Quinn, Jr. et al v. Wells Fargo Bank, N.A. et al

Filing 30

OPINION. Signed by Judge Claire C. Cecchi on 8/25/17. (sr, )

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
JOSEPH L. QUINN, JR. and MARY QUINN,

Civil Action No. 16-6967-CCC-MF

Plaintiffs,

OPINION
V.

WELLS FARGO BANK, N.A., HSBC BANK,
USA, NATIONAL ASSOCIATION AS
TRUSTEE FOR WACHOVIA MORTGAGE
LOAN TRUST, LLC SERIES 2007-A, and DOES
1 THROUGH 100, INCLUSIVE,
Defendants.

CECCHI, District Judge.
I.

INTRODUCTION
This matter comes before the Court upon motion of Defendant Wells Fargo Bank, N.A.

(“Defendant”)’ to dismiss pro se Plaintiffs Joseph L. Quinn, Jr. and Mary Quinn’s (“Plaintiffs”)
Complaint pursuant to Federal Rules of Civil Procedure l2(b)(1) and 12(b)(6). ECF No. 16.
Plaintiffs oppose the motion. ECF No. 25. No oral argument was heard. See Fed. R. Civ. P. 78.
for the reasons set forth below, Defendant’s motion is granted.

II.

BACKGROUND
On or about June 21, 2007, Plaintiffs financed the property located at 13 East 10th Street,

Bayonne, New Jersey (the “Property”). Complaint (“Compl.”), ECF No. 1

¶ 22. The Property

was acquired with a mortgage loan in the sum of $254,804.90, originated by Wachovia Bank. Id.

Defendant HSBC Bank, USA, National Association as Trustee for Wachovia Mortgage Loan
Trust, LLC Series 2007-A has not made an appearance in this case and was dismissed from this
case on July 25, 2017. ECF No. 29.
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The mortgage subsequently was assigned to multiple parties, and ultimately was transferred to
National Association as Trustee for Wachovia Mortgage Loan Trust, LLC Series 2007-A. Id. ¶
39. Plaintiffs dispute the validity of the chain of assignments. Id. ¶j[ 39-47, 56-63. On August
13, 2015, Defendant filed a Foreclosure Complaint against Plaintiffs, and on February 9, 2016,
after Plaintiffs defaulted, a final judgment and writ of execution were entered against Plaintiffs in
state court. See Wells Fargo Bank NA v. Quinn, Superior Court of New Jersey, Docket No.
028l23l5.2
Plaintiffs initiated this action on August 10, 2016, alleging five counts against Defendant:
Breach of Contract/Breach of Duty of Good Faith and Fair Dealing (Count One); Violation of New
York Unfair and Deceptive Business Practices (Count Two); Breach of Covenant of Good Faith
and Fair Dealing (Count Three); Negligent Misrepresentation (Count Four); and Quiet Title,
Constructive Fraud (Count Five). On October 20, 2016, Defendant filed the instant motion to
dismiss. ECF No. 16.
III.

LEGAL STANDARD
A.

Dismissal Pursuant to Federal Rule of Civil Procedure Rule 12(b)(1)

A court must grant a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) if
the court detennines that it lacks subject matter jurisdiction over a claim. In re Schering Plough

Corp. Intronfremodar Consumer Class Action, 678 F.3d 235, 243 (3d Cir. 2012). An attack on
subject matter jurisdiction can be either facial—based solely on the allegations in the complaint—
or factual—looking beyond the allegations to attack jurisdiction in fact. Mortensen v. first Fed.

