Martin v. The Bank of New York Mellon Corporation as Trustee for Structured Asset Mortgage Investments II Inc. Mortgages Pass-Through Certificates Series 2006-AR4 et al
MEMORANDUM OPINION and ORDER Granting Defendant's 3 MOTION to Dismiss - Signed by District Judge Judith E. Levy. (FMos)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
Case No. 15-cv-10330
Hon. Judith E. Levy
Mag. Judge David R. Grand
The Bank of New York Mellon
Corporation and Nationstar
OPINION AND ORDER GRANTING DEFENDANTS’ MOTION TO
This is a contested foreclosure case. Plaintiff Richard Martin filed
a complaint in state court, generally alleging that defendants Bank of
New York Mellon Corporation and Nationstar Mortgage, LLC
wrongfully foreclosed on his property in violation of state and federal
misrepresentations to induce plaintiff not to challenge the foreclosure.
(See Dkt. 1.) Defendants removed the case, (see id.), and then filed a
motion to dismiss for failure to state a claim. (See Dkt. 3.) For the
reasons set forth below, defendants’ motion is granted.
Unless otherwise noted, the following is drawn from the
allegations plaintiff makes in his complaint.
Plaintiff was the fee simple owner of the real property located at
469 Woodlawn Avenue, Ypsilanti, Michigan 48198, and has lived there
for over twenty-five years. (See Dkt. 1 at 17, 26.) On April 5, 2006,
plaintiff obtained a loan for $105,300.00, which was secured by the
property. (See id. at 17, 28-47.) The loan was serviced by defendant
Nationstar and is currently held by defendant Bank of New York
Mellon. (See id. at 18.) According to defendants, plaintiff defaulted,
and defendant Nationstar sent plaintiff a notice of default. (See Dkt. 3
Plaintiff began requesting “loan modification or any other
financial assistance options from [d]efendants” prior to December 15,
(See Dkt. 1 at 18.)
He “promptly and diligently [sent] every
document [d]efendants requested,” but defendants “repeatedly told
[p]laintiff that they had[ not] received either all or part of various
documents.” (See id.) Plaintiff “promptly complied with every request
that [d]efendants made of him,” and he “was never informed that he
was not eligible for any of the loan modification options or programs
that [d]efendants offer.” (See id.)
On December 24, 2014, defendant Nationstar sent plaintiff a
letter indicating that it had “completed the first filing notice required to
start the foreclosure process”—even though plaintiff “had been
repeatedly assured by [d]efendants that he was being reviewed for a
loan modification”—and that “if [plaintiff had] already reached out for
help, do[ not] worry, that process is still proceeding and no further
action is required.” (See id. at 19 (emphasis in original).) According to
the foreclosure notice, lenders, and agents, the balance of the mortgage
was $98.159.66. (See id. at 20.)
When deciding a motion to dismiss under Fed. R. Civ. P. 12(b)(6),
the Court must “construe the complaint in the light most favorable to
the plaintiff and accept all allegations as true.” Keys v. Humana, Inc.,
684 F.3d 605, 608 (6th Cir. 2012). “To 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.” Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009). A plausible claim 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 Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).
As a preliminary matter, the documents attached to defendants’
Rule 12(b)(6) motion—specifically, alleged letters sent to plaintiff
informing him of default and denying his requests for loan modification
or other assistance—cannot be considered without converting the
motion into one for summary judgment under Rule 56.
Defendants argue that this evidence is “[referenced] in the
complaint and is central to the plaintiff’s claim,” and may thus be
considered without converting the motion into one for summary
judgment. (See Dkt. 3 at 12-13 n.1 (citing Greenberg v. Life Ins. Co. of
Va., 177 F.3d 507, 514 (6th Cir. 1999).) But when, as here, unverified
communications “are unsigned, there is no way for the court to know if
defendant sent and plaintiff received the letters, plaintiff has not had a
chance to question anybody with regard to the letters, and they only
give one side of the story,” they may not be considered without
converting the motion. See Houle v. Green Tree Servicing, LLC, No. 14cv-14654, 2015 U.S. Dist. LEXIS 53414, at *3 (E.D. Mich. Apr. 23, 2015)
(Steeh, J.). Cf. DBI Invs., LLC v. Blavin, No. 14-1398, 2015 U.S. App.
