Goss v. CitiMortgage, Inc. et al
OPINION AND ORDER granting 32 Motion for Leave to File a Second Amended Complaint and terminating as moot 25 Motion for Leave to File a First Amended Complaint. Signed by District Judge Robert H. Cleland. (LWag)
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF MICHIGAN
ROBERT GOSS JR.,
Case No. 16-14391
CITIMORTGAGE, INC. and NATIONSTAR
OPINION AND ORDER GRANTING MOTION FOR LEAVE TO FILE
SECOND AMENDED COMPLAINT
On December 19, 2016, Plaintiff Robert Goss Jr. filed an “Emergency Motion for
Temporary Restraining Order” (Dkt. # 4) asking the court to stay the December 20,
2016 sheriff’s foreclosure sale of his home at 6263 Malvern Drive, Troy, Michigan. The
court denied the motion in an order entered the next day (Dkt. # 5), explaining that the
court lacked sufficient time to review the motion before the sale and, in any event,
Plaintiff had not shown that irreparable harm would result, as Michigan law provided a
variety of mechanisms by which the parties could effectively undue the foreclosure sale.
(Dkt. # 5, Pg. ID 201-02.) The auction was held and Plaintiff’s home was sold to a thenunidentified third party.
Defendants Citimortgage, Inc. and Nationstar Mortgage, LLC, have filed motions
to dismiss (Dkt. ## 17, 18), which have been fully briefed. On May 9, 2017, Plaintiff filed
a motion for leave to file an amended complaint—adding a claim under the Real Estate
Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2605 (Dkt. # 25)—and a “Renewed
Emergency Motion for a Temporary Restraining Order” (Dkt. # 26). Plaintiff’s renewed
TRO asked the court to stay the running of the six month statutory period during which
Plaintiff may redeem his allegedly-defaulted mortgage. (Id.) In a May 25, 2017 opinion
and order (Dkt. # 31), the court construed the renewed TRO as a motion for a
preliminary injunction. In its opinion, the court explained that Michigan’s redemption
period does not begin to run until the sheriff’s deed from the foreclosure sale is
recorded, and that the sheriff’s deed had not yet be recorded by the third-party
purchaser. (Id. at Pg. ID 814.) The court also explained that it could not enjoin any
action by the purchaser until that individual was joined as a party to this proceeding.
(Id.) Finding that “Plaintiff’s requested injunction would have no effect[,]” the court
denied the motion without prejudice. (Id.) The court took no action on the motion for
leave to file the first amended complaint or on the motions to dismiss, all of which
Now before the court is a motion for leave to file a second amended complaint,
joining Zana Zaitouna—the third-party purchaser—as a Defendant. (Dkt. # 32.)1
Defendants Citimortgage and Nationstar stipulate to joining Zaitouna as a Defendant,
but ask the court to deny leave add the RESPA claim.2 Defendants contend that adding
this claim would be futile, they were not given proper notice, and adding the claim now
would be unduly prejudicial. (Dkt. # 33, Pg. ID 990.) The court agrees with the parties
that joining Zaitouna is appropriate and will grant that aspect of the motion without
Although Zaitouna is identified as a “Third Party Defendant” in the caption of the
proposed second amended complaint (Dkt. # 32-2), this appears to be a mistake. The
court understands Plaintiff to be joining Zaitouna under Federal Rule of Civil Procedure
20, not Rule 14.
Defendants also opposed Plaintiff’s request for leave to file his first amended
complaint in this respect. (See Dkt. # 30.) The court—anticipating the instant motion—
declined to address the issue at the time and, in a May 19, 2017 telephonic status
conference, invited Defendants to renew their objection here.
discussion. After reviewing the briefing and finding no hearing necessary, see E.D.
Mich. L.R. 7.1(f)(2), the court will also grant leave to bring the RESPA claim.
Except for amendments allowed as a matter of course under Federal Rule of
Civil Procedure 15(a)(1), “a party may amend its pleading only with the opposing party’s
written consent or the court’s leave. The court should freely give leave when justice so
requires.” Fed. R. Civ. P. 15(a)(2). Factors that may affect the determination include
undue delay in filing, bad faith or dilatory motive, undue prejudice, repeated failure to
cure deficiencies by previous amendment or futility of amendment by the moving party.
Head v. Jellico Hous. Auth., 870 F.2d 1117, 1123 (6th Cir. 1989) (citation omitted). The
ultimate decision to grant or deny leave to amend a pleading is left to the sound
discretion of the district court. Robinson v. Michigan Consol. Gas Co., Inc., 918 F.2d
579, 591 (6th Cir. 1990).
Plaintiff’s second amended complaint alleges that he “inquired about information
on his account and for correction of the errors made . . . . [and] Defendant Citimortgage
failed to respond to Plaintiff’s inquiry and make the necessary corrections to [his]
mortgage, in violation of 12 U.S.C.[ §] 2605(e). (Dkt. # 32-2, Pg. ID 840.) Attached to
the proposed second amended complaint is Plaintiff’s inquiry, which identifies itself as a
“Qualified Written Request under RESPA” and is dated June 8, 2016. (Dkt. # 32-2, Pg.
