Hopper v. Nationstar Mortgage, LLC

Filing 17

OPINION and ORDER: Denying 9 Motion to Dismiss for Failure to State a Claim. Signed on 9/20/16 by Judge Ann L. Aiken. (ljb)

UNITED STATES DISTRICT COURT
DISTRICT OF OREGON

GLENN E. HOPPER,

6: 16-cv-00884-AA
OPINION AND ORDER

Plaintiff,
v.
NATIONSTAR MORTGAGE, LLC,
Defendant.

AIKEN, Judge:
Plaintiff filed this action alleging a single violation of the Real Estate Settlement
Procedures Act (RESPA), 12 U.S.C. § 2601 et seq. Plaintiff seeks damages and attorney fees
relating to the alleged RESPA violation.

Defendant moves to dismiss plaintiffs' claims for

failure to state a claim on which relief may be granted. Fed. R. Civ. P. 12(b)(6). For the stated
reasons, defendant's motion is denied.
STANDARD
On a motion to dismiss under Fed. R. Civ. P. 12(b)(6), a complaint is construed in favor
of the plaintiff, and its well-pleaded factual allegations are taken as true. Daniels-Hall v. Nat 'l

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OPINION AND ORDER

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Educ. Ass'n, 629 F.3d 992, 998 (9th Cir. 2010). "[G]enerally, the scope of review on a motion to

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dismiss for failure to state a claim is limited to the Complaint." Id. The court may consider
documents if they are attached to the complaint or if the complaint "necessarily relies" on the
document. Id at 998-99. The court need not accept "conclusory" allegations, "unwarranted
deductions of fact, or unreasonable inferences." Id Instead, "for a complaint to survive a motion
to dismiss, the non-conclusory 'factual content,' and reasonable inferences from that content,
must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. United States

Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009). "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).

On February 2, 2006, Plaintiff opened a mortgage loan account for his principle residence

ii

5. Defendant is responsible for

servicing the mortgage loan account as the beneficial holder with the right to receive payments.
Compl.

ii 8.

Plaintiff alleges that on November 7, 2014 and December 12, 2014, he made two,

$1500 payments which defendant subsequently failed to properly apply to his mortgage loan
account. Compl. ii 11. Plaintiff further alleges that, as a result of defendant's failure to apply the
November and December payments, late fees and other fees were assessed on his mortgage loan
account. Compl. ii 13.
On February 18, 2016, plaintiff, by and through his counsel, sent a Qualified Written
Request (QWR) to defendant regarding his mortgage loan account. Compl.

ii

14. Plaintiffs

QWR notified defendant that plaintiff believed the servicing of the mortgage loan account was in
error. Compl. Ex. A. The QWR additionally requested that defendant conduct an investigation

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BACKGROUND

located at 3624 NE 45th St., Redmond, OR 97756. Compl.

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and make necessary corrections no later than the time provided under RESP A. Id. In the event
that defendant believed plaintiffs mortgage loan account was not in error, plaintiffs QWR
requested that information be provided describing why defendant believed the account was
correct. Id. Plaintiff alleges that defendant received the QWR on February 23, 2016. Compl.

if

15.

Plaintiff further alleges that defendant was required to notify plaintiff of receipt of his
QWR no later than March 1, 2016 and provide a substantive response no later than April 5, 2016.

Id. Plaintiff alleges that due to a lack of response, additional mailing fees were incurred along
with the denial of refinancing on the property, which resulted in an additional $800 per month in
missed savings. Comp!.

if 16-17. Plaintiff brought this action to recover damages for mailing

fees, the $800 monthly savings as well as damages for pain and emotional suffering. Compl.

if

27-31. Plaintiff also seeks attorney's fees. Compl. if 24.
DISCUSSION
Defendant moves for dismissal of plaintiffs claims, arguing that they fail as a matter of
law for two reasons. First, defendant argues that plaintiff is factually mistaken, because it sent a
letter in response to plaintiffs QWR. Second, defendant argues that plaintiff did not adequately
plead the plausibility of damages resulting from the alleged RESP A violation. For the following
reasons, both arguments are unconvincing at this stage of the proceedings and defendant's
motion to dismiss is denied.
Defendant's argument that a response was provided, thereby refuting plaintiffs claim, is
based on a letter dated April 4, 2016 ("Acknowledgment Letter"), referred to in Defendant's
Motion to Dismiss. See Deel. of Kristine E. Kruger, Ex. 1. However, the court generally cannot
consider documents outside of the Complaint in ruling on a motion to dismiss. The court may

