Geoffrion et al v. Nationstar Mortgage LLC
Filing
96
MEMORANDUM OPINION AND ORDER re 89 MOTION for Judgment as a Matter of Law , Motion to Alter or Amend Judgment, and Alternatively, Motion for New Trial and Brief in Support filed by Nationstar Mortgage LLC. Defendants Renewed Motion for Judgment as a Matter of Law, Motion to Alter or Amend Judgment, and Alternatively, Motion for New Trial (Dkt. #89) is hereby DENIED. Signed by Judge Amos L. Mazzant, III on 4/21/16. (cm, )
United States District Court
EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
DANIELLE GEOFFRION and
DARREN KASMIR
v.
NATIONSTAR MORTGAGE LLC
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Case No. 4:14-CV-350
Judge Mazzant
MEMORANDUM OPINION AND ORDER
Pending before the Court is Defendant’s Renewed Motion for Judgment as a Matter of
Law, Motion to Alter or Amend Judgment, and Alternatively, Motion for New Trial (Dkt. #89).
After considering the relevant pleadings and the relevant trial testimony and evidence, the Court
finds that Defendant’s motion for judgment as a matter of law is denied.
PROCEDURAL BACKGROUND
In the parties’ Joint Final Pretrial Order, Plaintiffs Danielle Geoffrion (“Geoffrion”) and
Darren Kasmir (“Kasmir”) (together, “Plaintiffs”) accuse Defendant Nationstar Mortgage LLC
(“Defendant” or “Nationstar”) of violating the Real Estate Settlement Procedures Act 12 U.S.C.
¶ 2605(e) (“RESPA”) (Dkt. #64 at p. 2). Plaintiffs allege that they sent Defendant Qualified
Written Requests (“QWRs”) for information regarding their Nationstar Mortgage Account (the
“Account”) on at least six occasions (Dkt. #64 at p. 3 n. 3). Plaintiffs allege that Defendant
“failed to provide information required by federal law.” (Dkt. #64 at p. 2). Plaintiffs “also sued
in equity to receive [an] accounting from Defendant.” (Dkt. #64 at p. 2). 1
Defendant maintains that Plaintiffs’ letter to Defendant “did not trigger any obligation
under the law[.]” (Dkt. #64 at p. 3). Defendant contends that “the communications Plaintiffs sent
1
Plaintiffs also brought a breach of contract claim against Defendant (Dkt. #64 at p. 2). Defendant asserted that
Plaintiffs breached their contract with Defendant, “prior to any alleged breach by Defendant” (Dkt. #64 at p. 3).
However, Plaintiffs dropped this claim before trial (Dkt. #89 at p. 1).
do not meet the statutory definition of QWRs, were not sent to the address to which such
requests must be sent to trigger an obligation to respond, and were overly broad, unduly
burdensome, and sought ‘discovery type’ information regarding Plaintiffs’ account.” (Dkt. #64 at
p. 3). Defendant also argues that “Plaintiffs have not been damaged in a fashion to entitle them
to recover damages in this lawsuit[.]” (Dkt. #64 at p. 3). Defendant further alleges that “the
accounting claim is not well-founded because there is no issue of sufficient complexity to justify
relief per that claim.” (Dkt. #64 at p. 3).
The trial began on September 9, 2015. On September 10, 2015, Defendant moved for
judgment as a matter of law as to the RESPA claim after Plaintiffs rested (Trial Tr. 9/10/15 at
92:6-94:10).
Defendant based the motion on its contention that the letters to which Defendant did not
respond did not constitute QWRs and that Defendant adequately responded to the December 16,
2013 communication that Plaintiffs sent (Trial Tr. 9/10/15 at 92:7-93:3). Defendant also asserted
that Plaintiffs failed to establish actual damages, and that mental anguish damages are not
recoverable under RESPA (Trial Tr. 9/10/15 at 93:4-94:10). Plaintiffs asserted that there was
adequate evidence for the jury to determine that the relevant communications constituted QWRs
(Trial Tr. 9/10/15 at 94:12-95:2). Plaintiffs also maintained that there was sufficient evidence
upon which a jury could base findings of actual damages and that RESPA provides for the
recovery of mental anguish damages (Trial Tr. 9/10/15 at 95:3-96:16).
On September 10, 2015, the jury rendered a verdict finding that Plaintiffs submitted
QWRs to Defendant on December 16, 2013 (the “December 16 Communication”), and on
January 3, 2014 (the “January 3 Communication”) (Dkt. #76 at p. 1). The jury also found that
Defendant failed to respond or provided an inadequate response to the January 3 Communication
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(Dkt. #76 at p. 2). The jury found that Plaintiffs were entitled to recover damages caused by
Defendant’s failure to respond to Plaintiffs’ written inquiry, in the amounts of $23,500 for
pecuniary loss and $151,500 for mental anguish that Plaintiffs suffered in the past (Dkt. #76 at p.
3). The jury verdict also stated that Defendant engaged in a pattern or practice of noncompliance
with the requirements of RESPA and that Plaintiffs were entitled to an accounting of the
Account (Dkt. #76 at pp. 4-5).
On October 12, 2015, Defendant filed its Renewed Motion for Judgment as a Matter of
Law, Motion to Alter or Amend Judgment, and Alternatively, Motion for New Trial (Dkt. #89).
On October 26, 2015, Plaintiffs filed their response (Dkt. #91). On October 30, 2015, Defendant
filed its reply (Dkt. #94).
FACTUAL BACKGROUND
At trial, Kasmir testified that he and Geoffrion moved to Los Angeles to pursue his career
in film (Trial Tr. 9/9/15 at 17:16-18:21). After about five years in the area, Plaintiffs began
looking to buy a home (Trial Tr. 9/9/15 at 18:22-19:3). Plaintiffs bought a house through a
conservatorship sale and then spent a considerable amount of time updating the home (Trial Tr.
9/9/15 at 19:7-22:24). In 2004, Plaintiffs refinanced the house because the property value had
increased and they wanted to put more finances into home improvements (Trial Tr. 9/9/15 at
22:25-23:8). In 2012, Plaintiffs moved to Houston because their niece was seriously ill (Trial Tr.
9/9/15 at 25:4-27:12, 82:22-84:1). The mortgage was assigned to a variety of companies over
several years, but it was eventually assigned from Bank of America to Defendant on July 1, 2013
(Trial Tr. 9/9/15 at 23:9-19).
Plaintiffs continued to make automatic payments to Bank of America until payments
were returned to them in October 2013 (Trial Tr. 9/9/15 at 28:22-29:22, 100:3-101:3). Plaintiffs
3
then tried to send payments to Defendant but the payments were sent back (Trial Tr. 9/9/15 at
29:23-30:16). In late October or early November 2013, Plaintiffs called Defendant and began
speaking with and sending faxes to a couple of different individuals within the company. Over
the next several weeks Plaintiffs spoke to different individuals within Nationstar on several
different occasions. See Trial Tr. 9/9/15 at 30:21-32:22 (Kasmir testified that he spoke with
someone named Carla who told him to contact her through her direct phone line and fax
number); Trial Tr. 9/9/15 at 39:7-17 (Kasmir testifying that when he tried calling Carla on the
direct phone line he was given, he instead spoke to someone named Adrian); Trial Tr. 9/9/15 at
43:15-44:12 (Kasmir stating that he spoke to someone named Garrett). Plaintiffs were told to
send documentation of their payments, which they did repeatedly because they were told that
their previous communications had not been received. See Trial Tr. 9/9/15 at 33:6-36:2 (Kasmir
explaining that he sent Carla an authorization for him to speak with Defendant’s employees
about the loan, bank records, and a request for clarification); Trial Tr. 9/9/15 at 36:3-38:2
(Kasmir stating that he never heard back from Carla and sent her another communication on
November 14, 2013); Trial Tr. 9/9/15 at 39:18-22 (Kasmir testifying that Adrian said that he saw
no records of any faxes being received, so he faxed Adrian on November 19, 2013).
Plaintiffs were assured that research was being done and that they would hear from
Defendant about the matter, only to hear nothing (Trial Tr. 9/9/15 at 33:6-36:2). Plaintiffs were
also told, by different people within Nationstar, that they were behind on their payments by
vastly different amounts. See Trial Tr. 9/9/15 at 44:13-45:4 (Kasmir stating that they were
initially told by Carla or Adrian that they were approximately $40,000 behind on payments);
Trial Tr. 9/9/15 at 43:15-44:12 (Kasmir explaining that Garrett told him that Plaintiffs were
$76,000 behind on their mortgage); Trial Tr. 9/9/15 at 44:10-13 (Kasmir testifying that Plaintiffs
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received a demand letter that stated that they owed $44,000). At one point Kasmir was informed
that an escrow account was attached to Plaintiffs’ mortgage because of property taxes, but
Plaintiffs were not given details about the escrow account (Trial Tr. 9/9/15 at 47:25- 50:19).
Kasmir stated that Plaintiffs hired an attorney, Sara Fendia (“Fendia”), to help them get
an answer about the amount that they owed on the mortgage, and why (Trial Tr. 9/9/15 at 52:2353:10). Fendia sent the December 16 Communication to Defendant, requesting an accounting of
the mortgage (Trial Tr. 9/9/15 at 53:17-55:19). Fendia then got a response in the form of a
packet of information (Trial Tr. 9/9/15 at 55:20-25).
Kasmir testified that the packet did not explain why Plaintiffs owed between $40,000 and
$75,0000, and it did not explain what happened with the escrow account and taxes (Trial Tr.
9/9/15 at 58:1-59:6). In fact, Kasmir stated that “this package led to more questions than it
answered.” (Trial Tr. 9/9/15 at 59:7-9). Even after meeting with Fendia, and going through the
packet with her, Plaintiffs still did not understand the contents of it (Trial Tr. 9/9/15 at 62:13-21).
Therefore, Fendia sent the January 3 Communication to Defendant (Trial Tr. 9/9/15 at 62:2264:19). Fendia continued to try to communicate with Defendant, but Defendant only responded
by sending Fendia refinance applications (Trial Tr. 9/9/15 at 65:23-70:11).
Plaintiffs testified that they would have leased the house while they were staying in
Houston to be with their niece, but that they were unable to because of the dispute over the
mortgage payment (Trial Tr. 9/9/15 87:8-90:14; 115:2-116:3). Kasmir also testified that
Plaintiffs still owned the house, that they had lived there for four months last year, and that they
had lived in the house for a few months the previous year (Trial Tr. 9/9/15 at 94:13-95:2).
Kasmir stated that they had not made a payment on the loan since 2013 and that Plaintiffs had
not paid taxes against the property for at least the last three years (Trial Tr. 9/9/15 at 95:11-17).
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Kasmir also said that Defendant had the right to pay taxes assessed against the property under the
security instrument (Trial Tr. 9/9/15 at 95:18-22).
Later in the trial, Fay Janati (“Janati), Defendant’s corporate respresentative, testified.
Janati testified that when she was deposed in April 2015, she was not aware of written policies
and procedures for determining whether a borrower’s letter qualified as a QWR (Trial Tr.
9/10/15 at 7:18-8:2). She also testified that she did not know the details of Defendant’s QWR
policy during her deposition, nor did she know if Defendant even had a written policy (Trial Tr.
9/10/15 at 8:13-20). She then said that since her deposition, she had done research and found out
that Defendant did have a policy for determining whether or not a letter qualifies as a QWR
(Trial Tr. 9/10/15 at 9:3-9:18). Janati conceded that the communications at issue in the current
case were sent in the fall of 2013, with the exception of one or two that were sent in January of
2014 (Trial Tr. 9/10/15 at 10:17-11:6).
Janati also conceded that the written policy that
Defendant eventually produced to Plaintiffs was published on April 6, 2015 (Trial Tr. 9/10/15 at
11:7-15). When asked whether she had previously stated that the policy was in effect in 2013,
Janati testified that during her deposition she was confused between “written policies” and “not
written policies” (Trial Tr. 9/10/15 at 11:16-13:1).
