Strong v. HSBC Mortgage Services, Inc. et al
ORDER - The parties must advise the Court of the status of HSBC and US Bank as defendants within ten (10) days of the date of this order. Caliber's Motion to Dismiss, or Alternatively, for More Definite Statement (Filing No. 9) and K&Ms Motio n to Dismiss, or in the Alternative, Motion for More Definite Statement (Filing No. 11 ) are GRANTED in part and DENIED in part in accordance with the terms of this order. The motions are granted to the extent they seek a more definite statement and denied to the extent they seek dismissal under Federal Rule of Civil Procedure 12(b)(6). Strong shall file an Amended Complaint consistent with this order no later than August 12, 2016. Failing to comply with this order may result in the dismissal of the Complaint. Ordered by Judge Robert F. Rossiter, Jr. (Copy mailed) (MKR)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
MIKE K. STRONG,
MEMORANDUM AND ORDER
HSBC MORTGAGE SERVICES, INC.;
CALIBER HOME LOANS, INC., US Bank
Trust N.A. as Trustee of LSF9 Master
Participation Trust; KOZENY &
MCCUBBIN, Kerry Feld, Successor
Trustee; and KERRY FELD,
This matter is before the Court on Defendant Caliber Home Loans, Inc.’s (Caliber)
Motion to Dismiss, or Alternatively, for More Definite Statement (Filing No. 9) and
Defendants Kozeny & McCubbin and Kerry Feld, Successor Trustee’s (collectively,
K&M) Motion to Dismiss, or in the Alternative, Motion for More Definite Statement
(Filing No. 11).1 See Fed. R. Civ. P. 12(b)(6), (e). Plaintiff Mike K. Strong (Strong)—
proceeding pro se—opposes the motions (Filing Nos. 15, 16). For the reasons stated
below, the Court grants Caliber’s and K&M’s respective motions to the extent they seek
a more definite statement and denies the motions to the extent they seek dismissal.
On March 8, 2007, Strong and his wife executed a $357,000 promissory note in
favor of HSBC Mortgage Services, Inc. (HSBC) in return for a loan on their home in
Gretna, Nebraska. According to the Complaint, HSBC later sold Strong’s debt to Caliber
and K&M acted as trustee under a deed of trust on the property. On March 18, 2015,
K&M recorded a notice of default on the loan based on Strong’s failure to make
payments when due. The notice identified HSBC as the beneficiary of the deed of trust
K&M treats Kozeny & McCubbin, L.C. and Kerry Feld, Successor Trustee, as
separate defendants. Kerry Feld is also listed separately as a defendant on the docket
sheet. Strong’s Complaint and summons seem to treat them as a single defendant.
and the lawful holder of Strong’s promissory note. On May 15, 2015, K&M notified
Strong the property would be sold at a foreclosure sale on June 8, 2015. In response,
Strong filed a quiet title action in state court and requested a temporary restraining order
but later voluntarily dismissed the Complaint and filed for bankruptcy. Strong avers his
bankruptcy petition was dismissed because he “did not qualify.” It is not clear from the
Complaint whether the foreclosure sale ever took place.
On December 29, 2015, Strong filed the present “Quiet Title Action Declaratory
Judgement” against HSBC, Caliber, and K&M in state court, alleging they “willfully
violated, consumer credit reporting requirements, State and Federal mortgage disclosure
and notice requirements, [and] State and Federal consumer protection regulations” and
committed “fraud for profit and or unjustified risk based pricing ‘Mortgage Loan’ fraud.”
That same day, Caliber removed the action to federal court (Filing No. 1) pursuant to 28
U.S.C. § 1331 because Strong asserted “numerous claims arising under and invoking
federal law.”2 See 28 U.S.C. §§ 1441(a), 1446. Upon removal, Caliber and K&M
separately moved to dismiss, or in the alternative, for a more definite statement.
The Named Defendants
As an initial matter, the Court has some additional questions about the status of
some of the named defendants. HSBC is named in the Complaint, but the docket sheet
indicates HSBC has not entered an appearance in this case. The materials Caliber
submitted in support of removal (Filing No. 1-1) give some indication HSBC—like
Caliber and K&M—was served with summons by certified mail in November 2015 while
this case was pending in state court.
