Helmus et al v. Chase Home Finance, L.L.C.

Filing 17

OPINION; signed by Judge Gordon J. Quist (Judge Gordon J. Quist, jmt)

UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
__________________________

ROBERT HELMUS and
MARIAN HELMUS,
Plaintiffs,
Case No. 1:11-CV-1016
v.
HON. GORDON J. QUIST
CHASE HOME FINANCE, LLC and
JPMORGAN CHASE BANK, N.A.,
Defendants.
_______________________________/
OPINION
Plaintiffs, Robert and Marian Helmus, filed their Complaint in the Circuit Court for the
County of Kent, State of Michigan, on or around August 9, 2011. On September 22, 2011,
JPMorgan Chase Bank, N.A. (“Chase”), timely removed the action to this Court. All of the claims
arise out of a mortgage Plaintiffs obtained on their real property located at 8109 Oldfield Ct. SE,
Byron Center, Michigan (“Property”).
Plaintiffs allege the following claims against Chase: (1) breach of contract, (2) promissory
estoppel, (3) a violation of Michigan’s Regulation of Collection Practices Act (“MRCPA”), M.C.L.
§ 445.251, and (4) a violation of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C.
§ 2601, et seq. Chase moves to dismiss all of Plaintiffs’ claims pursuant to Fed. R. Civ. P. 12(b)(6).
Having reviewed the parties’ written materials, the Court concludes that oral argument is
unnecessary to an informed decision on the motion. For the following reasons, the Court will grant
Chase’s motion to dismiss, and dismiss Plaintiffs’ Complaint.

I. BACKGROUND
The following facts are taken from Plaintiffs’ Complaint and accepted as true for purposes
of the instant motion to dismiss.
In 2005, Plaintiffs purchased their Property located at 8109 Oldfield Ct. SE, Byron Center,
Michigan. On about May 19, 2006, Plaintiffs executed a promissory note, and granted a mortgage
interest in the Property to JP Morgan. In 2008, Plaintiffs began to fall behind in their mortgage
payments, and Plaintiffs worked with Chase to attempt to resolve any default in their mortgage.1
Plaintiffs claim that in May of 2009, Chase offered Plaintiffs a Home Affordable Modification
Program (“HAMP”) Trial Period Plan (“TPP”), pursuant to which Plaintiffs were to make three
payments of $1223.33 each. HAMP is a federal program enacted pursuant to the Emergency
Economic Stabilization Act, P.L. 110, 110-343, 122 Stat. 3765. HAMP was designed to assist
homeowners in avoiding foreclosure by offering lenders incentives to offer borrowers modifications
with more favorable terms. See Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547, 556 (7th Cir.
2012). Pursuant to HAMP, the Secretary of the Treasury negotiates Servicer Participation
Agreements with servicers such as Chase, which require servicers to identify eligible homeowners
who are in default or will likely soon default and to modify the terms of their loans. Id. Chase
entered into a Servicer Participation Agreement (“SPA”) with Fannie Mae (acting as an agent of the
federal government), in which Chase agreed to apply the Treasury Department’s HAMP criteria to
all of the loans it services. As this Court has previously explained, the HAMP guidelines specify
that
[A] servicer follows three steps to determine whether a borrower is eligible for a
modification. First, the servicer determines whether the borrower meets certain

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Chase, a wholly-owned subsidiary of JP Morgan, apparently serviced Plaintiffs’ mortgage loan during all
relevant times. Chase subsequently merged into JP Morgan Chase Bank, N.A. (Def.’s Br. Supp. Mot. to Dismiss Ex.C.)