Janati then read from the transcript of her
deposition and conceded that when she was asked whether Defendant had a written policy in
place in December of 2013, she answered yes (Trial Tr. 9/10/15 at 13:2-6). Janati then testified
that Defendant had about 7,000 employees, that it was her job to attend the deposition, and that
Defendant had been aware of this lawsuit for almost a year and a half (Trial Tr. 9/10/15 at 13:1424).
Janati went on to testify that during her deposition, she did not know whether or not
Defendant responded to the January 3 Communication (Trial Tr. 9/10/15 at 15:6-17). After
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reading aloud her deposition testimony where she had previously stated that she did not know the
total amount of the loan as of November 25, 2013, Janati stated that there was too much for her
to remember (Trial Tr. 9/10/15 at 18:2-19:9).
Janati continued to discount her previous deposition testimony by arguing that there was
too much information for her to know the answers to several questions without reviewing the
relevant documentation, and that she was not sure she reviewed the necessary documentation
during the deposition (Trial Tr. 9/10/15 18:2-19:9, 20:5-22:8). Janati also testified that her
testimony was changing as a result of new information she had learned since her deposition
(Trial Tr. 9/10/15 at 9:3-18, 22:9-22:23, 58:21-59:15).
Janati also asked to re-review
documentation so she could determine if her answers during the deposition were right or wrong
(Trial Tr. 9/10/15 at 24:9-26:7). Janati’s testimony revealed that she could have accessed or
brought the documents that she was requesting to trial (Trial Tr. 9/10/15 at 27:23-34:1).
Upon further questioning, Janati stated that while she had been unsure during her
deposition about whether the January 3 Communication was a QWR, she was now sure that it
was not a QWR because she had done further research (Trial Tr. 9/10/15 at 58:15-59:15). When
asked by the Court how she did not know whether the communications at issue qualified as
QWRs during her deposition, Janati only answered, “I’m sorry” (Trial Tr. 9/10/15 at 59:1660:5).
When questioned further, Janati answered, “We do have a --- I am not Customer
Relation” (Trial Tr. 9/10/15 at 60:6-60:8). After further questioning from the Court about why
her testimony had changed, Janati finally testified that it was based on a conversation she had
with “somebody who works for Customer Relationship[.]” (Trial Tr. 9/10/15 at 60:9-61:6).
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LEGAL STANDARD
“A motion for judgment as a matter of law . . . in an action tried by jury is a challenge to
the legal sufficiency of the evidence supporting the jury’s verdict.” Ford v. Cimarron Ins. Co.,
Inc., 230 F.3d 828, 830 (5th Cir. 2000) (quoting Jones v. Kerrville State Hosp., 142 F.3d 263,
265 (5th Cir. 1998) (quoting Harrington v. Harris, 118 F.3d 359, 367 (5th Cir. 1997)) (internal
citations omitted). Judgment as a matter of law is only appropriate when “a reasonable jury
would not have a legally sufficient evidentiary basis to find for the party on that issue.” FED. R.
CIV. P. 50(a). “If the court does not grant a motion for judgment as a matter of law made under
Rule 50(a), the court is considered to have submitted the action to the jury subject to the court’s
later deciding the legal questions raised by the motion.” FED. R. CIV. P. 50(b). Therefore, a
movant may file a renewed judgment as a matter of law, which may include an alternative or
joint request for a new trial under Rule 59, “[n]o later than 28 days after the entry of judgment.”
Id.. “[A] jury verdict must be upheld, and judgment as a matter of law may not be granted,
unless ‘there is no legally sufficient evidentiary basis for a reasonable jury to find as the jury
did.’” Fractus, S.A. v. Samsung Elec. Co., Ltd., 876 F. Supp. 2d 802, 813 (E.D. Tex. 2012)
(citing Hiltgen v. Sumrall, 47 F.3d 695, 700 (5th Cir. 1995)). The jury’s verdict must be
supported by “substantial evidence” in support of each element of the claims. Am. Home
Assurance Co. v. United Space All., 378 F.3d 482, 487 (5th Cir. 2004).
“A court reviews all evidence in the record and must draw all reasonable inferences in
favor of the nonmoving party; however, a court may not make credibility determinations or
weigh the evidence, as those are solely functions of the jury.” Fractus, 876 F. Supp. 2d at 813;
see Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150-151 (2000). “The moving
party is entitled to judgment as a matter of law, ‘only if the evidence points so strongly and so
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overwhelmingly in favor of the [] moving party that no reasonable juror could return a contrary
verdict.’” SSL Servs., LLC v. Citrix Sys., Inc., 940 F. Supp. 2d 480, 486 (E.D. Tex. 2013)
(quoting Porter v. Epps, 659 F.3d 440, 445 (5th Cir. 2011) (alteration in original, citation
omitted).
“The court may, on motion, grant a new trial on all or some of the issues[.]” FED. R. CIV.
P. 59(a)(1). “[I]f the trial judge is not satisfied with the verdict of a jury, he has the right—and
indeed the duty—to set the verdict aside and order a new trial.” Smith v. Transworld Drilling
Co., 773 F.2d 610, 613 (5th Cir. 1985) (citation omitted). In ruling on a motion for new trial, the
jury’s verdict may not be lightly set aside. See Ellis v. Weasler Eng’g, Inc., 258 F.3d 326, 343
(5th Cir. 2001) (“[C]ourts ‘must attempt to reconcile the jury’s findings, by exegesis, if
necessary, before we are free to disregard the jury’s verdict and remand the case for a new
trial.’”). “In considering whether the seemingly inconsistent verdicts may be reconciled, the
court must view the evidence in the light most favorable to upholding the jury’s decision by a
finding of consistency.” Id.; see Hiltgen, 47 F.3d at 701.
A Rule 59(e) motion “calls into question the correctness of a judgment.” Templet v.
HydroChem Inc., 367 F.3d 473, 478 (5th Cir. 2004) (quoting In re Transtexas Gas Corp., 303
F.3d 571, 581 (5th Cir. 2002)). The Fifth Circuit “has held that such a motion is not the proper
vehicle for rehashing evidence, legal theories, or arguments that could have been offered or
raised before the entry of judgment.” Id. at 479 (citing Simon v. United States, 891 F.2d 1154,
1159 (5th Cir. 1990)). A motion to alter or amend judgment may be granted on grounds
including: (1) an intervening change in controlling law; (2) the availability of new evidence not
previously available; or (3) the need to correct clear error or manifest injustice. See In re
Benjamin Moore & Co., 318 F.3d 626, 629 (5th Cir. 2002). Although courts have a great deal of
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discretion in ruling on a 59(e) motion, it is “an extraordinary remedy that should be used
sparingly[.]” Templet, 367 F.3d at 479.
ANALYSIS
The January 3 Communication
In its motion, Defendant seeks judgment as a matter of law because,
[t]he sole violation of the Real Estate Settlement Procedures Act (“RESPA”) upon
which the Court’s judgment against Nationstar rests is refuted by the plain
language of the statute and undisputed evidence; and [e]ven accepting the jury’s
finding of a RESPA violation, Plaintiffs failed to present any competent evidence
of damages resulting from that single violation.
(Dkt. #89 at p. 1). Defendant maintains that “[t]hese two independent grounds require entry of a
take-nothing judgment in favor of Nationstar.” (Dkt. #89 at p. 1).
Defendant claims that the January 3 Communication is not a QWR under RESPA
because it was faxed and because it was not sent by mail to the QWR office and address that
were clearly and properly designated (Dkt. #89 at p. 10). A QWR is defined as,
a written correspondence, other than notice on a payment coupon or other
payment medium supplied by the servicer, that — (i) includes, or otherwise
enables the servicer to identify, the name and account of the borrower; and (ii)
includes a statement of the reasons for the belief of the borrower, to the extent
applicable, that the account is in error or provides sufficient detail to the servicer
regarding other information sought by the borrower.
12 U.S.C. § 2605(e)(1)(B). A loan servicer must respond to a QWR only if it seeks “information
relating to the servicing of [the] loan.” 12 U.S.C. § 2605(e)(1)(A). The term “servicing” is
defined as “receiving any scheduled periodic payments from a borrower pursuant to the terms of
any loan, including amounts for escrow accounts . . . and making the payments of principal and
interest and such other payments with respect to the amounts received from the borrower as may
be required pursuant to the terms of loan.” 12 U.S.C. § 2605(i)(3).
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In order to protect consumers, RESPA imposes limited timeframes for loan servicers to
respond to inquiries from borrowers. Therefore, “[t]o aid servicers with this task of providing
consumers with timely information, RESPA’s implementing regulations allow (but do not
require) servicers to establish a designated address for QWRs.” Roth v. CitiMortgage Inc., 756
F.3d 178, 181 (2d Cir. 2014) (quoting 24 C.F.R. § 3500.21(e)(1) (“By notice either included in
the Notice of Transfer or separately delivered by first-class mail, postage prepaid, a servicer may
establish a separate and exclusive office and address for the receipt and handling of qualified
written requests.”)). Where a servicer complies with the notice requirements for designating an
exclusive QWR office and address, a letter sent to a different office and address is not considered
a QWR under RESPA. Id. at 182; see Berneike v. CitiMortgage, Inc., 708 F.3d 1141, 1145 (10th
Cir. 2013); Allen v. Dovenmuehle Mortg., Inc., No. 3:13–CV–4710, 2014 WL 3579812, at *8
(N.D. Tex. July 21, 2014); Steele v. Green Tree Servicing, LLC, No. 3:09-CV-0603-D, 2010 WL
3565415, at *3 (N.D. Tex. Sept. 7, 2010), aff’d sub nom. Steele v. Green Tree Servicing, L.L.C.,
453 F. App’x. 473 (5th Cir. 2011). Stated another way, where the servicer has established a
separate and exclusive office and address for the receipt and handling of QWRs, that servicer’s
duty to respond is triggered only if the borrower sends his or her written request to the
designated office and address. Berneike, 708 F.3d at 1148-1149; see Roth, 756 F.3d at 181 (“[I]f
a servicer establishes a designated QWR address, then the borrower must deliver its request to
that office in order for the inquiry to be a ‘qualified written request.’”) (citation omitted).
Defendant argues that the January 3 Communication is not a QWR because it was faxed
and not sent by mail (Dkt. #89 at p. 5). Defendant argues that faxing a letter to a servicer that
has properly designated a QWR office and mailing address does not trigger the servicer’s
RESPA duties, even if the servicer actually received the fax. Berneike, 708 F.3d. at 1147; see
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also Bally v. Homeside Lending, Inc., No. 02 C 5799, 2005 WL 2250856, at *2-3 (N.D. Ill. Sept.
8, 2005) (holding that lender’s RESPA duty to respond was not triggered by letters faxed to its
office, even if lender actually received the letters, where lender had stated that qualified written
requests must be sent by mail to a specific address). Defendant points out that its mortgage
statement does not provide a fax number for the receipt of QWRs (Dkt. #89 at p. 6). Therefore,
Defendant argues that the January 3 Communication does not qualify as a QWR and does not
trigger Defendant’s duties under RESPA.
Plaintiffs point out that “[Plaintiffs] mailed another copy of the [January 3
Communication] to Nationstar’s ‘exclusive address’ via certified mail on January [18], 2014 in
compliance with RESPA.” (Dkt. #91 at p. 4). A copy of the certified mail envelope that is dated
January 18, 2014 (the “January 18 Envelope”), was admitted into evidence (Dkt. #91 at p. 4;
Plaintiffs’ Ex. 16). Defendant responds that there is not sufficient evidence to support a jury
finding that the January 3 Communication was enclosed in the January 18 Envelope (Dkt. #94 at
p. 4-5).
