TIRRI et al v. FLAGSHIP RESORT DEVELOPMENT CORPORATION et al
Filing
49
OPINION filed. Signed by Judge Brian R. Martinotti on 8/30/2018. (mmh)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
____________________________________
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Plaintiffs,
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v.
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FLAGSHIP RESORT DEVELOPMENT :
CORPORATION d/b/a FANTASEA
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RESORTS, LA SAMMANA VENTURES, :
LLC d/b/a FANTASEA RESORTS, and
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ATLANTIC PALACE DEVELOPMENT :
CORP. d/b/a FANTASEA RESORTS,
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Defendants.
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____________________________________:
GAETANO TIRRI, BRIAN KALMUS,
and KELLY TAYLOR, on behalf of
themselves and the putative class,
Civil Action No. 3:16-cv-1771-BRM-TJB
OPINION
MARTINOTTI, DISTRICT JUDGE
Before this court are (1) Defendant Flagship Resort Development Corporation d/b/a
FantaSea Resorts (“Flagship”), La Sammana Ventures, LLC (“La Sammana”), and Atlantic Palace
Development Corp.’s (“Atlantic Palace”) (collectively, “Defendants”) Motion for Summary
Judgment (ECF No. 36), (2) Plaintiffs Gaetano Tirri (“Tirri”), Brian Kalmus (“Kalmus”), and
Kelly Taylor’s (“Taylor”) (collectively, “Plaintiffs”) Cross-Motion for Discovery pursuant to
Federal Rule of Civil Procedure 56(d), and (3) Plaintiffs’ Cross-Motion for Remand pursuant to
28 U.S.C. § 1332(d)(3) (ECF No. 41). All motions are opposed. (ECF Nos. 41 and 48.) Having
reviewed the parties’ submissions filed in connection with the motion and having declined to hold
oral argument pursuant to Federal Rule of Civil Procedure 78(b), for the reasons set forth below
and for good cause having been shown, Defendants’ Motion for Summary Judgment is
GRANTED, Plaintiffs’ Cross-Motion for Discovery is DENIED, and Plaintiffs’ Cross-Motion to
Remand is DENIED AS MOOT.
I.
FACTUAL AND PROCEDURAL BACKGROUND 1
This lawsuit arises out of Plaintiffs’ purchase of timeshare ownership interests in a
condominium in Atlantic City, New Jersey from Defendants. (Ds.’ Statement of Material Facts
(ECF No. 36-2) ¶ 1); Pls.’ Resp. to Ds. Statement of Material Facts (ECF No. 41-1) ¶ 1.) 2 In
connection with those purchases, Plaintiffs provided Purchase Money Mortgages and Mortgage
Notes to Flagship. (ECF No. 36-2 ¶¶ 2-3; ECF No. 41-1 ¶¶ 2-3.) Plaintiffs also executed Deeds in
Lieu of Foreclosure (“DILs”). (ECF No. 36-2 ¶ 4; ECF No. 41-1 ¶ 4.) Plaintiffs executed Escrow
Agreements, which provided the DILs would be placed in escrow. (ECF No. 36-2 ¶ 5.) 3
Defendants maintain the DILs have never left escrow; Plaintiffs dispute this. (ECF No. 36-2 ¶ 6;
ECF No. 41-1 ¶ 6.) Defendants contend Plaintiffs “have the right to rescind their [DILs] without
penalty”; Plaintiffs dispute this. (ECF No. 36-2 ¶ 7; ECF No. 41-1 ¶ 7.) Defendants also state
Flagship never commenced a foreclosure action against any of the Plaintiffs and that Plaintiffs still
1
A more substantial summary of the facts alleged in Plaintiffs’ Amended Complaint (ECF No. 9)
can be found in the Court’s October 19, 2016 Opinion, which granted in part and denied in part
Defendant’s motion to dismiss. (ECF No. 25.) For the purposes of the pending motions, the Court
incorporates that summary and recounts only those facts that the parties identified in their motion
papers as relevant to these motions.