2

threshold requirements. Second, the servicer applies various changes in order to
lower the monthly mortgage payment as close as possible to 31 percent of the
borrower’s monthly income. Finally, applying a net present value test, the servicer
determines whether it is more profitable for the lender to modify the loan or to allow
it to go into foreclosure.
Brady v. Chase Home Fin., No. 1:11-CV-838, 2012 WL 1900606, at *3 (W.D. Mich. May, 24
2012).
As part of this process, when the servicer identifies a borrower who may qualify for a HAMP
loan modification, the servicer offers the borrower a two-step TPP. The first step of the process is
a trial payment period, usually lasting three months, during which the borrower provides loan
modification documentation to the lender and makes trial payments under the new loan repayment
terms. Wigod, 673 F.3d at 557. The second step of the process is a permanent modification, which
occurs if the borrower makes all of the payments in the modified amounts and complies with all of
the requirements of the TPP. Brady, 2012 WL 1900606, at *3.
The TPP Cover Letter Chase sent to Plaintiffs stated:
You may qualify for a Home Affordable Modification Trial Period Plan . . .
If you qualify under the federal government’s Home Affordable Modification
program and comply with the terms of the Trial Period Plan, we will modify your
mortgage loan and you can avoid foreclosure . . . .
The monthly trial period payments are based on the income information that you
previously provided to us. They are also our estimate of what your payment will be
IF we are able to modify your loan under the terms of the program. If your income
documentation does not support the income amount that you previously provided in
our discussions, two scenarios can occur: . . . 2) You may not qualify for this loan
modification program.
(Def.’s Br. Supp. Mot. to Dismiss Ex. D at 20.) Furthermore, the TPP Cover Letter states that “[t]he
Trial Period Plan is the first step. Once we are able to confirm your income and eligibility for the
program, we will finalize your modified loan terms and send you a loan modification agreement[,]”
(Id. at 22) and “[p]lease note, however, that your modification will not be effective unless you meet
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all of the applicable conditions[.]” (Id. at 24.) The TPP Cover Letter also stated that if the person
applying for HAMP makes their first payment and does not qualify for the program, the “first trial
payment will be applied to your existing loan in accordance with the terms of your loan documents.”
(Id.) Additionally, the TPP stated, “This Plan will not [take] effect unless and until both I and the
Lender sign it and Lender provides me with a copy of this Plan [with] the Lender’s signature.” (Pls.’
Resp. Br. Ex. B at 1) The TPP also stated:
I understand that the Plan is not a modification of the Loan Documents and that the
Loan Documents will not be modified unless and until (I) I meet all of the conditions
required for modification, (II) I receive a fully executed copy of a Modification
Agreement, and (III) the Modification Effective Date has passed. I further
understand and agree that the Lender will not be obligated or bound to make any
modification of the Loan documents if I fail to meet any one of the requirements
under this Plan.
(Id. at 3.)
Plaintiffs accepted the TPP, submitted their paperwork, and began making payments in May
2009. Chase lost the paperwork for the TPP, and as a result, Plaintiffs submitted the TPP paperwork
a second time. Chase repeatedly asked for new documents, and Plaintiffs allegedly complied with
every request in a timely manner. If Plaintiffs successfully completed the trial modification,
Defendant allegedly agreed to make the loan modification permanent. After the third payment,
Plaintiffs continued making payments equal to the TPP payments. On at least one occasion, Chase
allegedly sent Plaintiffs a second proposed TPP with less favorable terms. In May 2010,
approximately a year after beginning the 3-month TPP, Chase sent Plaintiffs a letter stating that
Plaintiffs were denied a permanent modification because they had failed to provide all requested
documents. After the denial letter, Plaintiffs disputed the decision with Chase and continued to
make payments equal to the TPP payments. Chase then stopped accepting payments from Plaintiffs.
Throughout the time that Chase serviced Plaintiffs’ mortgage loan, Chase allegedly misapplied