Defendant relies solely on testimony from Fendia’s examination in support of its
contention that “the record is less than clear that the [January 3 Communication] was in fact
included in [the January 18 Envelope].” (Dkt. #94 at p. 4). 2 However, Defendant fails to note
that the exhibits themselves support a finding that the January 3 Communication was enclosed in
the January 18 Envelope (Plaintiffs’ Exs. 14-16). Indeed, the communication that was sent on
January 17, 2014 (the “January 17 Communication”) states that the original was being sent via
certified mail, includes a complete copy of the January 3 Communication, and includes the copy
of the January 3 Communication in its ‘total number of pages’ count that was on the January 17
2
Fendia stated during her testimony that she sent “a letter” on January 3, 2014, and on January 17, 2014 (Trial Tr.
9/10/15 at 85:25-86:11).
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Communication’s cover sheet (Plaintiffs’ Ex. 15). Additionally, Fendia testified that “Plaintiffs’
Exhibit 15 . . . was sent by fax, but also sent by . . . Certified Mail[.]” (Trial Tr. 9/10/2015 at
120:16-19). When viewing the evidence in favor of the nonmovant, the Court finds that there
was sufficient evidence presented at trial to uphold a jury’s finding that the January 3
Communication was included in the January 18 Envelope, and thus it is not disqualified from
being considered a QWR, because it was sent by proper means.
Defendant argues that even if the January 3 Communication was included with the
January 17 Communication and was sent via certified mail, “the jury expressly found that the
[January 17 Communication] was not a QWR.” (Dkt. #94 at p. 4). However, it is important to
note that the January 17 Communication was considered separately and distinctly from the
January 3 Communication.
Therefore, it is likely that the jury found that the January 17
Communication was repetitive of the January 3 Communication and therefore only the January 3
Communication constituted a QWR. Although the evidence could support a finding that the
January 3 Communication was sent with the January 17 Communication, that does not mean, and
Defendant does not argue, that it was improper for the jury to consider the two communications
enclosed in the certified envelope as separate communications. 3
Defendant also argues that the January 3 Communication is not a QWR because it was
addressed and sent to an individual instead of being addressed and sent to “Attn: Customer
Relations Officer” (Dkt. #89 at p. 6). The January 3 Communication was addressed to and faxed
to “Michael Ferrera” (Dkt. #89 at p. 6). Defendant asserts that even accepting Plaintiffs’
3
Defendant comments in its reply that “Plaintiffs cite no authority for the proposition that, when a communication
initially fails to meet the statutory requirements of a QWR, it can be revived if it is attached to a subsequent
communication that is a valid QWR. Fortunately, the Court need not decide that issue . . .” (Dkt. #94 at p. 2).
However, Defendant misconstrues the issue. The issue is not whether one communication can “revive” another, but
whether two separate communications can be considered individually although they are sent within the same
envelope. Defendant cites no case law establishing that just because a later communication that is repetitive of an
earlier communication is included in the same envelope as the earlier communication, the earlier commination is no
longer able to be considered a QWR.
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testimony that they were informed to communicate with Michael Ferrera, it is undisputed that
Defendant never indicated that it would receive QWRs at any office or address other than those
designated on the mortgage statements (Dkt. #89 at p. 6).
Defendant argues that the current case is similar to Steele. 2010 WL 3565415. In Steele,
“subsequent correspondence sent to the borrowers indicated they could contact the servicer or its
attorneys at other addresses, but the servicer never indicated that it would receive QWRs at any
other address.” (Dkt. #89 at p. 6) (citing Steele, 2010 WL 3565415 at *3). The Steele court held
that the “other addresses and telephone numbers” were merely “informal avenues to obtain other
information.” Steele, 2010 WL 3565415 at *3. Therefore, they did not alter the “exclusive
location at which it would accept” QWRs. Id. Thus, the letters that the borrowers sent “were not
sent to the exclusive address” that the servicer provided, and the servicer “had no duty under
RESPA to respond.” Id. However, Steele involved a very different set of facts than those found
in the current case. 4
4
Defendant cited a number of other cases to support its contention that the January 3 Communication does not
legally qualify as a QWR because it did not include “Attention Customer Relations Office” in the address and office.
However, the Court found that all of the cases that Defendant cited were unpersuasive because none of them
involved a discussion of whether the plaintiff sent the communication to a different office within the same physical
address specified to receive QWRs, or a situation where the plaintiff was specifically told to direct their
communications to a specific individual within the same physical address that was specified to receive QWRs. See
Berneike v. CitiMortgage, Inc., 708 F.3d 1141, 1145-1147 (10th Cir. 2013) (stating that the plaintiff admitted that
she did not mail her correspondence to the designated address and the plaintiff instead argued that the defendant
waived this requirement); Allen v. Dovenmuehle Mortg., Inc., No. 3:13–CV–4710, 2014 WL 3579812, at *8 (N.D.
Tex. July 21, 2014) (finding insufficient pleadings where the plaintiffs only alleged generally that they sent a QWR
and did not allege facts involving whether the request was written, sent to a designated address, or requesting
information that the defendant was required to provide under RESPA); Roth v. CitiMortgage Inc., 756 F.3d 178, 181
(2d Cir. 2014) (finding that the plaintiff did not send the correspondences to the QWR designated address but to
completely different states); Stein v. Nat’l City Bank, Civ. No. 09–1995 (MJD/JJG), 2010 WL 5559528, at *4-5 (D.
Minn. Nov. 22, 2010) (finding that the plaintiff mailed the letters to the wrong addresses, one of which was the
defendant’s attorney’s office); Daddabbo v. Countrywide Home Loans, No. C09–1417RAJ, 2010 WL 4262027, at
*2 (W.D. Wash. Oct. 27, 2010) (finding that “Counsel sent that letter to a different address than the one disclosed in
the . . . notice”); Lemieux v. Litton Loan Serv., No. 2:09-cv-02816-JAM-EFB, 2009 WL 5206641, at *3 (E.D. Cal.
Dec. 22, 2009) (finding the plaintiff’s pleadings insufficient because they did not plead facts showing that they
mailed a QWR to the address designated by the defendant); Bally v. Homeside Lending, No. 02 C 57992005, WL
2250856, at *2-3 (N.D. Ill. Sept. 8, 2005) (finding that the plaintiff’s communications did not constitute a QWR
where they faxed a copy of the letter and mailed the letter to the defendant’s attorney’s office instead of mailing it to
the physical address specified).
14
In Steele, the alternative means of communication were a phone number and a different
physical address that the lender indicated the borrowers “could” use to contact the lender or the
lender’s attorneys. Steele, 2010 WL 3565415 at *3. In the current case, Plaintiffs maintain that
before they sent the January 3 Communication, Defendant notified Plaintiffs that Michael
Ferrera was now “the single point of contact for this loan” (Trial Tr. 9/9/2015 at 66:19-67:3;
Trial Tr. 9/10/2015 at 71:12-18). Additionally, in Steele, the plaintiffs sent their inquiries to a
different physical address than the one specified for receiving QWRs. Steele, 2010 WL 3565415
at *3. In this case, although Plaintiffs’ communications were addressed to individuals instead of
the “Customer Relations Officer,” the physical address was correct.
Furthermore, it certainly would have been reasonable for the jury to find that the January
3 Communication was a QWR given its similarity to the December 16 Communication, which
Defendant’s corporate representative repeatedly said was a QWR. See Trial Tr. 9/10/15 at 15:1823 (stating that the December 16 Communication was “treated” as a QWR); Trial Tr. 9/10/15 at
47:12-16 (testifying that the December 16 Communication “from the attorney fit into the
QWR”); Trial Tr. 9/10/15 at 59:1-4 (referring to the December 16 Communication and then
saying that “one letter was QWR”). Both the December 16 Communication and the January 3
Communication were sent to the same physical address, via fax and certified mail, and both were
sent to an individual (Plaintiffs’ Exs. 12-14, 16).
Although Janati stated repeatedly that
Defendant’s procedures required the letters to include “Attention Customer Relation Officer,”
she also repeatedly stated that Plaintiffs’ December 16 Communication was treated as a QWR
(Trial Tr. 9/10/2015 at 15:22-23, 48:12, 48:17-18). In fact, Janati even stated that the December
16 Communication went “to the Customer Relation Officer” (Trial Tr. 9/10/2105 at 47:12-15).
Weighing the evidence in favor of the nonmovant, there is certainly enough evidence to support
15
the jury’s determination that the January 3 Communication was addressed with a sufficient level
of particularity to meet the requirements of being sent to the proper address and office. 5
Defendant also argues that the January 3 Communication was not a QWR because the
January 3 Communication sought information previously provided and was overbroad (Dkt. #89
at p. 7). Defendant quotes the following requests within the January 3 Communication in
support of its argument:
[a] full and detailed accounting of all payments made to you and Bank of America
from the beginning of the loan to the present date . . . a full and complete
accounting of the escrow account for this loan from its inception to the present . . .
copies of all notice letters, including without limitation, notice of your intent to
pay property taxes[.]
(Dkt. #89 at pp. 14-15; Plaintiffs’ Ex. 14).
Defendant argues that it was not required to respond to the January 3 Communication
because, “RESPA does not require a loan servicer to respond to a borrower’s numerous,
subsequent requests if the subsequent letters raise essentially the same dispute described in
borrower’s initial letter and servicer has already adequately responded.” (Dkt. #89 at p. 14).
Defendant asserts that the January 3 Communication was essentially raising the same dispute
described in the December 16 Communication and that the January 3 Communication was
merely following up to Defendant’s December 24, 2013 response (Dkt. #89 at p. 8). Defendant
argues that “Plaintiffs’ disagreement or dissatisfaction with [Defendant’s] December 24, 2013
5
The December 16 Communication was addressed to “Alex Beaty Dedicated Loan Specialist Nationstar Mortgage,
LLC 350 Highland Drive Lewisville, TX 75067-4177” (Plaintiffs’ Ex. 12). The January 3 Communication was sent
to “Michael Ferrera Nationstar Mortgage Highland Drive Lewisville, TX 75067” (Plaintiffs’ Ex. 14). When asked
about why he sent the December 16 Communication to Alex Beaty, Kasmir testified that “every time we called it
seemed like we got transferred to another person or said somebody else would handle this.” (Trial Tr. 9/9/15 at
54:11-14). Kasmir went on to state that he “was able to get somebody on the phone at some point who said you
need to send a letter to Alex Beaty. Alex Beaty also may have been the person who wrote the demand letter we got. I
don’t remember exactly. But I know that his name was presented as the person to send this to who was in charge of
our account at this point.” (Trial Tr. 9/9/15 at 54:15-21). This testimony is similar to the statements Kasmir made
when he was asked about why he later sent the January 3 Communication to Michael Ferrera. Kasmir stated that he
had been told that Ferrera was the single point of contact for their loan (Trial Tr. 9/9/15 at 66:19-67:9). Based on
Defendant’s own corporate representative’s testimony and the similarity of these two communications, Defendant is
seeking to make a distinction without a difference.
16
response does not constitute a new QWR in and of itself.” (Dkt. #89 at pp. 8-9). Furthermore,
Defendant claims that “[b]ecause the jury found that [Defendant] adequately responded to the
[December 16 Communication], and the [January 3 Communication] was merely a repetitious
follow-up letter raising the same dispute, [Defendant] was not required under RESPA to respond
as a matter of law.” (Dkt. #89 at p. 9).
Plaintiffs argue that the January 3 Communication, “clearly raises new issues, requests
additional information, and seeks clarification of the previous response provided by
[Defendant].” (Dkt. #91 at p. 5). Specifically, Plaintiffs contend that the letter lists “eleven
different, separate, and new issues” (Dkt. #91 at p. 5). The January 3 Communication clearly
contains new inquiries about specific payments that were made, specific late payments charges,
numbers not adding up to reflect payment totals, and other new inquiries. (Plaintiffs’ Ex. 14).
This looks vastly different from the December 16 Communication, which generally asked for a
full accounting of the “charges to and payments against the referenced loan” (Plaintiffs’ Ex. 12).
