Salley v. Bank of America et al
ORDER GRANTING 15 Defendant North Carolina Department of the Secretary of the State's Motion to Dismiss; GRANTING 18 Bank of America's Motion to Dismiss; GRANTING 21 Carrington's Motion to Dismiss; DENYING 25 Plaintiff's M otion for Summary Judgment; and DISMISSING AS MOOT 28 Carrington's Motion to Strike. The complaints against Bank of America and Carrington are dismissed without prejudice, and the complaint against the North Carolina Secretary of the State is dismissed with prejudice. Signed by US Chief District Judge James C. Dever, III, on 6/18/2014. Copy of order mailed to pro se plaintiff via US Mail. (Fisher, M.)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
VICTORIA S. SALLEY,
BANK OF AMERICA, N.A., et al.,
On October 28,2013, VictoriaS. Salley ("Salley" or "plaintiff'), who is proceeding prose,
filed a complaint against Bank of America, N.A. ("Bank of America"), Carrington Mortgage
Services, LLC ("Carrington"), and the North Carolina Department of the Secretary of State
(''NCSOS") (collectively, "defendants"), alleging violations of the Fair Debt Collection Practices
Act ("FDCPA"), 15 U.S. C. § 1692-1692p, the Racketeer Influenced and Corrupt Organizations Act
("RICO"), 18 U.S.C. § 1961-1968, and "United States Acts," as well as "SEC violations," mail
fraud, common-law fraud, trespass, conversion, unjust enrichment, and "illegal possession." See
Compl. [D.E. 1]. 1 Salley seeks $9,963,153.00 in damages. See id. 3.
In support of her claims, Salley's three-page complaint alleges only the following facts (at
best). On or about March 23, 2007, Salley obtained a loan for the purchase of real property located
at 110 Few Circle, Durham, North Carolina. Salley executed a promissory note (''the Note") and
In the caption of her complaint, Salley also cites the Real Estate Settlement Procedures Act
("RESPA"), 12 U.S.C. § 2601 et seq., the TruthinLendingAct ("TILA"), 15 U.S.C. § 1601 et seq.,
and the Home Ownership and Equity Protection Act ("HOEPA"), 15 U.S.C. § 1639. Salley's
complaint, however, does not mention these statutes. Thus, Salley has not asserted any claim for
relief pursuant to these statutes.
deed of trust (''the Deed") in favor of Bank of America, and Bank of America then securitized the
Note. See Compl. 1-2; [D.E. 19-1] (copy of the Deed). 2 From Salley's other filings, the court
gathers that Salley defaulted on her loan by September 2011, and that Bank of America foreclosed
on her property in 2013. See Resp. Opp'n Mots. Dismiss [D.E. 30] 1-2.
On November 25,2013, NCSOS moved to dismiss Salley's complaint based on Eleventh
Amendment immunity and pursuant to Federal Rule of Civil Procedure 12(b)(6) [D.E.l5]. On
December 4, 2013, and December 23, 2013, respectively, Bank of America and Carrington moved
to dismiss Salley's complaint pursuant to Federal Rules of Civil Procedure 8(a), 9(b), and 12(b)(6)
[D.E. 18, 21]. Pursuant to Roseboro v. Garrison, 528 F.2d 309, 310 (4th Cir. 1975) (per curiam),
the court notified Salley about the motions, the consequences of failing to respond, and the response
deadlines [D.E. 17, 20]. On December 30, 2013, Salley filed a motion for extension of time to file
a response to defendants' motions to dismiss [D.E. 23], which the court granted the next day [D.E.
On January 27,2014, Salley filed a motion for summary judgment [D.E. 25]. On January
30, 2014, Bank of America, Carrington, and NCSOS moved to stay certain pretrial deadlines, the
discovery period, and the deadline to respond to Salley's motion for summary judgment pending a
ruling on their motions to dismiss [D.E. 26]. On AprilS, 2014, the court granted defendants' motion
to stay [D.E. 31].
On February 10,2014, Carrington moved to strike Salley's motion for summary judgment
[D.E. 28]. On February 20, 2014, Salley filed additional evidence "pertinent to [her] case."
Because the Deed is a public record, the court may consider it without converting
defendants' motions to dismiss into motions for summary judgment. See,~. Philips v. Pitt Cnty.
Mem'l Hosp., 572 F.3d 176, 180 (4th Cir. 2009).
[D.E. 29]. On February 27, 2014, Salley responded to defendants' motions to dismiss [D.E. 30].
Salley's response to defendants' motions to dismiss is identical to her motion for summary judgment.
