Elmore v. One West Bank FSB

Filing 8

ORDER granting 7 Motion to Dismiss for Failure to State a Claim. Signed by Chief Judge Jon Phipps McCalla on 12/11/2012. (McCalla, Jon)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION

ANTHONY ELMORE,
Plaintiff,
v.
ONE WEST BANK, FSB,
Defendant.

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2:12-cv-02280-JPM-cgc

ORDER GRANTING DEFENDANT’S MOTION TO DISMISS

Before the Court is Defendant One West Bank, FSB’s
(“Defendant”), Motion To Dismiss, filed October 15, 2012.

(ECF

No. 7.)
For the following reasons Defendant’s Motion is GRANTED.
I.

BACKGROUND
This case arises out of the attempted foreclosure of

Plaintiff’s home on 1035 Semmes Avenue, Memphis, Tennessee
38111.

(See Mem. Law Supp. Def.’s Mot. To Dismiss, ECF No. 7-1,

at 1.)
On February 24, 2012, Plaintiff Anthony Elmore
(“Plaintiff”) filed a Complaint, (ECF No. 1-1), against
Defendant in the Chancery Court for Shelby County, Tennessee,
alleging the following:

(1) Defendant overcharged Plaintiff on

fees and expenses; (2) Defendant gave Plaintiff inadequate and

misleading notice of the foreclosure; (3) the Deed of Trust
issued by Defendant was adhesive; (4) the Tennessee foreclosure
procedure violated Plaintiff’s due-process rights; (5) the
adjustable-rate mortgage was abusive; and (6) Defendant violated
the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C.
§§ 2601 et seq., in closing on Plaintiff’s home based on a
fraudulent loan.

(ECF No. 1-1.)

With the exception of RESPA,

Plaintiff did not refer to any cases or statutes in his
Complaint.

(Id.)

Defendant removed this action to federal

court on April 10, 2012.

(ECF No. 1.)

On October 15, 2012, Defendant filed its Motion To Dismiss
alleging that Plaintiff failed to state a claim upon which
relief can be granted.

(ECF No. 7.)

Defendant asserts that

Plaintiff’s Complaint fails to raise any facts that would give
rise to a valid cause of action against Defendant.

(ECF No. 7-1

at 1.)
Plaintiff did not file a response to Defendant’s Motion To
Dismiss within the time allowed under Local Rule 12.1(b) and
Federal Rule of Civil Procedure 6(d).
II.

STANDARD OF REVIEW

Pursuant to Federal Rule of Civil Procedure 12(b)(6), a
defendant may move to dismiss the plaintiff’s complaint for
“failure to state a claim upon which relief can be granted.”
Under Ashcroft v. Iqbal, 556 U.S. 662 (2009), and Bell Atl.
2

Corp. v. Twombly, 440 U.S. 544 (2007), a “civil complaint only
survives a motion to dismiss if it ‘contain[s] sufficient
factual matter, accepted as true, to state a claim to relief
that is plausible on its face.’”

Courie v. Alcoa Wheel & Forged

Prods., 577 F.3d 625, 629-30 (6th Cir. 2009) (quoting Iqbal, 556
U.S. at 678).

The complaint “must contain either direct or

inferential allegations with respect to all material elements of
the claim.”

Wittstock v. Mark A. Van Sile, Inc., 330 F.3d 899,

902 (6th Cir. 2003).
The court “may not dismiss a complaint for failure to state
a claim based on disbelief of the complaint’s factual
allegations.”

Allstate Ins. Co. v. LG&E Energy, LLC, 201 F.

App’x 311, 315 (6th Cir. 2006).

The court must instead

“construe the complaint in the light most favorable to the
plaintiff, accept all its allegations as true, and draw all
reasonable inferences in favor of the plaintiff.”

In re Travel

Agent Comm’n Antitrust Litig., 583 F.3d 896, 902-03 (6th Cir.
2009) (citation omitted).