LEXIS 5034, at *2-3 (6th Cir. Mar. 26, 2015) (holding that both the
partnership agreement at issue and “Dear Partner Letters” were
central to the claims in the complaint and could thus be considered on a
motion to dismiss). Documents attached to a Rule 12(b)(6) motion that
“fill in the contours and details of the plaintiff’s complaint and add
nothing new,” may be considered, see Yeary v. Goodwill IndustriesKnoxville, Inc., 107 F.3d 443, 445 (6th Cir. 1997), but not when they
directly contradict the allegations in the complaint. Cf. Song v. City of
Elyria, Ohio, 985 F.2d 840, 842 (6th Cir. 1993) (document attached to
12(b)(6) motion could be considered, because it “did not rebut, challenge,
or contradict anything in the plaintiffs’ complaint”).
Although it is improbable that the documents attached to
defendants’ motion are anything other than what defendants purport
them to be, they cannot be considered without converting defendants’
motion into a motion for summary judgment under Fed. R. Civ. P. 56.
In any case, the documents need not be considered, because plaintiff
fails to plead any plausible claim on the face of his complaint.
a. Wrongful foreclosure
Plaintiff alleges that “[d]efendants failed to properly follow the
requirements of the Foreclosure process set forth in [Mich. Comp. Laws
§] 600.3201 et seq[.], including, but not limited to, failing to properly
calculate the amount claimed to be due on the date of the notice of
foreclosure.” (Dkt. 1 at 21.) But plaintiff’s sole factual allegation in this
regard is that “[a]ccording to the Foreclosure Notice, Lenders and its
agents claim the balance on said Mortgage is $98.159.66.” (See id. at
20.) Plaintiff does not allege how defendants improperly calculated that
amount, how the amount should have been calculated, or even what the
proper amount should have been. As many courts in this district have
found under nearly identical circumstances, such a conclusory
allegation lacks a sufficient factual basis to state a plausible claim for
See, e.g., Caggins v. Bank of N.Y. Mellon, No. 15-11124, 2015 U.S. Dist. LEXIS
85457, at *4-5 (E.D. Mich. July 1, 2015) (Steeh, J.) (“Plaintiff alleges that
Defendants violated the Michigan foreclosure statute by failing ‘to properly
calculate the amount claimed to be due on the date of the notice of foreclosure.’ . . .
The Plaintiff does not plead any facts as to why she believes the amount stated in
the foreclosure notice was miscalculated, how the amount was miscalculated, or
Plaintiff also claims that defendants “engaged in a pattern or
practice of non-compliance with RESPA’s mortgage-servicer provisions
contemporaneously with active foreclosure proceedings,” and failing “to
provide [p]laintiff with notice that there were no loss mitigation options
available to him.” (Dkt. 1 at 21.) Plaintiff requests an order that he be
given an opportunity to become current on the mortgage, that
what the correct amount should have been. . . . Plaintiff’s pleading is merely a
conclusory allegation without factual support, which does not meet Rule 12(b)(6)’s
pleading requirements.”); Fredericks v. Mortg. Elec. Registration Sys., No. 14-14270,
2015 U.S. Dist. LEXIS 70883, at *8 (E.D. Mich. June 2, 2015) (Borman, J.)
(“Plaintiffs allege . . . that Defendants failed to follow the procedures set forth in
Mich. Comp. Laws § 600.3201 et seq. ‘by failing to properly calculate the amount
claimed to be due on the date of the notice of foreclosure.’ . . . This one-paragraph
Count fails to plausibly suggest a claim.”); Fredericks v. Allquest Home Mortg.
Corp., No. 15-10429, 2015 U.S. Dist. LEXIS 56447, at *6-7 (E.D. Mich. Apr. 30,
2015) (Edmunds, J.) (“Plaintiff alleges that Defendants failed to properly calculate
the amount claimed to be due on the date of the notice of foreclosure in violation of
Mich. Comp. Laws § 600.3212(c). From a pleading perspective, this claim falls short
of the mark. Plaintiff fails to assert basic elements of her claim, including what she
believed the correct amount due to be. Plaintiff has made no factual allegation
beyond stating that the amount due was inaccurate.”); Frank v. Mortg. Elec.
Registration, No. 14-13518, 2014 U.S. Dist. LEXIS 167934, at *5 (E.D. Mich. Dec. 4,
2014) (Cohn, J.) (“Plaintiffs’ wrongful foreclosure claim is alleged in the complaint
as a ‘fail[ure] to properly follow the requirements of the Foreclosure process set
forth in MCL 600.3201, et seq.’ . . . The complaint does not state with any degree of
particularity what any of the alleged violations are. The closest the complaint
appears to identify any wrongdoing is suggesting that the amount claimed to be due
contained in the foreclosure notice was somehow improper. . . . However, the
complaint presents no facts or explanation for how the amount on the notice was
improperly calculated, why it is incorrect, or what the correct amount should have
been. * * * The wrongful foreclosure claim is nothing more than the conclusory
allegation that defendants failed to follow the foreclosure process. This ‘formulaic
recitation’ fails to meet the minimum pleading requirement.”) (quoting Twombly,
550 U.S. at 555).
defendants negotiate with plaintiff towards a reasonable loan
modification, and “[a]ny other, further or different relief” deemed just
and equitable. (See id.) But this claim fails as well, “because RESPA
does not provide the relief requested.” See Fredericks v. Allquest Home
Mortg. Corp., 2015 U.S. Dist. LEXIS 56447, at *7.