2
Plaintiffs did not submit a supplemental statement of material facts, which is permitted but not
required under Local Rule 56.1.
3
Plaintiffs dispute this fact, arguing Defendants’ Exhibit 5, which accompanies the statement,
“contains copies of an Escrow Agreement only.” (ECF No. 41-1 ¶ 5.) However, the attached
Escrow Agreements, which Plaintiffs signed, plainly state the DILs and all closing documents will
be held in escrow. (ECF No. 36-3 at 23, 25.)
2
own the property they purchased. (ECF No. 36-2 ¶¶ 8-9.) Plaintiffs dispute these facts. (ECF No.
41-1 ¶¶ 8-9.)
On February 11, 2016, Plaintiffs filed a complaint in the Superior Court of New Jersey,
Law Division, Warren County. (ECF No. 1-1.) On March 31, 2016, Defendants filed a Notice of
Removal to this Court. (ECF No. 1.) On April 21, 2016, prior to filing its answer, Flagship filed a
motion to dismiss for failure to state a claim. (ECF No. 5.) On May 12, 2016, Plaintiffs filed the
Amended Complaint (ECF No. 9) and the motion to dismiss the original complaint was terminated
by the Court without prejudice (ECF No. 10.) The Amended Complaint asserts claims for (1)
violations of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1, et seq. (Count One); (2-3)
violations of the Truth-in-Consumer Contact, Warranty, and Notice Act, N.J.S.A. 56:12-14, et seq.
(“TCCWNA”) (Counts Two and Four); (4) violations of the New Jersey Fair Foreclosure At,
N.J.S.A. 2A:50-53, et seq. (the “Fair Foreclosure Act,” or the “Act”) (Count Three); and (5) breach
of the duty of good faith and fair dealing (Count Five).
On June 9, 2016, Flagship filed a motion to dismiss (ECF No. 14.) On October 19, 2016,
the Court denied Flagship’s motion to dismiss Counts One, Two, and Four, and granted the motion
to dismiss Count Three. (ECF No. 25 and 26.) Flagship did not seek dismissal of Count Five. (ECF
No. 14.) On November 21, 2017, the Hon. Tonianne J. Bongiovanni, U.S.M.J. stayed discovery
and granted Defendants leave to file a dispositive motion. (ECF No. 35.) On January 26, 2018,
Defendants filed their Motion for Summary Judgment. (ECF No. 36.) The motion was fully briefed
on March 19, 2018.
3
II.
LEGAL STANDARD
A. Summary Judgment
Summary judgment is appropriate “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter
of law.” Fed. R. Civ. P. 56(c). A factual dispute is genuine only if there is “a sufficient evidentiary
basis on which a reasonable jury could find for the non-moving party,” and it is material only if it
has the ability to “affect the outcome of the suit under governing law.” Kaucher v. Cty. of Bucks,
455 F.3d 418, 423 (3d Cir. 2006); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). Disputes over irrelevant or unnecessary facts will not preclude a grant of summary
judgment. Anderson, 477 U.S. at 248. “In considering a motion for summary judgment, a district
court may not make credibility determinations or engage in any weighing of the evidence; instead,
the non-moving party’s evidence ‘is to be believed and all justifiable inferences are to be drawn in
his favor.’” Marino v. Indus. Crating Co., 358 F.3d 241, 247 (3d Cir. 2004) (quoting Anderson,
477 U.S. at 255)); see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587,
(1986); Curley v. Klem, 298 F.3d 271, 276-77 (3d Cir. 2002).
