Gibbs et al v. Bank of America, N.A. et al

Filing 75

MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 3/31/2017. (kns, Deputy Clerk)(c/m 3/31/17)

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
Southern Division

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BARBARA A. GIBBS, et al,

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Case No.: GJH-I6-2855

Plaintiffs,

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v.

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BANK OF AMERICA, N.A., et al,

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Defendants.

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MEMORANDUM OPINION
This removal action stems from pro se Plaintiffs Barbara A. Gibbs and Melvin E. Gibbs'
claims against Defendants Bank of America, N.A. ("Bank of America"), Nationstar Mortgage
("Nationstar"); Urban Settlement Services, d/b/a Urban Lending Solutions ("Urban"); Jeffrey
Nadel, Esq.; Atlantic Law Group, LLC ("Atlantic Law Group"); Montgomery Village
Foundation, Inc. ("Montgomery Village Foundation"); Maryland Attorney General Brian E.
Frosh; South Carolina State Judge Cynthia Graham Howe and South Carolina Attorney General
Alan McCroy Wilson (hereinafter, the "South Carolina Defendants") and four unnamed
defendants ("DOES 6-10"), regarding Plaintiffs' unsuccessful attempts to receive loan
modifications on their mortgages. Dispositive motions are pending before the Court on behalf of
all of the named defendants in this case: Defendant Frosh's Motion to Dismiss, ECF No. 10;
Defendants Bank of America and Nationstar's Motion to Dismiss, ECF No. 13; Defendant
Nadel's Motion to Dismiss, ECF No. 17; Montgomery Village Foundation's Motion to Dismiss,
ECF No. 25; Defendant Urban's Motion to Dismiss, ECF No. 31; the South Carolina
Defendants' Motion to Dismiss, ECF No. 57; and Defendant Atlantic Law Group's Motion to

Dismiss, ECF No. 66. Plaintiffs have filed a myriad of motions which the Court will also
consider at this time: Plaintiffs' Motion for Summary Judgment, ECF No. 39; Plaintiffs' Motion
for Clerk's Entry of Default as to Defendant Atlantic Law Group, ECF No. 48; Plaintiffs'
Motion for Sanctions Against All Defendants, ECF Nos. 53, 70 and 74; Plaintiffs' Motion for
Leave to File a Second Amended Complaint, ECF No. 60; Plaintiffs' Motion for Clerk's Entry of
Default as to unspecified Defendants, ECF No. 65; and Plaintiffs' Motion for Clerk's Entry of
Default as to Bank of America, Nationstar, Nadel, Atlantic Law Group, the South Carolina
Defendants and the Attorney General of Maryland, ECF No. 71. A hearing is unnecessary. Loc.
R. 105.6 (D. Md. 2016). For the reasons stated below, the Court will grant all of Defendants'
pending motions to dismiss and deny Plaintiffs' motions.

I.

BACKGROUND!
Between 2005 and 2006, Plaintiffs purchased two homes, one in Florence, South

Carolina and one in Gaithersburg, Maryland. ECF No. 2 ~ 50. Plaintiffs state that they "financed
the building of their South Carolina home with a one year construction loan[,] purchased with a
30-year fixed rate mortgage from [Bank of America.]." /d. Plaintiffs further state that the South
Carolina home was their primary residence until 2011, when they moved to Maryland so that Mr.
Gibbs could receive cancer treatment at Johns Hopkins Hospital in Baltimore, Maryland. /d. ~~
50, 59. They proffer no additional facts regarding the existence of a mortgage for their Maryland
home. However, the judge in a prior, almost identical case that Plaintiffs brought in the District
of Colorado stated that "it is clear that both of the Plaintiffs' mortgages were with [Bank of
America]." See Gibbs-Squires v. Urban Seulement Servs., No. 14-CV-00488-MSK-CBS,

2015

I While Plaintiffs frame a portion or their allegations as a proposed class action, a pro se plaintiff may not maintain a
class action case. See Tresvanl v. Oliver, No. CIVA DKC 12-0406,2013 WL 598333, at *4, (D. Md. Feb. 15,
2013) (citing Oxendine v. Williams, 509 F.2d 1405, 1407 (4th Cir.1975». Thus, such claims, see ECF No.2'
2448. will not be considered by the Court.

2

WL 196217, at *9 n.12 (D. Colo. Jan. 14, 20 IS), aff'd, 623 F. App'x 917 (10th Cir. 2015)
(emphasis in the original) (hereinafter, "the Colorado Action,,).2
Beginning in May of2008, Plaintiffs sought loan modifications from Bank of America.3
ECF NO.2 'll53. Bank of America initially approved Plaintiffs' request for loan modifications,
conditioned upon their payment of $30,000 in closing costs. Id. Plaintiffs declined the loan
modifications because any savings from a reduction in their monthly mortgage payments would
be erased by the new requirement to pay closing costs. Id. Plaintiffs continued, unsuccessfully, to
request alternative loan modifications from Bank of America until 2012. Id. 'll'll55-70. At that
point, they were informed by Bank of America that their mortgages had been sold to Nationstar.
Id. 'll70. Although Plaintiffs state that they "made all of their mortgage payments in full and on
time," id. 'll50, this contention is contradicted by their filings in the Colorado Action, where they
stated that "[i]n or about November 2009, after being totally frustrated with [Bank of America],
Mr. Gibbs returned to South Carolina; we stopped paying the mortgage and have not paid the
mortgage in five (5) years." Colorado Action, 2015 WL 196217, at *9.4
Plaintiffs complain about their treatment by Bank of America employees while they
sought loan modifications, stating that they were repeatedly misled about their qualifications for
a federal program known as the Home Affordable Modification Program ("HAMP"), which aims
to provide mortgage modifications to eligible borrowers facing foreclosure, and were often told

2

While Defendant Bank of America never affirmatively states that it owned both mortgages, neither does it dispute

this contention.
Again, Plaintiffs do not speci!)' whether they sought to modi!)' their South Carolina mortgage, their Maryland
mortgage, or both. However, based on the judge in the Colorado Action's statement that both mortgages were with
Bank of America, Plaintiffs' statement in the Colorado Action that they sought to have "both home mortgages
modified," and Plaintiffs' reference to seeking "loan modifications," plural rather than singular, from Bank of
America in this case, the Court assumes that Plaintiffs sought to modi!)' both loans. See Colorado Action, 2015 WL
196217, at. 9 n.12.
4 It is unclear whether Plaintiffs meant that they stopped paying their South Carolina mortgage or their Maryland
mortgage. See Colorado Action, 2015 WL 196217, at • 9 n. 12.
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to resubmit documents that they had already submitted. Id. ~~ 5-6, 50-73.5 These allegations are
repeated, almost word for word, from the allegations in Plaintiffs' Colorado Action complaint,
which focused on Plaintiffs' request for a loan modification regarding the South Carolina
property. Compare ECF No. I ~~ 50-73, with Colorado Action, 2015 WL 196217, at Dkt. NO.1

These allegations serve as the basis for what Plaintiffs describe as a violation ofthe
Racketeer Influenced and Corrupt Organizations ("RICO") Act, 18 U.S.C.