The court, however, “need not accept

as true legal conclusions or unwarranted factual inferences
. . . and conclusory allegations or legal conclusions
masquerading as factual allegations will not suffice.”

Id. at

903 (citations omitted) (internal quotation marks omitted).
The court may not dismiss a “plaintiff’s complaint solely
because the plaintiff fails to respond to a Rule 12(b)(6) motion
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to dismiss.”

Allstate Ins. Co., 201 F. App’x at 315 (citing

Carver v. Bunch, 946 F.2d 451 (6th Cir. 1991)).

“[R]egardless

[of whether] an adverse party fails to respond” the court “is
required at a minimum, to examine the movant’s motion [to
dismiss] to ensure that he has discharged” his initial burden.
Carver, 946 F.2d at 454-55.
III. ANALYSIS
Defendant contends that Plaintiff has failed to assert
factual allegations sufficient to adequately plead a claim upon
which relief can be granted under Federal Rule of Civil
Procedure 8(a).

(See ECF No. 7 at 1.)

following in his Complaint:

Plaintiff asserts the

(1) Defendant overcharged Plaintiff

on fees and expenses; (2) Defendant gave Plaintiff inadequate
and misleading notice of the foreclosure; (3) the Deed of Trust
was adhesive; (4) the Tennessee foreclosure procedure violated
Plaintiff’s due process rights; (5) the adjustable-rate mortgage
was abusive; and (6) Defendant violated RESPA in closing on
Plaintiff’s home.

(ECF No. 1-1.)

As an initial matter, the Court finds that Plaintiff’s
Complaint as a whole is deficient, and fails to comply with the
pleading standard articulated in Twombly and Iqbal.

Plaintiff

fails to cite any federal or state cases or authority with the
exception of RESPA, in support of his assertions.

Additionally,

Plaintiff’s assertions are conclusory and fail to allege with
any specificity a violation of any particular state or federal
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law.

While the Court is not required to “distill any possible

argument which could be made based on the materials” provided by
the parties, Siler v. Webber, 443 F. App’x 50, 58 (6th Cir.
2011) (quoting Blue Cross & Blue Shield of Ala. v. Weitz, 913
F.2d 1544, 1550 (11th Cir. 1990)) (internal quotation marks
omitted), viewing the Complaint in the light most favorable to
Plaintiff, the Court will construe the Complaint to allege the
following claims arising from Defendant’s handling of the
mortgage on Plaintiff’s home:

breach of contract claims under

the Deed of Trust, a violation of Plaintiff’s due process
rights, and a violation of RESPA.1

Plaintiff’s claims are

discussed in turn.
A. Breach-of-Contract Claim
In order to establish a breach of contract claim under
Tennessee law, a Plaintiff must prove “(1) the existence of a
contract, (2) breach of the contract, and (3) damages [that]
flow from the breach.”

Hinton v. Wachovia Bank of Del. Nat.

Ass'n, 189 F. App'x 394, 398 (6th Cir. 2006) (alteration in
original) (quoting Life Care Ctrs. of Am., Inc. v. Charles Town
Assocs. Ltd., 79 F.3d 496, 514 (6th Cir. 1996)) (internal
quotation marks omitted).
Here, Plaintiff has not submitted the Deed of Trust or any
other documents in support of the existence of an enforceable
1

See, e.g., Peoples v. Bank of Am., No. 11-2863-STA, 2012 WL 601777, at *10
(W.D. Tenn. Feb. 22, 2012) (construing Plaintiff’s allegations in order to
address whether Plaintiff had met the pleading standard under Federal Rule of
Civil Procedure 8(a)).

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contract between himself and Defendant.

However, Defendant does

not dispute the existence of a contract between itself and
Plaintiff.

(See ECF No. 7; ECF No. 7-1.)

Assuming the contract

exists between Plaintiff and Defendant, the Court will address
the four possible contractual breaches that Plaintiff alleges in
his Complaint.
1. Inadequate and Misleading Notice
Under Tennessee Law a trustee must “strictly comply with
the . . . [foreclosure] notice terms set forth in a deed of
trust.”

