Calizaire v. Mortgage Electronic Registration System, Inc. et al

Filing 33

MEMORANDUM AND ORDER, For the foregoing reasons, each of Calizaire's claims requires the court to abstain from exercising jurisdiction or fails to state a claim. Defendant's motion to dismiss is therefore granted. However, in light of Cali zaire's pro se status, the court grants him leave to amend. See Branum v. Clark 927 F.2d698,705(2d Cir 1991). Calizaire has thirty 30 days from the date of this Memorandum and Order to file to an amended complaint rehabilitating his eight clai ms are not just subject to Younger abstention; fraud, breach of contract, negligence, unjust enrichment, breach of the covenant of good faith and fail dealing, breach of fiduciary duty, HED, and wrongful foreclosure. The amended complaint must recite sufficient facts to make Calizaire's allegations plausible, and it will replace the original and first amended complaints.. Ordered by Judge Carol Bagley Amon on 3/6/2017. (Piper, Francine)

FulED

cIN CLERK'S OFFICE
U...., DISTRICT COURT E.D.N.Y.

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

----------------------------------------------------------x

ALLAN CALIZAIRE,

-.tr M)R D3 .2J9

*

BROOKLYN Q;TICE

Plaintiff,
-againstMORTGAGE ELECTRONIC REGISTRATION
SYSTEMS, INC., DEUTSCHE BANK
NATIONAL TRUST COMPANY, and OCWEN
LOAN SERVICING LLC,

NOT FOR PUBLICATION
MEMORANDUM & ORDER
14-CV-1542 (CBA) (SMG)

Defendants.

----------------------------------------------------------x
AMON, United States District Judge:

Plaintiff Allan Calizaire, proceeding pro se, brings this action against Mortgage Electronic
Registration Systems, Inc. ("MERS"); Deutsche Bank National Trust Company, as Trustee for the
Pooling and Servicing Agreement dated as of November 1, 2006 Securitization Asset Backed
Receivables LLC Trust 2006-FR4 ("Deutsche Bank"); and Ocwen Loan Servicing, LLC
("Ocwen") (collectively, "defendants"). 1 He alleges a range of wrongdoing by defendants in
connection with the transfer of his mortgage and subsequent foreclosure; some of his claims attack
the mortgage foreclosure proceedings directly, while others allege torts arising from those
proceedings. The Court now considers defendants' motion to dismiss Calizaire' s varied state law
claims. For the reasons set forth below, the motion to dismiss those claims is granted.
BACKGROUND

The Court assumes familiarity with the facts and background of this case, as set forth in
the earlier Memorandum and Order dismissing Calizaire's federal law claims, (see D.E. # 24), and
only recounts those facts relevant to the instant motion to dismiss. Calizaire defaulted on a

1

Calizaire named Fremont as a defendant in his original complaint, but as explained in the Court's earlier
Memorandum and Order dismissing Calizaire's federal law claims, Calizaire's actions subsequent to removal indicate
that he is not pursuing claims against Fremont. (See D.E. # 24 n.6.)

1

mortgage, and defendant Deutsche Bank subsequently initiated foreclosure proceedings against
Calizaire in New York Supreme Court; these proceedings are still pending. See Deutsche Bank v.
Calizaire, Index No. 6410/2013 (N.Y. Sup., Kings Cty). Calizaire thereafter filed this action, also
in state court, and defendants removed it to this Court.
Upon removal by defendants, Calizaire filed supplemental papers, which this Court has
construed as an amended complaint. 2 (See Am. Compl.) Calizaire's amended complaint raised
federal claims under the Truth in Lending Act ("TILA"), 15 U.S.C. § 1601 et seq., and the Real
Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. § 2601. (See id. at 14-16.) Calizaire
also asserted numerous state law claims in his original and amended complaints. Although his
filings are often unclear, it appears that almost all of Calizaire's state law claims stem from his
assertions that the assignment of his mortgage to Deutsche Bank was invalid for a number of
reasons, all of which render the state foreclosure proceeding commenced by Deutsche Bank
invalid. (Compl. at 2, 16; D.E. # 20 ("Pl. Opp.") at 1 (arguing that Deutsche Bank had "no
authority to bring about the foreclosure action because [it] is not the original Lender on the
promissory note.").) On this basis, Calizaire asserts claims for damages for wrongdoing in
connection with the foreclosure proceeding, including: (1) breach of contract, (Compl. ~~ 34-38);
(2) negligence, (id.~~ 39-44); (3) breach of the covenant of good faith and fair dealing,®:.~~ 5458); (4) breach of fiduciary duty,
(6) fraud, (Am. Compl.