The evidence presented at trial establishes that the information sought in the January 3
Communication was not previously provided and it was not repetitious.
Defendant argues that the January 3 Communication was not a QWR because it was
“overbroad and unduly burdensome” (Dkt. #89 at p. 7). Defendant cites two cases in support of
this argument. Defendant relies on Ekundayo v. PNC Bank, National Ass’n, which stated that an
eleven-page letter that contained “discovery-style document demands and interrogatories” was
not a QWR. A-14-CA-142-SS, 2014 WL 5092625, at *5 (W.D. Tex. Oct. 9, 2014). Defendant
also cites Ovsepyan v. OneWest Bank, FSB, which held that an eleven-page-long letter which
demanded a laundry list of information, including information about the defendant’s business
practices and systems of record-keeping, was not a QWR.
17
No. CV 11-8714, 2012 WL
10423213, *2 (C.D. Cal. June 14, 2012).
However, the January 3 Communication only
contained eleven short questions and it was only three pages long. Additionally, the January 3
Communication is much less broad than the December 16 Communication, which Janati
repeatedly stated was a QWR (Plaintiffs’ Exs. 12-13). The evidence introduced at trial supported
the jury’s finding that the January 3 Communication was not overbroad and unduly
burdensome. 6 The jury’s finding that the January 3 Communication was a valid QWR was
reasonable.
Damages
Pecuniary Loss
RESPA provides that servicers who fail to comply with the provisions of the statute shall
be liable to borrowers for any actual damages incurred by borrowers as a result of such failure.
12 U.S.C. § 2605(f)(1)(A). The burden is on the borrower to prove that he or she incurred actual
damages in order to substantiate a RESPA claim. See Caballero v. Wells Fargo Bank, N.A., No.
3-11-CV-1385-O-BD, 2011 WL 6039953, at *2 (N.D. Tex. July 25, 2011); In re Tomasevic, 273
B.R. 682, 687 (Bankr. M.D. Fla. 2002); Ricotta v. Ocwen Loan Servicing, LLC, No. 06–cv–
01502, 2008 WL 516674, at *5 (D. Colo. Feb. 22, 2008).
Defendant argues that there is no legally or factually sufficient evidence that Plaintiffs
suffered any damages as a result of Defendant’s alleged failure to adequately respond to the
January 3 Communication (Dkt. #89 at p. 9). Defendant argues that the jury’s finding of $23,500
in pecuniary loss should be set aside because there is no evidence to support such a finding,
because the only evidence supporting Plaintiffs’ claim of pecuniary loss was speculative, and
6
Additionally, Defendant points out that nothing in the January 3 Communication mentioned RESPA or indicated
the letter was intended to be a QWR under RESPA (Dkt. #89 at p. 6). However, RESPA does not require that for a
communication to be a QWR, it mention RESPA or indicate that it is intended to be a QWR. See 12 U.S.C. §
2605(e)(1)(B).
18
therefore legally insufficient to support a RESPA claim (Dkt. #89 at pp. 9-10). Defendant cites
McLean v. GMAC Mortgage Corp., in support of this contention. 595 F. Supp. 2d 1360 (S.D.
Fla. 2009), aff’d, 398 F. App’x 467 (11th Cir. 2010).
However, McLean involved a very different set of facts. In McLean, the court found that
damages arising from the mortgagor’s unfulfilled professional opportunities, which allegedly
resulted from time spent prosecuting RESPA claim violations, were speculative. Id. at 1370.
However, the mortgagor in McLean had not been working for several years due to an injury. Id.
The damages that Plaintiffs seek in the current case are much less speculative than the damages
at issue in McLean. See Trial Tr. 9/9/15 at 85:24-90:14 (Kasmir stating that they met with a real
estate agent who told them that they could lease the property for $4,500-$5,500 per month in fall
of 2014); Trial Tr. 9/9/15 at 115:2-116:3 (Geoffrion remarking that Plaintiffs knew an individual
who wanted to lease the house, but were advised that they could not rent the house while there
was a cloud on the title, were concerned about liability if they were to rent, and believed that
renting would be morally wrong); Trial Tr. 9/9/15 at 94:13-95:2 (Kasmir testifying that Plaintiffs
still owned the house, that they had lived there for four months last year, and that they had lived
in the house for a few months the previous year).
Given the facts stated above, it would have been reasonable for the jury to find that
Plaintiffs would have received rental income for up to eight months of the last year. Renting the
house for eight months would have resulted in rental income of $36,000-$44,000 if the range that
the real estate agent told Plaintiffs was reasonable was accurate. The evidence presented during
trial was sufficient to support an award of $23,500 for pecuniary loss.
19
Mental Anguish
Recoverable Under RESPA
Defendant argues that the jury’s award of $151,500 in mental anguish should be set aside
because mental anguish damages are not recoverable under RESPA (Dkt. #89 at pp. 10-11). The
Fifth Circuit and the Supreme Court have not yet addressed whether mental anguish damages are
recoverable under RESPA.
Of the circuits that have addressed the issue, two have indicated that emotional distress
damages should be allowed, while no circuit appears to have ruled that emotional damages are
not allowed. See Houston v. U.S. Bank Home Mortg. Wisconsin Servicing, 505 F. App’x. 543,
548, 548 n.6 (6th Cir. 2012) (remanding case for further fact-finding about alleged emotional
damages arising from servicer’s failure to respond to QWR and holding that “[w]e find nothing
in the text of § 2605(f), or in RESPA more broadly, to preclude ‘actual damages’ from including
emotional damages, provided that they are adequately proven”); Catalan v. GMAC Mortg. Corp.,
629 F.3d 676, 696 (7th Cir. 2011) (acknowledging that the defendant conceded that RESPA
allowed for recovery of emotional distress damages).
Additionally, the Eleventh Circuit
explained that a plaintiff alleging a RESPA violation “arguably may recover for non-pecuniary
damages, such as emotional distress and pain and suffering . . .” McLean v. GMAC Mortg. Corp.,
398 F. App’x. 467, 471 (11th Cir. 2010) (rejecting emotional distress damages in RESPA claim
because plaintiffs failed to adequately demonstrate causation).
The two district courts within the Fifth Circuit that have addressed this issue have
concluded that mental anguish damages are not permitted under RESPA (Dkt. #89 at p. 11). See
Steele v. Quantum Servicing Corp., No. 3:12-CV-2897-L, 2013 WL 3196544, at *7-8 (N.D. Tex.
June 25, 2013); Trahan v. GMAC Mortg. Corp., No. EP–05–CA–0017–FM, 2006 WL 5249733,
20
at *8 (W.D. Tex. July 21, 2006) (“The statute does not permit mental anguish damages and this
court is not at liberty to award damages which are not provided for in the statute.”). But other
district courts have allowed for the recovery of mental anguish damages for a RESPA claim. See
Rawlings v. Dovenmuehle Mortg., Inc., 64 F. Supp.2d 1156, 1166–67 (M.D. Ala. 1999) (citing
cases that have held that nonpecuniary damages for emotional distress are available under
RESPA); but see Katz v. Dime Sav. Bank, FSB, 992 F. Supp. 250, 255–56 (W.D.N.Y. 1997)
(concluding that nonpecuniary damages are not available under RESPA).
All of the cases that have allowed for the recovery of mental anguish damages for a
RESPA claim have turned on whether or not RESPA is a remedial consumer-protection statute.
This is because courts construe remedial consumer-protection statutes “liberally in order to best
serve Congress’ intent.” Rawlings v. Dovenmuehle Mortgage, Inc., 64 F. Supp. 2d 1156, 1165
(M.D. Ala. 1999) (citing Ellis v. General Motors Acceptance Corp., 160 F.3d 703, 707 (11th Cir.
1998)). Therefore, the Court must determine if RESPA is a remedial consumer-protection
statute.
The first step for the Court in construing a statute is to interpret the statutory language.
Section 2605 of RESPA provides for the recovery of “any actual damages to the borrower” as a
result of a servicer’s failure to comply with said section. 12 U.S.C. § 2605(f)(1)(A). “A basic
canon of statutory construction is that words should be interpreted as taking their ordinary and
plain meaning.” United States v. Yeatts, 639 F.2d 1186, 1189 (5th Cir. 1981) (citing Perrin v.
United States, 444 U.S. 37, 42 (1980)). We must assume that Congress used the words of the
statute as they are commonly and ordinarily understood. Id. Section 2605 of RESPA provides
for the recovery of “any actual damages to the borrower” as a result of a servicer’s failure to
comply with said section. 12 U.S.C. § 2605(f)(1)(A). “The term ‘actual damages,’ however,
21
‘has no consistent legal interpretation’ because ‘the interpretation var[ies] with the context of
use.’” Rawlings, 64 F. Supp. 2d at 1165 (quoting Fitzpatrick v. Internal Revenue Serv., 665 F.2d
327, 329 (11th Cir. 1982)). Therefore, “[b]ecause ‘actual damages’ has no ‘plain meaning’ in
legal lexicon,” the court “attempt[s] to discern Congressional intent on this issue.” Id.
First, the Court finds that the statutory language of RESPA demonstrates Congress’ intent
that RESPA be a remedial consumer-protection statute.
Indeed, RESPA states its purpose
clearly when it says,
Congress finds that significant reforms in the real estate settlement process are
needed to insure that consumers throughout the Nation are provided with greater
and more timely information on the nature and costs of the settlement process and
are protected from unnecessarily high settlement charges caused by certain
abusive practices that have developed in some areas of the country.
12 U.S.C. § 2601(a) (emphasis added). Additionally, the Court agrees with the analysis in
Rawlings that found that RESPA’s legislative history demonstrates that it was designed to be
remedial in nature, and that it was intended to protect consumers. 64 F. Supp. 2d at 1164-67.
The Court also agrees with the line of cases that has determined that RESPA is a remedial
consumer-protection statute. See Medrano v. Flagstar Bank, FSB, 704 F.3d 661, 665-666 (9th
Cir. 2012) (finding that “Congress intended RESPA to serve consumer-protection purposes” and
stating that the statute has a remedial purpose); Cohen v. JP Morgan Chase & Co., 498 F.3d 111
(2d Cir. 2007) (stating that “RESPA’s overall goal [is] to protect consumers from abusive
practices that result in unnecessarily high settlement charges.”) (citation omitted); Hardy v.
Regions Mortgage, Inc., 449 F.3d 1357, 1359 (11th Cir. 2006) (finding that “RESPA is a
consumer protection statute that regulates the real estate settlement process”); Carter v.
Countrywide Home Loans, Inc., No. CIV. 3:07-CV651, 2009 WL 1010851, at *4 (E.D. Va. Apr.
14, 2009) (stating that “the statutory language is clear that Congress intended for RESPA to be a
22
remedial consumer protection statute”); Wienert v. GMAC Mortgage Corp., No. 08-CV-14482,
2009 WL 3190420, at *10-11 (E.D. Mich. Sept. 29, 2009) (citing cases that found that RESPA
was a remedial consumer-protection statute and concluding that “recovery for emotional distress
damages is available under § 2605(f) of RESPA”); Ploog v. HomeSide Lending, Inc., 209 F.
Supp. 2d 863, 870 (N.D. Ill. 2002) (holding that “RESPA is a consumer protection statute and
RESPA’s actual damages provision includes recovery for emotional distress”); Johnstone v.
Bank of Am., N.A., 173 F. Supp. 2d 809, 816 (N.D. Ill. 2001) (finding that the express terms of
RESPA clearly indicate that it is, in fact, a consumer protection statute); Rawlings v.
Dovenmuehle Mortgage, Inc., 64 F. Supp. 2d 1156, 1164-67 (M.D. Ala. 1999) (finding that the
statutory language clearly demonstrates Congress’ intention that RESPA be a remedial
consumer-protection statute).