Self Help Ventures Fund v. Robilio, No. W2009-00368-

COA-R3-CV, 2010 WL 2176093, at *6 (Tenn. Ct. App. June 1, 2010).
In this case, Plaintiff alleges that he received inadequate and
misleading notice of the foreclosure sale of his house.
No. 1-1 ¶ 5.)

(ECF

In support of this assertion, Plaintiff claims

that “the mortgage company had been accepting payments . . .
before, during and after the scheduled sale. . . . Plaintiff had
been involved with negotiations and payments with the loan
workout department of the defendant.”

(Id.)

Defendant argues that Plaintiff’s assertions are conclusory
and insufficient under Rule 8(a) because Plaintiff does not
identify when he received notice in comparison with when he
should have received notice, and does not identify any provision
in the Deed of Trust that Defendant has violated in providing
notice to Plaintiff.

(ECF No. 7-1 at 4.)

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The Court holds that Plaintiff has failed to state a claim
for breach of contract based on the Deed of Trust’s notice
provision.

Taking the pleadings as true, Plaintiff has not

asserted any facts that either directly or inferentially raise a
plausible claim that Defendant failed to give Plaintiff proper
notice under the Deed of Trust instrument.

Plaintiff did not

identify what notice was required or what notice was received.
Therefore Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s breach-of-contract claim based on inadequate or
misleading notice.
2. Overcharging
Plaintiff contends that Defendant has “run up” unexplained
charges and fees that are “excessive, duplicative, and have led
to further and additional defaults,” (ECF No. 1-1 ¶¶ 6, 12), and
that “half of what he owes are excessive bank fees and costs.”
(Id. ¶ 4.)

Defendant asserts that Plaintiff has failed to state

facts asserting any erroneous or excessive charges to his
account, and that Plaintiff instead states in a conclusory
manner that he was overcharged.

(ECF No. 7-1 at 3.)

The Court holds that Plaintiff has failed to state a claim
for breach of contract based on overcharging.

Taking the

pleadings as true, Plaintiff has not asserted any facts that
either directly or inferentially raise a plausible claim that
Defendant was overcharging Plaintiff.

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Plaintiff did not

identify a single charge or fee that he paid, let alone a charge
or fee that was excessive, duplicative, or abusive in any way.
Therefore, Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s breach-of-contract claim based on overcharging.
3. Abusive Adjustable-Rate Mortgage
Plaintiff asserts that the adjustable-rate mortgage was
abusive, and “resulted in a huge increase in the loan payment,
and further, that the loan from the outset was calculated to
result in a default through techniques such as front-loading
huge fees and also not including an escrow for the payment of
taxes and for the collection of insurance premiums.”
No. 1-1 ¶ 8.)
contention.

(ECF

Defendant does not address this particular

(See ECF No. 7-1.)

The Court holds that Plaintiff has failed to state a claim
for breach of contract based on the adjustable-rate mortgage.
Taking the pleadings as true, Plaintiff has not asserted any
facts that either directly or inferentially raise a plausible
claim that the adjustable-rate mortgage was abusive.

Plaintiff

did not identify either the mortgage rate, an increase in the
rate, or any other factors that would suggest that the
adjustable-rate mortgage was abusive.
Therefore Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s breach-of-contract claim based on the adjustablerate mortgage.

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4. Contract of Adhesion
Under Tennessee law, a contract of adhesion is defined as
“a standardized contract form offered to consumers of goods and
services on essentially a ‘take it or leave it’ basis.”
Buraczynski v. Eyring, 919 S.W.2d 314, 320 (Tenn. 1996) (quoting
Black’s Law Dictionary 40 (6th ed. 1990)) (internal quotation
marks omitted).

A contract of adhesion is enforceable unless

the contract is found to be unconscionable.

See id.

