Spreitzer v. Woodall et al

Filing 154

ORDER by the Honorable Alan B Johnson granting 68 , 69 , 78 , 80 Motion to Dismiss ; denying 85 , 90 , 96 , 98 Motion to Strike ; denying 136 Motion for leave to file second amended complaint. Case Dismissed with prejudice. (Court Staff, sth)

FILED

U.S. DISTRICT COURT

DISTRICT OF WYOMING

im HfiR
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF WYOMING

3 pn 2 19

STEPHAN HARRIS. CLERK
CHEYENNE

JAMES A. SPREITZER,
Plaintiff,

Case No. 1:12-CV-00206-ABJ

JAMES H. WOODALL; HEATHER M.
MCGINLEY; JAMES H. WOODALL,

PLLC; DEUTSCHE BANK NATIONAL
TRUST COMPANY, as Trustee for
AMERIQUEST MORTGAGE
SECURITIES, INC.; HOMEWARD
RESIDENTIAL, INC.; DAVID
APPLEGATE; AMERIQUEST
MORTGAGE COMPANY; and DEFAULT
RESOLUTION NETWORK, LLC,
Defendants.

OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS AND
DENYING PLAINTIFF'S MOTION FOR LEAVE TO AMEND HIS COMPLAINT

In response to receiving foreclosure notices. Plaintiff filed RICO and FDCPA claims

against multiple defendants and filed for declaratory relief seeking to quiet his title.

The

original mortgage company, the mortgage assignee, the mortgage servicer, the attorney assisting
the mortgage assignee with foreclosure, and other defendants filed motions to dismiss the

plaintiffs claims against them. For the following reasons, the Court GRANTS their motions
and DENIES Plaintiffs motion for leave to amend his complaint.

BACKGROUND

On September 19, 2003, PlaintiffJames A. Spreitzer ("Plaintiff) executed a Fixed Rate
Note ("Note") promising to repay a loan that he received from Defendant Ameriquest Mortgage

Company ("Ameriquest"). [ECF No. 65 at H 27; ECF No. 1-1 at 4-6]. After the Plaintiff
executed the Note, Defendant Ameriquest indorsed the Note "without recourse." [ECF No. 65 at

^ 28; ECF No. 1-1 at 6]. This indorsement, as will be analyzed further below, is at the heart of
Plaintiffs claims.

The Plaintiff also executed a Mortgage ("Mortgage") which granted Defendant

Ameriquest and its "successors and assigns" a power of sale over Plaintiffs residence at 108

Sequoia Drive, Gillette, Wyoming 82718. [ECF No. 65 at ^ 27; ECF No. 1-1 at 8-22]. The
Mortgage was duly recorded on September 29, 2003, and it specifically provides that the Note

and Mortgage may be sold.

[ECF No. 1-1 at 22, 18]. Nearly six years later. Defendant

Ameriquest assigned ("Assignment") "the described mortgage" and the corresponding Note to
Defendant Deutsche Bank National Trust Company ("Deutsche Bank"), which was acting as

trustee for Ameriquest Mortgage Securities, Inc. Asset-backed Pass-through Certificates, Series

2003-11, under the Pooling and Servicing Agreement dated November 1, 2003, whose address is
1761 East St. Andrew Place, Santa Ana, CA 92705-4934 ("Ameriquest Certificates"). [Id at 28;
ECF No. 70 at 2; ECF No. 81 at 7].

On March 12, 2012, Plaintiff received the first of many notices of intent to foreclose.

[ECF No. 65 at ^ 42; ECF No. 1-1 at 24]. Defendant James H. Woodall ("Woodall") sent the
notices on behalf of Defendant Deutsche Bank because Plaintiff had defaulted under the Note

and Mortgage. [ECF No. 65 at

42-44; ECF No. 1-1 at 24; ECF No. 70 at 3; ECF No. 79 at 2-

3; ECF No. 81 at 8]. Subsequent to these notices. Defendant Homeward Residential, Inc.

("Homeward") sent Plaintiff a letter regarding the loan represented by the Note and the
foreclosure. [ECF No. 65 at ^ 75; ECF No. 70 at 3]. Defendant Homeward is the self-described
servicer of the loan evidenced by the Note. [ECF No. 70 at 3].

