Hoang et al v. Rosen et al

Filing 55

MEMORANDUM OPINION (c/m to Plaintiffs 2/28/13 sat). Signed by Chief Judge Deborah K. Chasanow on 2/28/13. (sat, Chambers)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
MINH VU HOANG, et al.
:
v.

:

Civil Action No. DKC 12-1393

:
GARY ROSEN, et al.
:
MEMORANDUM OPINION
On or about April 27, 2012, Plaintiffs Minh Vu Hoang and
Thanh Hoang were provided notice that a foreclosure sale of
their

home,

located

at

9101

Clewerwall

Drive

in

Bethesda,

Maryland (“the Property”), was scheduled to take place on May
14, 2012.
action

Approximately ten days later, they commenced this

against

Gary

Rosen,

the

chapter

7

trustee

in

their

ongoing bankruptcy proceeding; Cindy Diamond and Bruce Brown,
the substitute trustees; Fay Servicing, LLC, the loan servicer;
Citibank, N.A., as trustee for CMLTI Asset Trust, the holder of
a

promissory

Property;

and

predecessor
complaint

note

in

secured

Citigroup
interest

alleged,

inter

by

Global
of

a

Markets

the

alia,

deed

of

trust

Realty

current

note

violations

of

against

the

Corporation,
holder.
the

Fair

a

The
Debt

Collection Practices Act (“FDCPA”), and sought to enjoin the

foreclosure sale and quiet title to the Property.1
with

the

complaint,

Plaintiffs

filed

a

motion

Concomitantly
for

temporary

restraining order, requesting an emergency hearing in advance of
the foreclosure sale.

(ECF No. 2).2

The court issued a memorandum opinion and order on May 10,
2012, construing a letter attached to the complaint as a motion
for

leave

to

proceed

in

forma

pauperis,

and,

so

construed,

granted that motion and dismissed the complaint, sua sponte,
pursuant to 28 U.S.C. § 1915(e).

(ECF No. 3).

It explained:

The complaint, which is inartfully
drafted, appears to relate largely to the
underlying
promissory
note.
While
1

Plaintiffs cited diversity of citizenship and federal
question jurisdiction as the jurisdictional bases of their
complaint.
The parties are not diverse, however, as the
plaintiffs and multiple defendants are Maryland residents.
2

In addition to actively defending in the state court
foreclosure proceeding, one or both plaintiffs were prosecuting,
at around the same time, an adversary proceeding in the United
States Bankruptcy Court for the District of Maryland (Bankr. No.
12-00224-TJC) and a civil case in the Circuit Court for
Montgomery County, which was later removed to the bankruptcy
court (Bankr. No. 12-00330-TJC), against the same or similar
parties related to similar claims.
The adversary complaint in
case No. 12-00224-TJC was dismissed on or about November 16,
2012, for lack of subject matter jurisdiction. (Bankr. No. 1200224-TJC, ECF No. 103).
The other adversary proceeding, No.
12-00330-TJC, was remanded to the circuit court on August 21,
2012.
(Bankr. No. 12-00330-TJC).
According to publicly
available records, on January 18, 2013, the Circuit Court for
Montgomery
County
dismissed
Plaintiffs’
complaint,
with
prejudice, as to Ms. Diamond, Mr. Brown, Fay Servicing,
Citigroup Global Markets Realty Corporation, and Citibank. N.A.,
as trustee for CMLTI Asset Trust, leaving Mr. Rosen as the sole
remaining defendant.
Plaintiffs’ motion for summary judgment
was denied on February 7, 2013.
2