~~

®:.

~~

59-68); (5) "wrongful foreclosure,"

80-81 ); (7) intentional infliction of emotion distress,

and (8) unjust enrichment, (Compl.

~~

®:.

~~

45-50);

®:. ~~ 18-19);

51-52). He further requests the following injunctive and

declaratory relief: (1) the Court "set aside" the foreclosure, (id. ~~ 69-75); (2) the Court "set aside"

2

Because Calizaire proceeds pro se, this Court considers both his original and his amended complaints together. See
Little v. Citv of New York, 13-CV-3813(JGK), 2014 WL 4783006, at *I (S.D.N.Y. Sept. 25, 2014) ("Because the
plaintiff is proceeding pro se, the Court will consider the Original Complaint and the Amended Complaint together as
the operative pleading.")

2

the sale of the subject property,

llih ~~ 76-81); (3) quiet title, (id.~~ 89-93; Am. Campi.~~ 92-

99); and (4) a "judicial declaration determining the respective rights and obligations of the parties"
with respect to the assignment of the mortgage, (Am. Compl.~~ 22-27).
In iyiay 2014, defendants filed a motion to dismiss all of Calizaire's claims. (D.E. # 14.)
On February 27, 2015, this Court dismissed Calizaire's federal law claims as time-barred, but
declined to exercise supplemental jurisdiction over his state law claims. (D.E. # 24 at 16.) Instead,
the Court asked defendants to provide additional information on the citizenship of defendant
Ocwen to establish whether there is diversity of the parties. (Id.) Defendants have demonstrated
diversity and renewed their motion to dismiss Calizaire's state law claims. (D.E. # 26.) Calizaire
has filed a response to defendants' motion to dismiss, (see D.E. # 28), but his entire submission
focuses on his objections to having this action removed from state court.
On May 18, 2016, the Court entered an Order to Show Cause. (D.E. # 29.) The Court
noted that all ofCalizaire's state law claims stem from the foreclosure proceedings initiated against
him in state court by Deutsch Bank-proceedings that still appear to be pending. (Id. at 3.) The
Court reasoned that although neither party moved the Court to abstain on any claims in this case,
the Court may do so sua sponte if circumstances require. (Id. at 4 (citing Bellotti v. Baird, 428
U.S. 132, 143 n.10 (1976)). Accordingly, the Court ordered the parties to show cause, in writing,
within thirty days why the abstention doctrine should not be applied to dismiss some or all of
Calizaire's remaining claims.

<ML.) Calizaire filed a response to the Court's Order to Show Cause

3

on June 2, 2016, but his response does not address abstention, instead offering general arguments
why his case should not be dismissed. (D.E. # 30.)

DISCUSSION
I.

Abstention
Here, there is a parallel state court proceeding-Deutsche Bank's foreclosure proceedings

against Calizaire in state court-which invites an abstention analysis. Abstention is a judicially
created doctrine born out of the notion that even where "a federal equity court does have
jurisdiction of a particular proceeding," it may abstain from exercising that jurisdiction out of
"proper regard for the rightful independence of state governments in carrying out their domestic
policy." Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 724 (1996) (internal quotation marks
omitted). Because abstention concerns the Court's jurisdiction, the Court will address it as a
threshold issue.

See Arar v. Ashcroft, 532 F.3d 157, 168 (2d Cir. 2008) ("Determining the

existence of subject matter jurisdiction is a threshold inquiry and a claim is properly dismissed for
lack of subject matter jurisdiction under Rule 12(b)(l) when the district court lacks the statutory
or constitutional power to adjudicate it." (internal citations and quotation marks omitted)).
The abstention doctrine set forth in Younger v. Harris, 401 U.S. 37, 91 (1971), and its
progeny preclude federal courts from interfering with ongoing state proceedings. As the Second
Circuit explained, "[t]he defining feature of Younger abstention is that even though either a federal
or a state court could adjudicate a given claim, when there is an ongoing state proceeding in which
the claim can be raised, and when adjudicating the claim in federal court would interfere unduly
with the ongoing state proceeding, the claim is more appropriately adjudicated in state court."
Kirschner v. Klemons, 225 F.3d 227, 236 (2d Cir. 2000).