S 1962(c),

in which

Bank of America, Nationstar, Urban and other known and unknown defendants, conspired to
defeat the purpose of the HAMP program by misleading and deceiving borrowers. ECF No. 2 ~~
2,5-6, 9-13; see also id. ~~ 77-98. According to Plaintiffs, Bank of America and its coconspirators "serially strung out, delayed and otherwise hindered the modification processes that
it agreed to facilitate," resulting in otherwise qualified homeowners becoming unable to
participate in the program. Id. ~~ 4-5. Plaintiffs allege that Bank of America directed Nationstar
and Urban to acquire mortgages of HAMP applicants and foreclose on their homes. Id. ~~ 7, 2546. They further assert that Bank of America, Nationstar, Urban, and their other co-conspirators,
fraudulently claimed that key documents relating to HAMP modifications were never received
and lied to homeowners who were in the process of applying for HAMP modifications. Id. ~ 9.
Plaintiffs also allege that Bank of America directed Defendants Nadel, Atlantic Law
Group and Montgomery Village Foundation, to file frivolous lawsuits against them, with the
goal of "stealing" their homes. Id. ~ 24.7 They further allege that the Maryland Attorney General

, In the section titled "class action," Plaintiffs also include general allegations regarding other Bank of America
employees, along with Nationstar and Urban employees, but do not provide any details regarding their own personal
interaction with the individuals named. ld. ~ 26-46.
6 Dkt. No. I refers to the Colorado Action complaint, incorporated by reference into the Colorado Action amended
complaint.
7 Plaintiffs do not provide any information regarding the roles of these Defendants. For the reader's convenience, the
Court makes the following observations of their roles based on the uncontested statements in Defendants' briefs.

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entered into a consent agreement with Bank of America, agreeing to tum a "Blind Eye to [Bank
of America's] continued conspiracy and racketeering in defrauding HAMP" in return for
receiving money from the bank. ld. ~ 24. Finally, Plaintiffs claim that Defendants have "paid
bribes to South Carolina government employees to institute and maintain their illegal foreclosure
practices." ld. ~ 107.
Together with their RICO claim, Plaintiffs bring seven additional claims against the
Defendants, who they often refer to generally as "Defendants" or the "HAMP-less gang." ld. ~
23. First, they allege state law claims of breach of contract, unjust enrichment, conspiracy and
violations of the Maryland Consumer Protection Act ("MCPA"), Md. Code Ann., Com. Law

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13-101, el seq. ld. ~~ 49-73, 99-109.8 Plaintiffs also allege violations ofthree federal civil rights
statutes, 42 U.S.C.

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1983, 1985 and 1986, claiming that Defendants' "illegal actions were

instituted against Plaintiffs based on their RACE: BLACK." ld. ~ 108.
On March 26, 2015, Nadel, on behalf of Nationstar, instituted foreclosure proceedings
against Plaintiffs regarding the Maryland property. See Nadel Action, Case No. 402900V, at Dkt.
No. I. On June 2, 2015, Plaintiffs filed a counter-claim in that case, id., at Dkt. No.12, which was
separated from the foreclosure case and became the initial complaint in a new case. See Gibbs v.
Bank of America, N.A., Case No. 405624V (Mont. Co. Cir. Ct. 2015), Dkt. No I (hereinafter, the

JeffTey Nadel was counsel for Nationstar in the foreclosure proceedings for the Maryland property. See ECF No. 13I at5; see also Nadel v. Gibbs, Case No. 402900V (Mont. Co. Cir. Ct. 2015) (hereinafter, the "Nadel Action").
Atlantic Law Group was foreclosure counsel for Wells Fargo, who purchased the Maryland property at the
foreclosure sale. See Nadel Action, Case No. 402900V, at Dkt. No. 39; see also ECF No. 66-1 at 1-2. Montgomery
Village Foundation notes that their "limited interaction with the Gibbs has been to take legal action ...to collect
unpaid assessments from [Plaintitl] Barbara Gibbs, owed to [Defendant] pursuant to a Declaration of Covenants
f,0verning [the Maryland property]." ECF No. 25-1 at 2.
While Plaintiffs also allege a violation of the "Implied Covenant of Good Faith and Fair Dealing," Maryland does
not recognize this as an independent cause of action. See Culler v. Wal-Marl Stores, Inc., 175 Md. App. 177, 195
(Md. Ct. Spec. App. 2007). Thus, their claim is dismissed. Similarly, in what is labelled "Count VII," Plaintiffs
request that Defendants be "estopped from relying on any statute of limitation defense." ECF No. 2 ~~ 75-76. As

these comments represent arguments against Defendants' potential use of an affirmative defense and do not state a
cognizable claim for relief, they will not be considered hy the Court at this time.

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"Gibbs Action,,).9 On August 12,2016, Defendants Bank of America and Nationstar removed
the Gibbs Action to this Court. ECF No. I.
After removal, each of the named Defendants filed a motion to dismiss, arguing that
Plaintiffs' claims were barred on multiple grounds including res judicata, lack of subject matter
jurisdiction, improper venue, lack of personal jurisdiction, and failure to state a claim upon
which relief may be granted. See ECF Nos. 10, 13, 17,25,31,57,

and 66. Plaintiffs responded to

Defendants' motions via two omnibus Responses in Opposition, along with separate Responses
to the South Carolina Defendants and Defendant Atlantic Law Group's motions, purporting to
address the arguments of the Defendants, but instead mainly reiterating the conclusory
allegations from their Amended Complaint. See ECF Nos. 20, 38, 62 and 69. Plaintiffs have also
filed their own motions, including a Motion for Summary Judgment on all claims, ECF No. 39;
Motion for Clerk's Entry of Default as to Defendant Atlantic Law Group, ECF No. 48; Motion
for Sanctions Against All Defendants, ECF Nos. 53, 70 and 74; Motion for Leave to File a
Second Amended Complaint, ECF No. 60; Motion for Clerk's Entry of Default as to unspecified
Defendants, ECF No. 65; and Motion for Clerk's Entry of Default as to All Defendants, ECF No.
71.
II.

STANDARD OF REVIEW
To survive a motion to dismiss invoking Fed. R. Civ. P. 12(b)(6), "a complaint must

contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its
face.''' Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550
U.S. 544, 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

The Maryland state court dockets for the Gibbs and Nadet Actions can be accessed at
http://casesearch.courts.state.md.us
(last visited March 28, 2017).