Plaintiff contends that the Deed of Trust issued by
Defendant is a contract of adhesion which that was “not
contemplated, read or negotiated by the parties.”
¶ 7.)

(ECF No. 1-1

Defendant notes that there has not been a single judicial

opinion invalidating the Deed of Trust instrument.

(ECF No. 7-1

at 4.)
The Court holds that Plaintiff has failed to state a claim
for breach of contract based on the contract being adhesive.
Taking the pleadings as true, Plaintiff has not asserted any
facts that either directly or inferentially raise a plausible
claim that the contract was one of adhesion, nor any facts that
would suggest the contract was unenforceable because it was
unconscionable.

The lone statement that the contract is one of

adhesion is insufficient under Federal Rule of Civil Procedure
8(a).

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Therefore, Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s claim for breach-of-contract claim based on the Deed
of Trust being a contract of adhesion.
B. Due-Process Claim
Plaintiff contends that the Tennessee procedure for
“foreclosure by a Trustee on the courthouse steps denies
citizens of rights they would otherwise [have] under due
process.”

(ECF No. 1-1 ¶ 7.)

Defendant asserts that “non-

judicial foreclosures have been allowed in [Tennessee] for
decades . . . and since those foreclosures are conducted by
private citizens, and not the government” the process does not
implicate Plaintiff’s constitutional due-process rights.

(ECF

No. 7-1 at 4.)
The Court holds that Plaintiff has failed to state a claim
for a violation of his due-process rights based on the Tennessee
foreclosure procedure exercised by Defendant.

“Foreclosure

claims do not sound in due process ‘in the absence of state
action.’”

Ike v. Quantum Serv. Corp., No. 11-02914, 2012 WL

3727132, at *6 (W.D. Tenn. Aug. 27, 2012) (quoting Peoples, 2012
WL 601777, at *10).

Taking the pleadings as true, Plaintiff has

not asserted state action in the foreclosure of Plaintiff’s
home.
Therefore, Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s due-process claim.

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C. RESPA Claim
Plaintiff alleges that Defendant violated RESPA because the
foreclosure was based on a loan that was fraudulent and
deceptive.

(ECF No. 1-1 ¶ 8.)

In support of his allegation,

Plaintiff asserts the following acts by Defendant:
A) No[t] revealing the true costs of servicing and
carrying the loan[;]
B) Not revealing the context or parameters of the loan
payment and what it might become over the history of
the loan; [and]
C) Hiding and/or not properly revealing the costs and
fees paid to obtain the loan.
(Id. ¶ 8.)
Defendant argues that Plaintiff’s assertions are
insufficient because “he does not identify a single aspect of
the loan application process that was predatory . . ., the cost
of the loan or why it was excessive.”

(ECF No. 7-1 at 4.)

The Court holds that Plaintiff has failed to state a claim
for a violation of RESPA.

RESPA includes several protections

for consumers, some creating a private cause of action, and some
not creating a private cause of action.

See Baptist v. Bank of

N.Y. Mellon, No. 09-2569-STA, 2010 WL 1539973, at *6 (W.D. Tenn.
Apr. 16, 2010).

Plaintiff here has not identified any

particular provision of RESPA that has been violated.
Additionally, Plaintiff has only offered conclusory statements
in support of his RESPA claim.

(See ECF No. 1-1 ¶ 8.)

Taking

the pleadings as true, Plaintiff has not asserted any facts that

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either directly or inferentially raise a plausible claim under
RESPA.
Therefore, Defendant’s Motion To Dismiss is GRANTED as to
Plaintiff’s RESPA claim.
IV.

CONCLUSION

For the foregoing reasons, Defendant’s Motion To Dismiss is
GRANTED.

Plaintiff’s claims are DISMISSED WITH PREJUDICE.

SO ORDERED, this 11th day of December, 2012.

s/ Jon P. McCalla
JON P. McCALLA
CHIEF U.S. DISTRICT JUDGE

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