclosure sale on July 14, 2010
(id.), and the sale was ratified on December 8, 2010 (ECF No. 78).
On or about May 5, 2011 – i.e., approximately five months
after ratification – Plaintiff, by counsel, filed in the circuit
court a “motion to vacate and set aside the foreclosure sale and
counterclaim for breach of contract.”
(ECF No. 7-10).3
As
grounds for this motion, Plaintiff alleged:
[Nineteen] material violations of the Truth
in Lending Act, the Real Estate Settlement
Procedures Act and a variety of antipredatory-lending laws[;] . . . intentional
misrepresentations of fact made by the
lender and/or their servicing agents and/or
Trustees with knowledge of [their] falsity
and for the purpose of inducing Ms. [Hasan]
to reasonably rely upon the information
proffered to them, and to act upon [those]
material
misrepresentation[s]
to
Ms.
[Hasan’s] detriment (e.g. the mortgage that
they [] offered was predatory, was designed
to fail, served the lender but not the
borrower’s best interest)[;] . . . the Deed
of Trust and Promissory Note were not
recorded in the same name at the time of the
foreclosure sale[;] . . . the foreclosure
sale was premised upon fraud, because, based
on the higher standard of the fiduciary’s
responsibility, the act of not ascertaining
the ownership of the Promissory Note and
Deed of Trust is equal to a material
intentional misrepresentation based on a
falsehood, intended to get a purchaser to
commit to the purchase of the property, to
the detriment of Ms. [Hasan], and the
reliance
on
the
misrepresentation
was
3
References to page numbers for this document are to those
designated by the court’s electronic case filing system.
4
reasonable
buyer.
(Id. at 2-3).
under
the
circumstances
by
the
By a memorandum opinion and order issued May 10,
2011, the court denied this motion, reasoning, in relevant part:
[D]espite the arguments of counsel, the
Motion to Vacate was not filed in the
appropriate time because the sale has been
ratified for more than five months.
No
allegations sufficient to invoke Maryland
Rule 2-535(b) have been advanced and the
other issues advanced by the Defendant are
subsumed by the case of Bates v. Cohn, 417
Md. 309 (2010).
(ECF No. 7-9).
Plaintiff, proceeding pro se, commenced the instant action
against BNY Mellon and Friedman & MacFadyen by filing a verified
complaint in the Circuit Court for Prince George’s County on
October 26, 2011.
alleges
that
(ECF No. 2).
Defendants
“fail[ed]
In her complaint, Plaintiff
to
properly
and
accurately
credit payments . . . toward the loan, prepar[ed] and fil[ed]
false
documents,
and
foreclose[ed]
on
the
Subject
Property
without having the legal authority and/or proper documentation
to do so.”
“made
.
(Id. at ¶ 22).
.
.
false
She further contends that Defendants
representations,
concealments
and
non-
disclosures with knowledge of the misrepresentations, intending
to induce Plaintiff’s reliance[.]”
(Id. at ¶ 29).
Plaintiff
purports to raise claims of negligence, fraud, breach of implied
covenant of good faith and fair dealing, unjust enrichment, and
5
violations
of
(“HOEPA”).4
the
As
“[d]ismiss[ing]
Home
relief,
and
Ownership
she
Equity
seeks,
permanently
inter
enjoin[ing]
sale”;
“vacat[ing]
the
substitute
trustee’s
title
in
of
Plaintiff
and
favor
“compensatory,
special,
general,
and
“rescission of contract based on fraud.”
Protection
alia,
the
an
punitive
order
foreclosure
deed”;
against
Act
“quieting
Defendants”;
damages”;
and
(Id. at 18-19).
BNY Mellon was served with the complaint on November 10,
2011, and removed to this court on December 9, asserting federal
question
jurisdiction.
thereafter,
it
filed
Fed.R.Civ.P. 12(b)(6).
(ECF
a
No.
motion
(ECF No. 7).
1
to
¶¶
3,
6,
dismiss
9).
pursuant
Soon
to
Friedman & MacFadyen moved
to dismiss on similar grounds on December 29.
(ECF No. 11).
