Bledsoe et al v. Wells Fargo Home Mortgage
MEMORANDUM AND ORDER : IT IS FURTHER ORDERED that Plaintiffs motion for leave to amend is GRANTED in part and DENIED in part, as set forth above. ECF No. 19 . The motion for leave to amend is DENIED as to any claim under 18 U.S.C. § 1341, bu t is otherwise GRANTED. IT IS FURTHER ORDERED that the Clerk of Court shall file ECF No. 19-1 as Plaintiffs Third Amended Complaint, which will be deemed to be limited in the manner set forth above. IT IS FURTHER ORDERED that Defendant Wells Fargo Home Mortgages motion to dismiss is DENIED as moot. ECF No. 15 . This Defendants response to the Third Amended Complaint shall be due no later than 14 days from the date of this Memorandum and Order. IT IS FURTHER ORDERED that Plaintiffs shall promptly effect service on the newly named Defendants, in accordance with Federal Rule of Civil Procedure 4. Signed by District Judge Audrey G. Fleissig on 04/11/2018. (KCB)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
TERRY BLEDSOE and KELLI BLEDSOE, )
WELLS FARGO HOME MORTGAGE,
MEMORANDUM AND ORDER
This matter is before the Court on Defendant Wells Fargo Home Mortgage’s motion
to dismiss the pro se complaint of Plaintiffs Terry and Kelli Bledsoe, and Plaintiffs’ motion
for leave to amend their complaint. For the reasons set forth below, the Court will grant in
part and deny in part Plaintiffs’ motion for leave to amend, and deny as moot Defendant’s
motion to dismiss.
Plaintiffs filed this “Complaint to Quiet Title by Way of Fraud” in state court, and
on February 27, 2018, Defendant removed the case to this Court on diversity grounds.
Plaintiffs had previously amended their complaint twice while it was pending in state
court. The current complaint asks the Court grant an “Order to Quiet Title with prejudice
at 1325 Leroy Avenue, St. Louis Mo, 63133. Lot 5 Block 3 Hazel Hill Plat Book 4 Page
43,” and for emotional distress and punitive damages in the amount of $750,000.
Plaintiffs allege that Defendant is “knowingly collecting payments on a fraudulent
second deed of trust with a note that has been satisfied,” in the amount of $38,986. ECF
No. 6 at 3. Defendant has moved to dismiss the complaint for failure to state a claim.
Defendant argues that the documents incorporated by the complaint reveal that on
December 14, 2011, Plaintiffs obtained a $38,986 loan from Leader One Financial
Corporation, and signed a related promissory note to be secured by a mortgage, deed of
trust, or similar security instrument. The same day, Plaintiffs executed a deed of trust
encumbering the property. Defendant asserts that the deed of trust was recorded twice by
the St. Louis County Recorder of Deeds, the first time on December 15, 2011, in Book
19783, Page 2488 (“First Deed of Trust”), and the second time on January 4, 2012, in Book
19805, Page 965 (“Second Deed of Trust”). Defendant has attached copies of the note
and both recorded Deeds of Trust as exhibits to the memorandum in support of its motion.1
The First Deed of Trust describes the subject property as “Lot 5 in Block 3 of Hazel
Hill, according to the plat thereof recorded in Plat Book 4 Page 43 of the St. Louis County
Records,” ECF No. 16-2 at 10, and states that the property has the address of “1235 Leroy
Ave, Pagedale Missouri 63133,” id. at 3. The Second Deed of Trust also describes the
property as “Lot 5 in Block 3 of Hazel Hill, according to the plat thereof recorded in Plat
Book 4 Page 43 of the St. Louis County Records,” ECF no. 16-3 at 10, but states that the
property has the address of “1325 Leroy Ave, Pagedale Missouri 63133,” id. at 3.
Defendant asserts that, on March 29, 2012, Leader One executed a document titled
“Satisfaction,” which was recorded, but that this document released only the First Deed of
Trust. Defendant further contends that, on May 4, 2016, Mortgage Electronic
Registration Systems, Inc. (“MERS”) executed an “Assignment of Mortgage/Deed of
In addressing a motion to dismiss, [the court] may look to the pleadings, documents
attached to the pleadings, materials embraced by the pleadings[,] and matters of public
record.” Hageman v. Barton, 817 F.3d 611, 620 n.8 (8th Cir. 2016) (citation omitted).
Trust,” whereby MERS, as nominee for Leader One, assigned the Second Deed of Trust to
Wells Fargo. The Satisfaction and Assignment are also attached as exhibits to
Defendant’s memorandum in support of its motion.
The “Satisfaction” states:
In consideration of the satisfied debt secured by certain Deed of Trust made
by Leader One Financial Corporation, to Kelli Bledsoe and Terry Bledsoe,
Wife and Husband, dated December 14, 2011 and recorded December 16,
2011 in Book: 19783 Page: 2488 Doc No. 00754, in the amount of
$38,986.00 in the records of St. Louis County, Missouri, and covering the
following described real estate.
Lot 5 in Block 3 of Hazel Hill, according to the plat thereof recorded in Plat
Book 4 Page 43 in the St. Louis County Records.
Property address: 1235 Leroy Ave. Pagedale, MO 63133
Satisfaction of said Mortgage of trust is acknowledged and the same is
ECF No. 16-4.
Defendant argues that Plaintiffs’ claim for quiet title fails because, as evidenced by
the above documents, Plaintiffs have not plausibly alleged superior title to the subject
property. Defendant contends that, despite Plaintiffs’ conclusory allegation that the note
has been satisfied, the Satisfaction did not release the Second Deed of Trust, which remains
valid and enforceable and which has been assigned to Defendant. Defendant also argues
that Plaintiffs fail to state a claim for fraud because Plaintiffs have failed to plead the
alleged fraud with particularity and because, as discussed above, the Second Deed of Trust
has not been released.