On a motion to dismiss, the Court may consider the allegations in the complaint, any exhibits
attached to the complaint, matters of public record, and undisputedly authentic documents upon
which the plaintiff’s complaint is based. Pension Benefit Guar. Corp. v. White Consol. Indus., 998
F.2d 1192, 1196 (3d Cir. 1993). As the foreclosure action is a matter of public record, the Court
will consider these documents for purposes of the instant motion.
2

2

Say. & Loan Ass’n, 549 F.2d 284, 891 (3d Cir. 1977). Where, as here, the challenge to subject
matter jurisdiction is facial, the Court considers “the allegations of the complaint and documents
referenced therein and attached thereto, in the light most favorable to the plaintiff.” Gould Elecs.
Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000); Taliaferro v. Darby Twp. Zoning 3d., 458
F.3d 181, 188 (3d Cir. 2006). Accordingly, the complaint must be dismissed if the allegations on
the face of the complaint, accepted as true, fail to “allege facts sufficient to invoke the jurisdiction
of the district court.” Licata v. U.S.P.S., 33 F.3d 259, 206 (3d Cir. 1994).
B.

Dismissal Pursuant to Federal Rule of Civil Procedure Rule 12(b)(6)

For a complaint to survive dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6),
it “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 Att. Corp. v. Twombty,
550 U.s. 544, 570 (2007)). In evaluating the sufficiency of a complaint, the Court must accept all
well-pleaded factual allegations in the complaint as true and draw all reasonable inferences in favor

of the non-moving party. See Phillips v. Cnty. of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008).
However, “the tenet that a court must accept as true all of the allegations contained in a complaint
is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. “Factual

allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550
U.S. at 555. “A pleading that offers labels and conclusions will not do. Nor does a complaint
suffice if it tenders naked assertion[sj devoid of further factual enhancement.” Iqbal, 556 U.S. at
678 (internal citations omitted).
C.

Liberal Pleading Standard for Pro Se Litigants

Because Plaintiffs are prose litigants, their filings are entitled to a liberal construction. See

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Dtuhos v. Strasberg, 321 F.3d 365, 369 (3d Cir. 2003). A pro se litigant’s complaint is held to
“less stringent standards than formal pleadings drafted by lawyers.” Haines v. Kerner, 404 U.s.
519, 520-21(1972). This Court therefore has a special obligation to discern both the nature of the
relief and the appropriate law to govern their request. Id. Courts have a duty to construe pleadings
liberally and apply the applicable law, irrespective of whether apro se litigant has mentioned it by
name. Mata v. Crown Bay Marina, Inc., 704 F.3d 239, 244 (3d Cir. 2013). A pro se complaint

“can only be dismissed for failure to state a claim if it appears beyond doubt that the plaintiff can
prove no set of facts in support of his claim which would entitle him to relief.” Estelte v. Gamble,
429 U.S. 97, 106 (1976) (citing Haines, 404 U.S. at 520-2 1).
IV.

DISCUSSION
The gravamen of Plaintiffs’ Complaint is twofold. Plaintiffs allege: (1) the assignments of

the mortgage were in violation of the Pool Servicing Agreement (“PS A”) and therefore are invalid;
and (2) Defendant sold Plaintiffs a “deceptive loan product” because it knew or should have known
that Plaintiffs could not qualify for the mortgage loan. Compi. ¶I[ 32, 40-42. Defendant contends
the Court lacks subject matter jurisdiction pursuant to the Rooker-feldman doctrine and that the
doctrines of Younger, res judicata, collateral estoppel, and entire controversy bar Plaintiffs’
claims. See ECF No. 1$. Defendant further argues that Plaintiffs’ Complaint should be dismissed
pursuant to Federal Rule of Civil Procedure 12(b)(6) because it fails to state a claim upon which

relief can be granted. Id. For the reasons set forth below, the Court finds Plaintiffs lack standing
to challenge the assignment of the mortgage, their claims are barred by the Rooker-Feldman
doctrine, their federal claims are dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6),
and their remaining claims are dismissed for lack of subject matter jurisdiction pursuant to Federal
Rule of Civil Procedure 12(b)(1).

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A.

