Morgan v. Bayview Loan Servicing, LLC et al

Filing 70

MEMORANDUM OPINION. Signed by District Judge Robert E. Payne on 03/28/2019. (smej, )

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF VIRGINIA
Richmond Division

VALERIE D. MORGAN,

Plaintiff,
Civil Action No. 3:18-cv-435

V.

BAYVIEW LOAN SERVICING, LLC,

et al.,
Defendants.

MEMORANDUM OPINION

This

FINANCE,

DISMISS

matter

is

before

INC.'S MOTION

(EOF

No.

18)

TO

the

Court

on

DEFENDANT

NVR

DISMISS (EOF No. 9); the

filed

by

Bayview

Loan

MORTGAGE

MOTION

Servicing,

TO

LLC

C'Bayview"), E*Trade Bank (''E*Trade"), and Mortgage Electronic
Registration Systems, Inc. (^'MERS"); DEFENDANT BANK OF AMERICA,
N.A.'S MOTION TO DISMISS PLAINTIFF'S COMPLAINT (EOF No. 20); and

Plaintiff Valerie D. Morgan's MOTION[S] TO AWARD PLAINTIFF FEDERAL
& STATE CRIME VICTIMS RIGHTS, and DENY DEFENDANTS ANY/ALL FORMS OF
RELIEF - PER 18 USC 3771 (d)(1) (EOF Nos. 28, 34, 36, 38, and 39).

For the following reasons, the defendants' motions to dismiss (EOF
Nos. 9, 18, and 20) will be granted, and Morgan's MOTION [S] TO
AWARD PLAINTIFF FEDERAL &

STATE CRIME VICTIMS RIGHTS, and

DENY

DEFENDANTS ANY/ALL FORMS OF RELIEF - PER 18 USC 3771 (d)(1) (ECF

Nos. 28, 34, 36, 38, and 39) will be denied.

But, because Morgan

has recently retained counsel, the dismissal will be without
prejudice.
BACKGROUND

Morgan, proceeding pro se, filed this action on June 21, 2018
against five defendants.

See ECF No. 1.

Morgan alleges that NVR

Mortgage Finance Inc. C'NVR") is the original lender of her loan.
Id. at 4.^

NVR owned the original mortgage loan, but it sold her

mortgage to Bank of America, N.A. (^^Bank of America") over a decade
ago.

Morgan alleges that Bayview is the current servicer of her

loan, that E*Trade is the current owner of the loan, and that MERS

is the beneficiary of her loan.

Id. at 4.

It is not clear why

Morgan named Bank of America as a defendant, see id. at 5, but she
alleges that Bank of America was a prior servicer.

Id. at 6.

In the Complaint, Morgan alleges that she has been trying to

get information from the defendants for over nine years to verify
that her mortgage's chain of title is correct and to ensure that
the party collecting payments has a legal right to collect her

mortgage.

Id. at 5.

Morgan says that she has never been in

default or submitted any late payments, but she acknowledges that
she still must send in payments to avoid default.

See id. at 6.

The Complaint lacks logical flow, making it difficult to
discern Morgan's legal claims and which claims apply to which

1 In 2011, Morgan previously filed a suit against NVR in a
Virginia state court. That case was dismissed.

defendants.
ACTION."

Morgan

labeled

See id. at 2.

the

Complaint

as

a ''QUIET

TITLE

She insinuates that she did not know that

her mortgage would be sold and securitized, although she recognizes
that the defendants had a right to do so, and she alleges that the
defendants engaged in fraud by selling her mortgage.

3-6.

See id. at

She also alleges that there is a "cloud" over her title

because she thinks that she may have to defend her ownership

against some unknown party at some unknown time in the future.
Id. at 8.

She further includes a conclusory litany of other claims

without explanation as to how they apply to her case or which of
the defendants she thinks

violated

which

of the laws which she

mentions, including: (1) a claim under the Equal Protection Clause
of the Fourteenth Amendment of the U.S. Constitution for alleged

manipulation of the London Inter-bank Offered Rate ("LIBOR");
(2) racketeering under 18 U.S.C. § 1957; (3) money laundering under
18 U.S.C. § 1956; (4) use of an "illegal currency" in a deal under

Code of Virginia § 6.2-203; (5) fraud that can result in rescission
of a contract under U.C.C. § 3-202; (6) an unfair or deceptive

acts or practices claim under Section 5 of the Federal Trade
Commission Act (15 U.S.C. § 45) (the "FTCA"); (7) a trademark claim
under

15

U.S.C.

