MTGLQ Investors, LP v. Wellington et al

Filing 98

MEMORANDUM OPINION AND ORDER by District Judge Kenneth J. Gonzales denying 74 Ms. Wellington's Motion to Reconsider. (tah)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
MTGLQ INVESTORS, LP,
Plaintiff,
v.

No. 1:17-cv-00487-KG-LF

MONICA L. WELLINGTON, THE MONICA L.
WELLINGTON DECLARATION OF TRUST
DATED DECEMBER 28, 2007, ALTURA VILLAGE
HOMEOWNERS’ ASSOCIATION, INC., JPMORGAN
CHASE BANK, N.A.,
Defendants.
MEMORANDUM OPINION AND ORDER
This matter comes before the Court upon “Monica Wellington’s [Renewed] Motion to
Dismiss Complaint,” (“Motion for Reconsideration”) filed May 15, 2018.1 (Doc. 74). On May
29, 2018, MTGLQ filed its response, and on June 6, 2018, Ms. Wellington filed her reply.
(Docs. 76 and 78). Having considered the parties’ briefing and the relevant law the Court denies
Ms. Wellington’s motion.
Furthermore, the Court also issued a related Memorandum Opinion and Order (Doc. 97)
in which it concluded that Ms. Wellington has sufficiently alleged that MTGLQ is a debt
collector, but fails to plead a plausible violation of the Fair Debt Collection Practices Act’s
(“FDCPA”) venue provision, 15 U.S.C. 1692i. In particular, Ms. Wellington fails to allege that
the Note was signed outside of New Mexico or that she resided in California at the
commencement of this action. As explained below, to the extent that Ms. Wellington moves for

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Although styled as a Renewed Motion to Dismiss, Ms. Wellington’s motion will be analyzed as
a motion for reconsideration of the Court’s decision denying her previous motion to dismiss
MTGLQ Investors, LP’s (“MTGLQ”) Complaint. (Doc. 71).

a transfer of venue, the Court considers it moot for failure to make an adequate showing for such
a transfer.
I.

Background
This is not Ms. Wellington’s first attempt to dismiss MTGLQ’s Complaint. MTGLQ’s

Complaint contains a personal judgment claim and a foreclosure claim. (Doc. 1-1) at 1-6.
MTGLQ attached to its Complaint, a copy of the Note, Allonge to Note, Mortgage, and
Assignment of Mortgage related to Ms. Wellington’s 2124 Altura Verde property (“Altura Verde
property”) that is at the heart of this dispute. (Doc. 1-1) at 8-47; see also (Doc. 71) at 4. On June
23, 2017, Ms. Wellington filed a motion to dismiss MTGLQ’s complaint. (Doc. 9). In this
motion to dismiss, Ms. Wellington argued that MTGLQ’s Complaint should be dismissed (1) for
failure to state a claim for relief, (2) for a violation of the venue provision of the Fair Debt
Collection Practices Act (“FDCPA”), and (3) seeking the dismissal of “The Unknown Spouse of
Monica Wellington.” The Court considered these arguments and denied Ms. Wellington’s
motion in a Memorandum Opinion and Order (“MOO”), filed on April 27, 2018, finding, inter
alia, that MTGLQ has standing to enforce the Note and foreclose the Mortgage; the documents
attached to the Complaint were not altered or fabricated; Fed. R. Civ. P. 9(b) does not apply to
MTGLQ’s allegations; MTGLQ’s personal judgment claim is timely; and, Ms. Wellington
cannot represent the interest of another party. (Doc. 71).
II.

Ms. Wellington’s Motion for Reconsideration
In her Motion for Reconsideration, Ms. Wellington requests that the Court either dismiss

MTGLQ’s Complaint in its entirety, or transfer the personal judgment claim to a California
court. Ms. Wellington offers four reasons in support of her motion. First, she asserts that the
FDCPA applies to MTGLQ’s personal judgment claim and therefore the venue provision of the