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consider documents aside from the complaint when the documents are attached to the complaint,
the complaint "necessarily relies" on the documents, or the documents are matters of judicial
notice. See Daniels-Hall, 629 F.3d at 998.
Here, the Complaint alleges that "[ d]efendant failed to provide Plaintiff with
Acknowledgment of [plaintiffs QWR]," Compl. at if 7, and the Acknowledgement Letter is not
attached to the Complaint.
A complaint "necessarily relies" on a document if: "(1) the complaint refers to the
document; (2) the document is central to the plaintiffs claim; and (3) no party questions the
authenticity of the copy attached to the 12(b)(6) motion." Daniels-Hall, 629 F.3d at 998 (citing
Marder v. Lopez, 450 F.3d 445, 448 (9th Cir.2006)). The Acknowledgment Letter is not directly

referenced in the Complaint and the authenticity of the letter has been challenged by plaintiff.
Pl.'s Resp. in Opp'n at 5. For those reasons, the Complaint does not "necessarily rely" on the
Acknowledgment Letter and is not considered.
Moreover, none of the documents in this case have been the subject of judicial notice
and therefore the Acknowledgment Letter is not considered on those grounds.

Thus, the

Acknowledgment Letter is outside of the scope of the Complaint, and cannot be considered on a
motion to dismiss.
Finally, the court is not inclined to convert Defendant's Motion to Dismiss into a motion
for summary judgment. Under Rule 12(d): "If, on a motion under Rule 12(b)(6) or 12(c),
matters outside the pleadings are presented to and not excluded by the court, the motion must be
treated as one for summary judgment under Rule 56." Fed. R. Civ. P. 12(d). When a court
converts a Rule 12(b)(6) motion into a motion for summary judgment, "it must give the
nonmoving party an opportunity to respond." United States v. Ritchie, 42 F.3d 903, 907 (9th Cir.

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2003). This case has unresolved factual disputes over document authenticity and communication
timelines. Due to the early stage of this case, the court is not inclined to convert defendant's
motion.
Next, defendant argues that the Complaint fails to allege adequate facts which create the
plausibility of damages stemming from the purported RESP A violation. RESP A provides the
following damages provision:
Whoever fails to comply with any provision of this section shall be liable to the
borrower for each such failure in the following amounts: ... (A) any actual
damages to the borrower as a result of the failure; and (B) any additional
damages, as the court may allow, in the case of a pattern or practice of
noncompliance with the requirements of this section, in an amount not to exceed
$2,000.
12 U.S.C. § 2605(£)(1). A well-pleaded complaint under RESPA must contain allegations of
actual damages stemming from the conduct of the defendant. See Medrano v. Flagstar Bank,
FSB, 704 F.3d 661, 665 (9th Cir. 2012) ("If the servicer fails to respond properly to [a qualified

written request], the statute entitles the borrower to recover actual damages and, if there is a
'pattern or practice of noncompliance,' statutory damages ..."); Lettenrnaier v. Federal Horne
Loan Mortg. Corp., No. 11-156HZ, 2011WL3476648, at *12 (D. Or. Aug. 8, 2011).

Here, plaintiff adequately alleges factual content in his Complaint that allows the court to
draw the reasonable inference that defendant's alleged RESP A violation is the cause of
plaintiffs harm.

Plaintiff alleges: "Plaintiff would save approximately $800 per month by

refinancing the Property" and "[a]s a direct result of Defendant's Failure to Respond to QWR 1,
Plaintiff is unable to refinance the Property." Compl. at if 18. The loss of $800 per month due to
an inability to refinance qualifies as actual pecuniary damages. Taking all factual allegations in
the Complaint as true, it is reasonable to infer that defendant's failure to respond to plaintiffs
QWR may have adversely affected plaintiffs ability to refinance, resulting in financial harm.

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Thus, construing the facts alleged in favor of plaintiff, I find that he sufficiently alleges
defendant failed to comply with RESPA's response requirements resulting in actual damages.
CONCLUSION
Defendant's Motion to Dismiss (ECF No. 9) is DENIED.
IT IS SO ORDERED.
Dated this

_Jt2 day of September, 2016.

G.ue- GL0

Ann Aiken
United States District Judge

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