Plaintiffs acknowledge that they executed
the deed of trust on May 4, 1990, they
contend that they never signed the note, and
that the document filed in circuit court,
which bears their signatures, is a forgery.
On this basis, they challenge the authority
of the substitute trustees to proceed with
the sale, and seek, inter alia, rescission
of the deed of trust on the theory that
because the promissory note is invalid, “the
Deed of Trust is null and void and without
legal force[.]” (ECF No. 1, at 9).
. . . .
Given
the
fact
that
various
note
holders have, since 2005, attempted to
foreclose on the Property [as evidenced by
filings in the bankruptcy case] and that
Plaintiffs apparently made payments on the
debt evidenced by the note for approximately
fifteen
years
before
they
filed
for
bankruptcy, their present assertion that the
note is invalid is dubious, at best.
Nevertheless,
their
federal
claims
for
violation of the FDCPA cannot be sustained
because they are untimely.
Pursuant to 15
U.S.C. § 1692k(d), “[a]n action to enforce
liability created by [the FDCPA] may be
brought in any appropriate United States
district court without regard to the amount
in controversy . . . within one year from
the date on which the violation occurred.”
Here, the alleged FDCPA violations appear to
have occurred at around the time the
foreclosure action was commenced in the
Circuit
Court
for
Montgomery
County.
According to publicly available records, the
foreclosure action was reopened by the
substitute trustees on February 17, 2011;
Mr. and Mrs. Hoang were served by no later
than March 1; and they both filed answers by
March 24. Thus, Plaintiffs were required to
bring their FDCPA claims by no later than
March 2012.
Because they did not commence
this action until on or about May 7, 2012,
their federal claims are time-barred.
3

(ECF No. 3, at 6-8 (internal footnote omitted)).3

On the same

date, the case was closed.
The court subsequently learned that an unknown individual
paid the filing fee and filed an amended temporary restraining
order in the northern division clerk’s office on May 10.

The

amended motion was then transferred to the southern division
clerk’s office and docketed in the closed case on May 11.
that

date,

the

court

issued

an

order

reopening

the

On

case,

vacating the prior order, and denying the amended motion for a
temporary restraining order.

Vacatur was warranted because “the

filing fee was paid prior to the time the initial memorandum
opinion and order was issued,” thus “Plaintiffs should not have
been permitted to proceed in forma pauperis” and “the court was
without authority to dismiss the case, sua sponte.”
at 2).

(ECF No. 5,

As to the amended temporary restraining order, the court

observed that “[t]he only statement regarding the likelihood of
success

on

the

merits

is

the

conclusory

allegation

that

[Plaintiffs] ‘have [a] strong likelihood of success of their
claims, and therefore it is very likely that Plaintiffs could
prevail on their arguments.’”
4)).

(Id. at 3 (quoting ECF No. 4 ¶

Noting that the applicable standard requires the movant to

make a “clear showing that it will likely succeed on the merits
3

The court declined to exercise supplemental jurisdiction
over Plaintiffs’ remaining state law claims.
4

at trial,” the court found that “Plaintiffs have not made that
showing here, nor could they”:
To the extent that their claims are not
barred by the doctrine of res judicata –
according to publicly available records,
they have challenged the foreclosure sale in
the Circuit Court for Montgomery County, the
Court of Special Appeals of Maryland, and
the United States Bankruptcy Court for the
District of Maryland – or vulnerable to
attack by affirmative defense, they appear
to be wholly meritless.
(Id. at 3-4).
Nevertheless, the case proceeded.

On June 4, 2012, Mr.

Rosen filed a suggestion of referral to bankruptcy, arguing that
the case should be consolidated with the adversary proceeding in
Bankr. No. 12-00224.

(ECF No. 11).

In response, Plaintiffs

filed a motion for voluntary dismissal of Mr. Rosen pursuant to
Federal Rule of Civil Procedure 41(a)(1).

4

(ECF No. 16).4

Federal Rule of Civil Procedure 41(a)(1)(A)(i) provides
that “the plaintiff may dismiss an action without a court order
by filing . . . a notice of dismissal before the opposing party
serves either an answer or a motion for summary judgment.” See
also Redding v. Ameriprise Auto & Home Ins., Civ. No. DKC 113141, 2012 WL 1268327, at *3 (D.Md. Apr. 13, 2012) (Despite the
word “action” in the rule, a majority of courts have permitted
voluntary dismissal of fewer than all defendants pursuant to
Rule 41(a)).
Because Mr. Rosen had not answered the complaint
or filed a motion for summary judgment, no court order was
necessary to procure dismissal.
Accordingly, this motion will
be denied and the clerk will be directed to amend the docket to
reflect that Mr. Rosen was terminated as a defendant on July 2,
2012.
5

On

June

19,

the

substitute

trustees

filed

a

motion

to

dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6),
arguing that the FDCPA claim is time-barred and that all claims
are barred by the doctrine of res judicata.