At
around the same time, Plaintiff filed a motion to remand in
state circuit court, which BNY Mellon attached to a notice it
filed in the instant case.
(ECF No. 18-1).
Plaintiff opposed
Defendants’ motions to dismiss on January 17, 2012.
15, 20).
(ECF Nos.
BNY Mellon opposed Plaintiff’s motion to remand (ECF
No. 17) and filed a reply with respect to its motion to dismiss
(ECF No. 19).
4
The complaint lists several other “counts” that are not
true causes of action, such as “dismiss and permanently stop
trustee’s sale” (count III), “wrongful/unlawful foreclosure”
(count IV), and “standing” (count IX).
To the extent that
Plaintiff seeks an order enjoining the foreclosure sale that
took place approximately sixteen months before she filed suit,
her complaint is moot.
6
II.
Motion to Remand
In
moving
to
remand,
Plaintiff
asserts,
in
conclusory
fashion, that “remand is proper because [BNY Mellon] did not
file its Notice of Removal within the requisite thirty day time
period after receipt of the [c]omplaint.”
(ECF No. 18-1).
In
response, BNY Mellon asserts that Plaintiff effected service of
process by certified mail on November 10, 2011, attaching as
proof
a
copy
of
an
envelope
postmarked
November
8
and
date
stamped November 10 (ECF No. 17-1) and a United States Postal
Service tracking report (ECF No. 17-2).5
Further observing that
it filed its notice of removal on December 9, 2011, BNY Mellon
maintains that its removal was timely.
When the plaintiff challenges the propriety of removal, the
defendant bears the burden of proving that removal was proper.
See Greer v. Crown Title Corp., 216 F.Supp.2d 519, 521 (D.Md.
2002) (citing Mulcahey v. Columbia Organic Chems. Co., 29 F.3d
148, 151 (4th Cir. 1994)).
On a motion to remand, the court must
“strictly construe the removal statute and resolve all doubts in
favor of remanding the case to state court.”
Richardson v.
Philip Morris Inc., 950 F.Supp. 700, 702 (D.Md. 1997) (internal
5
As BNY Mellon observes, this report appears to contain an
error.
It indicates an expected delivery date of November 10
and that processing in Maryland occurred on November 8, but that
the document was actually delivered in New York on November 1.
Defendant suggests that the “report presumably should state that
delivery was made on November ‘10’” (ECF No. 17 ¶ 3) and
Plaintiff has not challenged this assertion.
7
quotation marks omitted).
This standard reflects the reluctance
of federal courts “to interfere with matters properly before a
state court.”
Pursuant
Id. at 701.
to
28
U.S.C.
§
1446(b)(1),
“[t]he
notice
of
removal of a civil action or proceeding shall be filed within 30
days after the receipt by the defendant, through service or
otherwise, of a copy of the initial pleading setting forth the
claim
for
relief
based[.]”
upon
which
such
action
or
proceeding
is
Furthermore, “[w]hen a civil action is removed solely
under section 1441(a), all defendants who have been properly
joined and served must join in or consent to the removal of the
action.”
18 U.S.C. § 1446(b)(2)(A).
Here, BNY Mellon has shown that it was served with the
complaint on November 10, 2011, and that it filed the notice of
removal on December 9, within the thirty days required by §
1446(b)(1).
Furthermore,
the
notice
of
removal
recites,
“Defendant Friedman & MacFadyen consents to removal of this case
to
federal
court”
(ECF
No.
1
¶
9),
and
the
law
independently confirmed its consent (ECF No. 13).
requirements of § 1446(b)(2) are also satisfied.
has
not
specifically
challenged
any
of
these
firm
has
Thus, the
As Plaintiff
assertions,
Defendants have met their burden of establishing that removal
was timely.
Accordingly, Plaintiff’s motion to remand will be
denied.
8
III. Motions to Dismiss
A.
Standard of Review
The
purpose
of
a
motion
to
dismiss
pursuant
12(b)(6) is to test the sufficiency of the complaint.
to
Rule
Presley
v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006).
A
plaintiff’s complaint need only satisfy the standard of Rule
8(a), which requires a “short and plain statement of the claim
showing that the pleader is entitled to relief.”
8(a)(2).