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payments, failed to apply payments, and placed improper and unauthorized charges on Plaintiffs’
account.
II. MOTION STANDARD
Pursuant to Rule 8(a), a complaint must provide “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Detailed factual allegations are not required, but “a
plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than
labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 1964-65 (2007) (quoting Conley v.
Gibson, 355 U.S. 41, 47, 78 S. Ct. 99, 103 (1957)). The court must accept all of the plaintiff’s
factual allegations as true and construe the complaint in the light most favorable to the plaintiff.
Gunasekera v. Irwin, 551 F.3d 461, 466 (6th Cir. 2009). The complaint must contain “enough facts
to state a claim to relief that is plausible on its face.” 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.” Ashcroft v.
Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 1949 (2009). Although the plausibility standard is not
equivalent to a “‘probability requirement,’...it asks for more than a sheer possibility that a defendant
has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at 556, 127 S. Ct. at 1965). “[W]here the
well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct the complaint has alleged - but it has not ‘show[n]’ - that the pleader is entitled to relief.” Id. at 679,
129 S. Ct. at 1950 (quoting FED . R. CIV . P. 8(a)(2)).
Although a court is normally precluded from considering matters outside of the pleadings
in addressing a motion under Fed. R. Civ. P. 12(b)(6), courts recognize an exception for documents
attached to or referenced in the complaint. “When a court is presented with a Rule12(b)(6) motion,

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it may consider the Complaint and any exhibits attached thereto...so long as they are referred to in
the Complaint and are central to the claims contained therein.” Bassett v. NCAA, 528 F.3d 426, 430
(6th Cir. 2008) (citation omitted).
III. DISCUSSION
A.

Motion to Dismiss
1.

Breach of Contract

In Count 1 of Plaintiffs’ Complaint, Plaintiffs allege that they entered into a contract with
Chase to “modify the existing mortgage and loan, whereby Plaintiffs agreed to make payments
pursuant to the TPP, and upon the successful completion of that TPP, Defendants agreed to provide
Plaintiffs with a permanent loan modification.” Plaintiffs allege that although they complied with
all of the requirements of the TPP, Chase breached the TPP by failing to provide them with a
permanent modification. Plaintiffs also allege that Chase breached the implied covenant of good
faith and fair dealing by failing to handle their account, payments, and communications in an
acceptable and fair manner in accordance with the contract’s provisions.
HAMP Does Not Bar Plaintiffs’ Breach of Contract Claim
As an initial matter, the Court addresses Chase’s argument that because HAMP provides
borrowers no private right of action, Plaintiffs may not maintain a breach of contract action
premised on a TPP, a HAMP-related document.
Chase’s argument is essentially an extension of the conclusion that a majority of courts have
reached that HAMP does not provide a private right of action to borrowers. See In re Lopez, 446
B.R. 12, 21-22 (Bkrtcy. D. Mass. 2012) (noting that “a majority of courts have held that HAMP
affords no private right of action”). This Court has reached the same conclusion. See Wyler v. Bank
of Am., No. 1:11-CV-132, 2011 WL 5361077, at *5 (W.D. Mich. Nov. 7, 2011) (“HAMP does not

6

provide plaintiffs with a private right of action.”). Citing this Court’s decision in Wyler, Chase
argues that because the TPP is a part of HAMP, the TPP cannot form the basis of a state-law breach
of contract claim. Id. However, in Brady v. Chase Home Finance, LLC, No. 1:11-CV-838, 2012
WL 1900606, at *5 (W.D. Mich. May 24, 2012), this Court followed Wigod v. Wells Fargo Bank,
N.A., 673 F.3d 547 (7th Cir. 2012), which rejected the argument “that where Congress does not
create a private right of action for violation of a federal law, no right of action may exist under state
law either.” The Seventh Circuit stated in Wigod that “[t]he absence of a private right of action from
a federal statute provides no reason to dismiss a claim under a state law just because it refers to or
incorporates some elements of the federal law.” Id. at 581. Plaintiffs in this case are bringing a
claim for a breach of contract, not a claim under HAMP. This distinction differentiates this case
from Wyler and all other cases Chase cites. See LaSalle Bank v. Nat’l Ass’n v. Ray, No. 09-13526,
2011 WL 576661, at *5 (E.D. Mich. Feb. 9, 2011) (Stating that “the statutes ‘do not create a private
right of action under which Plaintiff may seek relief”); Hart v. Countrywide Home Loans, Inc., 735
F. Supp. 2d 741, 748 (E.D. Mich. 2010) (“[t]he statutes do not create a private right of action under
which Plaintiff may seek relief. ‘There is no express or implied right to sue fund recipients...under
TARP or HAMP.’”); Brown v. Bank of N.Y. Mellon, No. 1:10-CV-550, 2011 WL 206124, at *2
(W.D. Mich. Jan 21, 2011) (“All of the district courts that have considered the issue have held that
homeowners do not have a private right of action under HAMP for denial of a loan modification.”);
and Adams v. U.S. Bank, No. 10-10567, 2010 WL 2670702, at *4 (E.D. Mich. July 1, 2010)
(“Federal district courts have held that homeowners do not have a right to a loan modification under
HAMP.”). Given the lack of any persuasive analysis to support Chase’s argument, this Court agrees
with those courts, including the Seventh circuit, that have found that the lack of private right of
action under HAMP does not preclude a plaintiff from maintaining a breach of contract claim based