4

In Sprint Communications, Inc. v. Jacobs, 134 S.Ct. 584 (2013), the Supreme Court held
that the Younger doctrine applies only to three classes of state court proceedings: (1) "state
criminal prosecutions," (2) "civil enforcement proceedings," and (3) civil proceedings that
"implicate a State's interest in enforcing the orders and judgments of its courts."

Sprint

Comm'cns, Inc., 134 S.Ct. at 588 (internal quotation marks omitted); see id. at 591 ("We have not
applied Younger outside these three 'exceptional' categories, and today hold ... that they define
Younger' s scope.").
Here, since the underlying state court case is not a criminal prosecution or a civil
enforcement proceeding, the Court must consider whether it is a "civil proceeding that implicates
a State's interest in enforcing the orders and judgments of its courts," id. at 588, and finds that it
is. Calizaire seeks injunctive and declaratory relief relating the same property that is the subject
matter of the underlying foreclosure action in state court. Furthermore, Calizaire's claims ask this
Court to interfere with ongoing state court proceedings by setting aside foreclosure proceedings
and the sale of the subject property, 3 and determining the rights and obligations of the parties with
respect to the subject property currently under the jurisdiction of the state court. Thus this case
falls within the third category of proceedings identified by the Supreme Court as appropriate for
abstention. See, e.g., Wenegieme v. US Bank Nat'l Ass'n, No. 16-CV-2634 (AMD), 2016 WL
3348539, at *2 (E.D.N.Y. June 9, 2016) (holding that Sprint applies where plaintiffs seek
injunctive relief relating to the same property that is the subject matter of an action pending in state
court); Abbatiello v. Wells Fargo Bank, N.A., No. 15-CV-4210 (SJF), 2015 WL 5884797, at *4
(E.D.N.Y. Oct. 8, 2015) (same); Clark v. Bloomberg, No. 10-CV-1263 (JG), 2010 WL 1438803,
at *2 (E.D.N.Y. Apr. 12, 2010) (finding that the Younger abstention doctrine barred plaintiffs

3

The Court notes that Calizaire's pleadings do not allege that there has been a sale of the subject property.

5

"claims to enjoin the foreclosure action and the eviction proceedings" where the state court actions
were pending); see also Taylor v. Jaquez, 126 F.3d 1294, 1297 (10th Cir. 1997) (emphasizing the
"important state interest" in "the enforcement of its method of registering good title to privately
owned lands within the state"). For these reasons, the Court declines to exercise jurisdiction over
Calizaire's claims for injunctive and declaratory relief.
The abstention principle established in Younger v. Harris does not require dismissal of
Calizaire' s claims for damages. Because Younger abstention focuses primarily on federal courts
interfering with and disrupting ongoing state proceedings, the Second Circuit has held that
abstaining from claims for money damages is inappropriate. See Kirschner, 225 F.3d at 238
("[W]e hold that Younger abstention is not appropriate with respect to Kirschner's claim for
money damages under § 1983 ... because it is a claim for money damages and not for declaratory
or injunctive relief."). The Court therefore has subject matter jurisdiction over Calizaire's claims
for damages and declines to apply the Younger abstention doctrine to these claims. The Court
will accordingly consider defendants' arguments to dismiss these remaining claims pursuant to
Federal Rule of Civil Procedure 12(b)(6).

II.

Sufficiency of the Pleadings
A. Standard of Review
To survive a Rule 12(b)(6) motion to dismiss, a complaint must allege "enough facts to

state a claim to relief that is plausible on its face." Bell Atlantic Coro. 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."
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Although "a complaint attacked by a Rule 12(b)(6)
motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the

