Houston v. U.S. Bank Home Mortgage
Filing
11
OPINION AND ORDER granting in part and denying in part 5 Motion to Dismiss. Signed by District Judge Patrick J. Duggan. (MOre)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
MARILYN HOUSTON,
Plaintiff,
v.
Case No. 10-13780
Honorable Patrick J. Duggan
U.S. BANK HOME MORTGAGE
WISCONSIN SERVICING, a wholly
owned subsidiary of U.S. Bank, N.A.,
Defendant.
____________________________/
OPINION AND ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT’S MOTION TO DISMISS
At a session of said Court, held in the U.S.
District Courthouse, Eastern District
of Michigan, on May 2, 2011.
PRESENT:
THE HONORABLE PATRICK J. DUGGAN
U.S. DISTRICT COURT JUDGE
This action, which was removed from the Wayne County Circuit Court on
September 22, 2010, arises from the foreclosure of real estate in the City of Detroit,
owned by Plaintiff Marilyn Houston (“Plaintiff”). In a Complaint filed August 16, 2010,
Plaintiff alleges that Defendant– improperly designated as U.S. Bank Home Mortgage
Wisconsin Servicing (“U.S. Bank”)– violated federal and state law when it claimed an
incorrect arrearage and balance on a mortgage loan U.S. Bank serviced. Specifically,
Plaintiff alleges the following claims against U.S. Bank: (I) misrepresentation; (II)
violation of the federal Real Estate Settlement Procedures Act, 12 U.S.C. §§ 2601-2617;
(III) violation of the federal Fair Debt Collection Practices Act, 15 U.S.C. §§ 16921692p; (IV) violation of the federal Home Affordable Modification Program and the
Emergency Economic Stabilization Act of 2008, 12 U.S.C. §§ 5201-5241; (V) wrongful
foreclosure; and (VI) intentional infliction of emotional distress.
Presently before the Court is U.S. Bank’s motion to dismiss pursuant to Federal
Rule of Civil Procedure 12(b)(6), filed on September 29, 2010. Plaintiff filed a response
to the motion on October 15, 2010; U.S. Bank filed a reply brief on October 22, 2010.
This Court held hearings with respect to the motion on November 18, 2010, and January
13, and April 27, 2011. For the reasons that follow, the Court grants in part and denies in
part U.S. Bank’s motion to dismiss.
I.
Standard for Motion to Dismiss
A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the
legal sufficiency of the complaint. RMI Titanium Co. v. Westinghouse Elec. Corp., 78
F.3d 1125, 1134 (6th Cir. 1996). Under Federal Rule of Civil Procedure 8(a)(2), a
pleading must contain a “short and plain statement of the claim showing that the pleader
is entitled to relief.” To survive a motion to dismiss, a complaint need not contain
“detailed factual allegations,” but it must contain more than “labels and conclusions” or
“a formulaic recitation of the elements of a cause of action . . .” Bell Atlantic Corp. v.
Twombly, 550 U.S. 555, 570, 127 S. Ct. 1955, 1964-65, 1974 (2007). A complaint does
not “suffice if it tenders ‘naked assertions’ devoid of ‘further factual enhancement.’”
Ashcroft v. Iqbal, – U.S. – , 129 S. Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at
2
557, 127 S. Ct at 1966).
As the Supreme Court provided in Iqbal and Twombly, “[t]o survive a motion to
dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570, 127
S. Ct. at 1974). “A claim has facial plausibility when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556, 127 S. Ct. at 1965). The
plausibility standard “does not impose a probability requirement at the pleading stage; it
simply calls for enough facts “to raise a reasonable expectation that discovery will reveal
evidence of illegal [conduct].” Twombly, 550 U.S. at 556, 127 S. Ct. at 1965.