plaintiff may only seek “actual damages,” see 12 C.F.R. §§ 1024.41,
2605(f), and—again, as many courts in this district have found under
nearly identical circumstances—plaintiff’s claim fails because he did not
allege that he suffered any actual damages.2
See, e.g., Caggins, 2015 U.S. Dist. LEXIS 85457, at *6 (“There is no provision
found in RESPA under which Plaintiff can seek to have foreclosure proceedings
nullified, or force Defendants to negotiate a loan modification. . . . To the extent
Plaintiff intends to state a RESPA claim for monetary damages, the court dismisses
the claim because Plaintiff does not allege any facts which would establish actual
damages or a pattern or practice of non-compliance.”); Fredericks v. Allquest Home
Mortg. Corp., 2015 U.S. Dist. LEXIS 56447, at *7-8 (“RESPA grants relief in the
form of monetary damages. . . . Plaintiff, however, seeks a declaration that the
foreclosure process is null and void, injunctive relief stopping the foreclosure and an
order requiring Defendants to negotiate another loan modification, none of which is
available under RESPA. The claim also fails to the extent that Plaintiff seeks
money damages because Plaintiff has not alleged how a purported violation resulted
in actual damages.”); Houle, 2015 U.S. Dist. LEXIS 53414, at *8-9 (“The principal
relief sought by plaintiff—to set aside the sheriff’s sale—is unavailable to him under
RESPA.”); Servantes v. Caliber Home Loans, Inc., No. 14-13324, 2014 U.S. Dist.
LEXIS 170667, at *2-3 (E.D. Mich. Dec. 10, 2014) (Duggan, J.) (“To the extent
Plaintiffs may wish to proceed with a RESPA claim for monetary damages only, the
Court dismisses the claim because Plaintiffs have not alleged that Defendant’s
alleged violations of 12 C.F.R. § 1024.39-41 resulted in actual damages.”).
b. Breach of contract
Plaintiff alleges that defendants breached the terms of the
mortgage contract and the implied covenant of good faith and fair
But Michigan does not recognize an independent claim for
breach of the implied covenant of good faith and fair dealing.
Triplett v. Perry (In re Leix Estate), 797 N.W.2d 673, 683 (Mich. Ct. App.
2010) (“Unlike some other jurisdictions, Michigan does not recognize a
cause of action for breach of the implied covenant of good faith and fair
dealing.”) (internal quotations omitted); Fodale v. Waste Mgmt. of Mich.,
Inc., 718 N.W.2d 827, 841 (Mich. Ct. App. 2006) (same). Defendants’
motion is therefore granted as to plaintiff’s implied-covenant claim.
Regarding the breach-of-contract claim, plaintiff alleges that
“[n]one of the correspondence received by [p]laintiff contained all of the
required components of Paragraph 22 of the Mortgage,” (Dkt. 1 at 22),
which provides in relevant part that:
The notice shall specify: (a) the default; (b) the action
required to cure the default; (c) a date, not less than 30 days
from the date the notice is given to Borrower, by which the
default must be cured; and (d) that failure to cure the default
on or before the date specified in the notice may result in
acceleration of the sums secured by this Security Instrument
and sale of the Property.
(See id. at 22, 40.) As with the rest of his complaint, plaintiff fails to
plead sufficient facts to state a plausible claim for relief.
attached none of the allegedly deficient letters to his complaint and fails
to articulate what specific information was lacking from them. See, e.g.,
Caggins, 2015 U.S. Dist. LEXIS 85457, at *6-7 (“Plaintiff generally
alleges that the correspondence she received from the Defendants did
not contain the components required by the mortgage agreement . . . . ,
[but] fails to identify the specific letters which she claims were deficient,
the contents of these letters, or how and why the specific letters were
deficient . . . . , [and thus] cannot survive a Rule 12(b)(6) motion to
And to the extent plaintiff alleges that defendants breached the
mortgage contract by “[d]isingenuously negotiation loss mitigation
assistance with [p]laintiff” and “[m]isleainding [p]laintiff about
approval and extension of loss mitigation assistance as an alternative to
foreclosure,” (see Dkt. 1 at 22), the claim still fails. Plaintiff fails to
plead any term of the mortgage that obligates defendants to modify the
loan. See, e.g., Frank v. Mortgage Elec. Registration, 2014 U.S. Dist.