6

grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do~" Twombly, 550 U.S. at 555 (internal
quotation marks, citations, and alterations omitted). Accordingly, in determining whether a claim
has "facial plausibility," a court accepts all factual allegations as true, but does not credit "mere
conclusory statements" or "[t]hreadbare recitals of the elements of a cause of action." Igbal, 556
U.S. at 678. '" [W]here the well-pleaded facts do not permit the court to infer more than the mere
possibility of misconduct,' ... dismissal is appropriate." Starr v. Sony BMG Music Entm't, 592
F.3d 314, 321 (2d Cir. 2010) (quoting Iqbal, 556 U.S. at 679).
The submissions of a pro se litigant "must be construed liberally and interpreted to raise
the strongest arguments that they suggest." Triestman v. Fed. Bureau of Prisons, 470 F.3d 471,
474 (2d Cir. 2006) (internal quotation marks and citations omitted); see also Harris v. Mills, 572
F.3d 66, 72 (2d Cir. 2009) ("Even after Twombly ... we remain obligated to construe a prose
complaint liberally."). A prose plaintiff must nonetheless "plead facts sufficient to state a claim
to relief that is plausible on its face." Teichmann v. New York, 769 F.3d 821, 825 (2d Cir. 2014)
(quoting Igbal, 556 U.S. at 678) (internal quotation marks omitted).
B. Fraud and Intentional Misrepresentation
Calizaire alleges "fraud and intentional misrepresentation" against all defendants, (Compl.
at 6), claiming that "[d]efendants have willfully concealed many facts ... especially with regard
to the loan modification plan." (Id.

~

29.) More specifically, Calizaire alleges that he "was not

informed by the Defendants that there are remedies available to them before the commencement
of the foreclosure proceedings."

(Id.~ 30.)

Calizaire then extends these allegations in his amended

complaint, claiming that the mortgage itself was issued "with motive to defraud the Plaintiff."

7

(Am. Compl.

~

79.) He also argues that "the alleged trustee has committed fraud upon all parties

by allowing a qualified endorsement to deprive the parties of their rights."

ilih ~ 35.)

Under New York law, to show fraud a plaintiff must demonstrate that "(l) the defendant
made a material false representation, (2) the defendant intended to defraud the plaintiff thereby,
(3) the plaintiff reasonably relied upon the representation, and (4) the plaintiff suffered damage as
a result of such reliance." Wall v. CSX Transp., Inc., 471 F.3d 410, 415-16 (2d Cir. 2006) (citation
omitted). It is well-settled that allegations of fraud must meet a "heightened pleading standard."
Rombach v. Chang, 355 F.3d 164, 167 (2d Cir. 2004). Under Federal Rule of Civil Procedure
9(b), a plaintiff must "state with particularity the circumstances constituting fraud or mistake."
For example, a "plaintiff must allege specific facts as to the fraud, including the misleading
statements, speaker, time, place, individuals involved, and specific conduct at issue." Johnson v.
Nextel Commc'ns, Inc., 660 F.3d 131, 143 (2d Cir. 2011).
Calizaire has not met the heightened pleading standard for fraud. To the extent he claims
the defendants provided inadequate information, the pleadings omit the requisite level of
specificity. See Fed. R. Civ. P. 9(b). Calizaire does not describe allegations that implicate all
defendants, how the omission of information amounted to a material misrepresentation, or in what
way Calizaire relied on that representation to his detriment. Similarly, to the extent Calizaire
argues that "the alleged trustee committed fraud upon all parties by allowing a qualified
endorsement to deprive the parties of their rights," (Am. Compl.

~

35), he fails to provide any

reasonably specific explanation of what this allegation means or why it constitutes fraud. Calizaire
claims only that "the alleged trustee failed in the fiduciary duties . . . by allowing the qualified
endorsement to be added to the alleged Note."

(Id.~

8

34.) This allegation is opaque to the Court

and is deficient under Rule 9(b) because it fails to describe why any of the four elements of fraud
are satisfied. 4 Calizaire' s claims of fraud are therefore dismissed.

C. Breach of Contract
Calizaire alleges that all of the defendants breached a contract-specifically because they
"failed to perform the promised services" and "breached one or more provisions under the subject
agreements and contracts." (Compl.

if 35.)

Under New York law, the elements of a breach of

contract claim include: "(1) the existence of an agreement, (2) adequate performance of the
contract by the plaintiff, (3) breach of contract by the defendant, and (4) damages." Harsco Com.
v. Segui, 91 F.3d 337, 348 (2d Cir. 1996).
Here, Calizaire merely states that "the defendant's conduct was a substantial factor in
causing the plaintiff irreparable harm in terms of depriving him from other modus operandi to set
aside foreclosure or loan modification by which they had breached the terms of the contract."
(Compl.

if 36.)