In reaching this conclusion, the Court is also persuaded by Fifth Circuit cases addressing
other consumer-protection statutes that are remedial in nature, wherein the Fifth Circuit has
found “actual damages” provisions to include damages for mental anguish. See, e.g., Stevenson
v. TRW, Inc., 987 F.2d 288, 296 (5th Cir. 1993) (stating that the Fair Credit Reporting Act
(“FCRA”) “authorizes a consumer to recover actual damages, which include humiliation or
mental distress, even if the consumer has suffered no out-of-pocket losses”); Fischl v. General
Motors Acceptance Corp., 708 F.2d 143, 148 (5th Cir. 1983) (holding that actual damages
include mental anguish under the Equal Credit Opportunity Act, 15 U.S.C. § 1691(e)).
Therefore, the Court finds that RESPA is a remedial consumer-protection statute, and because
statutes must be construed liberally in this context, the Court finds that mental anguish damages
are included within RESPA’s actual damages provision.
23
Sufficiency of the Evidence
Defendant also argues that Plaintiffs failed to present any legally or factually sufficient
evidence of any mental anguish damages caused by Defendant’s failure to respond to the January
3 Communication (Dkt. #89 at pp. 12–13). 7 A plaintiff must present “direct evidence of the
nature, duration, or severity of their mental anguish, thus establishing a substantial disruption in
the plaintiffs’ daily routine,” or evidence of “a high degree of mental pain and distress” that is
“more than mere worry, anxiety, vexation, embarrassment, or anger.” Saenz v. Fidelity & Guar.
Ins. Underwriters, 925 S.W.2d 607, 614 (Tex. 1996) (quoting Parkway Co. v. Woodruff, 901
S.W.2d 434, 444 (Tex. 1995)); see also Bentley v. Benton, 94 S.W.3d 561, 606 (Tex. 2002). At
trial, legally sufficient evidence was introduced to support an award of mental anguish damages.
See Trial Tr. 9/9/15 91:16-94:5 (Kasmir stating that he missed work, experienced nausea and
sleeplessness); Trial Tr. 9/9/15 120:1-25 (Geoffrion stating that she experienced nausea and
headaches and mentioning a particular time where she was unable to celebrate her niece’s life
due to having to involve herself with this dispute).
Defendant contends that “Plaintiffs failed to establish any causal link between their
claimed mental anguish and the only misconduct found by the jury — Nationstar’s failure to
respond to the [January 3 Communication]” (Dkt. #89 at pp. 13–14). Defendant states that
because most, if not all, of the anguish Plaintiffs felt was caused by the illness of their niece,
there was no basis for awarding $151,000 in mental anguish damages against Defendant (Dkt.
#89 at p. 13).
7
Defendant also alleges that since there was no mention of “mental anguish damages” in Plaintiffs’ complaint,
during discovery, or in the parties’ Joint Pretrial Order, Plaintiffs waived any type of mental anguish award (Dkt.
#89 at p. 12). However, as discussed above, mental anguish damages are included in actual damages under RESPA,
which Plaintiffs included in their Complaint (Dkt. #7 at ¶ 26). Additionally, Defendant did not assert this argument
in its initial Motion for Judgment as a Matter of Law (Trial Tr. 9/10/15 at 92:6-94:10). Therefore, Defendant cannot
argue waiver on these grounds for the first time now.
24
Defendant relies upon Gunn Infiniti, Inc. v. O’Byrne, a case that reversed an award of
mental anguish damages because “[m]any of the feelings [the plaintiff] described were unrelated
to [the defendant’s] DTPA violations.” 996 S.W.2d 854, 860-61 (Tex. 1999). However, the
current case is distinguishable. In Gunn Infiniti, Inc., there was limited testimony about mental
anguish, and the testimony that the court relied upon demonstrated that the source of the anguish
came from the plaintiff’s choice of brand, not from the DTPA violation. Id. Conversely, in this
case, there was a considerable amount of testimony about how Defendant’s failure to properly
respond to Plaintiffs’ inquiries was the source of their distress (Trial Tr. 9/9/15 at 90:19-94:5,
118:20-120:8). At trial, there was sufficient evidence of mental anguish to support the jury’s
award of damages. 8
Defendant goes on to argue that, “[t]o the extent that Plaintiffs attempted to connect their
alleged mental anguish to their frustration with [Defendant] generally, this presents a problem
because all but one of Plaintiffs’ RESPA claims was rejected by the jury.” (Dkt. #89 at p. 14).
Defendant maintains that since Plaintiffs did not offer an “evidentiary basis for differentiating or
segregating between” the mental anguish caused by their niece’s illness, the anguish caused by
Defendant’s failure to respond to the letters that were not QWRs, and the anguish specifically
caused by Defendant’s failure to respond to the January 3 Communication, they should not be
able to receive mental anguish damages (Dkt. #89 at p. 14).
8
Similarly, Defendant also suggests that because there was no expert testimony or health record evidence presented
regarding the mental anguish suffered by Plaintiffs, they are not able to recover mental anguish damages (Dkt. #89
at pp. 18-19). The actual damages portion of RESPA can be interpreted in a manner similar to the FDCPA.
McLean, 595 F. Supp. 2d at 1370. Therefore, the Court finds that Plaintiffs may establish emotional damages under
RESPA through their own, lay testimony. Guajardo v. GC Servs., LP, 498 F. App’x 379, 385 (5th Cir. 2012)
(finding sufficient evidence to support the award of mental anguish under the FDCPA even where jury heard
contradictory proof from the plaintiff herself).
25
However, Kasmir specifically differentiated between the stress he experienced from his
niece’s illness and eventual death and the stress that he experienced as a result of Defendant’s
failure to answer their QWR. During trial, Kasmir stated,
Obviously we’ve had our own stresses to deal with outside of Nationstar that
coincide with this, but the idea that we can’t get something which should be very
clear -- I mean, there are numbers. This is something that could be represented on
a spreadsheet. And the fact that it has taken all of this, and even now we don’t
know. I couldn’t tell you exactly where we are or what they say we owe or how
to substantiate any of that. It’s draining emotionally.
(Trial Tr. 9/9/15 at 92:24-93:7). Likewise, Geoffrion also differentiated the emotional distress
she experienced from the illness and death of her niece from the stress that was caused by
Defendant’s failure to respond to Plaintiffs’ request for information. 9
See Trial Tr. 9/9/15 at
119:1-3 (agreeing that she was able to compartmentalize the two “stressers” and explaining that
they are “completely different”).
It is true that Plaintiffs are not permitted to recover for mental anguish allegedly caused
by claims for which they did not recover at trial. See City of Dall. v. Rodriguez, No. 05-9700280-CV, 1999 WL 689615, at *9 (Tex. App.—Dallas Sept. 7, 1999, no pet.) (denying
recovery for mental anguish damages specifically attributed to a claim for which the plaintiff did
not recover at trial).
However, causation is an inherently fact-sensitive issue.
See, e.g.,
Millhouse v. Wiesenthal, 775 S.W.2d 626, 627 n.2 (Tex. 1989) (holding determination of
causation is a question of fact for the jury); Farley v. MM Cattle Co., 529 S.W.2d 751, 756 (Tex.
1975); see Lynch v. Ricketts, 314 S.W.2d 273, 276 (Tex. 1958) (describing causation as an
“ultimate fact issue”).
Additionally, the jury was instructed that they could only award
9
Defendant suggests that because Geoffrion was not the individual calling, faxing, and mailing communications to
Defendant, it could not have caused Geoffrion any type of mental anguish (Dkt. #89 at p. 13). However, case law is
clear that an attorney may send a QWR on behalf of their client and the Court sees no reason why this should bar an
injured plaintiff from receiving mental anguish damages. See Roth, 756 F.3d at 181 (considering whether letters that
the plaintiff’s lawyer sent were QWRs and not discussing the fact that they were sent by a lawyer instead of the
plaintiff herself); Daddabbo, 2010 WL 4262027, at *2 (finding that the letters that the plaintiff’s lawyer sent were
not QWRs because they were sent to the wrong address, not because they were sent by a lawyer).
26
compensatory damages for injuries that “Plaintiffs prove were proximately caused by
Nationstar’s allegedly wrongful conduct.” (Dkt. #74 at p. 8). 10 The evidence presented at trial, in
conjunction with the instructions given to the jury, are more than sufficient to uphold the jury’s
verdict as it relates to the inherently fact-intensive issue of causation.
Statutory Damages
Defendant also argues that Plaintiffs are not entitled to statutory damages because there is
no legally or factually sufficient evidence that Defendant engaged in a pattern or practice of
noncompliance with the requirements of RESPA (Dkt. #89 at p. 14). RESPA permits an award
of up to $2,000 “in the case of a pattern or practice of noncompliance with the requirements of
this section.” 12 U.S.C. § 2605(f)(1)(B). Although there is no particular number of violations
that create a “pattern or practice of noncompliance,” federal courts have consistently held that
two violations of RESPA are insufficient to support a claim for statutory damages. See, e.g.,
Kapsis v. American Home Mortg. Servicing Inc., 923 F.Supp.2d 430, 445 (E.D.N.Y. 2013);
McLean, 595 F. Supp. 2d at 1365-66; In re Maxwell, 281 B.R. 101, 123 (Bankr. D. Mass. 2002).
Defendant points out that the jury found that it only violated RESPA on one occasion
with regards to Plaintiffs (Dkt. #89 at p. 15). However, Defendant incorrectly argues that
“Plaintiffs presented no evidence of any kind showing a standard or institutionalized practice of
10
Defendant also argues that “[t]he damages awarded must fairly and reasonably compensate the loss, and there
must be some evidence to support the amount awarded.” (Dkt. #89 at p.13 n. 2). Defendant states that Plaintiffs
presented no evidence regarding the amount of mental anguish damages (Dkt. #89 at p. 13 n. 2). However, the cases
that Defendant cites are distinguishable. In Saenz, the appellate court found that there was no evidence that
supported an award of $250,000 for mental anguish damages. 925 S.W.2d at 614. Likewise, in Bentley v. Bunton,
the court found that a $7,000,000 award of mental anguish damages, which was more than forty times the amount
awarded for damage to his reputation, was more than excessive and unreasonable. 94 S.W.3d 561, 607 (Tex. 2002).
The current case is much less extreme. The amount awarded in the current case is a much smaller award than in the
cases that Defendant cites. Furthermore, other courts have upheld much larger awards. See McCollough v. Johnson,
Rodenburg & Lauinger, LLC, 637 F.3d 939, 957 (9th Cir. 2011) (finding that ample evidence exists in the record to
support the jury’s award of $250,000 for mental anguish for FDCPA violation); see also Bullock v. Abbott & Ross
Credit Servs., L.L.C., No. A-09-CV-413 LY, 2009 WL 4598330, at *4 (W.D. Tex. Dec. 3, 2009) (discussing how
longer-term emotional distress and physical ailments warrant higher awards of mental anguish damages than other,
less serious emotional distress).
27
noncompliance by Nationstar.” (Dkt. #89 at p. 15). Janati testified that there was no written
policy at Nationstar for identifying QWRs prior to April 6, 2015 (Trial Tr. 9/10/15 at 8:3-23,
14:11-14). However, Janati also stated that “every department had procedures in place” (Trial
Tr. 9/10/15 at 43:24). In view of the conflicting testimony, it is clear that the jury could have
found that a pattern or policy existed, and that it was not in compliance with RESPA. 11
Kasmir’s Standing
Defendant argues that it is entitled to judgment against Kasmir because he lacks standing
to bring a RESPA claim against Defendant because he is not a “borrower” under RESPA (Dkt.
#89 at p. 15). Defendant argues that Kasmir is not a borrower because he did not sign the
promissory note and thus was not required to make payments on the note (Dkt. #89 at pp. 15-18).
Plaintiffs argue that Kasmir is a borrower with standing under RESPA because he signed the
Deed of Trust (Dkt. #91 at p. 8).