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misconduct alleged." Iqbal, 556 U.S. at 678. "Threadbare recitals of the elements ofa cause of
action, supported by mere conclusory statements, do not suffice." Id. (citing Twombly, 550 U.S.
at 555) ("a Plaintiffs' obligation to provide the 'grounds' of his 'entitle[ment] to relief requires
more than labels and conclusions, and a formulaic recitation ofa cause of action's elements will
not do.").
Fed. R. Civ. P. 12(b)(6)'s purpose "is to test the sufficiency ofa ~omplaint and not to
resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses."
Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th CiT. 2006) (citation and internal
quotation marks omitted). When deciding a motion to dismiss under Rule 12(b)(6), a court "must
accept as true all of the factual allegations contained in the complaint," and must "draw all
reasonable inferences [from those facts] in favor of the plaintiff." £.1. du Pont de Nemours & Co.
v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (citations and internal quotation marks
omitted). The Court need not, however, accept unsupported legal allegations, see Revene v.
Charles County Comm 'rs, 882 F.2d 870, 873 (4th CiT. 1989), legal conclusions couched as
factual allegations, Papasan v. Allain, 478 U.S. 265, 286 (1986), or'conclusory factual
allegations devoid of any reference to actual events. United Black Firefighters of Norfolk v.
Hirst, 604 F.2d 844, 847 (4th CiT. 1979). Amended Complaints filed by pro se plaintiffs, as here,
are "to be liberally construed" and "must be held to less stringent standards than formal
pleadings drafted by lawyers." Erickson v. Pardus, 551 U.S. 89,94 (2007).10 However, the
Amended Complaint must contain more than "legal conclusions, elements of a cause of action,

10 As the court in the C%rada
Action indicated, Mr. Gibbs appears to have practiced law in the past, and courts
"normally doll not extend the benefits of liberal construction of pro se pleading to licensed (whether presently or
formerly) attorneys who choose to represent themselves." Colorado Action, 2015 WL 196217, *4 n. 9. (holding that
even under the more generous pleading standards afforded non-lawyers, plaintiffs still failed to state a claim).

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and bare assertions devoid of further factual enhancement." Nemet Chevrolet, Ltd v.
ConsumerajJairs.com, Inc., 591 F.3d 250, 255 (4th Cir. 2009).
Pursuant to Federal Rule of Evidence 201, a court at any stage of the proceedings may
'Judicially notice a fact that is not subject to reasonable dispute," provided that the fact "can be
accurately and readily determined from sources whose accuracy cannot reasonably be
questioned." Fed. R. Evid. 20 I(b)(2). These facts may be properly considered by the court
without converting a motion to dismiss into a motion for summary judgment, as long as the facts
are construed in the light most favorable to the plaintiff. Zak v. Chelsea Therapeutics Int 'I. Ltd.,
780 F.3d 597, 607 (4th Cir. 2015). Specifically, when as here, Defendants have raised the
defense of res judicata, "a court may judicially notice facts from a prior judicial proceeding."
Ashe v. PNC Fin. Servs. Grp., Inc., 165 F. Supp. 3d 357, 360 (D. Md. 2015) (quoting Brooks v.
Arthur, 626 F3d 194, 199 n.6 (4th Cir. 2010)). The consideration of the affirmative defense of
res judicata is appropriate at the motion to dismiss stage where "it clearly appears on the face of
the complaint...and

the res judicata defense raises no disputed issue of fact." Andrews v. Daw,

201 F. 3d 521, 524 n.1 (4th Cir. 2000).
III.

DlSCUSSION11
A. Res Judicata
Defendants Bank of America, Urban and Nationstar argue that all of Plaintiffs' claims

against them should be barred by the doctrine of res judicata because the District Court of
Colorado rejected the same allegations two years ago in the Colorado Action. See Colorado
11 Within their response memorandum, Plaintiffs also appear to dispute the removal of this case and this Court's
jurisdiction over their claims. These arguments are without merit. Plaintiffs have alleged violations of federal law,
including RICO and various civil rights statutes. and state law claims related to these controversies. Pursuant to 28
U.S.C. 9 1331, federal courts have "original jurisdiction of all civil actions arising under the Constitution, laws, or
treaties of the United States," along with any state law claims related to the same case or controversy. 28 U.S.c. 9
1367. Further, as this case originated in Montgomery County Circuit Court, it was properly removed to this Court,
which embraces the jurisdiction where the case was pending. 28 U.S.C. 9 1441(a). Thus,jurisdiction in this Court is
proper.

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Action, 2015 WL 196217. While taking the time to file eight motions in this case, including
motions for sanctions, default and summary judgment, Plaintiffs never mention the existence of
the prior litigation and do not address Defendants' arguments regarding res judicata.
"Res judicata, also known as claim preclusion, bars a party from relitigating a claim that
was decided or could have been decided in an original suit." Mbongo v. Jp Morgan Chase Bank,
N.A., No. CIV. PWG-14-1620, 2014 WL 3845443, at *3 (D. Md. Aug. 4, 2014), afj'd, 589 F.
App'x 188 (4th Cir. 2015) (quoting Laurel Sand & Gravel Co. v. Wilson, 519 F.3d 156, 161 (4th
Cir. 2008)). "For res judicata to prevent a party from raising a claim, three elements must be
present: '(I) a judgment on the merits in a prior suit resolving (2) claims by the same parties or
their privies, and (3) a subsequent suit based on the same cause of action.'" Ohio Valley Envtl.
Coal. v. Aracoma Coal Co., 556 F.3d 177,210 (4th Cir. 2009) (quoting Aliffv. Joy MIg. Co., 914
F.2d 39, 42 (4th Cir. 1990)). "Even claims that were not raised in the original suit may be
precluded if they arose from the same transaction or occurrence as those raised in the first suit
and were available to the plaintiff at the time of the first suit." Id. at 210-11.
In this instance, the relevant prior proceedings occurred in federal court. Thus, Fourth
Circuit precedent regarding res judicata applies, as "[i]t has been held in non-diversity cases
since Erie v. Tompkins, that the federal courts will apply their own rule of res judicata." Heiser v.
Woodruff, 327 U.S. 726, 733 (1946); see also Andrews, 201 F.3d at 524 ("Because [plaintiff]
brought his first suit against [defendant] in federal court, federal rules of res judicata apply.").
This is true even when, as is the case here, the prior litigation included both state and federal
claims. See Mbongo, 2014 WL 3845443, at *3 (D. Md. Aug. 4, 2014) (quoting Shoup v. Bell &
Howell Co., 872 F.2d 1178, 1179 (4th Cir.1989) (internal citations omitted) ("[F]ederal, not

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state, law determines the preclusive effect of a prior federal judgment," including actions where
"a federal court sits in diversity or has some other basis of jurisdiction.").
Having deciding the appropriate law to apply, the Court finds it useful to first address the
second element of res judicata. by identifying the claims and parties involved in the prior
litigation, before determining what issues were decided on the merits. In the Colorado Action,
the same plaintiffs, Mr. and Mrs. Gibbs, brought claims against three of the same defendants that
appear in this litigation, Bank of America, Urban and Nationstar. There, as here, plaintiffs
alleged that the defendants conspired to defeat the purpose of the HAM? program by misleading
and deceiving borrowers in violation of RICO. As is relevant to these proceedings, plaintiffs also
alleged state law claims of breach of contract and unjust enrichment regarding their South
Carolina property, and violations of several federal civil rights statutes including 42 USC

99

1983, 1985 and 1986. As the same parties present in the instant suit brought claims against the
same defendants in the prior suit, the second element of res judicata, requiring "claims by the
same parties or their privies," Ohio Valley Envtl. Coal., 556 FJd at 210, is satisfied.
Next, the Court must determine whether the first element of res judicata, "a judgment on
the merits in a prior suit," has been met. ld. While ultimately dismissing all claims against all
defendants, the court in the Colorado Action did not reach the merits on every claim, instead
dismissing some on jurisdictional grounds. With respect to the RICO claim, it held that plaintiffs
failed to establish the alleged predicate acts of mail or wire fraud, and also failed to allege a
RICO injury. Colorado Action, 2015 WL 196217, at *6. Specifically, the court opined that as
plaintiffs had no right to a HAM? modification, they did not show that "[Bank of America's]
actions deprived someone of money or property"

and thus, "failed to assert colorable

contentions of mail or wire fraud," as required to support their RICO claim. ld. (emphasis in the