However, Calizaire does not identify which agreements were breached by this

conduct. 5 Even if the Court assumes that Calizaire' s breach of contract claims arise under the
mortgage, not all of the defendants are party to the mortgage, and Calizaire cannot allege that he
has adequately performed under the mortgage given that he is in default. Additionally, although

To the extent Calizaire seeks to claim fraud with respect to the issuance of the mortgage, ~ Compl. 'if 6), he raises
a claim against a party that has not been involved in this suit, ~ supra n.1 ). That claim is also likely time-barred.
Calizaire secured the loan on May 23, 2006, (D.E. # 24 at 1), and filed this action in state court on January 30, 2014,
(D.E. # 1 at 2). The delay between the issuance of the mortgage and the filing of his action is therefore nearly eight
years, but the statute of limitations for common law fraud claims in New York is six years, see Rosen v. Spanierman,
894 F.2d 28, 36 (2d Cir. 1990) {"The statute oflimitations on fraud claims in New York is the longer of(l) six years
from the date of the fraud, or (2) two years from the date the fraud was discovered or could have been discovered with
the exercise ofreasonable diligence." (citations omitted)). Even if Calizaire tried to argue that he only discovered the
fraud when he realized that he could not make his payments, he says he made his "monthly payments for a couple of
years," (Compl. 'if 8), before falling behind, (i!h 'if 9). He would therefore have discovered the alleged fraud sometime
around 2008, close to six years before filing this action.
s Presumably, Calizaire believes some section of the mortgage agreement has been violated by one or more of the
defendants, but he never indicates which provisions are relevant. Even outside of the section of his complaint on
breach of contract, he only appears to refer to other sources, such as "guidelines laid down by the Office of Comptroller
of Currency." (Comp I. 'if 30.)
4

9

Calizaire refers to various sources in other sections of his complaint, such as "guidelines laid down
by the Office of Comptroller of Currency," (Compl. ~ 30), the Court finds no evidence that such
sources have been incorporated into a contract between Calizaire and any of the defendants. As a
result, Calizaire' s claims for breach of contract are dismissed.
D. Negligence
Calizaire also alleges negligence against all defendants, claiming they failed to uphold a
duty of care to Calizaire by taking a series of steps that led to their initiation of foreclosure
proceedings. (Compl.

~~

39-44.) Calizaire points to defendants' alleged failure "to disclose to

the Plaintiff that it was foreclosing on Plaintiffs subject property, treating other defendants as
separate entity [sic] to confuse and mislead the Plaintiffs, preparing and recording false documents,
and foreclosing on the subject property without having the legal authority and/or proper
documentation to do so."

(Id.~

41.) In Calizaire's view, this list seems to comprise actionable,

negligent deficiencies in how defendants "servic[ed] the loan." (Id.)
The "traditional common law elements of negligence [are] duty, breach, foreseeability, and
causation." Tufariello v. Long Island R.R. Co., 458 F.3d 80, 87 (2d Cir. 2006). Yet "[w]here the
only duty owed to the plaintiff arises from a valid contract, a negligence claim does not lie."
Abraham v. Am. Home Mortgage Servicing. Inc., 947 F. Supp. 2d 222, 236 (E.D.N.Y. 2013)
(quoting Banco Indus. de Venezuela. C.A. v. CDW Direct, L.L.C., 888 F. Supp. 2d 508, 512
(S.D.N.Y. 2012)). To the extent Calizaire's allegations derive from the purported failure of
defendants to comply with a loan service agreement, a claim for negligence is unavailable to
Calizaire as a matter of law. Although Calizaire alleges that the defendants, "acting as Plaintiffs
lenders and servicers, owed a duty to exercise reasonable care and skill," (Compl. ~ 40), that is not
the case. "It is well settled under New York law that a lender is not in a fiduciary relationship with

IO

a borrower, and thus a lender does not owe a borrower any special duties." Abraham, 947 F. Supp.
2d at 236. Similarly, "a mortgage servicer owes no duty of care to a borrower." Best v. Bank of
Am .. N.A., No. 14-CV-6546 (JG) (LB), 2015 WL 5124463, at *7 (E.D.N.Y. Sept. 1, 2015).
Calizaire has therefore failed to plead the elements of negligence as to any defendant.

E. Unjust Enrichment
Calizaire also alleges unjust enrichment against all defendants. (Compl.

~~

51-53.) His

allegations on this claim are especially vague and conclusory, stating only that the "Foreclosing
Defendants [sic] have been unjustly enriched at the expense of the plaintiff." (Id.