In deciding whether the plaintiff has set forth a “plausible” claim, the court must
accept the factual allegations in the complaint as true. Id.; see also Erickson v. Pardus,
551 U.S. 89, 127 S. Ct. 2197, 2200 (2007). This presumption, however, is not applicable
to legal conclusions. Iqbal, 129 S. Ct. at 1949. Therefore, “[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory statements, do not suffice.”
Id. (citing Twombly, 550 U.S. at 555, 127 S. Ct. at 1965-65).
II.
Factual Background
The following facts are taken from Plaintiff’s Complaint and documents in a
Chapter 13 bankruptcy filed by Plaintiff, In re Houston, No. 03-70761 (Bankr. E.D. Mich.
Sept. 4, 2009).
In August 2001, Plaintiff obtained a loan from Flagstar Bank, FSB in the amount
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of $63,900 to purchase real property located at 8740 Westfield in Detroit, Michigan (“the
property”). The loan was secured by a HUD/FHA insured mortgage on the property. In
August 2001, the mortgage was assigned to the Michigan State Housing Development
Authority (“MSHDA”).
On November 5, 2003, Plaintiff filed a voluntary Chapter 13 petition in the United
States Bankruptcy Court for the Eastern District of Michigan. On March 3, 2004, the
Bankruptcy Court confirmed the Chapter 13 plan. On October 11, 2007, during the
execution of the plan, U.S. Bank notified Plaintiff that servicing of her loan had been
transferred from Heartwell Mortgage Corporation to U.S. Bank.
On May 27, 2009, the Chapter 13 Trustee filed a “Notice of Completion of Plan
Payment; and Notice to Creditors of Right to Object.” (Def.’s Mot. Ex. G.) The notice
indicates that Plaintiff made all payments to the Trustee as required by the confirmed
Chapter 13 Plan and, as to “any secured claim that continues beyond the term of the
plan,” that “any pre-petition or post-petition defaults have been cured and the claim is in
all respects current, with no escrow balance, late charges, costs or attorney fees owing.”
(Id.) With respect to secured debt obligations, the notice advises the debtor:
1.
Immediately begin making the required payments on secured debt
obligations to avoid defaulting on those secured debt obligations.
2.
Continue to make required payments on secured debt obligations
until those obligations are paid in full. If the Court determines that
the Debtor is eligible for a Discharge, the Chapter 13 Discharge will
not discharge the Debtor from any obligation on any continuing
secured debt payments that come due after the date of the Debtor last
payment under the plan.
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(Id.) In a section entitled “Rights and Duties of Creditors,” the notice requires the filing
of an objection within thirty days by “any party in interest that asserts that . . . [w]ith
respect to any secured claim that continues beyond the term of the plan, there remains
pre-petition or post-petition defaults that have not been cured or that the claim is
otherwise not current in all respects including, but not limited to, any unpaid escrow
balance, late charge, cost or attorney fee . . .” (Id.)
On July 7, 2009, the Bankruptcy Court entered an Order of Discharge in Plaintiff’s
bankruptcy case. (Compl. Ex. 6.) On July 31, 2009, the Trustee filed her “Final Report
and Account” in the bankruptcy proceedings. (Compl. Ex. 4.)
Plaintiff received a statement from U.S. Bank dated July 17, 2009, indicating that
she owed $2,226.27 in past due amount(s) and $15.74 in late charges in addition to her
monthly payment of $742.09. (Compl. Ex. 7.) In response, Plaintiff telephoned U.S.
Bank to inquire about the alleged arrearage and the amount of the principal balance.
(Compl. ¶ 11.) According to Plaintiff, U.S. Bank did not address the payment amount in
dispute and insisted that Plaintiff owed the alleged amount. (Id.)
On August 19, 2009, Plaintiff sent a letter to U.S. Bank via certified mail regarding
her loan. Plaintiff identifies herself and her loan number at the top of the letter and then
writes:
US Bank Home Mortgage is the servicer of my mortgage loan at the above
address. I dispute the amount that is owed according to the Monthly Billing
Statement and request that you send me information about the fees, costs
and escrow accounting on my loan. This is a “qualified written request”
pursuant to the Real Estate Settlement and Procedures Act (section
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2605(e)).