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original). Additionally, the court held that plaintiffs did not demonstrate that they had suffered a
RICO injury, because "they do not allege facts that show that they meet the [HAMP] program's
eligibility criteria (much less demonstrate what, if any, modification they would have been
entitled to had their application been processed promptly and correctly.)." Id. Because the court
ruled that plaintiffs had failed to state a RICO claim, that decision operates as a judgment on the
merits in a prior litigation. Id. (dismissing RICO claim "against all parties").
Because Plaintiffs used RICO as a jurisdictional hook to bring non-Colorado defendants,
such as Nationstar and Bank of America, within the jurisdiction of the District Court of
Colorado,12 the court found it lacked personal jurisdiction over Nationstar once the RICO claim
had been dismissed. Id. at *6-7. However, "dismissal for jurisdictional defects has no res judicata
effect." Hostetler v. United States, 97 F. Supp. 2d 691, 695 (E.D. Va. 2000) (citing Williams v.
United States, 50 F.3d 299, 304 (4th Cir.1995». Thus, while additional claims were leveled
against Nationstar in the Colorado Action, the Court can only give res judicata effect in this
litigation to the RICO claims against Nationstar because that was the sole claim adjudicated on
the merits.
However, the court, finding that it did have personal jurisdiction over Bank of America,
and Urban, a Colorado resident, reached the merits as to the remainder of the claims against
those two defendants. See Colorado Action, 20 I 5 WL 1962 I 7, at *8- I I. Thus, the first element
of res judicata, "a judgment on the merits in a prior suit," Ohio Valley Envtl. Coal., 556 F.3d at

12 As the court in the Colorado Action explained, "[wlhen a RICO claim is brought against at least one defendant
over whom the Court has personal jurisdiction, the RICO Act permits any summons to be served 'nationwide' over
other defendants, essentially subjecting defendants who are foreign to the forum to personal jurisdiction if the 'ends
of justice' so require." Colorado Action, 2015 WL 196217, at *4 (quoting Cory v. Aztec Steel Bldg.. Inc., 468 F.3d
1226,1230-31 (lOth Cir. 2006)); see also ESAB Grp .• lnc. v. Centricut, Inc .• 126 F.3d 617, 627 (4th Cir. 1997)
(upholding district court's personal jurisdiction over defendants based on RICO's nationwide service of process
provision).

II

210, is satisfied for all the prior claims brought against Bank of America and Urban, but only for
the RICO claim brought against Nationstar.
To establish the third and final element of res judicata, the Court must determine whether
the present litigation constitutes "a subsequent suit based on the same cause of action." ld. The
Fourth Circuit employs a "transactional approach" in determining whether or not there is "an
identity of claims between the first and second suit" meaning that "res judicata will bar a newly
articulated claim if it is based on the same underlying transaction involved in the first suit and
could have been brought in the earlier action." Providence Hall Assocs. Ltd. P'ship v. Wells
Fargo Bank, N.A., 816 F.3d 273, 282 (4th Cir. 2016) (internal citations and quotations omitted).
The RICO claim that Plaintiffs bring in this case is virtually identical to the RICO claim
they asserted in the prior litigation, even inserting almost the exact same language from their
Colorado Action complaint into their Amended Complaint in this litigation. Compare ECF No. I
~~ 50-73, with Colorado Action, 2015 WL 196217, at Dkt. No. I ~~ 109-131. However, it is
unclear to the Court, and the parties have not addressed, whether Plaintiffs' attempts to modify
their South Carolina loan are part of same transaction as any attempts to modify their Maryland
loan. Thus, the Court finds that Plaintiffs' RICO claims against Bank of America, Nationstar and
Urban regarding the South Carolina loan are part of the "same cause of action," Ohio Valley
Envtl. Coal., 556 F.3d at 210, as the prior litigation, but their claims regarding the Maryland loan
are not.
A similar dichotomy exists with respect to the prior claims against Bank of America and
Nationstar regarding alleged violations of federal civil rights statues and state laws, such as
breach of contract and unjust enrichment. While Plaintiffs' instant allegations echo their sparsely
plead counterparts regarding the South Carolina loan in the Colorado Action, the parties have

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offered no argument to the Court as to how those actions form part of the same transaction as any
actions taken by Defendants regarding the Maryland loan. See e.g. Colorado Action, 2015 WL
196217, at • 9-11. Thus, again, the Court finds that Plaintiffs' claims regarding violations of the
federal civil rights statutes and state law claims with respect to the South Carolina loan are part
of the same cause of action as the prior litigation, but such claims as applied to the Maryland
loan can proceed.
The only new claims that Plaintiffs bring against Bank of America and Urban are claims
of civil conspiracy, and a purported violation of the Maryland Consumer Protection Act. It is
well established that "[ e)ven claims that were not raised in the original suit may be precluded if
they arose from the same transaction or occurrence as those raised in the first suit and were
available to the plaintiff at the time ofthe first suit." Ohio Valley Envtl. Coal., 556 F.3d at 210II (citation omitted). The Court finds that Plaintiffs' civil conspiracy claims regarding the South
Carolina property could have been brought in the prior litigation and in their numerous filings in
the present litigation, Plaintiffs failed to put forth any rationale to explain to the Court why these
claims could not have been brought earlier.

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Therefore, the Court finds that all of Plaintiffs' claims, with the exception of their
allegation regarding a violation of the MCPA, against Bank of America and Urban regarding the
South Carolina property are barred by res judicata. However, all of Plaintiffs' claims are allowed
to proceed against Bank of America and Urban as they relate to the Maryland property.

13 Regarding the MCPA, "[i]n Maryland, regulatory statutes are 'generally construed as not having extra-territorial
effect unless a contrary legislative intent is expressly stated.'" E/yazidi v. Sun Trust Bank, 780 F.3d 227, 237 (4th
Cir. 2015) (quoting Consumer Prot. Div. v. Outdoor World Corp., 91 Md. App. 275, 287 (Md. Ct. Spec. App.
1992)). While the MCPA has been held to apply to some extra-territorial activity directed towards Maryland
residents, it is unclear whether Plaintiffs were residents of Maryland at the time of the alleged incidents. Id.
(discussing the Maryland state court's holding that a state agency could bring charges under the MCPA regarding
false representations sent via mail to Maryland residents.). Because Plaintiffs' allegations clearly fail to state a
claim, and will be dismissed, the Court will not resolve the res judicata issue as it relates to the MCPA.

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Similarly, Plaintiffs' RICO claim against Nationstar is barred by res judicata with respect to the
South Carolina property, but all other claims against Nationstar may proceed.