~

52.) Under

New York state law, a claim for unjust enrichment "requires proof that (1) defendant was enriched,
(2) at plaintiffs expense, and (3) equity and good conscience militate against permitting defendant
to retain what plaintiff is seeking to recover." Briarpatch Ltd .. L.P. v. Phoenix Pictures. Inc., 373
F.3d 296, 306 (2d Cir. 2004).
Here, Calizaire has failed to articulate any specific theory under which any of the
defendants have been unjustly enriched at his expense, let alone how equity and good conscience
support his case to recover from defendants. For example, Calizaire does not appear to deny
receiving the loan, nor does he allege that he has paid back more than he owes; to the contrary, he
acknowledges having paid less. (Compl. ~ 9.) He therefore does not allege that any defendant has
recovered more than the amount dictated by the terms of the agreement, which could in theory
support a claim for unjust enrichment. See Tamir v. Bank of New York Mellon, No. 12-CV-4780
(DLI) (JO), 2013 WL 4522926, at *6 (E.D.N.Y. Aug. 27, 2013) (finding the absence of a threat of
double recovery decisive in an unjust enrichment claim brought by a plaintiff who was bound by
a mortgage and facing foreclosure).

11

Further, as noted above in connection with his negligence claim, Calizaire's relationship
with the defendants appears to be defined by agreements incident to the mortgage. To the extent
that is the case-and Calizaire does not clearly allege to the contrary-he "cannot state a plausible
unjust enrichment claim because ... a plaintiff cannot recover on an unjust enrichment theory
when a contract [such as a mortgage] governs the relationship between the parties." Pollak v. Bank
of Am., No. 12-CV-7726 (VB), 2013 WL 4799264, at *2-3 (S.D.N.Y. Aug. 27, 2013) (citing Beth
Israel Med. Ctr. v. Horizon Blue Cross & Blue Shield of New Jersey, Inc., 448 F.3d 573, 587 (2d
Cir. 2006)).

F. Breach of the Covenant of Good Faith and Fair Dealing
Calizaire alleges that each of the defendants breached the covenant of good faith and fair
dealing. (Compl.

~~

54-58.) The basis for Calizaire's claim appears to be that the defendants

failed to set aside foreclosure or provide him with a loan modification.

(Id.~

55.) He claims that

"[d]efendants had a duty of good faith and fair dealing in the performance and enforcement of
deed of trust, wherein the defendants had a discretionary power, affecting the rights of the plaintiff
to be informed about the loan modification plans and modus operandi to set aside the foreclosure
in cases pertaining to default, which was omitted by the defendants deliberately." (Id.)
It is well-settled that New York law "does not recognize a separate cause of action for

breach of the implied covenant of good faith and fair dealing when a breach of contract claim,
based upon the same facts, is also pied." Harris v. Provident Life & Accident Ins. Co., 310 F.3d
73, 81 (2d Cir. 2002). Courts in the Second Circuit have consistently dismissed claims for breach
of the implied covenant of good faith as "redundant where the conduct allegedly violating the
implied covenant of good faith is also the predicate for breach ... of an express provision of the
underlying contract." TVT Records & TVT Music, Inc. v. The Island Def Jam Music Gm., 244

12

F. Supp. 2d 262, 277 (S.D.N.Y. 2003); see also Alter v. Bogoricin, No. 97-CV-0662 (MBM), 1997
WL 691332, at *7 (S.D.N.Y. Nov. 6, 1997) ("[E]very court faced with a complaint brought under
New York law and alleging both breach of contract and breach of a covenant of good faith and fair
dealing has dismissed the latter claim as duplicative"). Consequently, a breach of the implied
covenant of good faith claim can survive a motion to dismiss "only if it is based on allegations
different than those underlying the accompanying breach of contract claim." Siradas v. Chase
Lincoln First Bank. N.A., No. 98-CV-4028 (MBM), 1999 WL 787658, at *6 (S.D.N. Y. Sept. 30,
1999).
Here, Calizaire' s claims for breach of contract and breach of the implied covenant of good
faith and fair dealing are both premised on the same conduct: defendants' failure to set aside the
foreclosure of the subject property and to provide Calizaire with a loan modification. 6 (Compare
Compl.

~

36 (breach of contract claim), with id.