Plaintiffs oppose the motion to dismiss and have moved to amend their complaint.
Plaintiff seeks to add Leader One Financial Corporation and MERS as Defendants and to
expand their factual allegations in support of their claims to quiet title and for fraud against
all Defendants. In their proposed amended complaint, Plaintiffs allege that their address
is 1325 Leroy Avenue, and that they are “in possession of two sets of closing documents,”
one with the address of 1235 Leroy Avenue, and the other 1325 Leroy Avenue. ECF No.
19-1 at 2. Plaintiffs allege that they signed these documents on December 14, 2011, but
they were unaware that they were signing two sets of documents with different addresses.
Plaintiffs likewise allege that they were “unaware [that they signed] two promissory
note(s) in the amount of $38,986.00 each.” Id. at 2.
The proposed amended complaint then discusses both Deeds of Trust and the
Satisfaction, and alleges that “there should have been one ‘note’ and one Security
Instrument.” Id. at 3. Plaintiffs allege that Defendants participated in a scheme to
defraud Plaintiffs by maintaining and seeking to enforce two notes and two security
instruments, Defendants knew about the falsity in this transaction and intended to deceive
Plaintiffs, and Plaintiffs have suffered damage as a result. Plaintiffs again ask the Court to
“grant Order to Quiet Title at 1325 Leroy Avenue, St. Louis Mo, 63133. Lot 5 Block 3
Hazel Hill Plat Book 4 Page 43,” and for emotional distress and punitive damages in the
amount of $750,000.
Defendant opposes the motion for leave to amend. Defendant argues that
Plaintiffs have already amended their complaint twice, and the proposed amended
complaint would be futile because it would not correct the deficiencies identified in
Defendant’s motion to dismiss. Specifically, Defendant argues that Plaintiffs’ proposed
amended complaint still fails to allege facts to dispute that Plaintiffs executed the Second
Deed of Trust to secure the $38,986 note, the Second Deed of Trust was never released, and
the Second Deed of Trust was assigned to Defendant.
Finally, Defendant notes that Plaintiffs’ proposed amended complaint references
the federal criminal mail fraud statute, 18 U.S.C. § 1341. Defendant argues that to the
extent Plaintiffs intend to assert a claim under this statute, such a claim is futile because
there is no private right of action under § 1341.
Under Federal Rule of Civil Procedure 15(a), a court “should freely give leave [to
amend pleadings] when justice so requires.” Notwithstanding this liberal standard, a
court may deny leave to amend where the proposed amendment would be futile. Reuter v.
Jax Ltd., 711 F.3d 918, 922 (8th Cir. 2013).
In determining whether Plaintiffs’ proposed amended complaint is futile, the Court
recognizes that a “pro se complaint must be liberally construed,” meaning that “if the
essence of an allegation is discernible, even though it is not pleaded with legal nicety, then
the district court should construe the complaint in a way that permits the layperson’s claim
to be considered within the proper legal framework.” Topchian v. JPMorgan Chase
Bank, N.A., 760 F.3d 843, 849 (8th Cir. 2014) (quoting Stone v. Harry, 364 F.3d 912, 915
(8th Cir. 2004)). However, pro se plaintiffs “still must allege sufficient facts to support
the claims advanced,” and a district court is not required to “assume facts that are not
alleged, just because an additional factual allegation would have formed a stronger
complaint.” Stone, 364 F.3d at 914-15.
As an initial matter, the Court agrees with Defendant that, to the extent Plaintiffs
attempt to assert a claim under 18 U.S.C. § 1341, such a claim would be futile. See
Wisdom v. First Midwest Bank of Poplar Bluff, 167 F.3d 402, 408 (8th Cir. 1999) (holding
there is no private right of action under 18 U.S.C. § 1341). Therefore, the Court will deny
leave to amend with respect to any claim under 18 U.S.C. § 1341.
However, the Court will otherwise grant Plaintiffs’ motion for leave to amend.
Liberally construed, Plaintiffs’ quiet title and fraud claims assert that Defendants
improperly sought to enforce two notes for the same amount, secured by two separate
Deeds of Trust, one with the incorrect address. Plaintiffs allege that there should have
been only one note and security instrument, and that the note was fully satisfied and any
encumbrance on the property should have been released. Defendant has failed to address
these allegations, either in its motion to dismiss or its opposition to the motion for leave to
amend, and it is not clear to the Court at this stage that Plaintiffs’ claims based on these
allegations are futile.
IT IS FURTHER ORDERED that Plaintiff’s motion for leave to amend is
GRANTED in part and DENIED in part, as set forth above. ECF No. 19. The motion
for leave to amend is DENIED as to any claim under 18 U.S.C. § 1341, but is otherwise
IT IS FURTHER ORDERED that the Clerk of Court shall file ECF No. 19-1 as
Plaintiff’s Third Amended Complaint, which will be deemed to be limited in the manner
set forth above.
IT IS FURTHER ORDERED that Defendant Wells Fargo Home Mortgage’s
motion to dismiss is DENIED as moot. ECF No. 15. This Defendant’s response to the
Third Amended Complaint shall be due no later than 14 days from the date of this
Memorandum and Order.
IT IS FURTHER ORDERED that Plaintiffs shall promptly effect service on the
newly named Defendants, in accordance with Federal Rule of Civil Procedure 4.
AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 11th day of April, 2018.
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