(ECF No. 13).

On

July 5, Mrs. Hoang, purportedly on behalf of herself and her
husband, filed a response in opposition to that motion (ECF No.
17), followed, four days later, by a “First Amended” complaint
(ECF No. 18).

With the exception of Mr. Rosen, the amended

complaint names the same parties as the original, and similarly
challenges the authority of the substitute trustees or other
defendants

to

act,

misconduct

occurring

ostensibly,

within

but

includes

within
the

the

numerous

foreclosure

limitations

allegations
proceeding

period.

On

July

of
and,
10,

Defendants Fay Servicing, LLC, Citigroup Global Markets Realty
Corporation,

Citibank,

N.A.,

and

CMLTI

Asset

Trust

filed

essentially a verbatim copy of the motion to dismiss previously
filed by the substitute trustees.

(ECF No. 21).

On July 11, the court issued an order directing Thanh Hoang
“to

file,

within

fourteen

(14)

days,

one

or

more

documents

containing his original signature and reflecting his intent to
join in the response to the motion to dismiss (ECF No. 17) and
amended complaint (ECF No. 18) filed by Minh Vu Hoang.”
No. 23, at 2).

(ECF

Mr. Hoang complied on July 20, by filing a

document “certify[ing] that he has joined his wife . . . in
6

filing documents no. 17 and no. 18.”

(ECF No. 36).

Thus, the

“amended” pleading filed on July 9 – i.e., within twenty-one
days after service of the initial motion to dismiss on June 19,
see Fed.R.Civ.P. 15(a)(1)(B) – is the operative pleading in this
case.5
As noted, the amended complaint essentially challenges the
authority

of

the

substitute

trustees

to

foreclose

on

the

Property because the party that appointed them was not a proper
note

holder

appointment.
of

the

and,

therefore,

no

authority

to

make

the

Thus, according to Plaintiffs, virtually every act

substitute

foreclosure

had

trustees

proceeding

or

constitutes

other
a

defendants

violation

of

in

the

the

FDCPA,

which “forbids the use of any false, deceptive, or misleading
representation or means in debt collection and provides a nonexhaustive list of prohibited conduct.”

United States v. Nat’l

Fin. Servs., Inc., 98 F.3d 131, 135 (4th Cir. 1996).
Plaintiffs’ claims in this regard are time-barred.6

The

FDCPA’s statute of limitations provides that “[a]n action to

5

Plaintiffs subsequently filed two “supplemental amended”
pleadings (ECF Nos. 33, 37) without first seeking leave of the
court, as required by Federal Rule of Civil Procedure 15(a).
They will not be considered.
6

The statute of limitations is an affirmative defense that
a party typically must raise in a pleading under Fed.R.Civ.P.
8(c), rather than in a motion pursuant to Rule 12(b)(6).
Dismissal is proper, however, “when the face of the complaint
clearly reveals the existence of a meritorious affirmative
7

enforce any liability . . . may be brought in any appropriate
United States district court . . . within one year from the date
on which the violation occurs.”

15 U.S.C. § 1692k(d).

While

Plaintiffs have alleged conduct occurring after May 7, 2011 –
i.e., one year prior to the date their original complaint was
filed – the limitations period for FDCPA claims commences “from
the date of the first violation, and subsequent violations of
the same type do not restart the limitations period.”