~~

55-56 (breach of implied covenant of good

faith and fair dealing claim).) As a result, Calizaire's claim for breach of the covenant of good
faith and fair dealing is duplicative and must be dismissed.
G. Breach of Fiduciary Duty
Calizaire also brings a breach of fiduciary duty claim against all defendants. (Compl.
~~

59-68.) In the supporting allegations, Calizaire suggests that "Defendants owed Plaintiff a

fiduciary duty because a relationship of trust and confidence existed between them." (Id.

~

63.)

Calizaire argues that defendants breached this duty by failing to act toward him in "good faith,"
(id.

~~

61, 64 ), and claims unspecified damages as a result, (id. ~~ 66, 68).

6

Although New York law recognizes a duty to act in good faith in mortgage foreclosure proceedings, see N.Y.
C.P.L.R. § 3408(f); Bank of New York v. Castillo, 991 N.Y.S.2d 446, 448 (App. Div. 2d Dep't 2014), this is not a
mortgage foreclosure action and there is no apparent basis for any extra-contractual duties owed by defendants to
Calizaire.

13

"To state a claim for breach of fiduciary duty under New York law, a plaintiff must allege
'(1) the existence of a fiduciary relationship, (2) misconduct by the defendant, and (3) damages
directly caused by the defendant's misconduct."' Mosdos Chafetz Chaim. Inc. v. RBS Citizens,
N.A., 14 F. Supp. 3d 191, 206 (S.D.N.Y. 2014) (quoting Varveris v. Zacharakos, 973 N.Y.S.2d
774, 775 (App. Div. 2d Dep't 2013)). "[T]he legal relationship between a borrower and a bank is
a debtor-creditor relationship that in and of itself does not create a fiduciary relationship," Scott v.
Dime Sav. Bank of New York, FSB, 886 F. Supp. 1073, 1078 (S.D.N.Y. 1995) afrd, 101 F.3d
107 (2d Cir. 1996), but "a broker may take on a fiduciary duty by performing tasks and/or taking
on obligations beyond that of an independent broker or traditional middleman," Grimes v. Fremont
Gen. Coro., 933 F. Supp. 2d 584, 609 (S.D.N.Y. 2013).
As a general matter, "[t]he core of a fiduciary relationship is a higher level of trust than
normally present in the marketplace between those involved in arm's length business transactions."
Faith Assembly v. Titledge of N.Y. Abstract, LLC, 961 N.Y.S.2d 542, 553 (App. Div. 2d Dep't
2013) (internal quotation marks omitted). Calizaire has not alleged, and there is nothing in the
record to suggest, that his relationship with any of the defendants featured a "higher level of trust
than normally present." Id. Accordingly, Calizaire has not established that any of the defendants
owed him a fiduciary duty, so his claim for breach of fiduciary duty is dismissed.

H. Intentional Infliction of Emotional Distress
Calizaire alleges that all of the defendants are liable to him for intentional infliction of
emotional distress ("IIED"). (Compl.
... emotional distress,"
to [his] health," (id.

~

(id.~

~~

82-88.) He claims that he has suffered "considerable

83), and that his "mental agony and stress" have "been detrimental

84). He alleges that at least some of the actions of the defendants are

14

"extreme and outrageous." (Id.

~

86.) He also suggests some of the defendants' conduct was

designed to inflict emotional distress upon him. (See Am. Compl. ~ 19.)
In New York, "[t]he state law tort of intentional infliction of emotional distress has four
elements: (1) extreme and outrageous conduct, (2) intent to cause severe emotional distress, (3) a
causal connection between the conduct and the injury, and (4) severe emotional distress." Bender
v. City of New York, 78 F.3d 787, 790 (2d Cir. 1996). "The conduct must be 'so outrageous in
character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be
regarded as atrocious, and utterly intolerable in a civilized society."' Conboy v. AT&T Com., 241
F.3d 242, 258 (2d Cir. 2001) (quoting Stuto v. Fleishman, 164 F.3d 820, 827 (2d Cir. 1999)).
Between his original complaint and his amended complaint, Calizaire pleads each of the
four elements, (see Compl.