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FDCPA prohibits this Court from hearing that claim. Second, she asserts that MTGLQ’s
allegation that JPMorgan Chase Bank, N.A., may have an interest in the Altura Verde property
demonstrates that MTGLQ lacks standing to foreclose on the property. Third, she asserts that
MTGLQ’s allegation that the Mortgage is in the hands of its counsel demonstrates that MTGLQ
lacks standing to foreclose on the property. Fourth, she asserts that the Court did not apply the
heightened pleading standard under Rule 9(b) to MTGLQ’s allegations of an erroneous
assignment or release of the Mortgage in its Complaint. Ms. Wellington contends that these
allegations amount to allegations of mistake that trigger Rule 9(b).
In response, MTGLQ argues that the FDCPA venue argument should be dismissed
because the Court concluded in another Memorandum Opinion and Order (Doc. 72), also filed
April 27, 2018, that Ms. Wellington failed to allege sufficient facts in her amended counterclaim
showing MTGLQ was a debt collector under the FDCPA. MTGLQ notes that the Court decided
the standing issue in its MOO (Doc. 71) concluding that MTGLQ has shown standing to enforce
the Note and foreclose on the Mortgage. MTGLQ does not address whether the Court erred in
failing to apply Rule 9(b) to MTGLQ’s allegations of an erroneous assignment or release.
In her reply, Ms. Wellington reiterates her four reasons for dismissal or transfer of the
personal judgment claim. Ms. Wellington does request, for the first time, “limited discovery in
order to uncover whatever facts may be essential” to the FDCPA venue issue.2 (Doc. 78) at 4
n.4.
III.

Legal Standard
Ms. Wellington’s Motion for Reconsideration is “an interlocutory motion invoking the

district court’s general discretionary authority to review and revise interlocutory rulings prior to
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Ms. Wellington’s discovery request is moot in light of the recent Scheduling Order by
Magistrate Judge Laura Fashing. (Doc. 93).
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entry of final judgment.” Wagoner v. Wagoner, 938 F.2d 1120, 1122 n.1 (10th Cir. 1991). The
Tenth Circuit analyzes motions to reconsider interlocutory orders, like this one, under Rule 54(b)
and looks to Rule 59(e) for guidance in addressing those motions to reconsider. Ankeney v.
Zavaras, 524 Fed. Appx. 454, 458 (10th Cir. 2013) (stating that, in considering Rule 54(b)
motion to reconsider, “court may look to the standard used to review a motion made pursuant to
Federal Rule of Civil Procedure 59(e).”).
A Rule 59(e) movant carries the burden of demonstrating that the Court should alter or
amend a judgment. See, e.g., Winchester v. Wilkinson, 2015 WL 2412175, at *2 (E.D. Okla.)
(“court finds petitioner has failed to meet his burden for relief under Fed.R.Civ.P. 59(e)”). Rule
59(e) relief is appropriate if there is new controlling law, new evidence not available previously,
or a “need to correct clear error or prevent manifest injustice.” Ankeney, 524 Fed. Appx. at 458
(quoting Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000)). The Tenth
Circuit has defined clear error as “an arbitrary, capricious, whimsical, or manifestly unreasonable
judgment.” Wright ex rel. Trust Co. of Kan. v. Abbott Labs., Inc., 259 F.3d 1226, 1236 (10th Cir.
2001). Although the Tenth Circuit has not precisely defined “manifest injustice” within the
meaning of Rule 59(e), that term is commonly defined as “[a] direct, obvious, and observable
error in a trial court....” Black’s Law Dictionary (10th ed. 2014). Furthermore, Rule 59(e) does
not allow a losing party to “revisit issues already addressed or advance arguments that could
have been raised in prior briefing.” Servants of the Paraclete, 204 F.3d at 1012.
IV.

Discussion
A. Venue
Ms. Wellington’s FDCPA venue argument is unavailing; she has failed to show that the

venue provision of the FDCPA requires transfer of MTGLQ’s personal judgment action. Here,

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MTGLQ brings both a personal judgment claim and a foreclosure claim in its Complaint. Ms.
Wellington contends that because the personal judgment claim seeks to collect a debt, the venue
provision under the FDCPA requires this Court to transfer the personal judgment claim to
California.3 In its Memorandum Opinion and Order (Doc. 97), the Court concluded that Ms.
Wellington alleges sufficient facts to plausibly suggest that MTGLQ is a debt collector under the
principal purposes definition.4 (Doc. 97) at 6. Ms. Wellington has not shown, however, that the
FDCPA requires transfer of the personal judgment claim or even that there is a violation of the
FDCPA venue provision. Therefore, the Court finds that Ms. Wellington’s venue argument is
moot.
B. Ms. Wellington’s Standing Arguments
Ms. Wellington argues MTGLQ lacks standing as to his foreclosure claim because of two
allegations in its Complaint. This argument, like the others, was raised in the initial Motion to
Dismiss. Specifically, Ms. Wellington argues that MTGLQ’s allegation that JPMorgan Chase
Bank, N.A., may have an interest in the Altura Verde property is contrary to MTGLQ’s standing
to foreclose on the property. (Doc. 1-1) at 5, ¶ 20. Similarly, Ms. Wellington asserts that
MTGLQ’s allegation that it placed the “Mortgage in the hands of the undersigned counsel for