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on a TPP. See Picini v. Chase Home Fin. LLC, __ F. Supp. 2d __, 2012 WL 580255, at *5
(E.D.N.Y. 2012) (“Defendants have not pointed to any ‘rule that where a state common law theory
provides for liability for conduct that is also violative of federal law, a suit under the state common
law is prohibited so long as the federal law does not provide for a private right of action.’” (quoting
Fletcher v. One West Bank, FSB, 798 F. Supp. 2d 925, 930-31 (N.D. Ill. 2011))); Bolone v. Wells
Fargo Home Mortg., Inc., No. 11-10663, 2012 WL 882894, at *4 (E.D. Mich. Mar. 14, 2012)
(rejecting the defendant’s argument that HAMP preempts state breach of contract claims based on
a TPP).
The Statute of Frauds Bars Plaintiffs’ Breach of Contract Claim
With regard to claims against financial institutions, Michigan’s statute of frauds provides:
(2) An action shall not be brought against a financial institution to enforce any of
the following promises or commitments of the financial institution unless the
promise or commitment is in writing and signed with an authorized signature by the
financial institution:
(a) A promise or commitment to lend money, grant or extend credit, or make any
other financial accommodation.
(b) A promise or commitment to renew, extend, modify, or permit a delay in
repayment or performance of a loan, extension of credit, or other financial
accommodation.
(c) A promise or commitment to waive a provision of a loan, extension of credit, or
other financial accommodation.
M.C.L.A. § 566.132(2). This provision applies to an action against financial institutions based upon
a promise to modify a loan and is “‘unambiguous.’” Ennis v. Wells Fargo Bank, N.A., No. 1:10-CV751, 2011 WL 1118669, at *3 (W.D. Mich. Mar. 25, 2011) (quoting Crown Tech. Park v. D & N
Bank, FSB, 242 Mich. App. 538, 550, 619 N.W.2d 66, 72 (2000)). Moreover, it applies to any
“claim-no matter its label-against a financial institution to enforce the terms of an oral promise to
waive a loan provision.” Crown Tech., 242 Mich. App. At 550, 619 N.W.2d at 72.
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Under the statute of frauds, Plaintiffs cannot maintain a breach of contract claim as the TPP
was not signed by an authorized representative of Chase. Plaintiffs attempt to cure this defect by
relying on the cover letter that accompanied the TPP that was signed “Sincerely, CHASE HOME
FINANCE LLC.” However, Michigan courts interpret the requirement of an “authorized signature”
as that of “an authorized representative” of the financial institution. See Cadle Co. II, Inc. v. P.M.
Group, Inc., No. 275099, 2007 WL 3119569, at *2 (Mich. Ct. App. Oct. 25, 2007) (per curiam).
Because the cover letter was not signed by an authorized representative of Chase, the statute of
frauds bars Plaintiffs’ breach of contract claim.2
The TPP Did Not Ripen Into An Offer
The introductory paragraphs of the TPP Cover Letter, to which the TPP was attached,
explained the process for obtaining a loan modification stating:
You may qualify for a Home Affordable Modification Trial Period Plan - a way to
make your payment more affordable. We have enclosed a customized Home
Affordable Modification Trial Period Plan...If you qualify under the federal
government’s Home Affordable Modification program and comply with the terms of
the Trial Period Plan, we will modify your mortgage loan and you can avoid
foreclosure.
(Defs.’ Br. Supp. Mot. to Dismiss at 20 (italics added).) The TPP Cover Letter contains five
sections titled: (1) Provide the info we need to help you; (2) Let us know that you accept this offer;
(3) Complete your checklist; (4) Important program info; and (5) Frequently asked questions.
Section One notified Plaintiffs of the information they had to submit to “take advantage of this
offer[,]” and stated:

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Plaintiffs assert that even if the statute of frauds bars their claim, they may proceed against Chase on a theory
of equitable estoppel. Plaintiffs’ equitable estoppel argument lacks merit as a result of the TPP stating in plain terms
that it would not become effective until Chase and Plaintiffs “sign it and [Chase] provides [Plaintiffs] with a copy of this
Plan [containing Chase’s] signature.” (Pls.’ Resp. Br. Ex. B at 2.) It would have been unreasonable for Plaintiffs to
believe that they could accept the offer even though they had not received a copy of the TPP signed by Chase. See
Adams v. City of Detroit, 232 Mich. App. 701, 591 N.W .2d 67, 70 (1998).

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The monthly trial period payments are based on the income information that you
previously provided to us. They are also our estimate of what your payment will be
IF we are able to modify you loan under the terms of the program. If your income
documentation does not support the income amount that you previously provided in
our discussions, . . . (2) You may not qualify for this loan modification program.
(Id. (italics added).) Additionally, Section Three suggests that Plaintiffs should “Act Now! To
accept this offer, and see if you qualify for a Home Affordable Modification[.]” (Id.) Furthermore,
Section Four states:
The Trial Period Plan is the first step. Once we are able to confirm your income and
eligibility for the program, we will finalize your modified loan terms and send you
a loan modification agreement . . . which will reflect the terms of your modified loan.
(Id. at 22.) Finally, Section Five states “that your modification will not be effective unless you meet
all of the applicable conditions,” and that if the person does not qualify for the program their “first
trial payment will be applied to [their] existing loan in accordance with the terms of [their] loan
documents.” (Id. at 24.)
The TPP agreement stated,
I understand that the Plan is not a modification of the Loan Documents and that the
Loan Documents will not be modified unless and until (I) I meet all of the conditions
required for modification, (II) I receive a fully executed copy of a Modification
Agreement, and (III) the Modification Effective Date has passed. I further
understand and agree that the Lender will not be obligated or bound to make any
modification of the Loan documents if I fail to meet any one of the requirements
under this plan.
(Pls.’ Resp. Br. Ex. B at 3.) The TPP agreement additionally informed Plaintiffs that,
I [Plaintiffs] understand that after I . . . return two copies of this Plan to the Lender,
the Lender will send me a signed copy of this Plan [if I] qualify for the Offer or will
send me written notice that I do not qualify for the Offer. This Plan will not [take]
effect unless and until both I and the Lender sign it and Lender provides me with a
copy of this Plan [with] the Lender’s signature.
(Id. at 1.)
As a federal court sitting in diversity, this Court applies Michigan substantive law. See
Biegas v. Quickway Carriers, Inc., 573 F.3d 365, 374 (6th Cir. 2009) (“Under the Eire doctrine,
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federal courts sitting in diversity apply the substantive law of the forum state and federal procedural
law.”). Under Michigan law, a binding contract requires an offer, acceptance, consideration, and
“a meeting of the minds on all essential terms.” Kilian v. Domino’s Pizza L.L.C., 273 Mich. App.
449, 452-53, 733 N.W.2d 766, 770 (2006). Contracts should be construed to give effect to the
intentions of the parties and to give a reasonable meaning to all provisions. Klever v. Klever, 333
Mich. 179, 186, 52 N.W.2d 653, 656-57 (1952). If the language of the contract is clear and
unambiguous, the court should construe it according to its plain sense meaning. Grosse Point Park
v. Mich. Mun. Liab. & Prop. Pool, 473 Mich. 188, 198, 702 N.W.2d 106, 113 (2005).
The language of the TPP is clear and unambiguous. Plaintiffs attempt to prove that the TPP
is an offer by using statements such as “[i]f I [the borrower] am in compliance with this Trial Period
Plan . . . and my representations in Section 1 continue to be true in all material respects, then the
Lender will provide me with a Home Affordable Modification Agreement . . . .[,]” and “the Lender
will send me a Modification Agreement.” (Pls.’ Resp. Br. Ex. B at 1.) However, these statements
are taken out of context and must be read with the rest of the document to obtain their actual
meaning. The opening paragraph of the TPP Cover Letter states that Plaintiffs “may qualify for a
Home Affordable Modification Trial Period Plan,” and continues “if you qualify under the federal
government’s Home Affordable Modification program.” (Def.’s Br. Supp. Mot. to Dismiss Ex. D
at 1.) Additionally, the TPP cover letter states:
The monthly trial period payments are based on the income information that you
previously provided to us. They are also our estimate of what your payment will be
IF we are able to modify your loan under the terms of the program. If your income
documentation does not support the income amount that you previously provided in
our discussions, . . . (2) You may not qualify for this loan modification.
(Id. (Italics added).) The TPP Cover Letter also states that once the eligibility for the program is
confirmed, Chase will “finalize your modified loan terms and send you a loan modification
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agreement . . . which will reflect the terms of your modified loan.” (Id. at 3.) Finally, the TPP itself
states that
I [Plaintiffs] understand that after I...return two copies of this Plan to the Lender, the
Lender will send me a copy of this Plan [if I] qualify for the Offer or will send me
a written notice that I do not qualify for the Offer. This Plan will not [take] effect
unless and until both I and the Lender sign it and Lender provides me with a copy
of this Plan [with] the Lender’s signature.
(Pls.’ Resp. Br. Ex. B at 3.) By its plain terms, the TPP makes it clear that it was not an offer, and
would not become binding on Chase until the contract was signed and returned to Plaintiffs, which
it was not. As a result, there was no offer for Plaintiffs to accept.
2.