Standing to Challenge Assignment

As a preliminary matter, Plaintiffs lack standing to challenge the mortgage assignment,
because Plaintiffs were neither parties to nor intended third-party beneficiaries of the pooi service
agreement or assignments. See Gilanno v. U.S. Bank NA ex ret. CSAB Mortgage Backed Trust
2006-1, 643 F. App’x 97, 100 (3d Cir. 2016) (agreeing with the “overwhelming majority of courts”
that “a borrower in default has no standing to challenge an assignment said to violate a pooling
service agreement”); English v. Fannie Mae, No. 13-2028, 2013 U.S. Dist. LEXIS 167906, at *10
(D.N.J. Nov. 26, 2013). Therefore, to the extent Plaintiffs bring claims pursuant to a violation of
the PSA, the Court grants Defendant’s motion to dismiss for lack of standing.
B.

Rooker-Feidman Doctrine Bars Plaintiffs’ Claims

The Rooker-Fetdman doctrine bars “cases brought by state court losers complaining of
injuries caused by state-court judgments rendered before the district court proceedings commenced
and inviting district court review and rejection of those judgments.” Exxon Mobil Corp. v. Saudi
Basic Indus. Corp., 544 U.S. 280, 284 (2005). “The Rooker-Fetdman doctrine is implicated when,
‘in order to grant the federal plaintiff the relief sought, the federal court must determine that the
state court judgment was erroneously entered or must take action that would render that judgment
ineffectual.” Madera v. AmeriquestMortg. Co. (In reMadera), 586 F.3d 228, 232 (3d Cir. 2009)
(quoting FOCUS v. Allegheny Cry. Court of Common Pleas, 75 F.3d 834, 840 (3d Cir. 1996)).
The doctrine is applicable where: “(1) the federal plaintiff lost in state court; (2) the plaintiff
‘complain[sJ of injuries caused by [the] state-court judgments’; (3) those judgments were rendered
before the federal suit was filed; and (4) the plaintiff is inviting the district court to review and
reject the state judgments.” Great Western Mining & Mineral Co. v. Fox Rothschild LLP, 615
F.3d 159, 166 (3d Cir. 2010) (citing Exxon Mobil, 544 U.S. at 284).

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“Because foreclosure requires the existence of a valid mortgage, claims that impugn the
validity of a mortgage and therefore ‘negate the foreclosure judgment’ are barred under Rooker
Feldman, since those claims are ‘inextricably intertwined’ with the foreclosure action itself.”
Dtmbar v. NationstarMortg., LLC, No. 16-4259, 2016 WL 6804874, at *2 (D.N.J. Nov. 16, 2016)

(quoting In re Madera, 586 F.3d at 232). Therefore, district courts in the Third Circuit have
consistently applied Rooker-Feidman to bar federal actions seeking to appeal or alter a state
foreclosure proceeding. Id. In the instant matter, the Court finds the Rooker-Feidman doctrine is
applicable, as Plaintiffs previously lost in state court, in that a final judgment was entered by the
New Jersey Superior Court on February 9, 2016, prior to the commencement of the instant suit
filed on August 10, 2016, and Plaintiffs seek reversal of that judgment in that they seek to bar
Defendant “from attempting

.

.

.

to evict” Plaintiffs from the subject property. Compl.

¶ 131.

Accordingly, the Rooker-Fetdman doctrine precludes Plaintiffs’ claims against Defendant
regarding Defendant’s right to foreclose on the subject property and bars Plaintiffs’ claims to the
extent that they invite the Court to review the state foreclosure action.
C.

Federal Claims

Plaintiffs identify seven federal statutes through which they claim this Court has subject
matter jurisdiction pursuant to 28 U.S.C.

§ 1331: Truth in Lending Act (“TThA”), Real Estate

Settlement Procedures Act (“RESPA”), Home Ownership and Equity Protection Act, Securities
Act of 1933, Wire Act, Mail Fraud Act, and Bank Fraud. Compl.

¶ 1. There are two plausible

causes of action the Court can discern from the facts alleged in the Complaint: a violation of TILA
and a violation of RESPA.
First, Plaintiffs assert that Defendant violated the requirement that a creditor that is “the
new owner or assignee of the debt shall notify the borrower in writing of such transfer, including

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•

.

.

(D) the location of the place where transfer of ownership of the debt is recorded.” Compi.

29; 15 U.S.C.

