BELLAK et al v. WELLS FARGO & CO. et al

Filing 11

OPINION filed. Signed by Judge Anne E. Thompson on 8/9/2017. (mps)

RECEIVED

NOT FOR PUBLICATION

UNITED STATES DISTRICr COURT
DISTRICT OF NEW JERSEY
JEFFREY A. BELLAK; THERESA P.
CIBOTTI; MARC S. CRAMER; THOMAS J.
CROWE; JOHN F. DALLY; JOHN
FUHRMEISTER; PHILIP CARUSO;
JEFFREY B. NUSSBUAM; CHARLES
McKENNA AND JANE/JOHN DOE(s)
WELLS FARGO HOME MORTGAGE
CONSULTANTS,

AUG 0 9 2017
AT 8:30
WILLIAM T. WALSH
CLERK

M

Civ. No. 17-2757
OPINION

Plaintiffs,

v.
WELLS FARGO & CO., WELLS FARGO
BANK, N.A., DBA WELLS FARGO HOME
MORTGAGE; ABC CORPORATION(S) 110 and/or JANE/JOHN DOES(S)
SUPERVISORS 1-10, individually and/or as
agents, servants and/or employees of the
above-named corporate defendants and ABC
CORPORATION(s) 1-10,
Defendants.
THOMPSON. U.S.D.J.

INTRODUCTION
This matter has come before the Court on the motion to dismiss brought by Defendants
Wells Fargo & Co. and Wells Fargo Bank, N.A. ("Defendants"). (ECF No. 6). Plaintiffs Jeffrey
A. Bellak, Theresa P. Cibotti, Marc S. Cramer, Thomas J. Crowe, John F. Dally, John
Fuhrmeister, Philip Caruso, Jeffrey B. Nussbaum, and Charles McKenna ("Plaintiffs") oppose.
(ECF No. 8). The Court has decided the motion based on the written submissions of the parties
and without oral argument pursuant to Local Civil Rule 78.l{b). For the reasons stated herein,
Defendants' motion is denied without prejudice.
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BACKGROUND
This case involves the alleged wrongful termination of Plaintiffs. Plaintiffs' allegations
are as follows. Plaintiffs are citizens of New Jersey and/or Pennsylvania, and are former
employees of Defendant Wells Fargo & Co. ("Defendant Wells"), within the Wells Fargo Home
Mortgage Division of Defendant Wells Fargo Bank, N.A. ("Defendant Wells N.A."). (Am.
Compl., at W5, 31, ECF No. 3-1) ("Am. Compl."). Defendants engaged in an extensive
violation of a provision of the Real Estate Settlement Procedures Act, 12 U.S.C. § 2607
("RESP A"), which prohibits procuring referrals of potential mortgage customers from real estate
title insurance companies in exchange for referrals back from the mortgage customers. (Id. ,, at
9....,11). Previously, the Consumer Financial Protection Bureau ("CFPB") and the State of
Maryland Office of the Attorney General filed a Complaint against Defendant Wells and other
named defendants. (Id. at W 13-14). Defendant Wells was required to pay fines in excess of
$34,000,000 as part of a settlement of the case involving the CFPB. (Id. at , 26).
Subsequently, Defendant Wells N .A. advised the CFPB that it was conducting an internal
investigation to seek out those employees responsible for the violations. (Id. at , 41 ). Plaintiffs
were interviewed during this internal investigation. (Id. at, 44, 54). -Plaintiffs' supervisors
approved of and encouraged Plaintiffs to continue to use business practices which violated CFPB
regulations. (Id. at,, 55-56). However, in the first week of January, 2015, Plaintiffs complied
with the directions of their supervisors to discontinue the business practices in question. (Id. at ,
58). On April 13, 2015, Defendant Wells issued a policy memorandum declaring these business
practices to be against company rules. (Id. at if 57). Despite Plaintiffs discontinuing these
business practice at the direction of their supervisors in January 2015, Plaintiffs were terminated
for their continued use of these business practices. (Id. at,, 56, 58). All of the Plaintiffs except
Charles McKenna were terminated before April 13, 2015, the effective date of the new company
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rule. (Id.

at~

59). Plaintiff Charles McKenna was tenrtinated on June 8, 2015. (Id.

at~ 60).