(Compl. Ex. 8.) In her letter, Plaintiff then requests “an itemization” of several things
including her payment history, the amount of claimed arrears or delinquencies, and a copy
of all bankruptcy payments and how the payments were applied to her account. (Id.)
Plaintiff claims that U.S. Bank never responded to her inquiry. Instead,
foreclosure proceedings were instituted with a Sheriff’s Sale set for August 18, 2010.
(Compl. ¶ 13, Ex. 9.) Two days before the scheduled Sheriff’s Sale, Plaintiff initiated this
action.
III.
Applicable Law and Analysis
A.
Real Estate Settlement Procedures Act (“RESPA”)
Plaintiff alleges that U.S. Bank violated RESPA, specifically 12 U.S.C. § 2605(e),
by failing to respond to her August 19, 2009 letter. Section 2605(e) imposes the
following duties on a loan servicer:
(1)(A) If any servicer of a federally related mortgage loan
receives a qualified written request from the borrower (or an
agent of the borrower) for information relating to the
servicing of such loan, the servicer shall provide a written
response acknowledging receipt of the correspondence within
20 days (excluding legal public holidays, Saturdays, and
Sundays) unless the action requested is taken within such
period.
...
(2) Not later than 60 days (excluding legal public holidays,
Saturdays, and Sundays) after the receipt from any borrower
of any qualified written request under paragraph (1) and, if
applicable, before taking any action with respect to the
inquiry of the borrower, the servicer shall--
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(A) make appropriate corrections in the account of the
borrower, including the crediting of any late charges or
penalties, and transmit to the borrower a written notification
of such correction (which shall include the name and
telephone number of a representative of the servicer who can
provide assistance to the borrower);
(B) after conducting an investigation, provide the borrower
with a written explanation or clarification that includes-(I) to the extent applicable, a statement of the reasons for
which the servicer believes the account of the borrower is
correct as determined by the servicer; and
(ii) the name and telephone number of an individual employed
by, or the office or department of, the servicer who can
provide assistance to the borrower; or
(C) after conducting an investigation, provide the borrower
with a written explanation or clarification that includes-(I) information requested by the borrower or an explanation of
why the information requested is unavailable or cannot be
obtained by the servicer; and
(ii) the name and telephone number of an individual employed
by, or the office or department of, the servicer who can
provide assistance to the borrower.
12 U.S.C. § 2605(e). The statute defines a “qualified written request” as:
a written correspondence . . . that– (I) includes, or otherwise enables the
servicer to identify, the name and account of the borrower; and (ii) includes
a statement of the reasons for the belief of the borrower, to the extent
applicable, that the account is in error or provides sufficient detail to the
servicer regarding other information sought by the borrower.
12 U.S.C. § 2605(e)(1)(B).
U.S. Bank argues that Plaintiff fails to state a claim upon which relief may be
granted under § 2605(e) because her August 19, 2009 letter to U.S. Bank does not qualify
as a qualified written request (“QWR”) as defined in the statute and she does not allege
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how the failure to respond to the QWR proximately caused her actual damages. The
Court does not agree.
As set forth above, Plaintiff’s August 19 letter to U.S. Bank qualifies as a QWR if
it “(I) includes or otherwise enables the servicer to identify, the name and account of the
borrower; and (ii) includes a statement of the reasons for the belief of the borrower, to the
extent applicable, that the account is in error or provides sufficient detail to the servicer
regarding other information sought by the borrower.” 12 U.S.C. § 2605(e)(1)(B)
(emphasis added). U.S. Bank does not argue that the first requirement is not satisfied and
clearly Plaintiff’s letter identifies her name and the loan number.