On August 20, 2012, the Plaintiff received a letter from Defendant Default Resolution
Network, LLC ("Default Resolution"). [ECF No. 65 at f 87]. The letter stated that Defendant
Homeward had "referred [Plaintiffs] loan to us for foreclosure." [ECF No. 1-2 at 44]. Aside

from including the letter and identifying Defendant Default Resolution, the Plaintiff has not
alleged any other facts regarding that defendant. [M; ECF No. 65 at 22].

On September 11, 2012, Plaintiff filed his initial complaint in this case alleging that
Defendants James H. Woodall, James H. Woodall, PLLC ("Woodall PLLC"), Heather M.

McGinley ("McGinley"), Ameriquest, Deutsche Bank, Homeward, and Default Resolution had
violated multiple counts of the Fair Debt Collection Practices Act and the Racketeer Influenced

and Corrupt Organizations Act. [ECF No. 1]. Various defendants filed motions to dismiss the
original complaint, and Plaintiff filed the instant Verified Amended Complaint ("Amended
Complaint"), ECF No. 65, in response.

Shortly thereafter. Defendant Default Resolution filed its Motion to Dismiss the

Plaintiffs Verified Amended Complaint. [ECF No. 68]. Ten days later, Deutsche Bank and
Homeward filed their Motion to Dismiss the Amended Complaint and an accompanying

Memorandum in Support. [ECF Nos. 69, 70]. Shortly thereafter. Defendants Woodall, Woodall
PLLC, and McGinley filed their Motion to Dismiss the Amended Complaint and its supporting

memorandum. [ECF Nos. 78, 79]. A day later. Defendant Ameriquest filed its Motion to
Dismiss the Verified Amended Complaint and its supporting memorandum. [ECF Nos. 80, 81].
Instead of filing a response to these motions to dismiss. Plaintiff filed motions to strike or deny

each respective motion. [ECF Nos. 85, 90, 96, 98]. Since motions to strike are disfavored, the
Court will examine his motions to strike or deny as though they were responses.

Most

defendants replied to the motion seeking to strike or deny their motion to dismiss. [ECF Nos.

104, 108, 113, 114]. The Plaintiff responded to those replies (without seeking leave to do so),
and he also filed several Judicial Notices to the Court. [ECF Nos. 66, 109, 111, 115, 127, 129].

On May 10, 2013, Paul Knight entered an appearance for Plaintiff, who had proceeded
pro se until then. [ECF No. 133]. Seven months later, the Court entered orders dismissing
several motions as moot and dismissing all claims as to Defendants Campbell County Abstract

Company and Barbara S. Redder. [ECF Nos. 134, 135]. Over a month after that. Plaintiff filed a
Motion for Leave to File a Second Amended Complaint. [ECF No. 136]. The Defendants filed

Responses in opposition. [ECF Nos. 137, 138, 140, 146]. Plaintiff, thereafter, filed his replies.
[ECF Nos. 149, 150, 151, 152]. The Court finds that these matters have been thoroughly briefed
and are ripe for disposition.

STANDARD OF REVIEW

In Ashcroft v. Iqbal, the Supreme Court articulated a two-step approach for district courts
to use when considering a motion to dismiss under Fed. R. Civ. P. 12(b)(6). See 556 U.S. 662,

679 (2009). First, "a court considering a motion to dismiss can choose to begin by identifying

pleadings that, because they are no more than conclusions, are not entitled to the assumption of
truth." Id. Iqbal clarified that "the tenet that a court must accept as true all of the allegations
contained in a complaint is inapplicable to legal conclusions," and "[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. at
61%.

Second, "[wjhen there are well-pleaded factual allegations, a eourt should assume their

veracity and then determine whether they plausibly give rise to an entitlement to relief." Id. at
679. The Court has stated that "[t]o survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face."
Id. at 678. "A elaim 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. Plausibility lies somewhere between possibility and probability; a complaint must
establish more than a mere possibility that the defendantacted unlawfully but the complaintdoes
not need to establish that the defendant probably acted unlawfully. See id. "Determining

whether a complaint states a plausible claim for relief will ... be a context-specific task that
requires the reviewing court to draw on its judicial experience and eommon sense." Id. at 679.
DISCUSSION

I.