Caliber’s Notice of Removal states it “solely addresses § 1331” but also indicates
Caliber “believes this action is also subject to removal under 28 U.S.C. § 1332 (diversity
jurisdiction).” Caliber might be right, but at this point at least, the record does not
establish complete diversity.
Section 1446(b)(2)(A) provides “[w]hen a civil action is removed solely under
section 1441(a), all defendants who have been properly joined and served must join in or
consent to the removal of the action.” In its Notice of Removal (Filing No. 1), Caliber
(1) explains US Bank Trust N.A., as Trustee for LSF9 Master Participation Trust, (US
Bank) is a separate entity from Caliber and was never served with summons and
(2) asserts “[t]o the extent [Strong] has properly served US Bank,” the Notice of Removal
is also filed on US Bank’s behalf. But Caliber’s Notice of Removal is otherwise silent as
to the consent of the other named defendants, including HSBC. If HSBC was properly
joined and served, Caliber presumably would have obtained and noted HSBC’s consent
to remove this action.
For his part, Strong did not allege any defect in removal, see 28 U.S.C. § 1447(c),
and has not responded to Caliber’s assertion that US Bank is a separate entity that has not
been served. Indeed, Strong and Caliber both refer to US Bank in their respective briefs
regarding Caliber’s Motion to Dismiss. Strong also has not addressed HSBC’s failure to
enter an appearance in this case. In opposing dismissal, Strong opines HSBC “is the only
defendant who has provided the correct response to plaintiff’s complaint, which is no
response, therefore subject [sic] to declaratory judgment and relief as defined in
plaintiff’s complaint” (Filing No. 16). But Strong has not sought entry of default or
default judgment under Federal Rule of Civil Procedure 55.
The parties shall jointly or separately advise the Court in writing of the status of
HSBC and US Bank as defendants in this case within ten (10) days of the date of this
Rule 12 Motions
Caliber and K&M have each moved under Federal Rule of Civil Procedure
12(b)(6) to dismiss Strong’s Complaint for failing “to state a claim upon which relief can
be granted” (Filing Nos. 9, 11). “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) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “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. “The court accepts as true all
factual allegations, but is ‘not bound to accept as true a legal conclusion couched as a
factual allegation.’” McAdams v. McCord, 584 F.3d 1111, 1113 (8th Cir. 2009) (quoting
Iqbal, 556 U.S. at 678).
In challenging the Complaint, Caliber and K&M do not take a scalpel to Strong’s
allegations, opting instead for a broadsword and attempting to end this case with a single
blow. Without delving into Strong’s allegations, despite some prior experience with
Strong’s claims and this type of case, Caliber simply complains that Strong’s
“nonsensical statements and accusations” fail “to provide any valid factual or legal basis
for the relief he requests beyond conclusory statements.” According to Caliber, Strong
“cites to random statutory regulations that [he] alleges Caliber has violated” but “has
failed to identify, in any way, which of the defendants allegedly violated which of the
statutory provisions, or even how the regulations have been violated.”
K&M likewise summarily describes the Complaint as “a compilation of
nonsensical allegations that do not state any valid legal or factual basis for the relief
requested.” K&M also emphasizes Federal Rule of Civil Procedure 9(b) requires a party
alleging fraud to “state with particularity the circumstances constituting fraud.” As
Caliber and K&M see it, Strong’s Complaint is so deficient as to warrant prejudicial
dismissal. Short of that, Caliber and K&M seek a more definite statement to enable them
to reasonably respond to the Complaint. See Fed. R. Civ. P. 12(e).
Caliber’s and K&M’s briefs are short on detailed analysis of the multitude of
“claims,” but their arguments have some merit. See, e.g., Karnatcheva v. JPMorgan
Chase Bank, N.A., 704 F.3d 545, 548 (8th Cir. 2013) (affirming the dismissal of three
quiet-title theories “because the plaintiffs’ pleadings, on their face, have not provided
anything to support their claim that the defendants’ adverse claims are invalid, other than
labels and conclusions, based on speculation that transfers affecting payees and
assignments of the notes were invalid”). Federal Rule of Civil Procedure 8(a)(2) requires
“a short and plain statement of the claim showing that the pleader is entitled to relief.”