§

1125;

(8)

an

unfair

or

deceptive

acts

or

practices claim promulgated by the Consumer Financial Protection
Bureau; and (9) a securities claim under Section 17(a) of the

Securities

Exchange

Act

of

1933

(15

U.S.C. § 77q(a)).

See

generally id.

She requests multiple remedies, which, in essence,

ask the Court to nullify her mortgage, to hold that the defendants

have no legal or equitable interest in the property, and to order
the defendants to give her money.

In response to the Complaint, each defendant filed a motion
to

dismiss

under

Fed.

R.

Civ.

P.

12(b)(6).

See DEFENDANT

NVR

MORTGAGE FINANCE, INC.'S MOTION TO DISMISS (EOF No. 9); MOTION TO
DISMISS (EOF No. 18); DEFENDANT BANK OF AMERICA, N.A.'S MOTION TO

DISMISS PLAINTIFF'S COMPLAINT (EOF No. 20).

Morgan also filed

five separate documents titled MOTION TO AWARD PLAINTIFF FEDERAL
& STATE CRIME VICTIMS RIGHTS, and DENY DEFENDANTS ANY/ALL FORMS OF

RELIEF - PER 18 USC 3771 (d)(1).
39.

S^ EOF Nos. 28, 34, 36, 38, and

Her motions ask the Court to ignore the Defendants' arguments

and to grant her relief.
DISCUSSION

A. Legal Standard

In considering a motion to dismiss under Rule 12(b)(6), the
Court accepts all well-pleaded allegations as true and views the

Complaint in the light most favorable to the plaintiff.

Philips

V. Pitt Cty. Mem'1 Hosp., 572 F.3d 176, 180 (4th Cir. 2009).

But

the Court does not need to accept the plaintiff s legal conclusions
drawn from those facts.

Id.

The Court can take judicial notice

of matters of public record, and it can consider documents attached

to the complaint and motions to dismiss ""so long as they are
integral to the complaint and authentic."

Id.

Fed. R. Civ. P. 8(a)(2) requires ^^a short and plain statement

of the claim showing that the pleader is entitled to relief" to
'"give the defendant fair notice of what the . . . claim is and the
grounds upon which it rests."

Bell Atl. Corp. v. Twombly, 550

U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47
(1957)).

A complaint attacked by a motion to dismiss under Rule

12(b)(6) does not require detailed factual allegations, but it

does require ''more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do."

Id.

The complaint "must contain sufficient factual matter, accepted as
true, to 'state a claim to relief that is plausible on its face.'"
Ashcroft V. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550
U.S. at 570).

"A claim has facial plausibility when the plaintiff

pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged."

Id.

The

plausibility

standard

requires "more

possibility that a defendant acted unlawfully."

than

a

sheer

Id.

Courts construe pro se complaints liberally.

As the Supreme

Court has instructed, "[a] document filed pro se is to be liberally

construed, and a pro se complaint, however inartfully pleaded,
must be held to less stringent standards than formal pleadings

drafted by lawyers."

Erickson v. Pardus, 551 U.S. 89, 94 (2007)

{per

curiam)

(citations

omitted);

see

Fed.

R.

Civ.

P.

8(e)

("Pleadings must be construed so as to do justice.").

B.

Morgan Pails To State A Claim for Quiet Title

Morgan's complaint is styled as a "QUIET TITLE ACTION," see
ECF No. 1 at 2.

So, the Court addresses that claim first.

Under Virginia law, a plaintiff "seeking to quiet title must

plead that she has superior title over the adverse claimant" and
that she "has fully satisfied all legal obligations to the real
party in interest."

Squire v. Virginia Hous. Dev. Auth., 287 Va.

507, 520, 758 S.E.2d 55, 62 (2014).