Fed.R.Civ.P.
“Rule 8(a) (2) still requires a ‘showing,’ rather than
a blanket assertion, of entitlement to relief.”
v. Twombly, 550 U.S. 544, 555 n. 3 (2007).
Bell Atl. Corp.
That showing must
consist of more than “a formulaic recitation of the elements of
a cause of action” or “naked assertion[s] devoid of further
factual enhancement.”
Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (internal quotation marks omitted).
At this stage, the court must consider all well-pleaded
allegations in a complaint as true, Albright v. Oliver, 510 U.S.
266, 268 (1994), and must construe all factual allegations in
the
light
most
favorable
to
the
plaintiff,
see
Harrison
v.
Westinghouse Savannah River Co., 176 F.3d 776, 783 (4th Cir.
1999) (citing Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134
(4th Cir. 1993)).
Complaints filed by pro se litigants are “to
be liberally construed . . . and a pro se complaint, however
inartfully pleaded, must be held to less stringent standards
9
than formal pleadings drafted by lawyers.”
Erickson v. Pardus,
551 U.S. 89, 94 (2007) (internal quotation marks and citations
omitted).
The court need not, however, accept unsupported legal
allegations.
(4th
Cir.
couched
Revene v. Charles Cnty. Comm’rs, 882 F.2d 870, 873
1989).
as
Nor
factual
must
it
allegations,
agree
with
Iqbal,
556
legal
conclusions
U.S.
at
678,
or
conclusory factual allegations devoid of any reference to actual
events, United Black Firefighters v. Hirst, 604 F.2d 844 (4th
Cir. 1979); see also Francis v. Giacomelli, 588 F.3d 186, 193
(4th Cir. 2009).
“[W]here the well-pleaded facts do not permit
the court to infer more than the mere possibility of misconduct,
the complaint has alleged, but it has not ‘show[n] . . . that
the pleader is entitled to relief.’”
(quoting Fed.R.Civ.P. 8(a)(2)).
Iqbal, 556 U.S. at 679
Thus, “[d]etermining whether a
complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw
on its judicial experience and common sense.”
Id.
In the instant motions to dismiss, defendants raise several
affirmative defenses, including a statute of limitations defense
and the defense of res judicata.
The statute of limitations is
an affirmative defense that a party typically must raise in a
pleading
under
appropriate
Fed.R.Civ.P.
ground
for
8(c)
dismissal.
and
See
is
not
Eniola
usually
v.
an
Leasecomm
Corp., 214 F.Supp.2d 520, 525 (D.Md. 2002); Gray v. Mettis, 203
10
F.Supp.2d 426, 428 (D.Md. 2002).
proper
“when
the
face
of
the
Nevertheless, dismissal may be
complaint
clearly
existence of a meritorious affirmative defense.”
reveals
the
Brooks v. City
of Winston-Salem, N.C., 85 F.3d 178, 181 (4th Cir. 1996); see
also Rice v. PNC Bank, N.A., No. PJM 10-07, 2010 WL 1711496, at
*3 (D.Md. Apr. 26, 2010) (dismissing claims under the Truth in
Lending Act on motion to dismiss as untimely).
Similarly, the Fourth Circuit has permitted dismissal on
res judicata grounds in some circumstances:
This
Court
has
previously
upheld
the
assertion of res judicata in a motion to
dismiss.
Although an affirmative defense
such as res judicata may be raised under
Rule 12(b)(6) “only if it clearly appears on
the
face
of
the
complaint,”
when
entertaining a motion to dismiss on the
ground of res judicata, a court may take
judicial notice of facts from a prior
judicial proceeding when the res judicata
defense raises no disputed issue of fact.
Andrews v. Daw, 201 F.3d 521, 524 (4th
Cir. 2000) (internal
citations omitted).
B.
Analysis
Defendants move to dismiss on three grounds.
First, they
contend that Plaintiff’s sole federal claim, alleged violations
of the Home Ownership and Equity Protection Act (“HOEPA”), is
barred by the statute of limitations.
Second, they maintain
that the issues presented in the complaint were already resolved
in the foreclosure action; thus, the doctrine of res judicata
11
bars their relitigation in this case.