As explained below, thecourtgrantsdefendants' motions to dismiss [D.E. 15, 18, 21], denies
Salley's motion for summary judgment [D.E. 25], and dismisses as moot Carrington's motion to
strike [D.E. 28].
A motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure for "failure
to state a claim upon which relief can be granted" tests whether the complaint is legally and factually
sufficient. See Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009); Bell Atl. Corp. v. Twombly, 550
U.S. 544,562--63,570 (2007); Coleman v. Md. CourtofAru>eals, 626 F.3d 187, 190(4thCir. 2010),
aff'd, 132 S. Ct. 1327 (2012); Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008); accord
Erickson v. Pardus, 551 U.S. 89, 93-94 (2007) (per curiam). In considering a motion to dismiss, a
court need not accept a complaint's legal conclusions drawn from the facts.
U.S. at 678. Similarly, a court "need not accept as true unwarranted inferences, unreasonable
conclusions, or arguments." Giarratano, 521 F.3d at 302 (quotation omitted); see Iqbal, 556 U.S.
The legal sufficiency of a complaint depends, in part, on whether it meets the standards for
a pleading stated in Federal Rules of Civil Procedure 8 and 9. See Francis v. Giacomelli, 588 F.3d
186, 192 (4th Cir. 2009). Under Rule 8(a)(2), a complaint must contain "a short and plain statement
ofthe claim showing that the pleaderis entitled to relief." Fed. R. Civ. P. 8(a)(2). Rule 8(a)(2) aims
to assure that the defendant has adequate notice of the nature of the claims against it. See, ~.
Francis, 588 F.3d at 192. Under Rule 9(b), a party who alleges fraud must go a step further: the
party "must state with particularity the circumstances constituting fraud." Fed. R. Civ. P. 9(b).
Specifically, the party must allege ''the time, place, and contents of the false representations, as well
as the identity of the person making the misrepresentation and what he obtained thereby." Harrison
v. Westinghouse Savannah River Co., 176 F.3d 776, 784 (4th Cir. 1999) (quotation omitted); see
McCauleyv. Home Loanlnv. Bank.F.S.B., 710 F.3d 551,559-60 (4th Cir. 2013); United States ex
rei. Nathan v. Takeda Pharms. N. Am., 707 F.3d 451, 455-61 (4th Cir. 2013); Adkins v. Crown
Auto. Inc., 488 F.3d 225,231-32 (4th Cir. 2007); Dunn v. Borm, 369 F.3d 421,426-34 (4th Cir.
2004); United States ex rei. Harrison v. Westinghouse Savannah River Co., 352 F.3d 908, 921-22
(4th Cir. 2003); Riggs v. Orkin. Inc., No. 7:11-CV-5-D, 2011 WL 2417016, at *3 (E.D.N.C. June
13, 2011) (unpublished).
As for a complaint's factual sufficiency, a party must plead "enough facts to state a claim to
relief that is plausible on its face." Twombly, 550 U.S. at 570. "[N]aked assertions ofwrongdoing,"
devoid of "factual enhancement," cannot "cross the line between possibility and plausibility of
entitlement to relief." Francis, 588 F .3d at 193 (quotations omitted). A plaintiff armed with nothing
more than "labels and conclusions," or "a formulaic recitation of the elements of a cause of action,"
cannot proceed into the litigation process. Twombly, 550 U.S. at 555 & n.3; see Francis, 588 F.3d
Although a court must liberally construe a prose plaintiff's allegations, it "cannot ignore a
clear failure to allege facts" that set forth a cognizable claim. Johnson v. BAC Home Loans
Servicing. LP, 867F. Supp. 2d 766,776 (E.D.N.C. 2011); see Giarratano, 521 F.3dat304n.5. "The
special judicial solicitude with which a district court should view ... pro se complaints does not
transform the court into an advocate. Only those questions which are squarely presented to a court
may properly be addressed." Weller v. Dep't of Soc. Servs., 901 F.2d 387, 391 (4th Cir. 1990)
(quotation omitted). Every party-prose or otherwise-must comply with the Federal Rules of Civil
Procedure. See Iqbal, 556 U.S. at 678; Baldwin Cn1y. Welcome Ctr. v. Bro~ 466 U.S. 147, 152
(1984) (per curiam).
The court first addresses Bank of America's motion to dismiss [D.E. 18], which concerns
counts one through seven of Salley's complaint. Salley alleges that Bank of America violated the
FDCPA (four specific provisions) and RICO (generally), and committed "SEC violations," mail
fraud, common-law fraud, trespass, conversion, unjust enrichment, and "illegal possession." Compl.
