Smith v. Wells Fargo Bank, N.A. et al

Filing 8

Memorandum Opinion and Order dismissing this action. The court certifies, pursuant to 28 U.S.C. § 1915(a)(3), an appeal from this decision could not be taken in good faith. Signed by Judge Solomon Oliver, Jr on 1/25/2016. (D,M)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

DOUGLAS HOWARD SMITH,
Plaintiff,
v.
WELLS FARGO BANK, N.A., et al.,
Defendants.

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Case No.: 1:16 CV 08

JUDGE SOLOMON OLIVER, JR.

MEMORANDUM OF OPINION
AND ORDER

Pro se Plaintiff Douglas Howard Smith filed this action in the Lorain County Court of
Common Pleas against Wells Fargo Bank, N.A. (“Wells Fargo”), both individually and as trustee
for the Carrington Mortgage Trust, Series 2006-RFC1, the United States government, and the
Internal Revenue Service (“IRS”). In the Complaint, Plaintiff claims the Defendants conspired to
defraud him, in violation of 18 U.S.C. § 286, and 15 U.S.C. § 1602(aa). He also claims the
Defendants violated his constitutional rights. He seeks monetary damages. The United States
removed the action to federal court under 28 U.S.C. § 1442(a)(1).

Background
Plaintiff’s Complaint contains very few facts. It appears Plaintiff was having financial
difficulties and fell behind in his mortgage payments. He attempted to negotiate a modification of
his mortgage which would have allowed him to refinance the principal balance as well as all late
fees and costs, through a thirty-year mortgage at a competitive interest rate. Plaintiff also owed

delinquent taxes to the IRS. Rather than agreeing to the plan of refinancing, Wells Fargo consulted
the IRS about its tax liens and decided instead to file a foreclosure action in the Lorain County Court
of Common Pleas. Wells Fargo obtained a judgment of foreclosure, and subsequently purchased
the property at sheriff’s sale on November 25, 2015. The IRS took the money from the sale as a
payment toward his tax liability, and Wells Fargo retained title to the property. Plaintiff alleges
Wells Fargo and the IRS conspired together to deny him an amicable settlement which would have
saved his home.
Plaintiff asserts eight claims for relief. First, he contends Wells Fargo conspired to defraud
the IRS in violation of 18 U.S.C. § 286. He also contends Wells Fargo and the IRS violated the
Homeowner’s Equity Protection Act, 15 U.S.C. § 1602(aa) and Article I, Sec. 10 of the United
States Constitution. In addition, Plaintiff claims the Defendants violated his Fourth, Fifth, Seventh,
Eighth, Ninth, Tenth, and Fourteenth Amendment rights.

Standard of Review
While pro se pleadings are liberally construed, Boag v. MacDougall, 454 U.S. 364, 365
(1982) (per curiam); Haines v. Kerner, 404 U.S. 519, 520 (1972), the Court may dismiss an action
sua sponte if the Complaint is so “implausible, attenuated, unsubstantial, frivolous, devoid of merit,
or no longer open to discussion” as to deprive the Court of jurisdiction. Apple v. Glenn, 183 F.3d
477, 479 (6th Cir. 1999)(citing Hagans v. Lavine, 415 U.S. 528, 536-37 (1974)). The Court also
may dismiss an action sua sponte if the Court clearly lacks subject jurisdiction over the matters
presented in the Complaint. Id. Lack of subject matter jurisdiction is a non-waivable, fatal defect.
Von Dunser v. Aronoff, 915 F.2d 1071, 1074 (6th Cir.1990).

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Analysis
Plaintiff cannot bring his claims for alleged violations of his constitutional rights against
these Defendants. First, the United States, as a sovereign, cannot be sued without its prior consent,
and the terms of its consent define the Court’s subject matter jurisdiction. McGinness v. U.S., 90
F.3d 143, 145 (6th Cir. 1996). A waiver of sovereign immunity must be strictly construed,
unequivocally expressed, and cannot be implied. U.S. v. King, 395 U.S. 1,4 (1969); Soriano v. U.S.,
352 U.S. 270, 276 (1957).
The United States has not consented to suit in civil rights actions against itself or any of its
agencies. Civil rights claims against federal government Defendants must be brought, if at all, in
a Bivens1 action. Bivens creates a limited cause of action against individual federal government
officials acting under color of federal law for violation of the Plaintiff’s constitutional rights. The
United States, however, has not waived its sovereign immunity for Bivens actions brought against
the United States or its agencies. Berger v. Pierce, 933 F.2d 393, 397 (6th Cir. 1991)(stating that
a Bivens claim cannot be asserted against the United States government or its employees in their
official capacities). Plaintiff cannot maintain a Bivens action against the United States or the IRS.
In addition, Plaintiff cannot bring a civil rights action against Wells Fargo. Bivens provides
a cause of action against federal government employees acting under color of federal law. Wells
Fargo is not a United States government agency. Plaintiff cannot bring a Bivens claim against them.
Similarly, 42 U.S.C. § 1983 provides a cause of action against state government officials and
employees acting under color of state law. Generally to be considered to have acted “under color
of state law,” the Defendant must be a state or local government, government official or government

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Bivens v. Six Unknown Agents, 403 U.S. 388 (1971).
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employee. A private party may be found to have acted under color of state law to establish the first
element of this cause of action only when the party “acted together with or ... obtained significant
aid from state officials” and did so to such a degree that its actions may properly be characterized
as “state action.” Lugar v. Edmondson Oil Co., 457 U.S. 922, 937 (1982). A Defendant may also
be considered a state actor if the Defendant exercises powers traditionally reserved to a state.
Jackson v. Metropolitan Edison Co., 419 U.S. 345, 352 (1974). Wells Fargo is not a state agency,
nor did it exercise powers traditionally reserved for the state or act together with the state
government. Plaintiff cannot bring civil rights claims against Wells Fargo under 42 U.S.C. § 1983.
Plaintiff also asserts claims against Wells Fargo under 18 U.S.C.A. § 286. This statute
makes it a crime to conspire to defraud the United States. Only the United States Attorney can bring
criminal charges against a Defendant in federal court. This statute does not provide a private right
of action for a Plaintiff in a civil case. See Howard v. United States, No. 15-11901, 2015 WL
4243246 (E.D. Mich July 13, 2015)(finding no private right of action under 18 U.S.C. § 286);
Turner v. Welkal, No. 3:12 CV 915, 2014 WL 347815 (M.D. Tenn. Jan. 31, 2014)(same).
Finally, Plaintiff asserts a claim under 15 U.S.C.A. § 1602 (aa). This provision is in the
definition section of the Homeowner’s Equity Protection Act. It states: “The disclosure of an
amount or percentage which is greater than the amount or percentage required to be disclosed under
this subchapter does not in itself constitute a violation of this subchapter.” Plaintiff does not explain
how this statement is relevant to the limited facts presented in his case.

Conclusion
Accordingly, this action is dismissed. The Court certifies, pursuant to 28 U.S.C. §

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1915(a)(3), that an appeal from this decision could not be taken in good faith.2
IT IS SO ORDERED.
/S/ SOLOMON OLIVER, JR.
CHIEF JUDGE
UNITED STATES DISTRICT COURT

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28 U.S.C. § 1915(a)(3) provides:
An appeal may not be taken in forma pauperis if the trial court certifies that it is not
taken in good faith.
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