LEXIS 167934, at *8 (dismissing claim because plaintiffs did “not set
forth any term in the note or mortgage which obligate[d] [defendant] to
modify their loan,” and “neither the note or mortgage contain[ed] any
[such] term”). Defendants’ motion is therefore granted as to plaintiff’s
c. Fraudulent misrepresentation
Plaintiff alleges that defendants fraudulently misrepresented that
they would not begin foreclosure proceedings while the parties were
actively pursuing loan modification or other financial assistance
options. (See Dkt. 1 at 23.) According to plaintiff, defendants knew the
statements were false or made the statements with reckless disregard
for the truth, defendants intended to induce plaintiff to refrain from
defending the foreclosure, plaintiff reasonably relied on the statements
when he refrained from challenging the foreclosure, and plaintiff was
damaged by losing all right, title, and interest in his home. (See id.)
Plaintiff’s claim fails for two reasons.
First, plaintiff fails to plead his fraud claim with particularity, as
required. See Fed. R. Civ. P. 9(b) (“In alleging fraud . . . , a party must
state with particularity the circumstances constituting fraud or
mistake.”). In order to satisfy this burden, plaintiff must: “(1) specify
the statements that the plaintiff contends were fraudulent, (2) identify
the speaker, (3) state where and when the statements were made, and
(4) explain why the statements were fraudulent.” Frank v. Dana Corp.,
547 F.3d 564, 570 (6th Cir. 2008) (internal quotations omitted).
Plaintiff fails to plead facts regarding when the alleged statements were
made, who made the statements, or how the representations were false.
Plaintiff’s fraud claim is thus insufficiently pled under Rule 9(b). See,
e.g., Caggins, 2015 U.S. Dist. LEXIS 85457, at *7-8 (“Here, the Plaintiff
fails to particularly identify the specific fraudulent statements, who
made the statements, and when and where the statements were made.
Therefore, the Plaintiff fails to plead fraudulent misrepresentation with
the level of particularity required by Rule 9(b).”).
Even if plaintiff had properly pled fraud under Rule 9(b), his claim
is barred by the Michigan statute of frauds. Under Michigan law, “no
cause of action can be brought against a financial institution for a
promise of financial accommodation unless the promise is in writing
and signed by an authorized signature.”
See id. at *8 (citing Mich.
Comp. Laws § 566.132(2)(b)). Plaintiff argues that promissory estoppel
can be invoked to bypass the statute of frauds, (see Dkt. 8 at 25-26
(citing McMath v. Ford Motor Co., 259 N.W.2d 140, 142 (Mich. Ct. App.
1977) (“Promissory estoppel, if established, can be invoked to defeat the
defense of the statute of frauds.”))), but this argument fails as a matter
of law. McMath is inapposite, because the defendant there was not a
“financial institution” and was therefore not bound by Mich. Comp.
Laws § 566.132(2)(b), which, “in clear and unambiguous language, . . .
specifically bars” promissory estoppel actions. See Crown Tech. Park v.
D&N Bank, F.S.B., 619 N.W.2d 66, 73 (Mich. Ct. App. 2000); see also
Blackward Props., LLC v. Bank of Am., 476 F. App’x 639, 642 (6th Cir.
2012) (“Mich. Comp. Laws § 566.132(2) . . . amounts to ‘an unqualified
and broad ban’ and bars ‘all actions for the enumerated promises and
commitments, including actions for promissory estoppel.’”) (quoting
Crown Tech. Park, 619 N.W.2d at 73) (emphasis in original).
Defendants’ motion is therefore granted as to plaintiff’s fraudulent
Plaintiff fails to plead sufficient facts to state a plausible claim for
wrongful foreclosure under either state or federal law, breach of
contract, or fraudulent misrepresentation.
And as highlighted
throughout this opinion, particularly in the examples given in the
footnotes set forth above, courts in this district have considered
virtually identical complaints and have uniformly dismissed them.
Defendants’ motion, (Dkt. 3), is granted.
IT IS SO ORDERED.
Dated: November 20, 2015
Ann Arbor, Michigan
s/Judith E. Levy
JUDITH E. LEVY
United States District Judge
CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing document was served
upon counsel of record and any unrepresented parties via the Court’s
ECF System to their respective email or First Class U.S. mail addresses
disclosed on the Notice of Electronic Filing on November 20, 2015.
s/Felicia M. Moses
FELICIA M. MOSES
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