The party moving for summary judgment has the initial burden of showing the basis for its
motion. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). “If the moving party will bear the
burden of persuasion at trial, that party must support its motion with credible evidence . . . that
would entitle it to a directed verdict if not controverted at trial.” Id. at 331. On the other hand, if
the burden of persuasion at trial would be on the nonmoving party, the party moving for summary
judgment may satisfy Rule 56’s burden of production by either (1) “submit[ting] affirmative
evidence that negates an essential element of the nonmoving party’s claim” or (2) demonstrating
4
“that the nonmoving party’s evidence is insufficient to establish an essential element of the
nonmoving party’s claim.” Id. Once the movant adequately supports its motion pursuant to Rule
56(c), the burden shifts to the nonmoving party to “go beyond the pleadings and by her own
affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate
specific facts showing that there is a genuine issue for trial.” Id. at 324; see also Matsushita, 475
U.S. at 586; Ridgewood Bd. of Ed. v. Stokley, 172 F.3d 238, 252 (3d Cir. 1999). In deciding the
merits of a party’s motion for summary judgment, the court’s role is not to evaluate the evidence
and decide the truth of the matter, but to determine whether there is a genuine issue for trial.
Anderson, 477 U.S. at 249. Credibility determinations are the province of the factfinder. Big Apple
BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).
There can be “no genuine issue as to any material fact,” however, if a party fails “to make
a showing sufficient to establish the existence of an element essential to that party’s case, and on
which that party will bear the burden of proof at trial.” Celotex, 477 U.S. at 322-23. “[A] complete
failure of proof concerning an essential element of the nonmoving party’s case necessarily renders
all other facts immaterial.” Id. at 323; Katz v. Aetna Cas. & Sur. Co., 972 F.2d 53, 55 (3d Cir.
1992).
Pursuant to Federal Rule of Civil Procedure 56(d),
[i]f a nonmovant shows by affidavit or declaration that, for specified
reasons, it cannot present facts essential to justify its opposition, the
court may:
(1) defer considering the motion or deny it;
(2) allow time to obtain affidavits to take discovery; or
(3) issue any other appropriate order.
5
A party who submits an affidavit pursuant to Rule 56(d), “specify[], for example, what particular
information is sought; how, if uncovered, it would preclude summary judgment; and why it has
not previously been obtained.” Penn., Dep’t of Pub Welfare v. Sebelius, 674 F.3d 139, 157 (3d Cir.
2012) (quoting Dowling v. City of Phila., 855 F.2d 136, 139-40 (3d Cir. 1988)). If the nonmovant
files an affidavit that addresses these three requirements with
specificity, and especially when particular information, necessary to
the successful opposition to summary judgment, is in the sole
possession of the moving party, the Third Circuit has held that ‘a
continuance of a motion for summary judgment for purposes of
discovery should be granted almost as a matter of course.’
Malouf v. Turner, 814 F. Supp. 2d 454, 459 (D.N.J. 2011) (quoting Sames v. Gable, 732 F.2d 49,
51 (3d Cir. 1984)). However, the nonmovant cannot defeat summary judgment by offering
“[v]ague or general statements of what [it] hopes to gain through a delay for discovery.” Id. at 45960 (quoting Hancock Indus. v. Schaffer, 811 F.3d 225, 230 (3d Cir. 1987)).
B. Motion to Remand
A notice of removal of a civil action must be filed by a defendant within thirty (30) days
of receiving the complaint. 28 U.S.C. § 1446(b)(1). However, where it is not evident from the face
of the complaint that a case is removable, “a notice of removal may be filed within thirty [(30)]
days after receipt by Defendants . . . of a copy of an amended pleading, motion, order or other
paper from which it may be first ascertained that the case is one which is or has become
removable.” 28 U.S.C. § 1446(b)(3).
Upon the removal of an action, a plaintiff may challenge such removal by moving to
remand the case back to state court. 28 U.S.C. § 1447. Grounds for remand include: “(1) lack of
district court subject matter jurisdiction or (2) a defect in the removal process.” PAS v. Travelers
Ins. Co., 7 F.3d 349, 352 (3d Cir. 1993). A motion for remand on the basis of a procedural defect
in the removal must be filed within thirty (30) days of the notice of removal, 28 U.S.C. § 1447(c),
6
whereas “a motion to remand based on lack of subject matter jurisdiction may be made at any time
before final judgment,” Foster v. Chesapeake Ins. Co., 933 F.2d 1207, 1212-13 (3d Cir. 1991)
(citing 28 U.S.C. § 1447(c)).