~~

82-88; Am. Compl. at 19), but his allegations do not identify the

outrageous conduct engaged in by each of the defendants. As with his other claims, the underlying
issue appears to be the foreclosure proceedings. (See CompI. ~ 13; Am. Compl. at 19.) Deutsch
Bank is the only defendant to have initiated a foreclosure proceeding against Calizaire, and
therefore the conduct underlying Calizaire' s emotional distress likely cannot be attributed to
MERS or Ocwen. If that is correct, the IIED claims against both of those defendants must therefore
fail.

If he is understood as raising an IIED claim against Deutsche Bank for foreclosing, none
of the conduct alleged by Calizaire is sufficient to satisfy the elements of IIED. Debt collection or
foreclosure-even when initiated improperly-will typically support an IIED claim only if
accompanied by other "loathsome conduct." Assocs. First Capital v. Crabill, 51 A.D.3d 1186,
1188 (N. Y. App. Div. 3d Dep't 2008). In the context of debt collection, that can manifest as the
aggressive pursuit of the debt using techniques that are "intended or likely to cause physical

15

illness." Long v. Beneficial Fin. Co. of New York, 39 A.D.2d 11, 13 (N.Y. App. Div. 4th Dep't
1972) (quoting Clark v. Assoc. Retail Credit Men of Washington, D.C., 105 F.2d 62, 67 (D.C. Cir.
1939)). Calizaire's complaint, in essence, is that Deutsch Bank has knowingly initiated foreclosure
proceedings without the right to do so.

This does not constitute the "outrageous conduct"

necessary to support an IIED claim. See Stuto, 164 F.3d at 828 (noting that many cases accepting
IIED claims involve "some combination of public humiliation, false accusations of criminal or
heinous conduct, verbal abuse or harassment, physical threats, permanent loss of employment, or
conduct contrary to public policy").
Additionally, Calizaire fails to plead the second element of an IIED claim sufficiently. He
claims the defendants "fraudulently attempted to foreclose ... with the specific intent of inflicting
emotional distress on the Plaintiff, such that Plaintiff would be so emotionally distress[ ed] and
debilitated that he would be unable to exercise legal rights in the property." (Am. Compl. at 19.)
This circular theory falls short of the Igbal plausibility standard because, even on Calizaire's
description, the underlying intent evinced by Deutsche Bank would be to assert a successful claim
to the property, and initiating a foreclosure proceeding would accordingly be necessary whether
or not doing so was expected to distress Calizaire.
Finally, although Calizaire describes experiencing emotional distress as a result of the
foreclosure, the degree of severity necessary to make out an IIED claim is quite significant, and
Calizaire has not climbed over the threshold. Grimes, 933 F. Supp. 2d at 612 ("[C]ourts have
generally found that an IIED claim will not lie in a case ... where a debt collection effort or a
foreclosure results in inconvenience, frustration, embarrassment, and stress, but not serious mental
anguish."). Calizaire is no doubt distressed, but he has alleged no specific facts to explain why he
has endured "serious mental anguish" above and beyond the legitimate stresses typically incident

16

to a foreclosure. Id. Calizaire's IIED claims therefore fail as to all defendants, and are dismissed
according! y.

I. Wrongful Foreclosure
Finally, Calizaire contends that the foreclosure was wrongful because "the Foreclosing
Defendants engaged in a fraudulent foreclosure of the Subject Property in which the Foreclosing
Defendants did not have the legal authority to foreclose." (Comp!. if 49.) In particular, he contends
that the mortgage note was improperly transferred and defendants did not fulfill their legal
obligations to Calizaire because they failed to inform him of other options to avoid foreclosure.
(Id.~~

46-48.) However, Calizaire has not alleged that there has been an entry of judgment of

foreclosure on the subject property or a sale; rather, records from the New York Supreme Court
indicate that foreclosure proceedings are still pending. Without a "factual basis supporting an
allegation of foreclosure, a cause of action for wrongful foreclose cannot survive." Pawaroo v.
Countrywide Bank, No. 09-CV-2924 (ARR) (SMG), 2010 WL 1048822, at *7 (E.D.N.Y. Mar. 18,
2010); see also Lezynski v. Kasprzyk, 119 N.Y.S. 2d 904, 905 (App. Div. 4th Dep't 1953) ("The
alleged wrong was completed upon the entry of the judgment of foreclosure and sale on August
28, 1933 and the cause of action [for wrongful foreclosure], if any, accrued at that time.").
Accordingly, Calizaire's wrongful foreclosure claim is dismissed.

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s/CBA