B. RICOJ4
As was done in the Colorado Action, the Court will first address Plaintiffs' RICO claims
because they form the heart of the allegations at issue.
Pursuant to

S

I 962(c), "[i]t shaH be unlawful for any person employed by or associated

with any enterprise engaged in, or the activities which affect, interstate or foreign commerce, to
conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a
pattern of racketeering activity." 18 U.S.c.

S I 962(c).

Claims under

S

1962(c) must demonstrate

"(I) conduct (2) ofan enterprise (3) through a pattern (4) ofracketeering

activity." Sedirna

S.P.R.I. v. lrnrex Co., 473 U.S. 479, 496 (1985) (footnote omitted). For the reasons discussed
below, the Court finds that Plaintiffs have not demonstrated racketeering activity nor a
cognizable injury, and the Court will therefore grant the Defendants' respective motions to
dismiss as to Plaintiffs' RICO claim under

S 1962(c).

A RICO claim requires a showing of "racketeering activity," broadly defined under 18
U.S.C.

S

1961(1) to include the commission of several federal statutory and state common law

offenses, known as "predicate acts." See 18 U.S.C.

S

claim, Plaintiffs rely on two predicate acts listed in

S 1961(1),

wire fraud (18 U.S.c.

S

1961(1). To support their

S

I 962(c) RICO

mail fraud (18 U.S.C.

S

1341) and

1343). ECF No. 2 ~ 82. In order to establish the existence of racketeering

14 In their response memorandum, Plaintiffs include some new factual allegations about the Defendants, along with
conspiratorial allegations regarding Bill Cosby and references to a prior criminal case against Mr. Gibbs. The Court
will not consider any additional factual allegations that Plaintiffs include in these filings because plaintiffs "cannot,
through the use of motion briefs, amend the complaint." Zachair Ltd. v. Driggs, 965 F. Supp. 741, 748 n. 4
(D.Md.1997); see a/so Johnson v. SecTek. Inc., No. CIVA ELH-13-03798, 2014 WL 1464378, at *2 (D. Md. Apr.
14,2014). Further, any allegations regarding Bill Cosby or Mr. Gibbs' prior criminal case are not germane to the
present claims before the Court and thus, will not be considered for a second reason.

14

activity, Plaintiffs must adequately plead the elements of each of these predicate acts. They have
failed to do so.
The mail and wire fraud statutes prohibit the use of the mails or interstate wires in
furtherance of schemes to defraud. See 18 U.S.C.

SS 1341,

1343. To plead mail or wire fraud, a

plaintiff must show: (I) a scheme disclosing intent to defraud; and (2) the use, respectively, of
the mails or interstate wires in furtherance of the scheme. See Chisolm v. TranSouth Fin. Corp.,
95 F.3d 331, 336 (4th Cir.l996) (discussing elements of mail fraud). Federal Rule of Civil
Procedure 9(b) provides that "[i]n alleging fraud ... a party must state with particularity the
circumstances constituting fraud." Fed. R. Civ. P. 9(b). Thus, "[ w]hen mail and wire fraud are
asserted as the predicate acts for a civil RICO claim, the standards of Rule 9(b) apply." Bhari
Info. Tech. Sys. Private Ltd. v. Sriram, 984 F. Supp. 2d 498,505 (D. Md. 2013). "A complaint
fails to meet the particularity requirements of Rule 9(b) when a plaintiff asserts merely
conclusory allegations of fraud against multiple defendants without identifying each individual
defendant's participation in the alleged fraud." Adams v. NVR Homes, Inc., 193 F.R.D. 243, 250
(D. Md. 2000) (citations omitted). Furthermore, a scheme to defraud is only actionable if one
seeks to defraud a person of something that they had a property interest in. See e.g. Cleveland v.
United States, 531 U.S. 12, 15 (2000) ("It does not suffice ... that the object of the fraud may
become property in the recipient's hands; for purposes of the mail fraud statute, the thing
obtained must be property in the hands of the victim.").
Here, Plaintiffs allege that Bank of America and its agents did not promptly review their
HAMP applications; that Bank of America directed Nadel, Atlantic Law Group and the
Montgomery Village Foundation to file frivolous lawsuits against them; and that Bank of
America, or other defendants, bribed Maryland and South Carolina government employees to

15

either ignore these HAMP violations or assist in the frivolous lawsuits. Such allegations fail
because they either do not demonstrate that Plaintiffs were defrauded of something that they had
a property interest in or they lack the necessary detail to satisfy the particularity requirements of
Fed. R. Civ. P. 9(b).
Plaintiffs' claims against Bank of America fail because there is no individual right to a
HAMP modification, see Gibson v. Nationstar Mortg., LLC, No. GJH-14-03913, 2015 WL
302889, at *2-3 (D. Md. Jan. 21, 2015), and they have not alleged the existence ofa separate
contractual obligation that could provide them with a property interest. The Court agrees with the
following conclusion reached by the judge in the Colorado Action: "[a]t best...Plaintiffs'

have

pled facts showing that [Bank of America] offers poor customer service and did not comply with
the terms ofHAMP."

Colorado Action, 2015 WL 196217, at *6. However, poor customer

service does not constitute fraudulent behavior and "[t]he applicable case law is clear that....a suit
that seeks the general enforcement of the HAMP guidelines must fail." Spaulding v. Wells Fargo
Bank, N.A., 920 F. Supp. 2d 614, 618 (D. Md. 2012), aff'd, 714 F.3d 769 (4th Cir. 2013). A
plaintiff who enters into a Trial Period Plan ("TPP") with a bank may be able to bring a claim
asserting a violation of the TPP, because the agreement would have established a privity of
contract between the bank and the individual. ld. However, while Plaintiffs mention the
existence of "trial plan agreements" in their Amended Complaint, they never allege that they
ls

specifically entered into one with Bank of America or any of the other Defendants.

Simply put,

Plaintiffs did not have a property interest in a HAMP modification, and fail to identify any other

" Attached to their Response to the South Carolina Defendants' Motion to Dismiss, Plaintiffs' attach what appears
to be a pre-approved offer for a 2016 Trial Plan Agreement between Nationstar and Barbara Gibbs concerning the
South Carolina property. ECF No. 62-1 at 8. However, plaintiffs "cannot, through the use of motion briefs, amend
the complaint." Zachair Ltd. v. Driggs, 965 F. Supp. 741, 748 n. 4 (D. Md. 1997). In addition, even if the Court

were to consider the document, the existence of a contract in 2016 does not support the contention that a similar
contract existed during the time frame of the factual allegations in this case, 2008-2013. Nor does the mere
existence ofa contract in 2016 demonstrate that Defendants' have somehow breached it.