As to the second requirement, U.S. Bank is correct that Plaintiff does not state in
her letter a reason for why she “dispute[s] the amount that is owed according to the
Monthly Billing Statement.” Nevertheless, it is sufficient if the letter alternatively
“provides sufficient detail to the servicer regarding other information sought by the
borrower.” Id. Unlike the cases cited by U.S. Bank, Plaintiff does not simply request a
list of documents relating to her loan. See Gates v. Wachovia Mortgage, FSB, No. 2:09cv-02464, 2010 WL 2606511, at *3 (E.D. Cal. June 28, 2010) (unpublished opinion)
(finding that the plaintiff’s purported QWR “contain[ed] no statement of [the] plaintiff’s
belief as to the existence of a servicing error” and was “primarily aimed at uncovering
documents relating to the ownership of the obligation, as well as seeking rescission or
modification by calling into question the validity of the loan”); Phillips v. Bank of Am.
Corp., No. C 10-0400 JF, 2010 WL 1460824, at *4 (N.D. Cal. Apr. 9, 2010) (unpublished
8
opinion) (finding that the plaintiff’s fax to the defendant did not qualify as a QWR where
it only related to the origination documents and a proposed modification of the loan, not
servicing). In her letter, Plaintiff specifically disputes the amount U.S. Bank, as servicer,
indicates is owed in its billing statement and specific documentation relevant to
determining how that amount was calculated. Construed in a light most favorable to
Plaintiff, Exhibit 8 to her Complaint is a QWR. See In re Thorian, 387 B.R. 50, 70 (D.
Idaho 2008) (interpreting the terms “inquiry” and “request” as used in RESPA to mean “a
request for information” and “the act or instance of asking for something,” respectively,
and concluding that a QWR must “allege an account error or seek some information from
the servicer.)
Plaintiff also alleges– or at least provides statements in her response brief
indicating that she could allege– actual damages as a result of U.S. Bank’s failure to
comply with RESPA, sufficient to survive U.S. Bank’s motion to dismiss. See 12 U.S.C.
§ 2605(f)(1). In her Complaint, Plaintiff alleges that as a result of U.S. Bank’s “fail[ure]
to respond to Plaintiff’s inquiry and make the necessary corrections to [her] mortgage . . .
Plaintiff has been subjected to illegal foreclosure based on an erroneous debt, . . .”
(Compl. ¶ 29.) Plaintiff states in her response brief: “Plaintiff’s payment was increased
from $742.09 to $2,999.84, making it impossible to make the payment due to Defendants
[sic] error and catalyzing the default . . .” (Pl.’s Resp. at 10.)
For the above reasons, the Court finds that Plaintiff states a claim for relief under
RESPA on which relief may be granted (Count II).
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B.
Fair Debt Collection Practices Act (“FDCPA”)
Plaintiff alleges in her Complaint that U.S. Bank was a debt collector within the
meaning of the FDCPA, sent Plaintiff correspondence stating an incorrect amount owed
by Plaintiff, and failed to provide proper verification and correct the amount due. (Compl
¶¶ 31-33.) U.S. Bank contends that Plaintiff’s claim under the FDCPA fails because the
Bankruptcy Code provides the exclusive remedy for alleged violations of a discharge
injunction and, alternatively, because she fails to allege that the debt already was in
default when U.S. Bank began servicing the loan.
According to U.S. Bank, “[t]he essence of Plaintiff’s FDCPA claim is that U.S.
Bank impermissibly attempted to collect a debt that was allegedly satisfied in the
bankruptcy proceedings in violation of the Bankruptcy Court’s discharge injunction.”
(Def.’s Br. in Supp. of Mot. at 7.) The remedies for such a violation, U.S. Bank argues,
must be pursued in the bankruptcy court pursuant to the Bankruptcy Code. Therefore, as
U.S. Bank further argues and several courts have held, a plaintiff cannot “bring an ‘endaround’ the Bankruptcy Code through an FDCPA claim.” (Id.) In other words, the
availability of a remedy through the Bankruptcy Code precludes a cause of action under
the FDCPA. (Id. at 7-8, citing cases.)