“The party asserting jurisdiction bears the burden of showing that at all stages of the
litigation the case is properly before the federal court.” Samuel-Bassett v. KIA Motors America,
Inc., 357 F.3d 392, 396 (3d Cir. 2004). Federal courts rigorously enforce the congressional intent
to restrict federal diversity jurisdiction, and therefore removal statutes are “strictly construed
against removal” and “doubts must be resolved in favor of remand.” Id. at 396-403. Additionally,
when a case is removed, “all defendants who have been properly joined and served must join in or
consent to the removal of the action.” 28 U.S.C. § 1446(b)(2)(A).
III.
DECISION
A. Defendants’ Motion for Summary Judgment
Defendants argue “[a]ll four remaining counts of Plaintiffs’ [C]omplaint are based on two
alleged violations of the New Jersey Fair Foreclosure Act.” (Ds.’ Br. in Supp. of the Mot. for
Summ. J. (ECF No. 36-1) at 2.) Plaintiffs do not dispute this. (See ECF No. 41.) The first alleged
violation of the Fair Foreclosure Act—Defendants’ failure to issue notices of intent to foreclose
(“NOIs”) that comport with the Act’s requirements—is the basis of Plaintiffs’ claim that
Defendants violated the TCCWNA (Count Four). (ECF No. 36-1 at 2-3 (citing Am. Compl. (ECF
No. 9) ¶ 123).) The second alleged violation of the Fair Foreclosure Act is that Defendants
deprived Plaintiffs of their right to redeem their ownership interest by requiring DILs to be
escrowed. (Id. at 3 (citing ECF No. 9 ¶¶ 79, 84, 88. 95, 131-34).) That alleged violation is the basis
of Plaintiffs claims under the Consumer Fraud Act (Count One), the TCCWNA (Count Two), and
the implied covenant of good faith and fair dealing (Count Five). (Id.) Defendants maintain the
7
record shows they did not violate the Fair Foreclosure Act and are therefore entitled to summary
judgment on all remaining claims. (Id. at 2-4.)
1. Defendants’ Alleged Failure to Provide a Notice of Foreclosure
Defendants do not dispute Plaintiffs’ assertion that, pursuant to the fair foreclosure act,
“the holder of the mortgage is required to serve a [NOI] . . . before instituting foreclosure.” (Id. at
3 (citing ECF No. 9 ¶¶ 108-11).) The Fair Foreclosure Act states, in relevant part, “[B]efore any
residential mortgage lender may . . . commence any foreclosure . . . the residential mortgage lender
shall give the residential mortgage debtor notice of such intention at least 30 days in advance of
such action.” N.J.S.A. § 2A:50-56(a). Defendants argue they never commenced foreclosure actions
against Plaintiffs and therefore were never subject to the Fair Foreclosure Act’s requirement to
send a NOI. (ECF No. 36-1 at 4.) Defendants support their motion with an affidavit from Roxanne
Passarella (“Passarella”), the Escrow Agent on the transactions between Defendants and Plaintiffs.
(ECF No. 36-3.) Passarella states, “Defendant, Flagship, has never commenced a foreclosure
action against any of the Plaintiffs, Tirri, Kalmus or Taylor.” (Id. ¶ 10.) Defendants make the same
assertion in their Statement of Material Facts. (ECF No. 36-2 ¶ 8 (citing ECF No. 36-3 ¶ 10).)
In opposition, Plaintiffs argue Defendants sent NOIs that violated the requirements of
N.J.S.A. 2A:50-56. (ECF No. 41 at 29-30.) However, Plaintiffs do not refute Defendants’
argument that they never commenced foreclosure actions. Plaintiffs respond to Defendants’
assertion that no foreclosure was ever commenced by arguing “[t]he purported fact is not supported
by competent evidence pursuant to 28 U.S.C. § 1746(2).” (ECF No. 41-1 ¶ 8.) Pursuant to 28
U.S.C. § 1746(2), an unsworn statement may substitute for a sworn statement if the person offering
the statement “declare[s] . . . under penalty of perjury that the [content of the statement] is true and
correct.”