ID 931.) Under the statute, mortgage servicers are required to respond to qualified
written requests (“QWRs”) within thirty days. 12 U.S.C. § 2605(e)(2).
Defendants advance two arguments for why granting leave to bring this claim
would be futile. First, Defendants contend that Plaintiff’s inquiry was not a QWR under
the statute because Plaintiff sent his inquiry to the wrong address. The relevant
regulatory provision, promulgated by the Consumer Financial Protection Bureau,
provides in pertinent part:
A servicer may, by written notice provided to a borrower, establish an
address that a borrower must use to submit a notice of error in
accordance with the procedures in this section. The notice shall include a
statement that the borrower must use the established address to assert an
error. If a servicer designates a specific address for receiving notices of
error, the servicer shall designate the same address for receiving
information requests pursuant to § 1024.36(b). A servicer shall provide a
written notice to a borrower before any change in the address used for
receiving a notice of error. A servicer that designates an address for
receipt of notices of error must post the designated address on any Web
site maintained by the servicer if the Web site lists any contact address for
12 C.F.R. § 1024(c). According to an exhibit attached to the proposed second amended
complaint, Citimortgage provided Plaintiff with the following address for written requests
for information, notices of error, or qualified written requests on May 26, 2016:
Attn: Customer Research Team
P.O. Box 10002
Hagerstown, MD 21747-0002
(Dkt. # 32-2, Pg. ID 924.) On June 8, 2016, Plaintiff mailed his inquiry to:
P.O. Box 6243
Sioux Falls, SD 57117-6263
Attn: Mortgage Loan Accounting Department
(Dkt. # 32-2, Pg. ID 931.) Defendants argue that Plaintiff’s failure to use the
“established” Hagerstown mailing address renders his inquiry not a “qualified written
request” under the RESPA and relieves Citimortgage of its duty to respond, citing Best
v. Ocwen Loan Servicing, LLC, 2016 WL 125875 (E.D. Mich. January 12, 2016)
(Luddington, J.). (Dkt. # 33, Pg. ID 993.)
Setting aside whether a failure to use an established address would be fatal to
Plaintiff’s statutory claim, it is not obvious to the court that Citimortgage had “established
a QWR mailing address” (id.) at the time. In addition to requiring the servicer to provide
the borrower with written notice of the designated address, the servicer “must post the
designated address on any Web site maintained by the servicer if the Web site lists any
contact address for the servicer.” 12 C.F.R. § 1024(c). Nothing in Defendants’ briefing
or attachment addresses this requirement—Defendants’ block quotation from the
regulation omits it entirely (Dkt. # 33, Pg. ID 992). A cursory glance at Citimortgage’s
website provides a Sioux Falls address, though not the one Plaintiff used.3 Absent some
evidence that the Hagerstown address appeared on the website at the time Plaintiff sent
his inquiry, the court cannot conclude that Citimortgage met this requirement.
Defendants also argue that Citimortgage did, in fact, respond to the request on
June 17, 2016, and attach a copy of the purported response, as well as an affidavit
attesting to its authenticity, to their brief. (See Dkt. # 33-3.) However, the court is
disinclined to rule on the adequacy of Citimortgage’s response without the benefit of
briefing by Plaintiff—though the court is curious to hear Plaintiff’s explanation for why
the letter proffered by Defendants is insufficient even though it appears to address each
of aspect of Plaintiff’s request.
The court is unmoved by Defendants’ arguments regarding the alleged lack of
adequate notice and prejudice. Plaintiff apparently discovered the scheduled sheriff’s
sale only shortly before it was filed and rushed into court in an effort to stop the sale.
See Citi Mortgage, Contact Us,
https://www.citimortgage.com/Mortgage/Home.do?page=contactus (last visited June 26,
The court will not begrudge Plaintiff a failure to bring a closely related, fairly ancillary
statutory claim at the time. While Defendants are correct that their pending dispositive
motions do not address the RESPA claim, the claim is only advanced against
Citimortgage. The court anticipates that resolution of this claim will be fairly
straightforward and will not impose a significant burden for a large, sophisticated, and
experienced litigant like Defendant Citimortgage. Accordingly, mindful that leave to
amend should be “freely given when justice so requires[,]” Fed. R. Civ. P. 15(a)(2), the
court will grant Plaintiff’s motion.
IT IS ORDERED that Plaintiff’s motion for leave to file his second amended
complaint (Dkt. # 32) is GRANTED.
IT IS FURTHER ORDERED that Plaintiff’s motion for leave to file his first
amended complaint (Dkt. # 25) is TERMINATED AS MOOT.
s/Robert H. Cleland
ROBERT H. CLELAND
UNITED STATES DISTRICT JUDGE
Dated: June 27, 2017
I hereby certify that a copy of the foregoing document was mailed to counsel of record
on this date, June 27, 2017, by electronic and/or ordinary mail.
Case Manager and Deputy Clerk
S:\Cleland\JUDGE'S DESK\C1 ORDERS\16-14391.GOSS.second.amended.complaint.TLH.docx
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