2. In support of these numerous claims, however, Salley fails to put Bank ofAmerica on reasonable
notice of the substance of the dispute. 3 Specifically, in counts one through four, Salley alleges that
Bank of America violated the FDCPA, but fails to identify a specific debt or any specific activities
that Bank of America undertook to collect it. In count five, Salley alleges generally that Bank of
America engaged in "RICO violations" and "SEC violations," but fails to identify the specific
provisions ofRICO and the Securities Exchange Act that Bank ofAmerica allegedly violated. Salley
also alleges that Bank ofAmerica engaged in mail fraud and common-law fraud, but fails to give any
details concerning the alleged fraud. Cf. Fed. R. Civ. P. 9(b). In counts six and seven, Salley alleges
that Bank of America committed unjust enrichment, trespass, and conversion, but fails even to give
"a formulaic recitation of the elements of [these] cause[s] of action." Twombly, 550 U.S. at 555.
Salley also alleges that Bank of America engaged in "illegal possession," an unknown cause of
action under North Carolina law. Finally, Salley directs her numerous allegations in counts one
through seven at Bank of America and Carrington collectively. Salley, however, must distinguish
To the extent Salley provides more factual information in her response in opposition to
defendants' motions to dismiss [D.E. 30], Salley may not use her response to amend her complaint.
See,~. Car Carriers. Inc. v. Ford Motor Co., 745 F.2d 1101, 1107 (7th Cir. 1984) (collecting
cases); Ward v. Coastal Carolina Health Care, P.A., 597 F. Supp. 2d 567, 573 (E.D.N.C. 2009).
between the two defendants to state a claim against either one of them. See, ~' Southland Sec.
Cm:p. v. INSpire Ins. Solutions Inc., 365 F.3d 353, 365 (5th Cir. 2004); Magluta v. Samples, 256
F.3d 1282, 1284 (11th Cir. 2001) (per curiam); Banks v. Bosch Rexroth Corp., Civil Action No.
5:12-345-DCR, 2014 WL 868118, at *7 (E.D. Ky. Mar. 5, 2014) (unpublished); Chandler v.
Volunteers of Am.. Se .. Inc., Civil Action No. CV-12-S-3701-NW, 2013 WL 4058078, at *3 (N.D.
Ala. Aug. 12, 2013) (unpublished). In sum, Salley's complaint falls far short ofmeeting the pleading
standards in Rules 8 and 9. Accordingly, the court grants Bank of America's motion to dismiss
[D.E. 18] and dismisses the complaint against Bank of America without prejudice.
Alternatively, even if Salley's complaint did meet the pleading requirements of Rules 8(a)
and 9(b), her allegations fail to state a claim against Bank of America upon which relief can be
granted. In counts one through four, Salley alleges that Bank of America violated sections 1692g,
1692e, 1692f, and 1692a(6) of the FDCPA. To state a claim under the FDCPA, Salley must
plausibly allege that (1) she was the object of collection activity arising from a "consumer debt" as
defined by the FDCPA, (2) Bank of America is a "debt collector" as defined by the FDCPA, and (3)
Bank of America engaged in an act or omission prohibited by the FDCPA. See, ~' Boosahda v.
Providence Dane LLC, 462 F. App'x 331, 333 n.3 (4th Cir. 2012) (per curiam) (unpublished);
Johnson, 867 F. Supp. 2d at 776. Salley's FDCPA claims fail because Bank of America, as the
originator of Salley's mortgage loan, is not a "debt collector" subject to liability under the FDCPA.
[D.E. 19] Ex. A; see 15 U.S.C. § 1692a(6) ("The term 'debt collector' means any person ... who
regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be
owed or due another." (emphasis added)); id. § 1692a(6)(F) ("The term ['debt collector'] does not
include ... any person collecting or attempting to collect any debt owed or due or asserted to be
owed or due another to the extent such activity ... concerns a debt which was originated by such
person ....");Wilson v. Draper & Goldberg. P.L.L.C., 443 F.3d 373, 379 n.2 (4th Cir. 2006);
Nielsen v. Dickerson, 307 F.3d 623,634 (7th Cir. 2002); Perry v. Stewart Title Co., 756 F.2d 1197,
1208 (5th Cir. 1985); Scott v. Wells Fargo Home Mortg. Inc., 326 F. Supp. 2d 709, 717 (E.D. Va.
In count five, Salley alleges that Bank of America engaged in "RICO violations" and "SEC
violations" based on the "illegal securitization" of the Note. Compl. 2. Salley's allegations suffer
from at least three fatal flaws. First, assuming that Bank of America securitized the Note, such
securitization is lawful under the Deed, which contemplates future transfers or assignments. See
[D.E. 19-1] 13. Moreover, to the extent Salley claims that Bank of America's securitization of the
Note relieved her of her obligation to pay on it, courts have "consistently rejected" this claim.