There in fact is a circuit split on the issue of whether the Bankruptcy Code
precludes FDCPA claims. As U.S. Bank’s motion reflects, the Ninth Circuit has held that
it does. See Walls v. Wells Fargo Bank, N.A., 276 F.3d 502, 510 (9th Cir. 2002). The
Seventh Circuit, however, has held that the Bankruptcy Code does not preclude or
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impliedly repeal the FDCPA. Randolph v. IMBS, Inc., 368 F.3d 726, 730-32 (7th Cir.
2004). The Sixth Circuit has not decided the issue. This Court finds it unnecessary to
resolve the issue, however, because, as U.S. Bank alternatively argues, Plaintiff fails to
allege that the mortgage loan was in default when U.S. Bank acquired it.
Under the FDCPA, an individual’s “creditors” are not subject to liability unless a
debt was already “in default” at the time of its acquisition. 15 U.S.C. § 1692a(6(F)(iii);
see also Wadlington v. Credit Acceptance Corp., 76 F.3d 103, 107 (6th Cir. 1996)
(holding that creditors are not “debt collectors” under the FDCPA if the debt was not “in
default” at the time of the assumption of a loan origination). According to documents
filed in the bankruptcy proceeding, servicing of Plaintiff’s loan was transferred to U.S.
Bank effective August 1, 2007. (Def.’s Mot. Ex. B.) Plaintiff had not defaulted on the
loan by this time. For this reason, Plaintiff fails to state a FDCPA claim against U.S.
Bank on which relief may be granted (Count III).
C.
Home Affordable Modification Program (“HAMP”) and the
Emergency Economic Stabilization Act of 2008 (“EESA”)
In Count IV of her Complaint, Plaintiff alleges that U.S. Bank has a duty to
provide loan modifications pursuant to HAMP, that she met the criteria for modification
under HAMP, and that U.S. Bank violated its duty by refusing to modify her loan.
(Compl. ¶¶ 37-40.) As this Court has previously held, however, neither HAMP nor
EESA create a private right of action under which Plaintiff may seek relief. Hart v.
Countrywide Home Loans, Inc., – F. Supp. 2d – , 2010 WL 3272623, at *5 (E.D. Mich.
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Aug. 19, 2010) (citing cases). Furthermore the statutes do not compel a servicer to
modify a loan: “While the Secretary must encourage mortgage servicers to modify loans,
the statute does not require Defendant or other mortgage servicers to modify loans.” Id.
For this reason, Plaintiff fails to state a claim under HAMP or EESA (Count IV)
on which relief may be granted.
D.
Misrepresentation (Count I)
Plaintiff alleges that U.S. Bank made material misrepresentations regarding her
loan, including representing an arrearage without any basis for the arrearage and advising
her that the mortgage was subject to default and foreclosure when it “had a duty to
comply with FHA loss mitigation alternatives including the FHA-HAMP modification.”
(Compl. ¶ 20.) Under Michigan law, a claim for misrepresentation requires proof of the
following:
(1) That [the] defendant made a material representation; (2) that it was
false; (3) that when he made it he knew that it was false, or made it
recklessly, without any knowledge of its truth and as a positive assertion;
(4) that he made it with intention that it should be acted upon by [the]
plaintiff; (5) that [the] plaintiff acted in reliance upon it; and (6) that he
thereby suffered injury.
Hart, 2010 WL 3272623, at *6 (quoting U.S. Fidelity and Guaranty Co. v. Black, 412
Mich. 99, 114, 313 N.W.2d 77, 82 (1981) (additional citation omitted)). With respect to
Plaintiff’s claim that U.S. Bank made false representations regarding the outstanding
balance of her loan and the amount the loan was in arrears, U.S. Bank argues that Plaintiff
cannot establish the necessary elements of her misrepresentation claim because (1) there
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were no “false” representations and (2) she admits that she knew the alleged statements
by U.S. Bank were false when she received them. As to Plaintiff’s claim that U.S. Bank
made false representations regarding its modification of her loan, U.S. Bank argues that
there is no claim for duty owed or the servicer’s failure to modify a loan.