Fair Debt Collection Practices Act Claims

The Plaintiff has alleged that all Defendants have violated five sections of the FDCPA:

15 U.S.C. §§ 1692f(6), 1692e(2)(A), 1692e(4),(5), and (10). The Court finds that the Plaintiffs
claims arise under federal law and that jurisdiction is proper under 28 U.S.C. § 1331.

"The FDCPA prohibits the use of 'abusive, deceptive, and unfair debt collection

practices.'" Maynard v. Cannon., 401 Fed.Appx. 389, 393 (10th Cir. 2010) (quoting 15 U.S.C. §
1692(a)). "To prevail on a elaim under the FDCPA, a plaintiff must prove that a 'debt
eollector's' effort to collect a 'debt' from a 'consumer' violated some provision of the FDCPA."

Id. There seems to be no dispute that Plaintiffis a "consumer" as defined by the FDCPA, nor is
there a dispute that his mortgage was a "debt" under the FDCPA. See 15 U.S.C. § 1692a(5)

(defining "debt" as "any obligation or alleged obligation of a consumer to pay money arising out

of a" consumer transaction). Instead, Defendants argue that they are not "debt collectors" under

the FDCPA, that non-judicial foreclosure actions do not constitute "debt collection activity," and
that the Plaintiff has not alleged that they have attempted to collect a debt. [ECF No. 70 at 9;
ECF No. 78 at 2; ECF No. 81 at 11; ECF No. 54 at 3].

The FDCPA defines a "debt collector" as "any person . . . who regularly collects or

attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due
another." 15 U.S.C. § 1692a(6). However, the term "debt collector" does not include:

any person collecting or attempting to collect any debt owed or due or asserted to
be owed or due another to the extent such activity . . . (ii) concerns a debt which

was originated by such person; (iii) concerns a debt which was not in default at
the time it was obtained by such person; or (iv) concerns a debt obtained by such

person as a secured party in a commercial credit transaction involving the
creditor.

15 U.S.C. § 1692a(6)(F).

Thus, "a debt collector does not include the consumer's creditors, a mortgage servicing

company, or an assignee of a debt, as long as the debt was not in default at the time it was
assigned." Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (5th Cir. 1985); see S. RHP. 95-382,
3-4, 1977 U.S.C.C.A.N. 1695, 1698 ("the committee does not intend the definition to cover the

activities of trust departments, escrow companies, or other bona fide fiduciaries; the collection of
debts, such as mortgages and student loans, by persons who originated such loans; [or] mortgage

service companies and others who service outstanding debts for others, so long as the debts were
not in default when taken for servicing."); see also 173 A.L.R. Fed. 223 § 8.2 (2013 Cumulative
Supplement).

In the instant case. Plaintiffexecuted the Note and the Mortgage on September 19, 2003.

[ECF No. 65 at^ 26; ECF No. 1-1 at4-22]. Plaintiff executed both the Note and the Mortgage in
favor of Defendant Ameriquest. [ECF No. 1-1 at 4, 8-10]. On January 20, 2009, Citi Residential
6

Lending, Inc., as Ameriquest's attomey-in-fact, assigned the Note and Mortgage to Defendant
Deutsche Bank. [ECF No. 1-1 at 28]. Defendants Woodall, Ameriquest, and Deutsche Bank all
state in their motions to dismiss that Plaintiff then defaulted under the Note and Mortgage.

The Plaintiff alleges that he received the first notice of intent to foreclose over three years

after the Assignment. He has failed to allege that he was in default prior to the Assignment.

Instead, he alleges that the Note, by being indorsed "without recourse," was somehow satisfied
and that the later Assignment is therefore "a fabricated, phony, false, sham, fraud on-its-face"
document. [ECF No. 65 at

38-40, 8; ECF No. 90]. If the Plaintiffs attack on the Mortgage

and Assignment fails. Defendants Deutsche Bank and Homeward were the mortgagee or

assignee of the mortgage and the mortgage servicer before the debt was in default, and they are
not "debt collectors" under the FDCPA. A review of negotiable instruments quickly reveals the
unfounded nature of the Plaintiffs FDCPA claims.