Morgan does not plead that

she has superior title or has satisfied all legal obligations.
Thus, Morgan has not alleged a quiet title action against any
party.

0.

Morgan Has Failed To State A Claim For Fraud

Morgan also alleges that the defendants committed fraud by

securitizing her mortgage and selling that mortgage.

But her

concerns about the defendants' securitization of her mortgage are

inadequate to state a claim for fraud.

"To prevail on an actual

fraud claim under Virginia law, a plaintiff must prove by clear

and convincing evidence

^ (1) a false representation, (2) of a

material fact, (3) made intentionally and

knowingly, (4) with

intent to mislead, (5) reliance by the party mislead, and (6)

resulting damage to the party misled.'"
V.

Signet

Bank,

166

F.Sd

614,

628

Hitachi Credit Am. Corp.

(4th

Cir.

1999)

(quoting

Evaluation Research Corp. v. Alequin^ 247 Va. 143, 148, 439 S.E.2d

387,

390 (Va. 1994)).

For a fraud claim to be sufficiently

pleaded, the Complaint must allege those elements.

Here, the Complaint does not plead the necessary element of

a well-pleaded fraud claim.
legal under federal law.

Moreover, selling mortgage loans is

E.g., 0^Dell v. Deutsche Bank Nat. Tr.

Co., No. l:12-cv-985, 2013 WL 2389874, at *14 (E.D. Va. May 30,
2013), aff^d, 442 F. App'x 861 (4th Cir. 2011)).

Additionally,

Virginia law ^Mating back to at least 1827" has allowed notes to
be endorsed ''in blank" so that the notes may be transferred freely

and so the buying party "has full power to enforce" the notes.
Horvath v. Bank of New York, N.A., 641 F.3d 617, 621 (4th Cir.

2011); see also Va. Code Ann. § 8.3A-205(b) ("If an endorsement is

made by the holder of an instrument and it is not a special
endorsement, it is a 'blank endorsement.'

When endorsed in blank,

an instrument becomes payable to bearer and may be negotiated by

transfer of possession alone until specially endorsed.").
Finally, Morgan herself acknowledges that she knew the note
could be sold, so there was no false representation made by any
defendant.

See ECF No. 1 at 9 ("The Plaintiff was aware that the

note/mortgage
added)).

'might'

be

sold

and/or

reassigned."

(emphasis

Thus, she has no basis for a fraud claim against the

defendants.

D.

Morgan's Other Claims Fail To Satisfy Rule 12's Pleading
Standard

Even though Morgan lists numerous statutes and the Fourteenth
Amendment of the Constitution, she fails to state a claim based on

any of them.

Instead, she provides only ''labels and conclusions"

and "formulaic recitation[s] of the elements of a cause of action,"

which are not enough to survive a Rule 12(b)(6) motion to dismiss.
Twombly,

550

U.S.

at

555.

The

Complaint

fails

to "contain

sufficient factual matter . . . to 'state a claim to relief that

is plausible on its face.'"

Ashcroft, 556 U.S. at 678 (quoting

Twombly, 550 U.S. at 570).

First, her Equal Protection Clause claim—due to alleged LIBOR

manipulation—fails because Morgan has not sued any governmental
entity, and the Fourteenth Amendment applies only to conduct by a

government.

See Shelley v. Kraemer, 334 U.S. 1, 13 (1948).

And,

even if she had brought those LIBOR-manipulation claims under

another statute, they would fail because Morgan has not alleged

that

any

of

these

defendants

participated

in

any

Libor-

manipulation scheme. Instead, she merely cites a Wikipedia article
that does not mention any defendant in this action.

See ECF No.

1 at 5-6.

Second, Morgan's racketeering and money laundering claims
under 18 U.S.C. § 1956 and § 1957 fail, because those are criminal
statutes that do not indicate that Congress intended to create a

private right of action.
(noting

that

a

''bare

See Cort v. Ash, 422 U.S. 66, 80 (1975)
criminal

statute"

had

"absolutely

no

indication that civil enforcement of any kind was available to

anyone"); see also Doe v. Broderick, 225 F.3d 440, 447-48 (4th
Cir. 2000) ("The Supreme Court historically has been loath to infer
a

private

right

of

action

from

a

bare

criminal

statute,

because criminal statutes are usually couched in terms that afford

protection to the general public instead of a discrete, welldefined group." (citations omitted)). And, even if Morgan alleged
a civil RICO claim, she does not allege facts that satisfy the
elements of such a claim.

requires

"(1)

conduct

A violation of the civil RICO statute

(2)

of

an

enterprise

pattern (4) of racketeering activity."