Finally, Defendants argue
that Plaintiff has, in any event, failed to state a claim for
relief as to all state common law claims.
Plaintiff’s response
fails to address any of these arguments.
1.
The Limitations Defense
The Truth in Lending Act (“TILA”) is a federal consumer
protection
statute
intended
to
promote
the
informed
use
credit by requiring certain disclosures from lenders.
of
HOEPA,
which was enacted as an amendment to TILA, “applies to a special
class of regulated loans that are made at higher interest rates
and are subject to special disclosure requirements.”
See In re
Community Bank of Northern Va., 622 F.3d 275, 282 (3rd Cir. 2010)
(citing 15 U.S.C. § 1639).
More specifically, “HOEPA requires
lenders to disclose to their borrowers the annual percentage
rate (‘APR’) of sums due for the use of monies loaned and the
amount of regular monthly payments.”
In re Community Bank of
Northern Va., 622 F.3d at 282-83.
Violations
of
the
HOEPA
disclosure
creditor give rise to a cause of action.
American
Mortg.
Network,
No.
1:11cv622
requirements
by
a
See Caballero v.
(JCC/JFA),
2011
WL
3440025, at *3 (E.D.Va. Aug. 8, 2011) (citing McAnelly v. PNC
Mortg., No. 2:10-cv-02754, 2011 WL 2366680, at *2 (E.D.Cal. June
8, 2011)).
Such an action, however, “must be brought within one
year from the date of the occurrence of the violation,” and the
12
violation date can be “no later than the date the plaintiff
enters the loan agreement.”
No.
CCB-10-11,
2010
WL
Hood v. Aurora Loan Servs., Civ.
2696755,
at
*2
(D.Md.
(internal marks and citations omitted).
1635(a),
a
consumer
whose
loan
is
July
6,
2010)
Pursuant to 15 U.S.C. §
secured
by
his
or
her
principal residence has the right to rescind the loan “until
midnight of the third business day following the consummation of
the
transaction
or
the
delivery
of
the
information
and
rescission forms required under this section together with a
statement
this
containing
subchapter,
the
material
whichever
is
disclosures
later[.]”
If
required
the
under
required
disclosures are never made, an action for rescission under TILA
or HOEPA “expire[s] three years after the date of consummation
of the transaction or upon the sale of the property, whichever
first occurs[.]”
15 U.S.C. § 1635(f); see also 12 C.F.R. §
226.23; Hood, 2010 WL 2696755, at *2 (citing In re Community
Bank of Northern Va., 622 F.3d at 305).
Thus, the statute of
limitations for any claim under HOEPA expires, at the latest,
three
years
from
the
date
the
plaintiff
entered
the
loan
agreement.6
In her complaint, Plaintiff asserts that she is entitled to
money
damages
and
rescission
of
6
the
deed
of
trust
because
Courts have disagreed as to whether equitable tolling may
apply to HOEPA claims. See Caballero, 2011 WL 3440025, at *3 n.
4. Plaintiff has not advanced a tolling argument, however.
13
Defendants
failed
to
comply
with
the
requirements
of
HOEPA.
Plaintiff closed on her mortgage, however, on or about September
13, 2005, and commenced this action on October 26, 2011, over
six years later.
Accordingly, any alleged violation of HOEPA is
time-barred and subject to dismissal.
Because subject matter jurisdiction in this case is based
on the federal HOEPA claim, which will be dismissed, questions
arise as to (1) whether the court may exercise supplemental
jurisdiction over the remaining state law claims, and (2) if so,
whether it should.
Pursuant to 28 U.S.C. § 1367(a), the court
may exercise supplemental jurisdiction over “all [nonfederal]
claims that are so related to [federal] claims in the action . .
. that they form part of the same case or controversy[.]”
Here,
the remaining state law claims – i.e., those alleging fraud,
negligence, breach of an implied covenant of good faith and fair
dealing, and unjust enrichment – are sufficiently related to the
HOEPA
claim
such
that
jurisdiction over them.
the
court
may
exercise
supplemental
See White v. County of Newberry, S.C.,
985 F.2d 168, 172 (4th Cir. 1993) (supplemental claims “need only
revolve around a central fact pattern” shared with the federal
claim).