First, the Court assumes that Wyoming law applies because the Note and Mortgage were

executed in Wyoming and pertain to real property located in Wyoming. [ECF No. 1-1 at 10, 18,

22]. Second, the Note is a "negotiable instrument" under Wyoming law. See Wyo. Stat. Ann §
34.1-3-l04(a)-(e) (a "[negotiable] instrument is a 'note' if it is a promise); ECF No. 1-1 at 4
("Borrower's Promise to Pay").

Plaintiff alleges that "[t]he without recourse indorsement evidences the 'Lender' was

paid all sums secured by the Mortgage." [ECF No. 65 at ^ 38 (emphasis in original); see id. at
30, 102]. "Withoutrecourse" is a term of art that Plaintiffmisapprehends.
(a) . . . [l]f an instrument is dishonored, an indorser is obliged to pay the amount
due on the instrument (1) according to the terms of the instrument at the time it
was indorsed. . . . The obligation of the indorser is owed to a person entitled to
enforce the instrument or to a subsequent indorser who paid the instrument under
this section.

(b) If an indorsement states that it is made '"''without recourse^'' or otherwise
disclaims liability of the indorser, the indorser is not liable under subsection (a) to
pay the instrument.

Wyo. Stat Ann. § 34.1-3-415 (emphasis added).

Thus, Defendant Ameriquest's "without recourse" indorsement disclaims their liability to

an assignee or subsequent indorser of having to pay the amount due on the Note if the Plaintiff
failed to pay. See WITHOUT RECOURSE, Black's Law Dictionary (9th ed. 2009) ("one who
indorses an instrument ['without recourse'] indicates that he or she has no further liability to any

subsequent holder for payment."). Despite what the Plaintiff would like it to mean, a "without
recourse" indorsement simply does not have the legal effect of satisfying a note nor does it

signify that a note was satisfied. Thus, Ameriquest was not required to release the Note after
indorsing it "without recourse," and the Plaintiff has failed to allege sufficient, plausible facts
that he was not obligated under the Note and corresponding Mortgage when it was assigned in
2009.

Plaintiffs primary premise for attacking the Assignment thereby fails. He also alleges

that the Assignment is fraudulent because any valid assignment "was required to be deposited in
the [Ameriquest Certificates] on or prior to the Closing Date" of November 12, 2003. [ECF No.

65 at ^ 56]. In response, the Defendants initially argue that Plaintiffhas no standing because he
was not a party to the Assignment. That seems to be an overly broad statement. "A debtor may,

generally, assert against an assignee all equities or defenses existing against the assignor prior to
notice of the assignment, any matters rendering the assignment absolutely invalid or ineffective,

and the lack of the plaintiffs title or right to sue; but, if the assignment is effective to pass legal
title, the debtor cannot interpose defects or objections which merely render the assignment
voidable at the election of the assignor or those standing in his or her shoes." 6A C.J.S.

8

Assignments § 132. Thus, if the assignment was effective to pass legal title, Plaintiff cannot
object to any deficiencies that might make it voidable.

A valid assignment requires a perfected transaction between an assignor and an assignee
"and acts or words indicating an intent to transfer a present interest in the subject matter of the

assignment."

6A C.J.S. Assignments § 57.

Here, the Assignment clearly identifies Citi

Residential Lending, Inc. as the attomey-in-fact of the assignor. Defendant Ameriquest, and the
assignee, Deutsche Bank acting as Trustee for the Ameriquest Certificates. [See ECF No. 1-1 at

28]. On its face, the Assignment clearly identifies the Mortgage and transfers the Mortgage, the

Note, the security interest created by the Mortgage, and "all liens, and any rights due or to

become due." [Id]. The Mortgage itself does not have an anti-assignment clause. Instead, it

specifically anticipates the future sale or assignment of the Note and Mortgage. [Id. at 18 ("The
Note or a partial interest in the Note (together with this Security Instrument) can be sold one or
more times without prior notice to Borrower.")].

Instead of challenging any of these basic aspects of the Assignment, Plaintiffalleges that

the Ameriquest Certificates could not have legally accepted his mortgage. In support of this
allegation. Plaintiff alleges one fact: that the "Closing Date" for the Ameriquest Certificates in

the Pooling and Servicing Agreement ("PSA") was November 12, 2003. [ECF No. 65 at ^ 56].
He also alleges a legal conclusion, which is not entitled to the Iqbalassumption of truth: that any

valid assignment must have been deposited with the Ameriquest Certificates before the Closing
Date in order for such an assignment to be legally assigned to the Ameriquest Certificates. [Id.].