Plaintiffs claim that they were arbitrarily chosen to be terminated in order to create the false
appearance of conducting a true internal investigation. (Id.

at~ 63).

Plaintiffs' Complaint contains three counts: (1) Wrongful Termination, Breach of
Covenant of Good Faith and Fair Dealing; (2) Punitive Damages; and (3) Conversion. (Id.

at~

68-99). _This case was originally filed in the Superior Court of New Jersey, Law Division,
Mercer County. (See ECF No. 1). On April 21, 2017, Defendants removed the case to this
Court. (Id.). On April 24, 2017, Defendants file an amended notice of removal. (See ECF No.
3). On May 12, 2017, Defendants filed the instant motion to dismiss pursuant to Fed. R. Civ. P.
12(b)(6). (ECF No. 6).

DISCUSSION
A motion under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a
complaint. Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir. 1993). The defendant bears the burden
of showing that no claim has been presented. Hedges v. United States, 404 F.3d 744, 750 (3d
Cir. 2005). When considering a Rule 12(b)(6) motion, a district court should conduct a threepart analysis. See Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011). "First, the court must
'take note of the elements a plaintiff must plead to state a claim."' Id. (quoting Ashcroft v. Iqbal,
56 U.S. 662, 675 (2009)). Second, the court must accept as true all of a plaintiffs well-pleaded
factual allegations and construe the complaint in the light most favorable to the plaintiff. Fowler
v. UPMC Shadyside, 578 F.3d 203, 210--11 (3d Cir. 2009); see also Connelly v. Lane Const.
Corp., 2016 WL 106159 (3d Cir. Jan. 11, 2016). However, the court may disregard any
conclusory legal allegations. Fowler, 578 F.3d at 203. Finally, the court must determine
whether the "facts are sufficient to show that plaintiff has a 'plausible claim for relief.'" Id. at
211 (quoting Iqbal, 556 U.S. at 679). If the complaint does not demonstrate more than a "mere
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...

,

possibility of misconduct," the complaint must be dismissed. See Gelman v. State Farm Mut.
Auto. Ins. Co., 583 F.3d 187, 190 (3d Cir. 2009) (quoting Iqbal, 556 U.S. at 679).

In this case, the parties have not adequately briefed what law applies to Plaintiffs' claims.
A federal court sitting in diversity applies the forum state's choice oflaw rules to determine what
substantive law applies. See Klaxon Co. v. Stentor Elec. Mfg., 313 U.S. 487, 496-98 (1941); see
also Lebegerri v. Forman, 471 F.3d 424, 428 (3d Cir. 2006) (noting "[a]s this was a diversity
case filed in New Jersey, New Jersey choice oflaw rules govern"). Here, Defendants' briefs
apparently assume that New Jersey or Pennsylvania law applies and includes potentially relevant
case law from both jurisdictions. (See ECF Nos, 6, 10). Plaintiffs' opposition brief similarly
includes potentially relevant case law from both New Jersey and Pennsylvania. (See ECF No. 8).
However, nowhere in any of the submissions before this Court does any party engage in a choice
oflaw analysis arguing which law applies to Plaintiffs' claims. Moreover, the Court does not
have before it facts that could possibly impact what law applies to Plaintiffs' claims, e.g., the
state in which Plaintiffs worked for Defendant. 1 Without proper briefing on the choice of law
issue, this Court cannot assume, as the parties apparently do, that either New Jersey or
Pennsylvania law applies to Plaintiffs' claims, nor can the Court properly analyze the claims
without determining which law applies. Therefore, Defendants' motion to dismiss is denied

without prejudice.

CONCLUSION
For the foregoing reasons, Defendant's motion to dismiss is denied without prejudice.
Defendants may renew their motion to dismiss consistent with this Opinion. If Defendants wish

1

The Amended Complaint states that Plaintiff Philip Caruso ''was employed in the Wells'
Somerville, New Jersey Office" (Am. Compl, ECF No. 3-1 at if 31), however nowhere in the
Amended Complaint or the other submissions of the parties is it specified where the remaining
eight Plaintiffs worked.
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•

to do so they must file the renewed motion within twenty-one (21) days of the date of the Order
accompanying this Opinion. An appropriate order will follow.

Isl Anne E. Thompson
ANNE E. THOMPSON, U.S.D.J.

Date: August 9, 2017

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