¶

§ 1641(g). Plaintiffs assert “there are no recorded assignments of’ their mortgage,

and thus Defendant violated this statute. Compi.
is governed by 15 U.S.C.

¶ 29. Civil liability for violation of this statute

§ 1640. Church-El v. Bank ofN.Y., No. 11-877, 2015 U.S. Dist. LEXIS

167220, at *18 (D. Del. Dec. 15, 2015). The Third Circuit has explained that “[i]n the context of
TThA disclosure violations, a creditor’s failure to properly disclose must cause actual damages;
that is, without detrimental reliance on faulty disclosures (or no disclosure), there is no loss (or
actual damage).” Values v. Sky Bank, 591 F.3d 152, 157 (3d Cir. 2009). Here, Plaintiffs fail to
allege detrimental reliance on Defendant’s lack of disclosure or actual damages caused by such
failure. Accordingly, Defendant’s motion to dismiss Plaintiffs’ claim for a violation of TILA is
granted pursuant to Federal Rule of Civil Procedure 12(b)(6).
Second, Plaintiffs allege Defendant “violated RESPA rules by failing to disclose the use of
table funding for Plaintiff’s [sic] loan, the source of funds used on Plaintiff’s [sic] loan, and the
commissions and fees earned by Wachovia and others relating to the use of the table funded loan.”
Compi.

¶ 52. Notably, Plaintiffs do not identify the relevant section of RESPA they allege

Defendant violated. Nevertheless, as with a claim pursuant to TILA, Plaintiffs must allege actual
damages to state a claim pursuant to RESPA. See Hutchinson v. DeL Say. Bank F$B, 410 F. Supp.
2d 374, 383 (D.N.J. 2006) (“[A]lleging a breach of RESPA duties alone does not state a claim
under RESPA. Plaintiffs must, at a minimum, also allege that the breach resulted in actual
damages.”) (citing 12 U.S.C.

§ 2605(f)(l)(A)). Here, Plaintiffs fail to allege actual damages.

Accordingly, Defendant’s motion to dismiss Plaintiffs’ claim for a violation of RESPA is granted
pursuant to Federal Rule of Civil Procedure 12(b)(6).
As to the other federal causes of action, Plaintiffs do not appear to assert, and the Court

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cannot discern, facts sufficient to state a cause of action arising from these statutes. Therefore, to
the extent Plaintiffs bring claims pursuant to these federal statutes, the claims are dismissed
pursuant to Federal Rule of Civil Procedure 12(b)(6).
D.

State Law Claims

To the extent the facts alleged in the Complaint give rise to state law claims, the Court
declines to exercise supplemental jurisdiction. The basic statutory grant of federal court subject
matter jurisdiction provides for federal question jurisdiction and for diversity of citizenship
jurisdiction. Arbaugh v. Y & H Corp., 546 U.S. 500, 513 (2006) (citing 28 U.S.C. § 1331, 1332).
“A plaintiff properly invokes § 1331 jurisdiction when she pleads a colorable claim ‘arising under’
the Constitution or laws of the United States.” Id. Here, as Plaintiffs failed to state a cognizable
federal claim, the Court does not have federal question jurisdiction. To invoke

§ 1332, Plaintiffs

must state “a claim between parties of diverse citizenship that exceeds the required jurisdictional
amount, currently $75,000.” Id. Here, as Plaintiffs do not plead any amount in controversy, the
Court cannot consider this claim under diversity jurisdiction. Further, the Court declines to
exercise supplemental jurisdiction pursuant to 28 U.S.C.

§ 1367(c) over any remaining state law

claims arising in the Complaint. Accordingly, the Court dismisses Plaintiffs’ Complaint in its
entirety for lack of subject matter jurisdiction.
V.

CONCLUSION
For the reasons set forth above, Defendant’s motion to dismiss is granted. To the extent

the deficiencies identified in this Opinion can be cured, Plaintiffs have thirty (30) days from the
date of this Opinion to file an amended pleading. An appropriate Order accompanies this Opinion.
Date: August 25, 2017
s/Claire C. Cecchi
CLAIRE C. CECCHI, U.S.D.J.

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