Plaintiff repeatedly alleges this conclusion, see ECF No. 1-1 at 32-37, but he fails to allege any
facts that would support a plausible claim that the Assignment is void. Thus, he lacks standing

to challenge the Assignment under the PSA. Several courts have similarly held that debtors lack

standing to challenge a mortgage assignment based upon alleged non-compliance with a PSA.

See McLaughlin v. Wells Fargo Bank, N.A., 2012 WL 5994924 (C.D. Cal. 2012); Sami v. Wells
Fargo Bank, 2012 WL 967051 (N.D. Cal. 2012); In re Correia, 452 B.R. 319, 324 (B.A.P. 1st
Cir. 2011).

Thus, Plaintiffs secondary attack against the Assignment fails, and the Court is left with
the conclusion that he has failed to allege a plausible claim under the FDCPA. Defendant

Ameriquest is not a "debt collector" because it was the originator of the debt, and Plaintiff has
failed to allege any facts that Defendant Ameriquest was "collecting or attempting to collect" a

debt. See 15 U.S.C. § 1692a(6)(F)(ii). Defendants Deutsche Bank and Homeward are not "debt
collectors" under the FDCPA because the Plaintiff has failed to plausibly allege that they were

not the assignee of the mortgage and the mortgage servicer before the debt was in default. See
15 U.S.C. § 1692a(6)(F)(iii).
Defendant Woodall and Woodall PLLC are not "debt collectors" under the FDCPA

because Plaintiff has failed to plausibly allege that they were doing anything other than

"attempting to collect" a debt owed to another to the extent the debt "was not in default" when it
was obtained by Defendant Deutsche Bank. Aside from conclusory allegations identifying her in
^ 10, the Plaintiff has failed to allege any facts that Defendant McGinley did anything to violate
the FDCPA. Cf. ECF No. 135.

Lastly, the Plaintiff has only alleged conclusory allegations against Defendant Default
Resolution. See ECF No. 65 at

21, 87, 88. Much like his allegations as to Defendant

McGinley, he has failed to allege sufficient facts that Defendant Default Resolution violated the

FDCPA in any way. Counts One through Five of Plaintiffs Verified Amended Complaint rely
on all Defendants being "debt collectors" under the FDCPA or otherwise violating the FDCPA,

10

see ECF No. 65 at

118, 128, 135, 142, 149; therefore, these counts fail to state a claim upon

which relief can be granted. Thus, the Court GRANTS Defendants' motions to dismiss, ECF
Nos. 68, 69, 78, 80, as to these counts and ORDERS that Counts One through Five of ECF No.
65 are DISMISSED as to all Defendants. Because the Court grants Defendants' motions to

dismiss, it also DENIES Plaintiffs motions to strike or deny, ECF Nos. 85, 90, 96, 98, the
respective motions.

II.

Racketeer Influenced and Corrupt Organizations Act Claims

Defendants' motions to dismiss next argue that Plaintiffs Complaint fails to state a RICO
violation claim.

"RICO provides a cause of action for those injured in business or property by
reason of prohibited racketeering activities." Bixler v. Foster, 596 F.3d 751, 756
(10th Cir. 2010). Under 18 U.S.C. § 1962(c), it is unlawful "for any person
employed by or associated with any enterprise ... to conduct or participate ... in
the conduct of such enterprise's affairs through a pattern of racketeering activity
or collection of unlawful debt." A § 1962(c) claim thus has four elements: "(1)

conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity."
Bixler, 596 F.3d at 761 (quotations omitted).

The fourth element—racketeering activity—"is defined ... as any 'act which is
indictable' under federal law," Tat v. Hogan, 453 F.3d 1244, 1261 (10th Cir.

2006) (quoting 18 U.S.C. § 1961(1)(B)), and includes extortion, mail fraud, wire
fraud, and bank fraud. An act of extortion under state law punishable by more
than one year in prison also is a racketeering activity. See 18 U.S.C. §

1961(1)(A). "These underlying acts are referred to as predicate acts, because they
form the basis for liability under RICO." Tal, 453 F.3d at 1261 (emphasis added)
(quotations omitted). A plaintiff must prove that a defendant engaged in at least
two predicate acts to satisfy the "pattern" element of a RICO claim. See id. at
1267.