Plaintiffs maintain that the Deed of Trust expressly
incorporates RESPA and “expressly extends rights granted by RESPA to the ‘Borrowers’ named
in the Deed of Trust, which includes . . . Kasmir” (Dkt. #91 at p. 8). However, Defendant points
out that the Deed of Trust specifically states that “[A]ny Borrower who co-signs this Security
Instrument but does not execute the Note . . . is not personally obligated to pay the sums secured
by this Security Instrument.” (Plaintiffs’ Ex. 19 at p. 9). However, Plaintiffs note that RESPA
does not define ‘borrower’ and that Defendant is relying on non-binding case law for its more
limited definition of ‘borrower’ (Dkt. #91 at p. 8). While the Court was unable to locate any
judicial authority that found that a party who did not sign the note was a “borrower” under
RESPA, it need not decide the issue today.
11
Janati also testified that she was involved in many other lawsuits that were pending and that she was unaware of
other specific pending cases with facts similar to the current case (Trial Tr. 9/10/15 at 61:9-63:18).
28
The Court need not decide the issue, because Defendant failed to raise the issue of
Kasmir’s standing in its original Rule 50 motion (Dkts. #89 at p. 18, #91 at p. 8). Defendant
acknowledges that it is raising Kasmir’s lack of standing for the first time and points out that
Kasmir was bringing a breach of contract claim until the morning of the trial (Dkt. #89 at p. 18).
Defendant argues that standing is a component of subject matter jurisdiction, which cannot be
waived (Dkt. #89 at p. 24).
Usually, an issue that is raised for the first time on a motion for new trial or renewed
motion for judgment as a matter of law is waived. See WesternGeco L.L.C. v. ION Geophysical
Corp., 953 F. Supp. 2d 731, 740 (S.D. Tex. 2013) aff’d in part, rev’d in part, 791 F.3d 1340
(Fed. Cir. 2015) (citing Auster Oil & Gas, Inc. v. Stream, 835 F.2d 597, 601 (5th Cir. 1988)).
However, the Fifth Circuit has made clear that “[a]s standing is not subject to waiver by the
parties, . . . [a party’s] pretrial, and even post-trial, failures to contest standing cannot, ipso facto,
create jurisdiction in federal court.” Doe v. Tangipahoa Par. Sch. Bd., 494 F.3d 494, 499 (5th
Cir. 2007) (finding that the court lacked subject matter jurisdiction). The Fifth Circuit has also
stated that “[i]t is true that subject-matter jurisdiction cannot be created by waiver or consent. It
is equally true that federal courts must address jurisdictional questions whenever they are raised
and must consider jurisdiction sua sponte if not raised by the parties.” Howery v. Allstate Ins.
Co., 243 F.3d 912, 919 (5th Cir. 2001).
However, the Fifth Circuit has made an important distinction between “prudential
standing” and constitutional standing. In Ensley v. Cody Resources, Inc., the defendant moved
for judgment as a matter of law at the close of the plaintiff’s case-in-chief, in part, on the grounds
that the plaintiff lacked standing to recover individually as a shareholder. 171 F.3d 315, 318
(1999). The jury awarded the plaintiff damages and the court entered judgment for the plaintiff.
29
Id. Then the defendant again moved for judgment as a matter of law on the standing issue. Id.
This time the court found that the claim belonged to the company and not to the plaintiff
individually. Id. The court granted the motion and entered an amended take-nothing judgment.
Id.
Then, “[o]n reconsideration, the court held that [the defendant’s] objection was not
‘standing’ in its jurisdictional sense and sua sponte determined that the objection was a realparty-in-interest question that [the defendant] had waived by not raising it before trial.” Id. The
court then entered a second amended judgment awarding the plaintiff damages and postjudgment
interest. Id.
The case at hand is strikingly similar to Ensley. In Ensley, the defendant relied on
“caselaw holding that a shareholder lacks standing to pursue the corporation’s cause of action.”
Id. at 319. In the current case, Defendant relies on case law that states that Kasmir is not a
“borrower” under the statute, and thus lacks standing to pursue a cause of action against the
Defendant (Dkt. #89 at p. 15). Likewise, in Ensley, the defendant neglected to address the
distinction between constitutional and “prudential” limitations on standing. Id. The Ensley court
held that cases on shareholders’ lack of standing do not address injury in fact, and the real
objection, since injury was obvious, was to the real party in interest. Id. at 320. Reasoning thus,
the court found that the “prudential” standing argument was waived, and affirmed the denial of
judgment as a matter of law. Id.
The Supreme Court has made clear that Article III’s standing requirements are separate
and distinct from statutory interpretation considerations which determine whether a “particular
class of persons ha[s] a right to sue under this substantive statute.” Lexmark Int’l, Inc. v. Static
Control Components, Inc., 134 S. Ct. 1377, 1387 (2014) (quoting Association of Battery
Recyclers, Inc. v. EPA, 716 F.3d 667, 675–676 (2013)). Likewise, the Fifth Circuit has stated
30
that, “[a]lthough often clothed as an issue of subject-matter jurisdiction, the Supreme Court has
made clear that ‘the absence of a valid (as opposed to arguable) cause of action does not
implicate subject-matter jurisdiction, i.e. the court’s statutory or constitutional power to
adjudicate the case.” Janvey v. Brown, 767 F.3d 430, 437 (5th Cir. 2014) (quoting Lexmark
Int’l, Inc., 134 S. Ct. 1377, 1387 n.4 (2014)); see also Gil Ramirez Grp., L.L.C. v. Houston
Indep. Sch. Dist., 786 F.3d 400, 409 (5th Cir. 2015) (“‘statutory standing’ is a misleading label
since the absence of a valid . . . cause of action does not implicate subject-matter jurisdiction”)
(citing Verizon Md., Inc. v. Pub. Serv. Comm’n of Md., 535 U.S. 635, 642–43(2002) (internal
quotations omitted)). Therefore, Defendant is not making a constitutional argument that Kasmir
lacks standing when it argues that Kasmir is not a ‘borrower’ under the RESPA, but a prudential
argument. Ensley held that an objection that implicated prudential standing that was made after a
plaintiff’s case-in-chief was too late, even when framed as a standing issue, and thus the
objection was waived. 171 F.3d at 318. Therefore, when a defendant fails to object to prudential
standing concerns until their renewed motion for judgment as a matter of law, the defendant has
certainly waived their objection. 12
12
Plaintiffs also argue that Defendant stipulated to the following facts which negate Defendant’s standing argument
(Dkt. #91 at p. 9): “On or around August of 2003, Plaintiffs purchased a single-family home located at 934
Dunsmuir Avenue, Los Angeles, CA 90036 (the ‘Property’).” (Dkt. #74 at p. 5) (emphasis added). “After
purchasing the Property in 2003, Plaintiffs refinanced their mortgage. . .” (Dkt. #74 at p. 5) (emphasis added). “To
secure repayment of the Note, Plaintiffs executed a deed of trust encumbering the Property. (The June 30, 2004
note and deed of trust are the ‘Loan.’).” (Dkt. #74 at p. 5) (emphasis added). “Nationstar contends Plaintiffs are
delinquent on their account.” (Dkt. #74 at p. 6) (emphasis added). Defendant does not address this argument. While
case law is clear that regardless of whether the parties have stipulated to facts establishing constitutional jurisdiction,
“courts are required to examine the true facts.” In re Olson, No. 92 A 258, 1995 WL 348038, at *7 (N.D. Ill. May
30, 1995) (citing Kanzelberger v. Kanzelberger, 782 F.2d 774 (7th Cir. 1986)). However, as explained above, this is
not a situation in which Defendant is actually making a jurisdictional argument. While the stipulations above only
demonstrate further that Defendant waived its objection to Kasmir’s ability to bring this claim, the Court need not
rely on the stipulations to arrive at the conclusion that Defendant waived its objection.
31
However, Defendant also appears to suggest that Kasmir lacks Article III standing. 13
“From Article III’s limitation of the judicial power to resolving ‘Cases’ and ‘Controversies,’ and
the separation-of-powers principles underlying that limitation, [the Supreme Court] ha[s]
deduced a set of requirements that together make up the ‘irreducible constitutional minimum of
standing.’” Id. at 1386 (quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). “The
plaintiff must have suffered or be imminently threatened with a concrete and particularized
‘injury in fact’ that is fairly traceable to the challenged action of the defendant and likely to be
redressed by a favorable judicial decision.” Id. As discussed previously in the “Damages”
section above, as an owner of the property who was not able to lease the property because of the
ongoing dispute, Kasmir has established that he was injured by Defendant’s failure to respond to
the January 3 Communication. Furthermore, the Defendant’s harmful actions are likely to be
redressed by a favorable judicial decision, such as a jury’s award of damages for those injuries,
which has actually already occurred.
Defendant goes on to argue that because the questions in the jury charge were not
segregated between the two Plaintiffs, no judgment can be formed as to Geoffrion. Defendant
claims that because Plaintiffs had the burden to obtain individual findings on both liability and
damages as to each of the Plaintiffs, it is not possible for the Court to enter judgment for
Geoffrion (Dkt. #89 at p. 24). Defendant cites Decorte v. Jordan in support of its contention that
Plaintiffs had the burden to obtain individual findings on both liability and damages as to each of
them. 497 F.3d 433, 442 (5th Cir. 2007). However, the Court understands Decorte to mean only
that in order to receive mental anguish damages, each plaintiff must provide specific
13
Defendant does not directly and specifically address Article III standing, but does cite several cases where courts
found that the plaintiffs did not have Article III standing to bring a claim under RESPA because they were not
signatories to the note (Dkt. #89 at pp. 15-19). Therefore, the Court will analyze whether Kasmir has Article III
standing.
32
individualized evidence about how they were personally affected. Id. As described above,
Plaintiffs both testified that they experienced physical manifestations of their mental anguish.
Plaintiffs assert that any error in the collective submission of “Plaintiffs” has been waived
because there was no objection to the jury charge (Dkt #91 at p. 10) (citing FED. R. CIV. P.
51(d)(1); Crist v. Dickson Welding, Inc., 957 F.2d 1281, 1286 (5th Cir. 1992)). Defendant
contends that it is Plaintiffs’ burden to submit a substantially correct jury charge on which they
have the burden of proof and that the collective submission of “Plaintiffs” where one plaintiff
lacked standing is plain error (Dkt. #94 at pp. 8-9). Defendant does not explain this argument
beyond mentioning the plain error rule and citing Tompkins v. Cyr. 202 F.3d 770, 785-86 (5th
Cir. 2000). Defendant contends that Tompkins applies to the current case because it holds that
double recovery is plain error, which requires reversal (Dkt. #94 at pp. 8-9). However, as
discussed above, Defendant waived its non-constitutional standing defense. Therefore, there was
no double recovery, and the damages awarded were not plain error.
New Trial
Alternatively, Defendant seeks a new trial, alleging that there is no factually sufficient
evidence to support the jury findings, and the jury’s damages are excessive for the reasons
discussed above (Dkt. #89 at p. 18). Defendant also seeks a new trial for the following reasons:
(1) jury charge error in submitting “Plaintiffs” collectively; (2) evidentiary error in admitting
evidence regarding the illness and death of Plaintiffs’ juvenile niece; (3) improper jury argument
regarding “eggshell plaintiff” doctrine; and (4) the Court’s questioning of Janati (Dkt. #89 at pp.
18-22).
“If the court does not grant a motion for judgment as a matter of law made under Rule
50(a), the court is considered to have submitted the action to the jury subject to the court’s later
33
deciding the legal questions raised by the motion.” FED. R. CIV. P. 50(b). Therefore, a movant
may file a renewed judgment as a matter of law, which may include an alternative or joint
request for a new trial under Rule 59, “[n]o later than 28 days after the entry of judgment.” Id.
“[A] jury verdict must be upheld, and judgment as a matter of law may not be granted, unless
‘there is no legally sufficient evidentiary basis for a reasonable jury to find as the jury did.’”