8
Plaintiffs’ argument—that Defendants’ offered proof does not comply with 28 U.S.C.
§ 1746(2)—is without merit. Passarella’s affidavit is sworn and notarized. (ECF No. 36-3 at 2);
see Turner v. New Jersey State Police, No. 08-5163, 2017 WL 1190917, *3 (D.N.J. Mar. 29, 2017)
(finding 28 U.S.C. § 1746 does not apply to a sworn affidavit). Further, Plaintiffs’ mere denial of
Defendants’ assertion that there has been no foreclosure is inadequate. Defendants adequately
support their motion pursuant to Rule 56(c); therefore, the burden shifts to Plaintiffs to “go beyond
the pleadings and by [their] own affidavits, or by the depositions, answers to interrogatories, and
admissions on file, designate specific facts showing that there is a genuine issue for trial.” Celotex
Corp., 477 U.S. at 324. Plaintiffs cite no evidence to support the contention that Defendants have
commenced foreclosure actions. The Court finds Defendants are entitled to summary judgment on
Count Four, because Defendants had no obligation to serve NOIs. Under New Jersey law, “a
foreclosure plaintiff must send a [NOI] to a defendant before commencing a foreclosure action,”
but if there is no foreclosure action there is no need for a NOI. Wilmington Trust, N.A. v. Assoulin,
2017 WL 1422875, *4 (N.J. Super. App. Div. Apr. 21, 2017).
The Court finds there is no dispute of fact as to whether Defendants were required to serve
Plaintiffs with NOIs, and therefore Defendants are entitled to judgment as a matter of law as to
Count Four.
2. Defendants alleged deprivation of plaintiffs’ right to redeem their
ownership interest by requiring DILs to be escrowed
Pursuant to N.J.S.A. 2A:50-61, “[w]aivers by the debtor of rights provide pursuant to [the
Fair Foreclosure Act] are against public policy, unlawful, and void unless given after default
pursuant to a work agreement in a separate written document signed by the debtor” New Jersey
courts have held, “[a] mortgagor may not deprive himself of a right to redeem even by an express
9
agreement for that purpose if such agreement is a part of, or may contemporaneously with, the
conveyance.” Mallozzi v. Cerciello, No. C-07-472009 WL 303326, *3 (N.J. Super. Ct. App. Div.
Feb. 10, 2009) (quoting Smith v. Shattls, 169 A.2d 503 (N.J. Super. Ct. App. Div. 1961)). A
mortgagor may sell or release her equity of redemption to the mortgagee by a separate and distinct
transaction any time after the execution of the mortgage. Id. (citations omitted). Here, the parties
dispute whether the DILs, which were executed contemporaneously with the mortgage, deprived
Plaintiffs of their right to redeem.
Defendants argue they are entitled to summary judgment as to Counts One, Two, and Five,
which are based on Defendants’ alleged transfer of Plaintiffs’ property interest back to Defendants
by way of the DILs. (ECF No. 36-1 at 4.) Defendants contend Plaintiffs were not deprived of their
right to redeem because the DILs have never left escrow. (Id. at 5 (citing ECF No. 36-2 ¶ 6).) 4
Defendants maintain Plaintiffs have not been deprived of their right to redeem their ownership
interest because title reports show Plaintiffs still own the property they purchased. (ECF No. 36-1
at 6 (citing ECF No. 36-2 ¶ 9).) Finally, Defendants point out the Escrow Agreement gives
Plaintiffs “the right to rescind their [DILs] without penalty.” (ECF No. 36-1 at 5 (citing ECF No.
36-2 ¶ 7).)
Plaintiffs acknowledge that the title documents Defendants attach to their motion indicate
Plaintiffs own their respective properties, but Plaintiffs contest the validity of that title. (ECF No.