Sky Harbor AirServ., Inc. v. Reams, 491 F. App'x 875, 887-88 (10th Cir. 2012).
The Plaintiffs Verified Amended Complaint alleges that Defendants violated 18 U.S.C.

§§ 1951 (extortion) and 1341 (mail fraud) as the predicate acts for RICO liability.
A.

Extortion

11

There are two essential elements to a § 1951 charge: "interference with commerce, and

extortion. Both elements must be charged." Stirone v. U.S., 361 U.S. 212, 218 (1960). "The
term 'extortion' means the obtaining of property from another, with his consent, induced by
wrongful use of actual or threatened force, violence, or fear, or under color of official right." 18
U.S.C. § 1951(b)(2). In the instant case. Plaintiff has alleged that the "Defendants attempted to

extort roughly $150,000 from Plaintiff by threatening to sell and seize [his] home under color of
official right by and through the use of the allegedly fraudulent Assignment "which had no

enforceable security interest granting Defendants any present right of possession." [ECF No. 65
atH 159].

Plaintiff, in addition to misunderstanding "without recourse" above, also evidently

misunderstands "under color of official right." The Tenth Circuit has stated that "[a]n extortion
effort made under color of official right is ... a public official's attempt to obtain money not due
him or his office." United States v. Troutman, 814 F.2d 1428, 1456 (10th Cir. 1987). The

statute's definition of "under color of official right" "repeats the common law definition of

extortion, a crime which could only be committed by a public official, and which did not require

proof of threat, fear, or duress." United States v. Kenny, 462 F.2d 1205, 1229 (3d Cir. 1972),
cert, denied 409 U.S. 914. Plaintiff has not alleged in any way that any of the Defendants are

"public officials." Instead, he has alleged that they are private persons or business entities with
various principal offices located in different states. Thus, the Defendants could not have extorted
Plaintiff "under color of official right." Count Six of Plaintiffs Verified Amended Complaint,
ECF No. 65, is, therefore, DISMISSED as to all Defendants.
B.

Mail Fraud

12

'The elements of federal mail fraud as defined in 18 U.S.C. § 1341 are (1) a scheme or

artifice to defraud or obtain property by means of false or fraudulent pretenses, representations,

or promises, (2) an intent to defraud, and (3) use of the mails to execute the scheme." United
States V. Welch, 327 F.3d 1081, 1104 (10th Cir. 2003). Fed. R. Civ. P. 9(b) requires that RICO
claims based on predicate acts of fraud must be pled with particularity. See Cayman Exploration

Corp. V. United Gas Pipe Line Co., 873 F.2d 1357, 1362 (10th Cir. 1989). "Thus, a complaint
alleging fraud must set forth the time, place and contents of the false representation, the identity

of the party making the false statements and the consequences thereof." Tal v. Hogan, 453 F.3d
1244, 1263 (10th Cir. 2006).

In the instant ease, the gist of the Plaintiffs allegations is that the Defendants committed

mail fraud by mailing letters saying that they would foreclose on Plaintiffs home. The Plaintiff
does not specifically identify the "false representation," but, through the incorporation of his
previous allegations, the Court surmises that the "false" representation would be that the Note,

Mortgage and Assignment were valid and granted Defendants and their agents a right to
foreclose on Plaintiffs home. Plaintiffs allegation is premised on the misguided belief that

"without recourse" represents a satisfaction of a debt. The Court has already resolved that
contention above in Section I; therefore, the Court finds that the Defendants did not make a

"false" representation. The Court further finds that the Plaintiff has failed to plead fraud with the
particularity required by Fed. R. Civ. P. 9(b). The Court, therefore, DISMISSES Count Seven
of Plaintiffs Verified Amended Complaint, ECF No. 65, as to all Defendants.
III.

Claim to Quiet Title

In Count Eight of his Verified Amended Complaint, Plaintiff alleges that Defendant

Ameriquest's indorsement of the Note "without recourse" "evidences Ameriquest having been
13

paid in full, thereby releasing the 'Mortgage' and rendering said 'Mortgage" a nullity." [ECF
No. 65 at ^ 182]. He, therefore, requests that the Mortgage and Assignment be struck from the
chain of title and that the Court enter an order declaring that he is the only legal and equitable

owner of 108 Sequoia Drive in Gillette. [Id. at

183, 184, Prayer for Relief]. Defendants move

to dismiss his claim.