Fractus, 876 F. Supp. 2d at 813 (citing Hiltgen, 47 F.3d at 700). The jury’s verdict must be
supported by “substantial evidence” in support of each element of the claims. Am. Home
Assurance Co., 378 F.3d at 487.
“A court reviews all evidence in the record and must draw all reasonable inferences in
favor of the nonmoving party; however, a court may not make credibility determinations or
weigh the evidence, as those are solely functions of the jury.” Fractus, 876 F. Supp. 2d at 813;
see Reeves, 530 U.S. at 150-151. “The moving party is entitled to judgment as a matter of law,
‘only if the evidence points so strongly and so overwhelmingly in favor of the [] moving party
that no reasonable juror could return a contrary verdict.’” SSL Servs., LLC, 940 F. Supp. 2d at
486 (quoting Porter, 659 F.3d at 445 (alteration in original, citation omitted)).
“The court may, on motion, grant a new trial on all or some of the issues[.]” FED. R. CIV.
P. 59(a)(1). “[I]f the trial judge is not satisfied with the verdict of a jury, he has the right—and
indeed the duty—to set the verdict aside and order a new trial.” Transworld Drilling Co., 773
F.2d at 613 (citation omitted). In ruling on a motion for new trial, the jury’s verdict may not be
lightly set aside. See Ellis, 258 F.3d at 343 (“[C]ourts ‘must attempt to reconcile the jury’s
findings, by exegesis, if necessary, before we are free to disregard the jury’s verdict and remand
the case for a new trial.’”). “In considering whether the seemingly inconsistent verdicts may be
34
reconciled, the court must view the evidence in the light most favorable to upholding the jury’s
decision by a finding of consistency.” Id.; see Hiltgen, 47 F.3d at 701.
Individualized Damages
In the alternative, Defendant seeks a new trial on various grounds. Defendant argues that
“Plaintiffs were required to obtain individual, rather than collective, findings for claimed
pecuniary loss and mental anguish damages.” (Dkt. #89 at p. 19). Defendant asserts that because
the jury findings are not separated out between the individual claims, Plaintiffs are not entitled to
any recovery as a matter of law (Dkt. #89 at p. 19). However, as discussed above, Defendant did
not raise an objection to Kasmir’s standing at any point prior to its Renewed Motion for
Judgment as a Matter of Law, and thus its objection to his standing was waived.
Admission of Evidence Regarding Ill Niece
Defendant also asserts that the Court committed an evidentiary error by admitting
evidence regarding the illness and death of Plaintiffs’ juvenile niece (Dkt. #89 at p. 19).
Defendant argues that this information was not relevant to Plaintiffs’ RESPA claim and that “any
remote probative value that Plaintiffs’ niece’s health condition may have had to the claims in this
lawsuit was substantially outweighed by the danger of unfair prejudice, confusing of the issues,
and misleading the jury.” (Dkt. #89 at p. 19).
Evidence is relevant if (a) it has any tendency to make a fact more or less probable than it
would be without the evidence; and (b) the fact is of consequence in determining the action.
Fed. R. Evid. 401. The court may exclude relevant evidence only if its probative value is
substantially outweighed by a danger of one or more of the following: unfair prejudice,
confusing the issues, misleading the jury, undue delay, wasting time, or needlessly presenting
cumulative evidence. Fed. R. Evid. 403.
35
The evidence and testimony regarding Plaintiffs’ terminally ill niece was relevant to why
Plaintiffs left their house in California to be in Texas, where their niece was living (Trial Tr.
9/9/15 at 24:5-28:21). This was also relevant because it helped explain why it took time for
Plaintiffs to become aware of the fact that they were in default (Trial Tr. 9/9/15 at 102:13-21).
Additionally, this evidence is relevant to why Plaintiffs were interested in renting out the house
instead of selling it (Trial Tr. 9/9/15 at 86:3-90:11).
District courts are granted broad discretion in admitting evidence, and their rulings are
reviewed only for an abuse of discretion. Perez v. Texas Dep’t of Criminal Justice, Institutional
Div., 395 F.3d 206, 210 (5th Cir. 2004) (citing Kelly v. Boeing Petroleum Servs., 61 F.3d 350,
356 (5th Cir. 1995)). Furthermore, “[a]n erroneous evidentiary ruling is reversible error only if
the ruling affects a party’s substantial rights. Id. (citing Kelly, 61 F.3d at 361). Even assuming
the Court made an erroneous evidentiary ruling on this issue, which it did not, this testimony and
evidence did not affect Defendant’s substantial rights. See EEOC v. Manville Sales Corp., 27
F.3d 1089, 1093 (5th Cir. 1994) (finding that employer’s remarks over four-year period were
relevant to age discrimination case and were improperly excluded).
Improper Jury Argument
Defendant also argues that there was improper jury argument regarding the “eggshell
plaintiff” doctrine (Dkt. #89 at p. 20). Defendant argues that the tort doctrine of the “eggshell
plaintiff” has no relevance to this statutory RESPA case and that the improper invocation of the
doctrine was prejudicial in that it unduly aroused the sympathy of the jury and thereby
influenced its verdict (Dkt. #89 at p. 20). Defendant asserts that the effect of this improper
argument was plain error (Dkt. #89 at p. 20).
36
A motion for a new trial premised on improper arguments by counsel “should only be
granted when improper closing argument irreparably prejudices a jury verdict.” Baisden v. I’m
Ready Prods., Inc., 693 F.3d 491, 509 (5th Cir. 2012) (citation omitted). “To justify a reversal
based on improper comments of counsel, the conduct must be such as to gravely impair the calm
and dispassionate consideration of the case by the jury.” Dixon v. Int’l Harvester Co., 754 F.2d
573, 585 (5th Cir. 1985) (citation omitted). Therefore, closing argument must go far beyond the
bounds of accepted advocacy before a court must grant a new trial. Edwards v. Sears, Roebuck
& Co., 512 F.2d 276, 284 (5th Cir. 1975). Here, the closing argument was well within the
bounds of proper argument. 14 Even assuming the argument was improper, Defendant failed to
object and obtain a ruling during trial, and has thus waived its objection to these statements.
Baisden, 693 F.3d at 509.
The Court’s Questioning of Janati
Defendant also asserts that the Court’s questioning of Janati expressed disbelief and
“thereby trespassed on the jury’s function of assessing the credibility of the witness” (Dkt. #89 at
p. 27).
The first issue regarding Janati arose on May 15, 2015, when Plaintiffs filed their Motion
for Sanctions (Dkt. #30). In the Motion for Sanctions, Plaintiffs asked that the Court compel
Defendant to produce a competent corporate representative, award Plaintiffs’ counsel’s travel
costs, and award Plaintiffs’ attorneys’ fees for preparing and attending the deposition (Dkt. #30).
Plaintiffs asserted that “Janati was evasive during her deposition, and responded with ‘I don’t
14
At least one other court has utilized similar information in its determination of whether a plaintiff was more prone
to suffer higher degrees of mental anguish than others similarly situated. See McCollough v. Johnson, Rodenburg &
Lauinger, LLC, 637 F.3d 939, 957 (9th Cir. 2011) (holding that $250,000 award for emotional damages under the
FDCPA and MCPA was proper and discussing a doctor’s testimony that the lawsuit may have worsened a head
injury victim’s existing mental anguish symptoms).
37
know’ to virtually every single important question relating to Plaintiffs’ claims and allegations in
this case and the topics disclosed in her deposition notice.” (Dkt. #30 at p. 5).
The Court held a hearing on the Motion for Sanctions on June 5, 2015 (Dkt. #39). On
July 14, 2015 the Court entered an Order granting Plaintiffs’ Motion for Sanctions, and ordered
Defendant to produce a competent corporate representative with personal knowledge of the
topics and ordered Defendant to produce requested documents contained in Plaintiffs’
Deposition Notice of Corporate Representative pursuant to Rule 30(b)(6) (Dkt. #44).
Plaintiffs made a strategic decision not to depose a second corporate representative as a
witness (Dkt. #52). 15
Therefore, Janati remained the corporate representative sitting at
Defendant’s table and testifying at trial as a fact witness (Dkt. #62). Janati’s trial testimony
regarding several important aspects of the case drastically differed from her testimony at her
deposition. See Trial Tr. 9/10/15 at 58:15-59:14 (testifying during her deposition that she was
unsure about whether or not the January 3 Communication qualifies as a QWR, then testifying at
trial that she was sure that it does not qualify as a QWR); Trial Tr. 9/10/15 at 11:24-13:13
(stating during her deposition that Defendant had a written policy in December 2013 for
identifying QWRs, and stating during trial that Defendant did not have a written policy at that
time); Trial Tr. 9/10/15 at 16:4-17:1 (stating that as of November 25, 2013, the total amount of
the whole loan was roughly $600,000 although during her deposition she testified that she did
not know); Trial Tr. 9/10/15 at 29:4-19 (acknowledging that she did not know how much
Plaintiffs were behind on payments as of November 2013 in her deposition, even though she
prepared for the deposition, but stating now that they owed about forty-four thousand dollars in
November 2013); Trial Tr. 9/10/15 at 22:8-23:7 (stating that during her deposition she stated that
15
Plaintiffs persuasively argued that Defendant should not be allowed to benefit from not complying with Rule
30(b)(6). FED. R. CIV. P. 30(b)(6).
38
on May 28, 2013, Plaintiffs made a payment of over $6,000 on their account, but after the
deposition she researched it and found out that the payment was returned to the homeowner).
Additionally, during trial she was evasive and nonresponsive. 16
When the jury was allowed to ask Janati questions, 17 the following exchange occurred:
The Court: Then, ma’am, for the fall of 2013 how were the procedures for
handling QWRs communicated to the other employees responsible for responding
to the QWRs, prior to the issuance of the written policy? 18
A. Other employees would not respond to QWR. It needed to fit the specific of
QWR. And in this case, the December 16 letter from the attorney fit into the
QWR. It did go to Customer Relation Officer. They logged it in. They worked it,
and they responded to every question that they have.
The Court: Okay. So are you saying you make that decision? I mean, that’s what
I'm trying to understand I guess and I think the jury is trying to understand, is you
16
See Trial Tr. 9/10/15 at 23:8-17 (refusing to acknowledge the fact that she said “I don’t know” several times in her
deposition even after the attorney told her that she said that phrase 116 times in her deposition, and instead
repeatedly telling the lawyer he would have to point it out to her in the deposition transcript); Trial Tr. at 9/10/15
20:23-21:22:8 (stating that she could not be sure if her deposition testimony was correct because she did not know if
during the deposition she had examined the relevant documentation); Trial Tr. 9/10/15 at 26:1-28:7 (unable to state
how much Plaintiffs paid in October of 2013 and saying that she was not smart enough to retain the numbers and
dates she was asked about); Trial Tr. 9/10/15 at 19:16-20:22 (refusing to say that she understood that Plaintiffs’
contention was that they never received an adequate accounting, even though she had stated that she understood this
during her deposition); Trial Tr. 9/10/15 at 31:12-32:13, 32:22-33:2, 33:9-34:1 (acknowledging that she could have
brought documentation with her to assist her in answering questions, after stating several times that she could not
answer Plaintiffs’ counsel’s questions because she would have to check the records).