Porterfield v. JP Morgan Chase Bank. Nat'l Ass'n, No. 4:13-CV-00128-BO, 2013 WL 5755499, at
*5 (E.D.N.C. Oct. 23, 2013) (unpublished) (quotation omitted) (collecting cases); see,~. Zapata
v. Wells Fargo Bank. N .A., No. C 13--04288 WHA, 2013 WL 64913 77, at* 1-2 (N.D. Cal. Dec. 10,
2013) (unpublished) (rejecting plaintiffs' "attempt to avoid foreclosure by attacking the mortgage
securitization process"); Bhatti v. Guild Mortg. Co., No. C11--0480JLR, 2011 WL 6300229, at *5
(W.D. Wash. Dec. 16, 2011) (unpublished) ("Securitization merely creates a separate contract,
distinct from the Plaintiffs' debt obligations under the Note, and does not change the relationship of
the parties in any way."). Second, Salley fails to state a federal civil RICO claim because she has
not plausibly alleged that Bank of America engaged in a "pattern of racketeering activity," an
"essential element in any RICO action." Menasco. Inc. v. Wasserman, 886 F.2d 681, 683 (4th Cir.
1989); see 18 U.S.C. §§ 1961(5), 1962; Traber v. Mortg. Elec. Registration Sys .. Inc., No.
1:11cv126, 2012 WL4088865, at *4-5 (W.D.N.C. Aug. 6, 2012) (unpublished), memorandum and
recommendation affirmed, 2012 WL 4089282, at *1 (W.D.N.C. Sept. 17, 2012) (unpublished).
Rather, Salley's allegations "center on a single business relationship which involved only one
alleged victim," and "[t]his type of alleged conduct ... [does not] serve to justify the imposition of
the enhanced penalties allowed under the RICO Act." Am. Bankers Ins. Co. of Fla.. Inc. v. First
Union Nat'l Bank ofN.C., 699 F. Supp. 1174, 1177-78 (E.D.N.C. 1988); see Menasco. Inc., 886
F .2d at 683. Finally, Salley fails to state a claim for "SEC violations" because there is no recognized
cause of action for general SEC violations.
In count five, Salley also alleges that Bank of America "failed to disclose a monetary gain
to [her][,] resulting in unjust enrichment[,] mail fraud[,] and fraud." Compl. 2. As for Salley's
mail-fraud claim, there is no private cause of action for violations of the federal mail-fraud statute,
18 U.S.C. § 1341. A plaintiff may enforce the federal mail-fraud statute only through a civil RICO
action. See,~' Ayres v. Gen. Motors Com., 234 F.3d 514, 519 n.8 (11th Cir. 2000); Official
Publ'ns. Inc. v. Kable News Co., 884 F.2d 664,667 (2d Cir. 1989); Laupot v. Berley, 865 F.2d 255,
1988 WL 131819, at *1 (4th Cir. 1988) (per curiam) (unpublished table decision). Salley, however,
fails to state a federal civil RICO claim against Bank of America because she has not plausibly
alleged that Bank of America engaged in a "pattern of racketeering activity." Moreover, even if
Salley had plausibly alleged that Bank of America committed two or more acts of mail fraud (she
has not), the Fourth Circuit counsels "cautio[n] about basing a RICO claim on predicate acts of mail
and wire fraud because it will be the unusual fraud that does not enlist the mails and wires in its
service at least twice." Al-Abood ex rei. Al-Abood v. El-Shamiri, 217 F.3d 225, 238 (4th Cir.
2000) (quotations omitted). As for Salley's common-law fraud claim, Salley fails not only to plead
fraud with particularity, but also to plausibly allege any of the essential elements of fraud under
North Carolina law. See,
Terry v. Terry, 302 N.C. 77, 83, 273 S.E.2d 674, 677 (1981).
Similarly, Salley fails to state an unjust-enrichment claim because she does not plausibly allege any
of the essential elements of that claim under North Carolina law. See,~. JPMorgan Chase Bank.
Nat'l Ass'n v. Browning, 750 S.E.2d 555, 559 (N.C. Ct. App. 2013).
Finally, in counts six and seven, Salley purports to state claims for trespass, conversion,
unjust enrichment, and "illegal possession" against Bank ofAmerica. Compl. 2. As discussed, there
is no cause of action for "illegal possession" under North Carolina law. Salley fails to state claims
for trespass, conversion, and unjust enrichment because Salley does not plausibly allege any of the
essential elements of those claims under North Carolina law.