Still, the court “may decline to exercise supplemental
jurisdiction . . . [if it] has dismissed all claims over which
it has original jurisdiction.”
28 U.S.C. § 1367(c)(3).
In
deciding whether to exercise discretion to consider supplemental
14
claims,
courts
generally
look
to
factors
such
as
the
“convenience and fairness to the parties, the existence of any
underlying issues of federal policy, comity, and considerations
Shanaghan v. Cahill, 58 F.3d 106, 110 (4th
of judicial economy.”
Cir. 1995) (citing Carnegie-Mellon Univ. v. Cohill, 484 U.S.
343, 350 n. 7 (1988)).
Ultimately, supplemental jurisdiction
“is a doctrine of flexibility, designed to allow courts to deal
with cases involving pendent claims in the manner that most
sensibly accommodates a range of concerns and values.”
(quoting Carnegie-Mellon Univ., 484 U.S. at 350).
Id.
Here, the
remaining state law claims plainly cannot be maintained in any
court;
thus,
it
makes
little
sense
to
remand
district court for further proceedings.7
judicial
economy,
the
court
will
them
to
state
In the interest of
exercise
supplemental
jurisdiction to consider the remaining claims.
2.
The Res Judicata Defense
Defendants contend that Plaintiff’s remaining claims are
barred
by
the
doctrine
of
res
judicata.
As
Judge
Williams
recently explained:
7
As this case was removed from the District Court of
Maryland for Prince George’s County, a decision not to exercise
supplemental jurisdiction would require remand of the remaining
claims to that court. See Darcangelo v. Verizon Communications,
Inc., 292 F.3d 181, 196 (4th Cir. 2002) (citing Roach v. W. Va.
Regional Jail and Corr. Facility Auth., 74 F.3d 46, 48-49 (4th
Cir. 1996)).
15
Res judicata, or claim preclusion, prohibits
relitigation of claims that could have been
asserted, or were decided, in a [] prior
suit between the same parties or their
privies.
[Anyanwutaku]
v.
Fleet
Mortg.
Group, Inc., 85 F.Supp.2d 566, 570 (D.Md.
2000). The purpose of this doctrine is to
provide litigants, as well as the judicial
system, with some definite end to the
litigation of matters previously addressed
by the court. . . . “Generally, the
preclusive effect of a judgment rendered in
state court is determined by the law of the
state in which the judgment was rendered.”
Laurel Sand & Gravel, Inc. v. Wilson, 519
F.3d 156, 162 (4th Cir. 2008). In accordance
with Maryland law, res judicata applies
when: (1) the present parties are the same
or in privity with the parties to the
earlier dispute; (2) the claim presented is
identical to the one determined in the prior
adjudication; and (3) there has been a final
judgment on the merits. See [Anyanwutaku],
85 F.Supp.2d at 570–71.
McCreary v. Beneficial Morg. Co. of Maryland, Civ. No. AW-11-cv01674, 2011 WL 4985437, at *3 (D.Md. Oct. 18, 2011).
Each of those requirements has been met here.
While the
parties are not identical to those in the foreclosure action,
they
are
in
privity
with
them.
The
plaintiffs
in
the
foreclosure case were the substitute trustees, including Kenneth
MacFadyen, principal of the law firm Friedman & MacFadyen, P.A.,
who is a named defendant in the instant case.
(ECF No. 7-8).8
Moreover, the substitute trustees in the foreclosure action were
8
As noted previously, the law firm itself is not a proper
defendant in this action, but Plaintiff clearly intended to sue
the substitute trustees.
16
acting to enforce the rights of BNY Mellon, a defendant here,
under the promissory note and deed of trust associated with
Plaintiff’s property.
(ECF No. 7-6).
There can be no question
that the substitute trustees were in privity with BNY Mellon.
See Vaeth v. Mayor and City Council of Baltimore City, Civ. No.
WDQ-11-0182,
2011
WL
4711904,
at
*2
(D.Md.
Oct.