As this Court held in Hart, a plaintiff cannot state a misrepresentation claim based
on allegations that the defendant promised but failed to modify the plaintiff’s loan. 2010
WL 3272623, at *6. “[R]eliance on a promise that [the servicer] would review [the]
Plaintiff’s mortgage for modification could not cause an injury . . . where, as discussed in
detail above, [the] Plaintiff is not entitled modification regardless of her eligibility under
[HAMP and EESA].” Id.
With respect to U.S. Bank’s allege misrepresentations regarding Plaintiff’s loan
balance and arrears, U.S. Bank contends that its statement– as reflected on the July 2009
Monthly Mortgage Statement sent to Plaintiff– accurately reflected arrears arising from
Plaintiff’s failure to remit loan payments after the Trustee turned the responsibility for the
payments over to her. (Def.’s Br. in Supp. of Mot. at 3.) First, the statement does not
identify how the arrearage was calculated, in other words what specific earlier payments
were not made. (Compl. Ex. 7.) Second, viewing Plaintiff’s Complaint in the light most
favorable to her, the Court cannot conclude, as U.S. Bank asserts, that the overdue
amounts stated on the statement were correct. Plaintiff appears to allege in her Complaint
that the loan should have been paid off completely through the bankruptcy plan or at least
paid up-to-date when she was discharged from bankruptcy (the same time when the
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statement was sent to her showing an arrearage).
For the same reasons, the Court cannot conclude that Plaintiff knew the statements
were false when she received U.S. Bank’s Monthly Mortgage Statement. Additionally,
while Plaintiff alleges in her Complaint that she sent a letter to U.S. Bank stating that the
debt amount and status of her account as represented on the statement were incorrect
(Compl. ¶ 32), she also alleges that she “to date has no knowledge of the accuracy of any
alleged debt and arrearages.” (Id. ¶ 14.) It is clear from her Complaint that Plaintiff
doubted the accuracy of U.S. Bank’s representations; however, she had no means to
verify the statements when U.S. Bank failed to respond to her request for documentation
supporting them.
The Michigan courts have indicated that “someone who knows that a
representation is false cannot rely on that representation. Such knowledge prevents not
only reasonable reliance, it prevents any reliance at all.” (Def.’s Br. in Supp. of Mot. at
11 (quoting Phinney v. Verbrugge, 222 Mich. App. 513, 535, 564 N.W.2d 532, 547
(1997)). As the court further explained in Phinney, however, “‘[t]he representation and
its materiality proven, it must be shown that the plaintiff's knowledge was so
informatively complete as to render the allegation of reliance quite as false as the
representation itself.’” Id. (quoting Sautter v. Ney, 365 Mich. 360, 363, 112 N.W.2d 509
(1961) (emphasis added)).
Nevertheless, and although not raised by U.S. Bank, the Court is concerned about
Plaintiff’s “naked assertion” or “threadbare recital” that she “did rely” on U.S. Bank’s
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misrepresentations. (Compl. ¶ 23.) Plaintiff fails to indicate how she acted in reliance
on U.S. Bank’s statements to her detriment– in other words, what she did or did not do
based on the misrepresentations. For this reason, the Court concludes that Plaintiff’s
misrepresentation claim (Count I) fails to state claim on which relief may be granted.
E.
Wrongful Foreclosure (Count V)
Plaintiff asserts that U.S. Bank wrongfully foreclosed on her home because she
made all of the payments due on the mortgage loan. U.S. Bank seeks dismissal of this
claim, arguing that because MSHDA holds the mortgage and has the ultimate authority to
determine whether to institute foreclosure proceedings, Plaintiff must exhaust her
administrative remedies prior to effectuating a “wrongful foreclosure” action in this
Court.