Promissory Estoppel

In Count 2, Plaintiffs allege a claim of promissory estoppel. A claim of promissory estoppel
is an equitable remedy and requires that there be “(1) a promise, (2) that the promisor should
reasonably have expected to induce action of a definite and substantial character on the part of the
promisee, (3) which in fact produced reliance or forbearance..., and (4) in circumstances such that
the promise must be enforced if injustice is to be avoided.” Ardt v. Titan Ins. Co., 233 Mich. App.
685, 692, 593 N.W.2d 215, 219 (1999). “The promise must be definite and clear, and the reliance
on it must be reasonable.” Zaremba Equip., Inc. v. Harco Nat’l Ins. Co., 280 Mich. App. 16, 41, 761
N.W.2d 151, 166 (2008) (citing Ypsilanti Twp. v. Gen. Motors Corp., 201 Mich. App. 128, 134, 506
N.W.2d 556, 559 (1993) (per curiam)).
Plaintiffs’ promissory estoppel claim fails for two reasons. First, any reliance on the TPP
as a promise for loan modification from Chase would have been unreasonable because the TPP
explicitly stated that the Plaintiffs still had to qualify for the Home Affordable Modification and
Chase had to send Plaintiffs the signed loan modification agreement, neither of which occurred.
Second, similar to the breach of contract claim, the promissory estoppel claim does not escape the
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statute of frauds. See Talton v. BAC Home Loans Servicing LP, 839 F. Supp. 2d 896, 912 (E.D.
Mich. 2012) (citing Crown Tech. Park, 242 Mich. App. at 550, 619 N.W.2d at 72). Therefore, the
promissory estoppel claim must be dismissed.
3.