4,
2011)
(“Privity exists when a non-party to the earlier litigation is
‘so identified with a party . . . that he represents precisely
the
same
legal
right
in
respect
to
the
subject
matter
involved.’”) (quoting Martin v. Am. Bancorporation Ret. Plan,
407 F.3d 643, 651 (4th Cir. 2005)); see also McCreary, 2011 WL
4985437,
at
*3
(finding
privity
where
“the
parties
in
the
foreclosure action included [s]ubstitute [t]rustees from the law
offices of [the defendant firm]”).
Moreover, the state law claims raised by Plaintiff in this
action are identical, for res judicata purposes, to those raised
in the foreclosure case.
on
the
same
proceeding
if
cause
it
of
“[A] claim in a second action is based
action
‘arises
[as
out
of
one
raised]
the
involves the same ‘operative facts.’”
same
in
an
earlier
transaction’
or
Vaeth, 2011 WL 4711904,
at *3 (quoting Keith v. Aldridge, 900 F.2d 736, 740 (4th Cir.
1990)).
In
considering
whether
claims
arise
from
a
prior
identical transaction, courts look to “whether the facts are
related in time, space, origin, or motivation, whether they form
17
a convenient trial unit, and whether their treatment as a unit
conforms to the parties’ expectations or business understanding
or
usage.”
McCreary,
Restatement
(Second)
of
2011
WL
Judgments
4985437,
§
24(2)
at
*3
(quoting
(1982)).
In
the
foreclosure action, Plaintiff argued that certain disclosures
were
purposefully
withheld
by
the
lender
and/or
substitute
trustees associated with her loan, and challenged the authority
of the substitute trustees to proceed with the foreclosure sale.
She has presented the exact same issues in this case.
Id. (“Any
claim that Defendants’ conduct in enforcing the Deed of Trust
was abusive or wrongful should have been raised as an exception
during the foreclosure proceeding itself.”).
Finally, the circuit court’s December 8, 2010, ratification
order
was
clearly
a
final
foreclosure proceeding.
the
foreclosure
sale
by
relief
prior
to
motion
vacate
and
set
filing
the
denied by the circuit court.
Plaintiff
had
an
sale
aside
counterclaim for breach of contract.
Because
on
(ECF No. 7-8).
injunctive
to
judgment
the
merits
the
Plaintiff challenged
emergency
and
the
of
a
motion
for
post-ratification
foreclosure
sale
and
Both of those motions were
(ECF No. 7-9).
a
full
and
fair
opportunity
to
litigate her claims against Defendants or their privies during
the foreclosure proceeding, the doctrine of res judicata bars
18
their
relitigation
in
this
case.
Accordingly,
Defendants’
motions to dismiss will be granted.
In
her
“intends
to
opposition
press
papers,
forward
Plaintiff
with
an
asserts
amended
that
complaint
she
to
meticulously set out the details behind the problems illustrated
in
the
initial
verified
complaint.”
(ECF
No.
15,
at
1).
Pursuant to Federal Rule of Civil Procedure 15(a)(2), courts are
to grant leave to amend a pleading “freely . . . when justice so
requires.”
Leave
should
be
denied,
however,
where
“the
amendment would be so prejudicial to the opposing party, there
has been bad faith on the part of the moving party, or the
amendment would be futile.”
HCMF Corp. v. Allen, 238 F.3d 273,
276 (4th Cir. 2001) (quoting Johnson v. Oroweat Foods Co., 785
F.2d 503, 509 (4th Cir. 1986)).
“An amendment is futile when the
proposed amendment is clearly insufficient or frivolous on its
face, or if the amended claim would still fail to survive a
motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6).”
El-Amin
v. Blom, Civ. No. CCB-11-3424, 2012 WL 2604213, at *11 (D.Md.
July 5, 2012).
statute
of
Because Plaintiff’s claims are barred by the
limitations
and/or
the
amendment would clearly be futile.
doctrine
res
judicata,
Thus, Plaintiff will not be
permitted to file an amended complaint.
19
of
IV.
Conclusion
For
the
foregoing
reasons,
Plaintiff’s
motion
to
remand
will be denied and Defendants’ motions to dismiss will granted.
A separate order will follow.
________/s/_________________
DEBORAH K. CHASANOW
United States District Judge
20
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