That “requires more than labels and conclusions” or a “a formulaic recitation of the
elements of a cause of action.” Twombly, 550 U.S. at 555. “Factual allegations must be
enough to raise a right to relief above the speculative level.” Id. As it stands, it is not
clear Strong’s Complaint can satisfy that standard.
After briefly describing a general mishandling of his mortgage loan, Strong
provides a laundry list of more than a dozen state and federal statutes and regulations the
defendants “presumably” violated. Strong then—largely failing to distinguish between
the defendants—makes a series of vague and conclusory allegations that the defendants
acted improperly in some way or violated one provision or another of the cited statutes
and regulations. But Strong’s random allegations do not effectively establish a basis for a
legally cognizable claim under state or federal law. Nor do they include sufficient facts
to raise a plausible claim for relief under any of the statutes and regulations he lists or
allow the defendants to respond. Bare allegations that the defendants violated a statute or
regulation do not suffice, particularly when the allegations do not describe each specific
defendant’s degree of participation, if any, in the alleged misconduct.
Strong’s “allegations are variously legal conclusions, which this court may ‘set
aside,’ abstract statements of fact, statements of fact whose relevance to the asserted
claims are dubious,” and obscure contentions apparently based on undeveloped legal
theories cobbled together from the long list of statutes and regulations Strong
haphazardly cites. Vang v. PNC Mortg., Inc., 517 F. App’x 523, 526 (8th Cir. 2013)
(unpublished per curiam) (quoting Braden v. Wal–Mart Stores, Inc., 588 F.3d 585, 594
(8th Cir. 2009)).
Rule 8(a)(2) “demands more than . . . unadorned, the-defendant-
unlawfully-harmed-me accusation[s].” Iqbal, 556 U.S. at 678. For allegations of fraud,
Rule 9 requires even more. See, e.g., United States ex rel. Joshi v. St. Luke’s Hosp., Inc.,
441 F.3d 552, 556 (8th Cir. 2006) (“To satisfy the particularity requirement of Rule 9(b),
the Complaint must plead such facts as the time, place, and content of the defendant’s
false representations, as well as the details of the defendant’s fraudulent acts, including
when the acts occurred, who engaged in them, and what was obtained as a result.”). This
Court “‘will not supply additional facts, nor . . . construct a legal theory for plaintiff that
assumes facts that have not been pleaded.’” Stone v. Harry, 364 F.3d 912, 914 (8th Cir.
2004) (quoting Dunn v. White, 880 F.2d 1188, 1197 (10th Cir. 1989)).
At this time, the Court will not dismiss Strong’s claims without affording him an
opportunity to address the significant deficiencies in the Complaint.3 See Erickson v.
Pardus, 551 U.S. 89, 94 (2007) (per curiam) (“A document filed pro se is ‘to be liberally
construed,’ and ‘a pro se complaint, however inartfully pleaded, must be held to less
stringent standards than formal pleadings drafted by lawyers.’” (quoting Estelle v.
Gamble, 429 U.S. 97, 106 (1976))). Strong must provide factual allegations based on
more than conjecture and naked legal conclusions.
The Court will closely review
Strong’s Amended Complaint for plausible claims; the defendants should do the same
and respond specifically and appropriately.
In light of the foregoing, the Court grants Caliber’s and K&M’s motions to the
extent they seek a more definite statement and denies the motions to the extent they seek
Strong attempts to provide a more-definite statement in his opposition, but his
clarifications, which focus on state substantive law, suffer almost all of the same
deficiencies as his Complaint.
IT IS ORDERED:
1. The parties must advise the Court of the status of HSBC and US Bank as
defendants within ten (10) days of the date of this order.
2. Caliber’s Motion to Dismiss, or Alternatively, for More Definite Statement
(Filing No. 9) and K&M’s Motion to Dismiss, or in the Alternative, Motion for
More Definite Statement (Filing No. 11) are GRANTED in part and DENIED
in part in accordance with the terms of this order. The motions are granted to
the extent they seek a more definite statement and denied to the extent they
seek dismissal under Federal Rule of Civil Procedure 12(b)(6).
3. Strong shall file an Amended Complaint consistent with this order no later than
August 12, 2016. Failing to comply with this order may result in the dismissal
of the Complaint.
Dated this 26th day of July, 2016.
BY THE COURT:
s/ Robert F. Rossiter, Jr.
United States District Judge
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