Regulation of Collection Practices Act Claim

Plaintiffs allege in Count 3 that Chase violated the Regulation of Collection Practices Act
(“RCPA”) also known as the Michigan Regulation of Collection Practices Act (“MRCPA”). The
RCPA “prohibits abusive collection efforts...with respect to obligations arising out of a ‘purchase
made primarily for personal, family, or household purposes.’” Levant v. Am. Honda Fin. Corp., 356
F. Supp. 2d 776, 782 (E.D. Mich. 2005) (quoting M.C.L. § 445.251(a)). Plaintiffs allege that Chase
violated the RCPA by “a) [m]aking inaccurate, misleading, untrue, or deceptive statements in
communication to collect a debt; b) [m]isrepresenting the legal rights of the creditor or debtor; c)
[a]nd using a harassing, oppressive, or abusive debt collection method. MCL 445.252.” (Compl.
¶ 55.) Chase argues that this claim must be dismissed because Plaintiffs fail to plead “any facts
illustrating the existence of any violation.” (Def.’s Br. Supp. Mot. to Dismiss at 17.) The Court
agrees. When ruling on a motion to dismiss, a court “need not accept . . . legal conclusions as true.”
Heyne v. Metro. Nashville Pub. Schs., 665 F.3d 556, 564 (6th Cir. 2011). Additionally, while
detailed factual allegations are not required, “a plaintiff’s obligation to provide the ‘grounds’ of his
‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the
elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.
Ct. 1955, 1964-65 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S. Ct. 99, 103 (1957)).
Furthermore, the complaint must contain “enough facts to state a claim to relief that is plausible on
its face.” 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
13

defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct.
1937, 1949 (2009). Plaintiffs contend that their claim properly incorporated by reference all of their
previous allegations that provide basis for their claim. Taking into account all statements made in
the complaint regarding the TPP, none of Plaintiffs’ allegations establish that Chase violated the
RCPA. The TPP Cover Letter clearly states that the Plaintiffs “may qualify for a Home Affordable
Modification Trial Period Plan[,]” and furthermore, that Plaintiffs “may not qualify for this loan
modification program.” (Def.’s Br. Supp. Mot. to Dismiss Ex. D at 20.) Chase did not make any
inaccurate, misleading, untrue, or deceptive statement by failing to offer Brady a loan modification
pursuant to the TPP. Accordingly, this claim will be dismissed.
4. Violation of RESPA Claim
In Count 4 (erroneously designated as Count 6), Plaintiffs allege that Chase violated RESPA
by failing to acknowledge their qualified written request (QWR). Plaintiffs state that under the
Dodd-Frank Financial Reform Bill, Chase failed to acknowledge the receipt of the QWR within the
required five day period and failed to respond within thirty days.3 Chase argues that Plaintiffs “have
not alleged any legitimate damages occurring as a result of this failure.” (Def.’s Br. Supp. Mot. to
Dismiss at 19.) The Court agrees. Courts have held that in order to maintain a RESPA claim, a
plaintiff must allege that the violation resulted in actual pecuniary damages. See Pliam v. Cendant
Mortg. Corp., Civ. No. 11-3720 (RHK/JSM), 2012 WL 1439035, at *3 (D. Minn. Apr. 26, 2012)
(“While RESPA itself does not set a pleading standard, courts have interpreted the statute to require
a showing of pecuniary damages in order to state a claim.”); Shum v. Experian Info. Solutions, No.
3

Plaintiffs correctly allege in their complaint that the twenty-day and sixty-day periods under 12 U.S.C. §
2605(e)(1)(A) were shortened to five days and thirty days, respectively, by the Dodd-Frank Act. See Pub. L. 111-203,
Title XIV, §§ 1400(c), 1463(c), July 21, 2010. Courts have noted some uncertainty as to the effective date of this
provision. See Nikiforuk v. CitiMortgage, Inc., No. 11-10815, 2011 W L 7113469, at *5 n.3 (E.D. Mich. Dec. 27, 2011)
(citing Solan v. Everhome Mort. Co., No. 10-CV-2280-H (RBB), 2011 W L 456013, at *2 n.2 (S.D. Cal. Feb. 3, 2011)).
For purposes of the instant motion, however, the Court need not decide the issue.