41-1 ¶ 9.) Plaintiffs argue there are issues of material fact as to Defendants’ escrow process. 5 (ECF
4
Passarella also attests to the fact the DILs have not left escrow. (ECF No. 36-3 ¶ 8.)
5
Plaintiffs also contend Passarella may not qualify as an escrow agent under due to “her multihatted executive roles for the Defendants.” (ECF No. 41 at 28.) Defendants cite no law to support
this claim, which the Court addresses at greater length in its analysis of Plaintiffs’ Rule 56(d)
motion.
10
No. 41 at 28.) Specifically, Plaintiffs point out the Escrow Agreement states, “Seller may give
notice to Escrow Agent to break escrow at any time prior to the satisfaction of [the] conditions”
noted in the Escrow Agreement. (Id. at 28-29 (quoting ECF No. 36-3, Ex. 5, ¶ 2).) Plaintiffs
contend additional discovery into Defendants’ escrow process and their use of DILs could reveal
Plaintiffs were in fact deprived of their right to redeem their property interest. (Id. at 27-28.)
Plaintiffs offer no response to Defendants’ assertion that Plaintiffs have the right to rescind their
DILs without penalty, other than to challenge Passarella’s affidavit pursuant to 28 U.S.C.
§ 1746(2). As the Court has found, 28 U.S.C. § 1746(2) does not apply to Passarella’s affidavit.
The Court finds Defendants are entitled to summary judgment on Counts One, Two, and
Five, because the plain language of the Escrow Agreement states Plaintiffs could rescind the DILs
at any time. The Escrow Agreement provides, in relevant part:
Buyer acknowledges that Buyer has signed and delivered a [DIL] to
Escrow Agent for the purposed of permitting Seller to reacquire the
[property] in the event that Seller is entitled to foreclose upon the
[property]. The Buyer understands that Buyer may, without penalty,
rescind (withdraw and cancel) the Deed in Lieu of Foreclosure
within seven (7) days, excluding Saturdays, Sunday and legal
holidays . . . . The Buyer further understands that in the event that
Buyer defaults under the Mortgage on the [property], the Seller shall
first provide at least thirty (30) days[’] notice of its intention to
foreclose, during which time the Buyer shall the right to cure the
default . . . . If the default is not cured by Buyer, Buyer shall have
an additional seven (7) day period, excluding Saturdays, Sundays
and legal holidays, after an additional notice from Seller sent to the
foregoing address, to rescind the Deed in Lieu of Foreclosure
without penalty . . . .
(ECF No. 36-3 at 24 (emphasis added).) The Court finds significance in Plaintiffs’ lack of a
response to Defendants’ arguments about Plaintiffs’ right to rescind. Plaintiffs do not attempt to
explain how the DIL deprived them of their right to redeem when they retained the right to rescind
the DIL without penalty. Plaintiffs rely on Mallozzi, which they argue stands for the proposition
11
“that New Jersey law prohibits the practice of requiring a borrower to execute a [DIL]
contemporaneously with the conveyance of the property.” (ECF No. 41 at 27.) Even if the Court
were to accept Plaintiffs’ interpretation of Mallozzi, the fact Plaintiffs could rescind the DILs
distinguishes this case from the facts in Mallozzi, where there was no mention of a right to rescind.
The Court finds DILs did not constitute a waiver of rights in violation of N.J.S.A. § 2A:50-61,
because the Escrow Agreement granted Plaintiffs the right to rescind the DILs “without penalty.”
Because the DILs did not deprive Plaintiffs of their right to redeem, the Court finds
Defendants are entitled to summary judgment as a matter of law as to Counts One, Two, and Five.
Therefore, Defendants’ Motion for Summary Judgment (ECF No. 36) is GRANTED. 6
B. Plaintiffs’ Rule 56(d) Motion
Though the Court has granted Defendants’ Motion for Summary Judgment, it will explain
why Plaintiffs’ Cross-Motion is denied. See Smith v. Depuy Orthopaedics, Inc., No. 11-4139, 2013
WL 1108555, *15 (D.N.J. Mar. 18, 2013). Plaintiffs seek discovery into two main areas: (1)
Defendants’ practices regarding DILs, escrow, and foreclosure; and (2) a deposition of Passarella
“in order to test the unverified statements in her supporting Affidavit.” (ECF No. 41 at 10-11.)