To support its argument, U.S. Bank relies on Michigan Administrative Code Rule
125.111 which provides, in relevant part: “A person, firm, corporation, or public body or
agency, aggrieved by a decision of the authority [MSHDA] or the executive director, may
request in writing that the authority hold a hearing in accordance with Act No. 306 of the
Public Acts of 1969, as amended, being SS24.201 to 24.315 of the Michigan Compiled
Laws.” U.S. Bank fails to convince this Court that this rule requires Plaintiff to seek a
hearing before the MSHDA before pursuing her wrongful foreclosure claim against U.S.
Bank. First, it is not evident from Plaintiff’s Complaint that MSHDA made the decision
to initiate foreclosure proceedings with respect to the property. Even if it did, however,
there is no evidence that Plaintiff was informed of a decision by MSHDA such that
15
Plaintiff would know to pursue any available administrative remedies. Furthermore, U.S.
Bank fails to cite and this Court found no decisions applying this rule to the authority’s
decision to foreclose on a loan it held.
Therefore, based on U.S. Bank’s argument, the Court cannot conclude at this
juncture that Plaintiff’s wrongful foreclosure claim (Count V) fails to state a claim upon
which relief may be granted.
F.
Intentional Infliction of Emotional Distress (Count VI)
Plaintiff alleges that U.S. Bank’s conduct with respect to her mortgage was
intentional and constituted extreme and outrageous conduct that caused her emotional
distress. (Compl. ¶¶ 47-48, 50.) To establish a Michigan common law claim of
intentional infliction of emotional distress, a plaintiff must show “(1) extreme and
outrageous conduct, (2) intent or recklessness, (3) causation, and (4) severe emotional
distress.” Graham v. Ford, 237 Mich.App. 670, 674, 604 N.W.2d 713 (1999); see also
Roberts v. Auto-Owners Insurance Co., 422 Mich. 594, 374 N.W.2d 905 (1985). Liability
under this theory requires that the conduct complained of “has been so outrageous in
character, and so extreme in degree, as to go beyond all possible bounds of decency, and
to be regarded as atrocious and utterly intolerable in a civilized community.” Graham,
237 Mich. App. at 674, 604 N.W.2d 713. This is a demanding standard: It is not sufficient
to show that the defendant acted tortiously, intentionally, or even criminally. Id. The test
has been described as whether “the recitation of the facts to an average member of the
community would arouse his resentment against the actor, and lead him to exclaim,
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‘Outrageous!’” Roberts, 422 Mich. at 603, 374 N.W.2d 905.
Plaintiff’s intentional infliction of emotional distress claim, like all her claims,
revolves around U.S. Bank’s alleged misrepresentations regarding the status of her loan
payments and a resulting foreclosure action. Plaintiff’s allegations, under the standard set
forth in Graham and Roberts, do not constitute “outrageous” conduct. Plaintiff’s
intentional infliction of emotional distress claim (Count VI) fails to state a claim on which
relief may be granted.
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IV.
Conclusion
For the reasons set forth above, the Court concludes that Plaintiff fails to state a
claim upon which relief may granted in her counts alleging a violation of the FDCPA
(Count III) and HAMP and EESA (Count IV), as well as misrepresentation (Count I) and
intentional infliction of emotional distress (Count VI). The Court however cannot
conclude at this time and for the reasons set forth by U.S. Bank that Plaintiff’s RESPA
(Count II) and wrongful foreclosure (Count V) claims are subject to Rule 12(b)(6)
dismissal.
Accordingly,
IT IS ORDERED, that Defendant U.S. Bank’s motion to dismiss is GRANTED
IN PART AND DENIED IN PART.
s/PATRICK J. DUGGAN
UNITED STATES DISTRICT JUDGE
Copies to:
Vanessa G. Fluker, Esq.
Edward C. Cutlip Jr., Esq.
Davidde A. Stella, Esq.
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