(3)

through

a

Sedima, S.P.R.L. v. Imrex

Co., 473 U.S. 479, 496 (1985) (footnote omitted).

pleaded any facts to satisfy these elements.

Morgan has not

Most notably, she

has not specified any "racketeering activity" under 18 U.S.C. §
1961 (also known as the "predicate act") in which the defendants

engaged, nor has she alleged that they participated in a "pattern"
of racketeering activity through at least two distinct but related

predicate acts.

Id. at 496 n.l4; Walters v. McMahen, 684 F.3d

435, 440 (4th Cir. 2012). Thus, even if Morgan had brought a civil
RICO claim, any such claim would fail.

Third, Morgan fails to state a claim for use of an "illegal

currency" in a deal under Code of Virginia § 6.2-203.

Morgan has

alleged only that she was harmed by interest-rate manipulation.
ECF No. 1 at 9.

Because an interest rate is not a currency, see

Currency, Black^ s Law Dictionary, her claim fails.

Thus, there

are no facts to support a claim that the defendants used an illegal
currency to harm her.

Fourth, Morgan cannot sue to rescind her mortgage agreement
under U.C.C. § 3-202, even if she had a valid claim, because her

right of rescission expired in 2009, which was three years after

she signed the note and mortgage deed.

See 15 U.S.C. § 1635(f)

(''An obligor's right of rescission shall expire three years after
the date of consummation of the transaction or upon the sale of

the property, whichever occurs first . . . .").

Thus, she has not

pleaded facts to satisfy a claim under U.C.C. § 3-202.
Fifth, Morgan cannot bring a claim under Section 5 of the

FTCA.

As this Court has previously said, "The Fourth Circuit has

explicitly recognized that 'the substantive prohibitions of [the
FTCA] [are] inextricably intertwined with provisions defining the

powers and duties of a specialized administrative body charged
with its enforcement,' and, as a result, 'courts have declined to

imply any private right of action [in the FTCA] and have relied
upon the regulatory scheme to police the industry.'"

Benton v.

Phillips Edison & Co., No. 3:17CV630-HEH, 2017 WL 6273361, at *4
(E.D. Va. Dec. 8, 2017) (alterations in original) (quoting A & E

Supply Co. V. Nationwide Mut. Fire Ins. Co., 798 F.2d 669, 675

10

(4th Cir. 1986)).

Therefore, Morgan has no legal claim against

any defendant under the FTCA.

Id.

Sixth, there is no trademark at issue in this case, so Morgan
cannot

make

a

claim

under

15

U.S.C.

§

1125.

To

state

an

infringement claim, the trademark holder must prove: (1) that it
possesses a mark; (2) that the defendant used the mark; (3) that
the defendant used the mark ^^in commerce"; (4) that the defendant

used the mark "in connection with the sale, offering for sale,

distribution, or advertising" of goods and services; and (5) that
the defendant used the mark in a manner that was likely to confuse

consumers.
(4th

Cir.

See, e.g., Lamparello v. Falwell, 420 F.3d 309, 313
2005);

People

for

Ethical

Treatment

Doughney, 263 F.3d 359, 364 (4th Cir. 2001).

of

Animals

v.

Morgan has not

alleged that there is any trademark at issue in this case, so she
cannot maintain such a claim.

Seventh, Morgan's claims related to the Consumer Financial
Protection Bureau's rules cannot be brought, because the Consumer
Financial Protection Bureau was established after Morgan bought
her house.

Finally, Morgan cannot bring a claim Section 17(a) of the
Securities Exchange Act of 1933 (15 U.S.C. § 77q(a)).

Simply put,

a private individual cannot bring a claim under Section 17(a)
because the Fourth Circuit has held that Section 17(a) does not

contain a private right of action.