Plaintiffs have failed to demonstrate “how, if uncovered, [this information] would preclude
summary judgment.” Penn., Dep’t of Pub Welfare, 674 F.3d 139, 157 (3d Cir. 2012) (quoting
Dowling, 855 F.2d at 139-40. The two main deficiencies in Plaintiffs’ opposition to Defendants’
Motion for Summary Judgment also compel denial of Plaintiffs’ Cross-Motion. First, Plaintiffs
offered no response to Defendants’ evidence that they never commenced foreclosure against
6
The Court need not address the parties’ arguments regarding Defendants’ additional grounds for
summary judgment. (See ECF No. 36-1 at 6-9.)
12
plaintiffs. Second, Plaintiffs offered no response to Defendants’ arguments concerning the Escrow
Agreement’s grant of a right to rescind.
Plaintiffs argue the discovery sought “would confirm that Defendants sent noncompliant
NOIs to Plaintiffs that were never subsequently cured.” (ECF No. 41 at 11-12.) As the Court found,
however, Plaintiffs never commenced foreclosure and therefore had no obligation to send NOIs in
the first place. See Assoulin, 2017 WL 1422875 at *4. Plaintiffs offered no response to Defendants’
arguments concerning the absence of foreclosure proceedings.
Plaintiffs claim additional discovery “would establish the [DILs] are not escrowed.” (ECF
No. 41 at 11.) Again, Plaintiffs failed to respond to Defendants’ arguments concerning Plaintiffs’
right to rescind. The Court cannot determine how additional discovery into the DILs or the escrow
process would raise an issue of material fact as to whether Plaintiffs were deprived of their right
to redeem their property interest when Plaintiffs did not contest the fact they had a right to rescind
the DILs without penalty.
Finally, as to Plaintiffs’ argument concerning Passarella, Plaintiffs cite no authority to
support the contention that Passarella’s affiliation with Defendants would preclude her from
serving as escrow agent. Under New Jersey law, an attorney for one party may serve as escrow
agent on a transaction involving the represented party. See Bowman v. Brown, 99 A. 839 (N.J.
Super. Ct. Ch.), aff'd, 100 A. 1070 (N.J. 1917); Mangani v. Stadium Bowling Academy, 40 A.2d
289, 300 (N.J. 1944). Also, as noted, Passarella’s Affidavit was sworn and not unverified as
Plaintiffs state. Therefore, Plaintiffs’ basis for seeking to depose Passarella is groundless.
Because Plaintiffs have not demonstrated the discovery sought would preclude summary
judgment, Plaintiffs’ Cross-Motion for Discovery is DENIED.
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C. Plaintiffs’ Cross-Motion for Remand
Plaintiffs also move for remand pursuant to 28 U.S.C. § 1332(d)(3), which states a district
court shall decline to exercise jurisdiction over a class action in which two-thirds or more of the
members of the proposed class and the primary defendants are citizens of the state in which the
action was originally filed. Because the Court has granted Defendants’ Motion for Summary
Judgment, Plaintiffs’ Cross-Motion to Remand is DENIED AS MOOT.
IV.
CONCLUSION
For the reasons set forth above, Defendants’ Motion for Summary Judgment (ECF No. 36)
is GRANTED, Plaintiffs’ Cross-Motion for Additional Discovery (ECF No. 41) is DENIED, and
Plaintiffs’ Cross-Motion to Remand (ECF No. 41) is DENIED AS MOOT. The case is CLOSED.
An appropriate Order will follow.
/s/ Brian R. Martinotti
BRIAN R. MARTINOTTI
UNITED STATES DISTRICT JUDGE
Dated: August 30, 2018
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