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C 12-0496 PJH, 2012 WL 1376979, at *1-2 (N.D. Cal. Apr. 19, 2012) (noting that the actual
damages alleged “must be pecuniary in nature” and the plaintiff’s allegations of damage to his
reputation and added cost of obtaining credit were “too conclusory to demonstrate that [the plaintiff]
has sufficiently pled pecuniary damages”). Plaintiffs allege that they “suffered damage from
Defendants’ failure to comply with RESPA, including but not limited to knowing the accuracy of
any statements made by Defendants, and not knowing whether Defendants properly applied
payments prior to the Agreement.” (Compl. ¶ 72.) As a result, Plaintiffs request that this Court
“enter a judgment for damages together with interest, costs and attorney’s fees[,]” in addition to
statutory damages. (Id. ¶ 73.) Such allegations are insufficient to show actual pecuniary damage.
See Tamburri v. Suntrust Mortg., Inc., No. C-11-2899 EMC, 2011 WL 6294472, at *8 (N.D. Cal.
Dec. 15, 2011) (holding that the plaintiff’s allegations that she was harmed by not knowing the true
owner of the note and whether her payments were properly applied were “insufficient to allege the
pecuniary harm required by the statute”). Therefore, Plaintiffs’ RESPA claim must be dismissed
as a result of failing to allege actual pecuniary damage.
B.

Request to Amend
In response to Chase’s Motion to Dismiss, Plaintiffs have requested leave to amend their

complaint to address any pleading deficiencies. This request was made in Plaintiffs’ Brief in
Opposition to Defendant’s Motion to Dismiss, and Plaintiffs have not filed a motion to amend.
Pursuant to Fed. R. Civ. P. 15(a)(2), a court “should freely give leave [to amend] when justice so
requires.” As stated in PR Diamonds, Inc. v. Chandler, 364 F.3d 671, 698-99 (6th Cir. 2004),
however, “a bare request in an opposition to a motion to dismiss - without any indication of the
particular grounds on which amendment is sought . . . does not constitute a motion within the
contemplation of Rule 15(a).” In this case, Plaintiffs failed to follow the proper procedure for
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requesting leave to amend, which is to file a motion to amend. See La. Sch. Emp. Ret. Sys. v. Ernst
& Young, LLP, 622 F.3d 471 (6th Cir. 2010) (holding that the district court properly dismissed the
plaintiffs’ claims and request to amend when plaintiffs did not file a motion to amend); Cozzarelli
v. Inspire Pharm. Inc., 549 F.3d 618 (6th Cir. 2008). Additionally, this Court cannot determine that
“justice so requires” an amendment as no substance to the proposed amendment has been given to
this Court. See, e.g., Kostyu v. Ford Motor Co., No. 85-1207, 1986 WL 16190, at *2 (6th Cir. July
28, 1986) (holding the district court did not abuse its discretion in not allowing the plaintiff to
amend his complaint because “[t]he plaintiff did not submit a proposed amended complaint and
failed to disclose what amendments he intended to make”). Plaintiffs have failed to file a motion
to amend and this Court has not received a proposed amended complaint. For the reasons stated
above, this Court will deny Plaintiffs’ request to amend.
IV. CONCLUSION
For the foregoing reasons, the Court will grant Chase’s motion to dismiss under Fed. R. Civ.
P. 12(b)(6) in its entirety.
An Order consistent with this Opinion will enter.

Dated: August 27, 2012

/s/ Gordon J. Quist
GORDON J. QUIST
UNITED STATES DISTRICT JUDGE

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