Singleton v. Haywood Elec.
Membership Cotp., 357N.C. 623,627,588 S.E.2d 871,874 (2003) (trespass); Variety Wholesalers.
Inc. v. Salem Logistics Traffic Servs .. LLC, 365 N.C. 520, 523, 723 S.E.2d 744, 747 (2012)
(conversion); Browning, 750 S.E.2d at 559 (unjust enrichment).
As for Carrington's motion to dismiss [D.E. 21], Salley's allegations against Carrington are
identical to the ones she makes against Bank of America. See Compl. 2. Thus, Salley's allegations
against Carrington also do not meet the pleading standards in Rules 8 and 9. Alternatively, Salley
fails to state a claim against Carrington upon which relief can be granted. As for counts one through
four, Salley has failed to plausibly allege the essential elements of an FDCPA claim against
462 F. App'x at 333 n.3; Johnson, 867 F. Supp. 2d at 776.
Assuming without deciding that Carrington is a "debt collector'' subject to liability under the
FDCPA, Salley's claims fail because she does not identify a specific debt or any specific activities
Carrington took to collect it. See Compl. 2. 4 As for counts five through seven, these claims fail for
Whether a mortgage servicing company is a "debt collector" subject to liability under the
FDCPA turns on when it took the mortgage for servicing. If the mortgage servicing company took
the mortgage for servicing before default, it is not a "debt collector." In contrast, if the mortgage
servicing company took the mortgage for servicing after default, it is a "debt collector." See 15
U.S.C. § 1692a(6)(F)(iii); see,~. Schlosserv. Fairbanks Capital Cotp., 323 F.3d 534,536 (7th Cir.
2003) (collecting cases). Unlike Bank of America, Carrington does not argue that it is not a "debt
the same reasons the court discussed in evaluating Bank of America's motion to dismiss.
Accordingly, the court grants Carrington's motion to dismiss [D.E. 21] and dismisses the complaint
against Carrington without prejudice.
As for NCSOS' s motion to dismiss [D .E. 15], the Eleventh Amendment bars federal lawsuits
for damages against a state and its agencies, unless the state has waived its sovereign immunity or
Congress has abrogated that immunity. See U.S. Const. amend. XI; Kimel v. Fla. Bd. of Regents,
528 U.S. 62,72-73 (2000); Regents of the Univ. of Cal. v. Doe, 519 U.S. 425,429 (1997); Seminole
Tribe of Fla. v.
517 U.S. 44, 54 (1996); Will v. Mich. Dep't of State Police, 491 U.S. 58,
66 (1989); Edelman v. Jorrum, 415 U.S. 651, 663 (1974); Constantine v. Rectors & Visitors of
George Mason Univ., 411 F.3d 474,479 (4th Cir. 2005). NCSOS is an agency of the State ofNorth
Carolina, and Salley has not plausibly alleged that North Carolina has waived its sovereign immunity
and consented to this suit or that Congress has abrogated the state's immunity. Thus, the court grants
NCSOS 's motion to dismiss [D.E. 15] and dismisses the complaint against NCSOS with prejudice.
Alternatively, the court grants NCSOS's motion to dismiss pursuant to Federal Ru1e of Civil
Procedure 12(b)(6). In its entirety, Salley's sole claim against NCSOS reads: "Beginning on or
about September 6, 2013[,] North Carolina Department of the Secretary of State violated United
States Acts by refusing to set the Record by way of a pecuniary interest after receiving lawful money
at the Division of Cash Management." Compl. 2. Salley does not even seek a remedy against
NCSOS. See id. 2-3. Salley's vague allegations against NCSOS are insufficient to state a claim
upon which relief can be granted.
collector." See [D.E. 22] 9. Thus, the court assumes without deciding that Carrington took Salley's
mortgage for servicing after default and is a "debt collector." Salley's deficient complaint gives no
facts from which the court can discern Carrington's role in the dispute.
Finally, in light of its rulings on defendants' motions to dismiss, the court denies Salley's
motion for summary judgment [D.E. 25], and dismisses as moot Carrington's motion to strike
In sum, the court GRANTS defendants' motions to dismiss [D.E. 15, 18, 21], DISMISSES
WITHOUT PREJUDICE the complaint against Bank of America and Carrington, and DISMISSES
WITH PREJUDICE the complaint against NCSOS. The court also DENIES Salley's motion for
summary judgment [D.E. 25], and DISMISSES AS MOOT Carrington's motion to strike [D.E. 28].
SO ORDERED. This J.a day of June 2014.
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