Fontell

v. Hassett, 870 F.Supp.2d 395, 404 (D.Md. 2012); see also Alston
v. Cavalry Portfolio Servs., LLC, Civ. No. 12-03589, 2013 WL
665036, at *3 (D.Md. Feb. 22, 2013); Reid v. New Century Morg.
Corp., Civ. No. 12-2083, 2012 WL 6562887, at *4 (D.Md. 2012).
As

noted,

“occurred

the
at

base

FDCPA

around

the

violations
time

the

alleged

by

foreclosure

Plaintiffs
action

was

commenced in the Circuit Court for Montgomery County,” which was
on or about February 17, 2011.

(ECF No. 3, at 8).

Thus,

“Plaintiffs were required to bring their FDCPA claims by no
later than March 2012,” when they were served and responded in

defense.” Brooks v. City of Winston-Salem, 85 F.3d 178, 181 (4th
Cir. 1996); see also 5B Charles A. Wright & Arthur R. Miller,
Federal Practice & Procedure § 1357, at 714 (3d ed. 2004) (“A
complaint showing that the governing statute of limitations has
run on the plaintiff’s claim for relief is the most common
situation in which the affirmative defense appears on the face
of the pleading and provides a basis for a motion to dismiss
under Rule 12(b)(6).”).
The face of Plaintiffs’ first amended
complaint clearly reveals the merit of Defendants’ limitations
defense; thus, dismissal on that ground is proper.
8

the foreclosure action.

(Id.).

Because they did not commence

this action until May 7, 2012, their federal claims are timebarred.7
Pursuant to 28 U.S.C. § 1367(c), the court has discretion
to

retain

or

dismiss

nonfederal

claims

where,

as

federal basis of the action is no longer applicable.

here,

the

District

courts in the Fourth Circuit “enjoy wide latitude in determining
whether or not to retain jurisdiction over state claims when all
federal claims have been extinguished.”
F.3d 106, 110 (4th Cir. 1995).

Shanaghan v. Cahill, 58

In deciding whether to exercise

discretion, courts consider factors such as the “convenience and
fairness to the parties, the existence of any underlying issues
of

federal

economy.”

policy,

comity,

and

considerations

of

judicial

Id. (citing Carnegie-Mellon Univ. v. Cohill, 484 U.S.

343, 350 n. 7 (1998)).

Ultimately, supplemental jurisdiction

7

The record is insufficient to permit a finding that
Plaintiffs’ claims are also barred by the doctrine of res
judicata, but to the extent that Plaintiffs complain of conduct
occurring in the foreclosure proceeding itself, the RookerFeldman likely serves as an additional bar. The Rooker-Feldman
doctrine bars “lower federal courts from considering not only
issues raised and decided in the state courts, but also issues
that are ‘inextricably intertwined’ with the issues that were
before the state court.’” Washington v. Wilmore, 407 F.3d 274,
279 (4th Cir. 2005) (quoting District of Columbia Court of
Appeals v. Feldman, 460 U.S. 462, 486 (1983)). Here, the docket
of the state court foreclosure proceeding demonstrates that
Plaintiffs challenged the foreclosure process at virtually every
conceivable juncture. Nevertheless, the Property was sold at a
foreclosure sale and the sale was ratified by the circuit court.
This court has no authority to consider allegations related to
the propriety of that sale.
9

“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.”

Id.

(quoting Carnegie-Mellon Univ., 484 U.S. at 350).
To

the

extent

that

it

could

exercise

jurisdiction

over

Plaintiffs’ remaining state law claims, the court will decline
to do so.

Accordingly, Defendants’ motions to dismiss will be

granted; Plaintiffs’ motion for voluntary dismissal of Mr. Rosen
will be denied; and all other pending motions will be denied as
moot.8
A separate order will follow.

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

8

These motions are: (1) Mrs. Hoang’s motion for an order to
participate in hearings by phone (ECF No. 7); (2) Mr. Rosen’s
suggestion of referral to the bankruptcy court (ECF No. 11); (3)
Plaintiffs’ motions for default judgment (ECF Nos. 34, 35); (4)
Defendants’ motion to strike (ECF No. 39); and (5) Plaintiffs’
motion for an extension of time (ECF No. 41).
10