16

contract, such as a TPP, that they could have a property interest in. Thus, Plaintiffs' claims
against Bank of America are dismissed because Bank of America could not defraud them of
something Plaintiffs had no right to.
Similarly, Plaintiffs' allegations against Nadel, Atlantic Law Group and the Montgomery
Village Foundation regarding the "frivolous lawsuits" they brought against Plaintiffs are
insufficient to state a claim of mail or wire fraud. Plaintiffs make no effort to identitY in what
specific way such lawsuits are meritless or demonstrate an intent to defraud.16 Plaintiffs' claims
that Bank of America, or other defendants, bribed Maryland and South Carolina government
employees to either ignore these violations or assist in the frivolous lawsuits also lack additional
details alleging the "time, place, and contents of the false representations, as well as the identity
of the person making the misrepresentation and what he obtained thereby." Harrison v.
Westinghouse Savannah River Co., 176 F3d 776, 784 (4th CiT. 1999). Because the Amended
Complaint must contain more than "legal conclusions, elements of a cause of action, and bare
assertions devoid of further factual enhancement," Nemet Chevrolet, Ltdv.
ConsumerajJairs.com, Inc., 591 F.3d 250, 255 (4th CiT. 2009), to survive a Motion to Dismiss,
Plaintiffs' RICO claim must fail.
Finally, with respect to Plaintiffs' more detailed allegations regarding Bank of America's
scheme to defraud, even if Plaintiffs could have established that they had a property interest in a
HAMP modification, their

S 1962(c)

would still fail because they have not pled a cognizable

RICO injury. To make out a civil action for damages under the RICO statute, a private plaintiff
must demonstrate not only that the defendants have violated

S

1962, but also that he has been

"injured in his business or property by reason of [the alleged] violation of section 1962." 18

"In fact, the Court takes judicial notice of the fact that the Maryland foreclosure case is closed and an order of
judgment of possession has been issued. See Nadel Action, Case No. 402900V, at Okl. No. 39.

17

V.S.c.

9

1964(c). Section I 964(c) requires a plaintiff to make two closely related showings: (I)

that he or she has suffered injury to his or her business or property; and (2) that this injury was
caused by the predicate acts of racketeering activity that make up the violation of

9

1962. See

Nodine v. Textron, Inc., 819 F.2d 347, 348 (1st Cir.1987). Here, Plaintiffs have failed to satisfy
the injury requirement because they did not include any assertions that they were eligible for the
HAMP modifications they allegedly sought for the Maryland mortgage and were therefore
denied such modifications because of Defendants' actions and not simply because of their
ineligibility. Specifically, they include no statements regarding the size ofthe mortgage for the
Maryland property and whether or not they were current on their payments with respect to the
Maryland loan. As discussed above, the judge in the Colorado Action inferred that Plaintiffs had
likely defaulted on their Maryland loan. Colorado Action, 2015 WL 196217, at * 9 n.12. Thus,
even accepting all of Plaintiffs' allegations regarding Bank of America as true, Plaintiffs' RICO
claim would still fail because they did not assert sufficient facts to show how they were injured
by Bank of America's actions.
C. Breach of Contract
To establish a claim for breach of contract, Plaintiffs must demonstrate that a contract
was formed, Defendants breached the contract, and Plaintiff suffered damages as a result.
Antonio v. Sec. Servs. of Am., LLC, 701 F. Supp. 2d 749, 761 (D. Md. 2010) (citing Parlette v.
Parlette, 88 Md. App. 628, 640 (Md. Ct. Spec. App. 1991)). "The formation of a contract
requires mutual assent (offer and acceptance), an agreement definite in its terms, and sufficient
consideration." Pruitt v. Bank of Am., N.A., No. CV TDC-15-13l0,

2016 WL 337531, at *3 (D.

Md. Jan. 28, 20 16) (citations omitted). Plaintiffs' breach of contract claims are dismissed

18

hecausc they ha,'c I~li ed to put ftJlward suflicient c"idencc to demonstrate
l
formed between themsel"es

and any of the Defendants.

The only f~lcts in the Amended Complaint
are Plaintiffs'

allegations

that a contract was

pointing to the existence of a potential contract

regarding their efl(Jr\s to recei"e loan modilications

America for their mortgages.

Ii'om Bank of

As discussed aho"e. any hreach of contract claim against Bank of

America regarding the South Carolina property is harrcd by

r('sjlldi('(//(/.

Thus. to support a

claim of breach of contract. Plaintiffs must allege that a contract was f(mncd bctween themselves
and Bank of Amcrica regarding the Maryland property. As discussed aho"e. while Plaintiffs
provide specific details regarding the South Carolina loan. they f~lilto provide any details
regarding the Maryland loan: as such it is impossihle
the loan modilications

discussions

ItJr the Court to determine which. ifany. of

that Plaintiffs reference rclate to the Maryland loan and which

rclate to the South Carolina loan. The only t~lCtsthat Plaintiffs include that could e"en point to
the existence ofa contract are a discussion
2008. They state that "IBank ofAmericaj

of Plain tilTs' application
appro"ed

f(lr loan modiJications

in

the modi lied loans. but only if the Gihhs'

paid closing costls] of about $30.000. The Gibhs' declined the modified loans'" ECF No.2';
Contract f(mnation requires both ofTer and acceptancc.
Plaintiffs'

['l"IIill.

53.

2016 WI, 337531. at • 3. Thus. by

own admission tbey did not (/('('('/)/ the purported otTer ofa loan modification

ti'om

Bank of America. It is axiomatic that there can be no breach of contract when no contract
existed. Thus. Plaintiffs'

breach of contract claims are dismissed.

I). Unjust En.-ichlllcnt

To state a claim Itlr unjust enrichment.
conferlredj

a henelit on the delendant:

(3) the defendant's

acceptance

Plaintiffs must allege that ..( 1) the plaintiff

(2) the dclendant

knlewj or appreeiateldl

or retention of the benclit under the circumstances

1<)

the benetit: and
would be

inequitable without the paying of value in return." Mona v. Mona Elec. Group, Inc., 176 Md.
App. 672, 712-13 (Md. Ct. Spec. App. 2007).
The only benefit that Plaintiffs allege they conferred on any of the Defendants is the
payment oftheir mortgage payments to Bank of America "in full and on time," ECF No. 2 ~ 50.
As the Court has already observed, this contention is contradicted by Plaintiffs' filings in the
Colorado Action, where they stated that "[i]n or about November 2009, after being totally
frustrated with [Bank of America], Mr. Gibbs returned to South Carolina; we stopped paying the
mortgage and have not paid the mortgage in five (5) years." Colorado Action, 2015 WL 196217,
at *9.17 However, even assuming that Plaintiffs were current on their Maryland mortgage, they
still have failed to demonstrate that Bank of America was unjustly enriched by their mortgage
payments. "A claim for unjust enrichment. .. requires that a plaintiff show, among other facts, that
the defendant retained a benefit conferred by the plaintiff 'under such circumstances as to make
it inequitable for the defendant to retain the benefit without the payment of its value.''' Bowers v.
Bank of Am .. N.A., 905 F. Supp. 2d 697, 703 (D. Md. 2012) (quoting Hill v. Cross Country
Settlements, LLC. 402 Md. 281, 295 (Md. 2007». Based on the facts alleged in their Amended
Complaint, Bank of America extended a loan to Plaintiffs so that Plaintiffs could purchase their
Maryland home, and thus, was entitled to receive Plaintiffs' mortgage payments in return.
Therefore, Plaintiffs' unjust enrichment claim fails.
E. Civil Rights Statutes
In addition to their state law claims, Plaintiffs allege violations of three federal civil
rights statutes, 42 U.S.C.

SS

1983, 1985 and 1986, claiming that Defendants actions against them

were based on their race.