17
The Court allowed jurors to ask questions of the witnesses. The procedure for doing so is explained to the jury
during the Court’s preliminary instructions. Each juror is given a blank question form. If, during a particular
witness’s testimony, they believe that there is something important that they would like to ask that witness, they may
write their question on the form. After the attorneys have completed their questioning of the witness, the Court asks
each juror to pass their form to the Court Security Officer. They are instructed to pass a form even if it is blank. By
doing this, the identity of the juror asking a question will not be readily apparent. The Court then has the attorneys
approach the bench and the Court reviews the questions with the attorneys out of the hearing of the jury. The Court
then decides whether it believes each question is appropriate. The Court then asks the witness the questions it
believes are appropriate, and the witness will then answer the questions for the jury. After the witness answers all of
the juror questions, the Court allows the attorneys, if they desire, to ask any follow-up questions. The jury is told
not be offended if the Court does not ask their question, or rephrases it. The jury is also told that the Court hopes that
by allowing jurors to ask questions, they will be more engaged in the proceedings and get the information they need
to reach a just verdict. The jury is instructed not to feel compelled to ask a question if they do not feel it is
necessary. The jury is also instructed that they should not be afraid to ask a question if they believe it will help them
better understand a witness’s testimony. They are told that their questions should be limited strictly to the witness’s
testimony, and not to ask questions that are unrelated to the specific testimony of that witness. The jury is informed
that the Court will decide whether a question is appropriate and whether it should be asked. The jury is instructed
that they should not draw any adverse inference against any party should the Court decline to ask a question or rephrase a question that has been submitted.
18
This question was submitted by the jury. The rest of the questions included herein were follow-up questions that
the Court asked in an attempt to clarify Janati’s response to the jury question.
39
have no written policy at the time you’re addressing these letters and you're
making it sound like, well, okay, if it's QWR, we respond. What procedures are
there in determining when it qualifies as a QWR?
A. If -- if it is made to –
The Court: Because, ma’am, the Plaintiffs are asserting that all these letters sent
qualified as a QWR. That's their assertion.
A. And it doesn’t. One of them, it qualifies. So there's three important factors
about QWR.
The Court: But, ma'am, the question I’m trying to figure out is tell me what
procedures are there to determine what qualifies as a QWR.
A. I’m sorry?
The Court: You're making the statement that this isn’t, but how? Why?
A. Why? Okay. So first, mailed to the correct address. Second, Attention
Customer Relation Officer. Third, your question should be in regards to servicing
of the account. We are the servicer of the account. So ask for accounting, ask for
-- you know, if you think there has been an error made. So if it does go to the
correct address, Attention Customer Relation Officer, and it does address or
question about the servicing of the account, it does go to Customer Relation
Officer, they open, they log in, and they respond.
(Trial Tr. 9/10/15 at 47:8-48:20).
After the jury questions were complete, Plaintiff’s counsel asked Janati follow-up
questions, and the following exchange occurred:
Q. Will you agree with me that that January 3rd letter was a QWR? The letter that
was previously up here, not the response. The letter that was just on the screen for
15 minutes.
A. No, sir, that was not a QWR.
Q. Okay.
A. Would you –
Q. Why was that not a QWR?
40
A. I read it carefully. Every single paragraph, if you want to put it up, it was
explained in the previous letter. It more looked like the previous attorney didn’t
agree with Nationstar. Every single item was addressed with the letter that we
sent to them with all those attachment. She is re-questioning me. She is just I
don’t agree with you, I don't agree with you, when I provided the document to
show how many month, what is this, what is this. Everything was in that package.
Q. Okay. Yes or no, do you think the January 3rd letter was a QWR?
A. No, sir.
Q. Okay. In your deposition you told me under oath you did not know whether or
not that letter was a QWR, right?
A. I said back then I –
Q. But now today you have changed your testimony and it is a QWR, right?
A. It is not.
Q. Oh, it’s not. I get confused. You answer so many different ways, I can't
remember which one it is.
A. Well, let me clear it. One letter, December 16 letter that we responded, it went
to Customer Relation. It got logged in. They followed the procedures and they
provided everything that they ask. One letter was QWR. The January 3rd was the
follow-up of that, and we can go paragraph by paragraph just so I can explain that
every question that Ms. Sara was asking, it was the same question from the
December 16 that it was responded. So I’m telling you the January 3rd is not
QWR. We already provided those information to the attorney.
Q. During your deposition you didn’t know whether or not the February 11th
letter was a QWR either, did you?
A. No, I didn’t know and I explained.
Q. Okay.
A. I researched it.
The Court: Let me just ask a question. How did you research it? So you’re in that
department. You followed the oral procedures, whatever those are, to make these
decisions. Of course, now you have a written policy. So at the time of your
deposition, those policies were in place. The written policies were in place I
believe at the time of the deposition. That’s correct, right? Make sure that counsel
–
41
Mr. Hughes: Yes.
The Court: Okay. So how would you not know at the time of your deposition
whether those qualified as a QWR? You’re the corporate representative at the
deposition. You’re the corporate representative. Why would you not know
whether that qualified as a QWR at that point? That’s your job. Why would you
not know?
A. I’m sorry.
The Court: No, that’s not sufficient. That’s not good enough. Why do you not
know?
A. We do have a -- I am not Customer Relation.
The Court: So why should we believe you now when you say it’s not one?
A: I’m sorry?
The Court: Why should we believe you now that it’s not a qualified written
request when your job at the deposition as the corporate representative for the
Defendant, you're saying you don't know at the deposition? After you already had
written policies in place at the time of your deposition, you’re saying you don't
know if those are qualified written requests. But today you’re saying no, they're
not. Tell me how we're supposed to believe one or the other. And I don't want to
hear I’m sorry. You're the -- you work for the company. How is the jury supposed
to assess this?”
A. I went back and researched it, so I –
The Court: How did you research it?
A. Well, you know, I went back and I talked to somebody who works for
Customer Relationship and I reverified that -- Your Honor, I said that one of them
was treated as a QWR, the letter before it. So the letter before it was treated as
QWR, and I didn’t know if the second letter would still be a QWR when I already
-- my company already responded to the previous one, so it was repetition. I didn't
know if it is a repetition of the question, would it be again a QWR.
(Trial Tr. 9/10/15 at 57:23-61:6).
42
After the exchange above occurred and after a break, Defendant’s counsel made a motion
for the Court’s recusal outside the presence of the jury. 19
Mr. McInnis: It’s our client’s position that because of the questioning, specifically
the questioning that went beyond that of the jurors, that it evidenced partiality and
questioned the credibility of the witness that crossed the line to advocacy and may
not be cured by the instruction, so we would respectfully ask for recusal.
(Trial Tr. 9/10/15 at 104:9-14). The Court denied the motion to recuse (Trial Tr. 9/10/15 at
104:15-16). After further discussion of the verdict form, the Court again addressed the motion
for recusal thus,
The Court: . . . And also going back to your request for recusal, I think the Federal
Rules allow me to question witnesses and allow me to comment on the evidence.
There’s nothing improper about that. So explain to me again why you think that
I’m not being -- somehow being impartial in this.
Mr. McInnis: Yes, sir. Certainly 614 allows Your Honor to ask questions, but
there is case law that says where that evidences a partiality or crosses the line to
advocacy as with regard to in this specific instance the statement of how am I
supposed to believe you, how are we supposed to believe you now, those type of
comments are the basis of the motion, Your Honor.
…
Mr. Hughes: First of all, all you were doing was reading the jurors’ questions, and
then the witness didn’t answer. And I believe all you were doing was instructing
her that she needs to answer the question and that’s the extent of what I believe
you were doing.
The Court: I agree. I mean, you put a witness on that did a horrible job and
wouldn’t respond, gave a lot of non-responsive answers and then also answered
questions that weren’t being asked. So I did do that, but that doesn’t show my
partiality. It’s trying to get the witness to answer the questions that were being
asked, both by counsel as well as the jury.
(Trial Tr. 9/10/15 at 105:7-106:8).
The Court’s questioning of Janati benefitted the jury by clarifying her previous
(nonresponsive and evasive) answers, and it is expressly authorized by the Federal Rules of
19
Defendant has not raised the issue of recusal again in its current motion (Dkt. #89).
43
Evidence. See Fed. R. Evid. 614(b). Rule 614(b) of the Federal Rules of Evidence permits
judges to question witnesses. Id. “A trial judge has wide discretion over the ‘tone and tempo’ of
a trial and may elicit further information from a witness if he believes it would benefit the jury.”
United States v. Saenz, 134 F.3d 697, 701-02 (5th Cir. 1998).
The Fifth Circuit has previously stated that a trial judge’s questioning of witnesses is
permissible if aimed at clarifying the evidence or managing the trial. United States v. Williams,
809 F.2d 1072, 1086 (5th Cir. 1987). The Fifth Circuit has stressed that its “review of the trial
court’s actions must be based on the entire trial record” and it will conclude a court’s questioning
warrants reversal only when the “cumulative effect” is substantial and prejudices the defendant.
United States v. Saenz, 134 F.3d 697, 702 (5th Cir. 1998). When determining whether reversal is
warranted, the Fifth Circuit reviews such factors as the context of the questions, the person to
whom the questions were directed, and the presence of curative instructions. Id. However,
“[t]he mere fact that there were more interruptions on one side or the other” and “[t]he judge’s
elicitation of ‘damaging information’ in the course of questioning witnesses” are “insufficient to
demonstrate that the judge was engaged in misconduct.” Richmond v. Horace Mann Ins. Co.,
480 F. App’x 747, 749-50 (5th Cir. 2010) (per curiam) (citing United States v. Lankford, 196
F.3d 563, 572-73 (5th Cir. 1999).
In the current case, the record indicates that the Court was seeking clarification (Trial Tr.
9/10/15 at 106:2-8). Additionally, the Court included a curative instruction in the jury charge.20
Janati’s testimony was inconsistent, and she had failed to adequately explain the inconsistency
20
The Court’s curative instruction in the Jury Charge stated that,
If I have given you the impression during the trial that I favor either party, you must disregard that
impression. If I have given you the impression during the trial that I have an opinion about the
facts of this case, you must disregard that impression. You are the sole judges of the facts of this
case. Other than my instructions to you on the law, you should disregard anything I may have said
or done during the trial in arriving at your verdict.
(Dkt. #74 at p. 1).
44
(Trial Tr. 9/10/15 at 57:23-61:6). The Court asked why her testimony had changed, and then
when she did not give a satisfactory answer, the Court pressed the witness to explain further so
that the jury could evaluate whether her deposition testimony or her live testimony was more
reliable. The Court’s line of questioning did not elicit “damaging information.” Indeed, the
information that was elicited might have been helpful to Defendant’s case because it explained
the inconsistency in Janati’s testimony.
When analyzed in the context of the entire record, the cumulative effect of the Court’s
questioning did not prejudice Defendant. See United States v. Deason, 14-10461, 2015 WL
4709584 at *9 (5th Cir. Aug. 7, 2015) (per curiam) (stating “it was not unreasonable for the trial
court to seek clarification of [Defendant’s] somewhat circuitous testimony to aid the jury” and
finding no plain error even though the court engaged in “several salty exchanges with both sides”
during trial); Richmond, 480 F. App’x at 749-50 (finding that a court’s questioning of one party’s
witnesses more actively, combined with the fact that its questioning seemed to point out flaws in
that party’s case, did not constitute plain error and that the questioning was “more focused on
ascertaining the truth and avoiding the needless consumption of time.”) (citation omitted);
United States v. Achobe, 560 F.3d 259, 272 (5th Cir. 2008) (holding that although the court’s
questioning “suggests antagonism or incredulity” toward the defendant’s testimony, there was
not clear error because the trial was large and there was a significant amount of evidence in favor
of the government’s argument); United States v. Lankford, 196 F.3d 563, 572-73 (5th Cir. 1999)
(finding no misconduct when the trial court interrupted the defendant’s examination of key
witnesses almost sixty times, while only interrupting the Government's examination of the same
witnesses twenty times); see also McMillan v. Castro, 405 F.3d 405, 412 (6th Cir. 2005) (finding
45
no misconduct even when the trial court's questioning “bordered on condescending”). Therefore,
the Court’s questioning of Janati was proper and a new trial should not be granted.
.
CONCLUSION
It is therefore ORDERED that Defendant’s Renewed Motion for Judgment as a Matter
of Law, Motion to Alter or Amend Judgment, and Alternatively, Motion for New Trial (Dkt.
#89) is hereby DENIED.
SIGNED this 21st day of April, 2016.
___________________________________
AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE
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