11

Newcome v. Esrey, 862 F.2d

1099, 1107 (4th Cir. 1988) (en banc).

Thus, Morgan cannot bring

a claim under that statute here.

E.

Morgan's Various Motions Asking For The Court To Award
Her Relief And Deny Defendants Relief (EOF Nos. 28, 34,
36, 38, and 39) Fail As A Matter of Law

Morgan

has also filed five motions that she has labeled

'^MOTION TO AWARD PLAINTIFF FEDERAL & STATE CRIME VICTIMS RIGHTS,

and

DENY

DEFENDANTS ANY/ALL FORMS OF RELIEF - PER 18

(d)(1)."

See EOF Nos. 28, 34, 36, 38, and 39.

USC 3771

These motions

function both as responses to the Defendants' various motions to
dismiss and as motions seeking protection under the Crime Victims'

Rights Act
follow.

C'CVRA").

These papers are illogical and hard to

Moreover, Morgan's papers do not substantively respond to

the Defendants' arguments.

Instead, Morgan's papers just copy and

paste statements from various websites and cases, Morgan's motions
lack

merit.

The

Fourth

Circuit

has

said

that 'Mt]he

rights

codified by the CVRA . . . are limited to the criminal justice

process; the Act is therefore silent and unconcerned with victims'
rights to file civil claims against their assailants."
States V. Moussaoui, 483 F.3d 220, 234-35 (4th Cir. 2007).

United
Thus,

she cannot bring a claim under the CVRA in a civil proceeding, so
her motions are denied.

F.

Morgan's Current Complaint Is Frivolous

Even according Morgan's Complaint the liberal interpretation

given to papers filed by pro se litigants, it is frivolous.

12

Nowhere does Morgan allege that she has been injured by the conduct
of any defendant.

Early in the case, the Court asked Morgan what

she wanted to achieve by filing the Complaint.

She advised that

she was ill and just wanted to know who held her mortgage. Although
that seemed obvious because Morgan

knew to whom she must make

mortgage payments, the Court directed the parties to make clear
how and to whom over time, the mortgage had been transferred.

did not satisfy Morgan.

That

Instead, she then pressed, for reasons

neither expressed nor readily apparent, to nullify her mortgage
and to declare that no defendant, even the current holder of the

mortgage, has an interest in it.
Whether this change of mind is caused by ignorance of the

facts or the law, by nuance, or by other reasons, it evinces, when
compared to applicable legal principles, frivolity, perhaps even
a vexatious purpose.

And, the defendants cannot be required to

incur legal fees to defend against claims that are frivolous at
best, vexatious at worst.

6.

The Dismissal Will Be Without Prejudice

Ordinarily, an action commenced by a Complaint such as this
would be dismissed with prejudice and without leave to amend.

However,

Morgan

has

recently

retained

counsel

who

has

noted

appearances in this case to assist Morgan on a pro bono basis.
See ECF Nos. 65, 67, 68, and 69.

Motion

to

Stay

(ECF

No.

66).

13

Morgan's counsel has filed a

That

motion

will

be

decided

separately.

However, counsel may file an Amended Complaint by

April 26, 2019.
CONCLUSION

For the forgoing reasons, DEFENDANT NVR MORTGAGE FINANCE,
INC.'S MOTION TO DISMISS (EOF No. 9), the MOTION TO DISMISS (EOF

No. 18) filed by Bayview, E*Trade and ''MERS, and DEFENDANT BANK OF
AMERICA, N.A.'S MOTION TO DISMISS PLAINTIFF'S COMPLAINT (EOF No.

20) will be granted; and Morgan's MOTION[S] TO AWARD PLAINTIFF
FEDERAL & STATE CRIME VICTIMS RIGHTS, and DENY DEFENDANTS ANY/ALL
FORMS OF RELIEF - PER 18 USC 3771 (d)(1) (EOF Nos. 28, 34, 36, 38,

and 39) will be denied.

The dismissal will be without prejudice.

It is so ORDERED.

/s/

Robert E. Payne

Senior United States District Judge

Richmond, Virginia
Date: March

2019

14