17 It is unclear whether Plaintiffs meant that they stopped paying their South Carolina mortgage or their Maryland
mortgage. C%radoAclion,
2015 WL 196217,' 9 n.12.

20

42 U.S.C.

S

1983 serves as a vehicle for private parties to enforce their federal

constitutional rights against state and local officials, municipalities, and any others who acted
under color of state law. See 42 U.S.C.
under

S 1983, respondents

S 1983. "To

state a claim for relief in an action brought

must establish that they were deprived of a right secured by the

Constitution or laws of the United States, and that the alleged deprivation was committed under
color of state law." Am. Mfrs. Mul. Ins. Co. v. Sullivan, 526 U.S. 40, 49-50 (1999). The only state
actors that Plaintiffs have sued are the South Carolina Defendants, South Carolina Attorney
General Alan Wilson and South Carolina Judge Howe, and the Maryland Attorney General,
Brian Frosh. Plaintiffs fail to mention any specific actions taken by the South Carolina
Defendants themselves, merely stating that "the HAMP-Iess Gang paid bribes to South Carolina
government employees to institute and maintain their illegal foreclosure practices." ECF No.2'
107. Similarly, the only allegations against Maryland Attorney General Frosh are that he entered
into a consent agreement with Bank of America, agreeing to tum a "Blind Eye to [Bank of
America's] continued conspiracy and racketeering in defrauding HAMP" in return for receiving
money from the bank. Id. , 24. Such unspecified, conclusory allegations, which do not identify
the constitutional rights allegedly infringed upon, are insufficient to state a violation of 42 U.S.C.

S

1983 and therefore, Plaintiffs' claims are dismissed.
The other two federal statutes cited by Plaintiffs, 42 U.S.C.

require state action. "To recover under

S

SS

1985 and 1986, do not

1985(3), a plaintiff must establish the existence of a

conspiracy and show 'some racial or perhaps otherwise class-based, invidiously discriminatory
animus behind the conspirators' action.''' C & H Co. v. Richardson, 78 F. App'x 894, 901-02
(4th Cir. 2003) (quoting Griffin v. Breckenridge, 403 U.S. 88, 102-03 (1971)). Pursuant to 42
U.S.C.

S

1986, people who knew of the existence of as 1985 conspiracy, had the power to

21

prevent such actions, and failed to act, can also be held liable by any persons injured by the
conspiracy. See 42 U.S.C.

9

1986. Plaintiffs' sole factual assertion with respect to these claims is

their statement that "the described illegal actions are instituted against Plaintiffs based on their
RACE: BLACK." ECF No. 2 ~ 108. As the Court in the Colorado Action observed, "the crux of
the Plaintiffs' complaint is [that] the Defendants acted on a systematic basis against as many
.borrowers as possible, solely out of an economic motive, not as the result of any specific racial
bias." Colorado Action, 2015 WL 196217, at *9 (dismissing all claims arising under federal civil
rights statutes). The Court agrees. Thus, Plaintiffs have failed to state a claim both for civil
conspiracy, 42 U.S.C.

9

1985 and for a failure to prevent a civil conspiracy, 42 U.S.C.

9

1986.

F. Maryland Consumer Protection Act
Plaintiffs' next cause of action alleges violations of the Maryland Consumer Protection
Act ("MCPA"), Md. Code Ann., Com. Law

9

13-101, et seq. Plaintiffs do not point to a specific

provision that the Defendants allegedly violated, instead citing the entirety of the act itself. ECF
NO.2 at 30. The single line devoted to explaining Plaintiffs' MCPA claim merely points the
Court towards the section ofthe Amended Complaint where they discuss their prior RICO
allegations. Thus, the Court will assume that Plaintiffs sought to bring a claim pursuant to the
MCPA's prohibition on unfair or deceptive trade practices, as that section ofthe MCPA most
closely relates to Plaintiffs' RICO allegations.
To state a claim of unfair or deceptive trade practices under the MCPA, Plaintiffs must
allege "(I) an unfair or deceptive practice or misrepresentation that (2) is relied upon, and (3)
causes [them] actual injury." Stewart v. Bierman, 859 F. Supp. 2d 754, 768 (D. Md. 2012) (citing
Lloyd v. Gen. Motors Corp., 916 A.2d 257, 277 (Md. 2007». Here, even assuming that Plaintiffs
had satisfied the heightened pleading standards of Fed. R. Civ. P. 9(b) that apply to MCPA

22

claims, see Spaulding v. Wells Fargo Bank, NA., 714 F.3d 769, 781 (4th Cir. 2013), their claim
would still fail because they do not allege that they relied on any false and misleading
statements. "To establish reliance under the MCPA, Plaintiffs must plead and prove that the false
or misleading statement substantially induced their choice." Currie v. Wells Fargo Bank, NA ..
950 F.Supp.2d 788, 798 (D. Md. 2013). Here, Plaintiffs have not pleaded sufficient facts from
which one can plausibly infer the existence of any statements or representations made by
Defendants that induced them to take any action or that they "substantially" induced any choice
they made. See id. Thus, their MCPA claims are dismissed.
G. Conspiracy
A claim of civil conspiracy requires Plaintiffs to allege "I) (a] confederation of two or
more persons by agreement or understanding; 2) some unlawful or tortious act done in
furtherance of the conspiracy or use of unlawful or tortious means to accomplish an act not in
itself illegal; and 3) actual legal damage resulting to the plaintiff." Windesheim v. Larocca, 443
Md. 312, 347 (Md. 2015). However, "(c]onspiracy is not a separate tort capable of independently
sustaining an award of damages in the absence of other tortious injury to the plaintiff." Alleco
Inc. v. The Harry and Jeanelle Weinberg Foundation. Inc., 340 Md. 176, 189 (Md. 1995)).
Conspiracy is merely a "matter of aggravation," becoming necessary only "to entitle the plaintiff
to recover in one action against several." ld. at 190.
Because the Court has dismissed all of Plaintiffs' claims in this case, there is no
foundational tort to support an allegation of civil conspiracy. See Clark v. Maryland Dep't of
Pub. Safety & Carr. Servs., 247 F. Supp. 2d 773, 777 (D. Md. 2003) (holding that because
"plaintiff has failed to state a claim for any substantive torts, his state law claim for civil

23

conspiracy must fail."). Accordingly, as Plaintiffs have not adequately established tortious
18

conduct on the part of Defendants, their claim for civil conspiracy must be dismissed as well.
H. Plaintiffs'

Motion for Leave to File a Second Amended Complaint

The Court must also address Plaintiffs' Motion for Leave to File a Second Amended
Complaint, ECF No. 60. After a plaintiff has already amended their pleading once as a matter of
course, any further amendments may only be made "with the opposing party's written consent or
the court's leave." Fed. R. Civ. P. 15(a)(2). Although "[t]he court should freely give leave when
justice so requires," id., "the Court may deny as futile a motion to amend a complaint when the
proposed complaint would not survive a motion to dismiss." Dehaemers v. Wynne, 522 F. Supp.
2d 240, 244 (D.D.C. 2007) (citing James Madison, Ltd. v. Ludwig, 82 F.3d 1085, 1099 (D.C. Cir.
1996); see also 6 Charles Alan Wright & Arthur R. Miller, Fed. Prac. & Proc. Civ.