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Ms. Wellington argues that California is the proper venue because the personal judgment action
is not an action to enforce an interest in real property and, therefore, it can only be brought “in
the judicial district or similar legal entity… (A) in which such consumer signed the contract sued
upon; or (B) in which such consumer resides at the commencement of the action.” 15 U.S.C. §
1692i(a)(2). Ms. Wellington contends that there is no evidence showing that the contract, Note,
was signed in New Mexico. MTGLQ did not address this contention.
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The Court emphasizes that its conclusions in its Memorandum Opinion and Order (Doc. 97)
concluding that MTGLQ is a debt collector is not an evidentiary determination. Rather, in that
Memorandum Opinion and Order, the Court applied a Rule 12(b)(6) analysis to determine
whether Ms. Wellington sufficiently alleged that MTGLQ is a debt collector and whether it
violated the FDCPA.
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collection and foreclosure,” is contrary to MTGLQ’s standing to foreclose on the property.
(Doc. 1-1) at 4, ¶ 17.
Ms. Wellington fails to provide legal authority to support this argument. See D.N.M.LRCiv. 7.3(a) (“A motion, response or reply must cite authority in support of the legal positions
advanced.”). Instead, Ms. Wellington presents her renewed standing arguments as a matter of
logic. Perhaps there is logic in this argument, but the Court is not persuaded that clear error or
manifest injustice results from the conclusion that MTGLQ has shown standing to proceed on its
foreclosure claim. MTGLQ has shown standing to enforce the Note by attaching to the
Complaint a copy of Ms. Wellington’s Note and the Allonge to Note. See (Doc. 71) at 8.
Accordingly, the Court denies Ms. Wellington’s renewed standing arguments.
C. Ms. Wellington’s Rule 9(b) Argument
Ms. Wellington again raises her Rule 9(b) argument in her Motion for Reconsideration.
Ms. Wellington contends that the “Court also seems to re-write Rule 9(b) to exclude the
‘mistake’ language” based on the Court's analysis in its MOO (Doc. 71). Ms. Wellington asserts
that two of MTGLQ’s allegations in its Complaint are allegations of mistake:
12. The Mortgage was erroneously released by Mortgage Electronic Registration
Systems, Inc. by a Release of Mortgage recorded November 1, 2012 as Document No.
2012115594, with the office of the County Clerk of Bernalillo County.
13. The Mortgage was thereafter erroneously assigned from Mortgage Electronic
Registration Systems, Inc. as nominee for Profolio Home Mortgage Corporation, its
successors and assigns to JPMorgan Chase Bank, National Association by an Assignment
of Mortgage recorded November 13, 2012 as Document No. 2012115594, with the office
of the County Clerk of Bernalillo County.
(Doc. 1-1) at 3, ¶¶ 12 and 13.
While there may be legitimate disagreement about whether these allegations amount to
allegations of mistake, assuming that Rule 9(b) applies, the allegations are acceptable and need

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not be stricken. “At a minimum, Rule 9(b) requires that a plaintiff set forth the ‘who, what,
when, where and how’ of the alleged fraud.” U.S. ex rel. Sikkenga v. Regence Bluecross
Blueshield of Utah, 472 F.3d 702, 726-727 (10th Cir. 2006) (quoting Thompson v.
Columbia/HCA Healthcare Corp., 125 F.3d 899, 903 (5th Cir. 1997)). The allegations state
who: Mortgage Electronics Registration Systems, Inc.; what: erroneously released or assigned
the Mortgage; when: on November 1 and 13, 2012; where: recorded in Bernalillo County in the
state of New Mexico; and how: by transfer or release of the Mortgage. Accordingly, Ms.
Wellington’s renewed Rule 9(b) argument is unavailing.
Finally, Ms. Wellington argues that if the Mortgage was released then it is implied that
the Mortgage was satisfied, which “contradicts any claim of anything being owed.” (Doc. 74) at
4. Ms. Wellington fails to provide citation to legal authority for this argument and therefore the
Court does not consider it at this time. Local Rule 7.3(a).
For the foregoing reasons, the Court denies Ms. Wellington’s Motion to Reconsider.
(Doc. 74).

_________________________________
UNITED STATES DISTRICT JUDGE

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