S

1487 (3d

ed., January 2017 update) ("several courts have held that if a complaint as amended could not
withstand a motion to dismiss or summary judgment, then the amendment should be denied as
futile. In a similar vein, if the court determines that plaintiff has had multiple opportunities to
state a claim but has failed to do so, leave to amend may be denied.").
Here, Plaintiffs already amended their complaint once as a matter of course in the state
court proceedings, prior to removal to this Court. See Gibbs Action, No. 402900V, at Dkt. No.
17. Furthermore, as evidenced by the opposition motion filed by several Defendants, ECF No.
64, Plaintiffs do not have the written consent of the opposing parties to amend their complaint.
Thus, the motion can only be granted by the Court's consent, if"justice so requires." Fed. R.

"As the Court finds that Plaintiffs' claims against all of the Defendants are insufficient to state a claim, the Court
will not address the additional arguments of some of the Defendants that the court lacks personal jurisdiction over
them, that Plaintiffs lack standing to bring these claims, or that venue is improper. Further, the Court finds that
Defendant Montgomery Village Foundation's request for attorney's fees is premalure. Any motion for attorney's
fees must be filed via separate motion, within fourteen (14) days of the entry of judgment. Fed. R. Civ. P. 54(d)(2)
and Loc. R. 109.2 (D. Md. 2016). Thus, their request for attorney's fees is denied without prejudice.

24

Civ. Pro. 15(a)(2). As Defendants note, many of the proposed changes in the Second Amended
Complaint are stylistic, such as changing "homeowners" to "Defendants-Plaintiffs"

throughout

the document. See e.g. ECF No. 60-1 ~ 4. The only material changes are additional conclusory
allegations that the Attorney Generals of Maryland and South Carolina accepted bribes from the
Defendants, references to an allegedly illegal foreclosure that Nationstar filed in October 2013,19
and the inclusion of what appears to be a pre-approved offer for a 2016 Trial Plan Agreement
between Nationstar and Barbara Gibbs concerning the South Carolina property. ld. ~ 80, 100,
110. Such allegations are futile as they fail to cure the deficiencies in Plaintiffs' Amended
Complaint, as explained above, and thus, would not survive a motion to dismiss. Because
additional amendment of the complaint would be futile, and would prejudice the Defendants who
have fully responded to Plaintiffs' arguments, Plaintiffs' Motion for Leave to File a Second
Amended Complaint, ECF No. 60, is denied.
I.

Plaintiffs'

20

Additional Pending Motions

In addition to the dispositive motions filed by the Defendants in this case, Plaintiffs have
filed a series of their own motions. As they either lack merit or are moot, the Court will deny all
of Plaintiffs' pending motions.
On September 26, 2016, Plaintiffs filed a motion for summary judgment. ECF No. 39.
Summary judgment is appropriate if "materials in the record, including depositions, documents,
electronically stored information, affidavits or declarations, stipulations ... , admissions,
interrogatory answers, or other materials," Fed. R. Civ. P. 56(c), show that there is "no genuine

"The Court assumes that this a reference to the foreclosure proceedings that Nationstar initiated against the South
Carolina property, already mentioned in the Amended Complaint. ECF NO.2 101; see also ECF No. 13.1 at3.
20Plaintiffs have additionally filed several documents, including a "pre-hearing brief," ECF No. 40, and an third
omnibus Reply to Defendants' pending Motions to Dismiss. ECF No. 47. The Court construes these as attempts to
file sur-replies. Because sur-reply memorandums are not permitted to be filed without the permission of the Court,
they will not be considered. Loc. R. 105.2(a).

25

dispute as to any material fact and the movant is entitled to judgment as a matter oflaw." Fed. R.
Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Because the Court has
found that Plaintiffs claims are either barred by res judicata, or because they failed to state a
claim for relief, Plaintiffs clearly are not entitled to judgment as a matter oflaw. Thus, Plaintiffs'
motion for summary judgment is denied.
On October 24, 2016, Plaintiffs filed a motion requesting that the Clerk enter default
against Defendant Atlantic Law Group who, at that time, had not responded to Plaintiffs'
Amended Complaint. ECF No. 48. Atlantic Law Group argued that the Court should deny
Plaintiffs' request because they were not properly served, and thus, their response could not be
considered untimely. ECF No. 61. "State law determines whether service while the case was
before a state court was proper." Samuels v. Two Farms, Inc., No. CIV A. DKCIO-2480, 2010
WL 4103670, at * 1-2 (D. Md. Oct. 18,2010) (citation omitted). Maryland requires service
conducted by certified mail to include a request for restricted delivery. Md. Rules 2-121(a)(3).
Here, the card that Plaintiffs submit to show that Atlantic Law Group was served on July 18,
2016, clearly shows that the box marked "restricted delivery" was not checked. See ECF No. 353. Although this may appear to be a minor issue, "Maryland courts seem to take a strict, narrow
approach to service" and "treat defective service of process [as] ajurisdictional

defect" that

cannot be cured with actual knowledge. Samuels, 2010 WL 4103670, at *2 (citation omitted)
(alteration in the original). As Atlantic Law Group was never properly served, their response
could not be untimely. Thus, the Court denies Plaintiffs' request for the Clerk's entry of default
against Atlantic Law Group. Plaintiffs also filed two additional Motions for Clerk's Entry of
Default, requesting that the Clerk enter defaults as to unspecified Defendants, ECF No. 65, and
the majority ofthe named Defendants, ECF No. 71. These motions appear to be based on

26

Defendants'

failure to respond to Plaintitls'

Second Amended

Complaint.

was required of Defendants.

llowever.

Plaintitls
sanctions:'

November

0.2016 Motion I(lr Leave to File a

because the Court did not grant this motion. no response

Thus. Plaintitls'

motion is denied.

haw also tiled three motions. which are partially captioned

as "motion

ECF Nos. 53. 70 and 74. but which actually consist of a combination

that the Court has already rejected rcgarding
conspiratorial.
As Plaintitls

eonelusory

statements

regarding

the actions of the Defendants

have failed to make a lactual showing

or have "multiplieldl

would justilY the imposition

the proceedings
of costs or attorney's

that the Defendants

on submissions

1(".

of arguments

the removal of the ease. and reitcrations

would violate Fed. R. Civ. P. II (b)'s restrictions
purpose:'

J

of the samc

prior to this ease.

have tiled motions that

tiled t(lr "any improper

in any case unreasonably

and vexatiously"

that

fees pursuant to 28 U.S.c. ~ 1927. Plaintiffs'

. .requests are del1le d'i

N<ldcl and the South Carolina Defendants' motions requesting
deadlines. EeF Nos . ..JS. 46 and 51. arc denied as moot.
!I

10

stay the case and !1:lreXlensions

ill

their filings

IV.

CONCLUSION
For the reasons stated above, the Court will grant Defendants' Motions to Dismiss, and

deny Plaintiffs' pending motions. A separate Order, detailing the specific disposition of each
motion, follows.

Dated: March3f.

2017

df/---

GEORGE 1. HAZEL

United States District Judge

28