The "plaintiff in a quiet title action[] has the burden of proof and must stand on the

strength of its own title and not on the weakness of the title of defendants." Kirby Royalties, Inc.
V. Texaco /«c., 458 P.2d 101, 106 (Wyo. 1969). In the instant case, the Plaintiff has done just the

opposite. He has only attacked the Note, Mortgage, and Assignment. He has never alleged that
he satisfied the Note, and he has not alleged that he is not in default. It is his default that clouds

his title. See Marty v. Mortgage Elec. Registration Sys., l:10-CV-00033-CW, 2010 WL

4117196 (D. Utah 2010) ("Plaintiff is still in default on the loan and it is this that clouds any title

owned by [him].")

Defendants' motions to dismiss the quiet title action are, therefore,

GRANTED, and Count Eight of the Amended Complaint, ECF No. 65, are DISMISSED as to
all Defendants.

IV.

Plaintiffs Motion to Seek Leave to Amend Complaint

Eight months after entering an appearance for the Plaintiff and over a month after the
Court ordered the dismissal of two defendants. Plaintiffs "newly-retained counsel, on behalf of
Plaintiff has filed a motion for leave to file a second amended complaint. [ECF No. 136].

Plaintiff argues that his motion is timely and there would be "no prejudice to any party' if the
Court were to grant his motion.

[Id.]. Defendants have filed responses in opposition to

Plaintiffs motion. [ECF Nos. 137, 138, 140, 146]. Defendants argue that Plaintiffs motion is
untimely, prejudicial, filed in bad faith, and futile.
14

Fed. R. Civ. P. 15(a)(2) states that the "court should freely give leave when justice so

requires." Granting leave to amend is inappropriate in circumstances of "undue delay, bad faith
or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments

previously allowed, undue prejudice to the opposing party by virtue of allowance of the
amendment, futility of amendment, etc." Foman v. Davis, 371 U.S. 178, 182 (1962). In the
Tenth Circuit, "untimeliness alone is a sufficient reason to deny leave to amend." Frank v. U.S.

W., Inc., 3 F.3d 1357, 1365 (10th Cir. 1993). In the instant case. Plaintiff filed his Verified

Amended Complaint on October 29, 2012. The instant motion was filed on January 27, 2014,

nearly fifteen months later. Plaintiffs "newly-retained counsel" entered his appearance nine
months before filing this motion, and, aside from reviewing the prior filings, there is no

explanation as to why he could not have sought to amend the complaint earlier. In recent filings.
Plaintiffs counsel references a "special counsel," but that individual has yet to seek admission

pro hace vice. [See ECF No. 136 at 2-3; ECF No. 149 at 2-3]. The Court finds that such a delay

is untimely. Additionally, Plaintiff only sought the instant amendment after the Court dismissed
two defendants by a previous order. [ECF No. 135]. That, in and of itself, appears to bedilatory
to the Court.

Further, Defendants Homeward and Deutsche Bank argue that they "would be

substantially prejudiced by any further delay in the ultimate disposition of this case." [ECF No.
138 at 7]. The Court agrees. This case is replete with ad hominem filings, and those filings have
consumed significant judicial resources as well as the resources of all the parties. The Court
finds that any further delay would be prejudicial to the resolution of this case and would be

contrary to the justice upon which Plaintiff claims to base his motion. His motion for leave to
amend, ECF No. 136, is, therefore, DENIED.

15

CONCLUSION

In summary, the Court finds that Plaintiff has failed to state a claim upon which relief
may be granted in his Verified Amended Complaint. [ECF No. 65]. Accordingly, the Court
GRANTS Defendants' motions to dismiss, ECF Nos. 68, 69, 78, 80, the Amended Complaint

and orders that the Amended Complaint be DISMISSED WITH PREJUDICE as to all
Defendants. The Court, therefore, also DENIES Plaintiffs motions to strike or deny, ECF Nos.

85, 90, 96, 98, Defendants' respective motions to dismiss. The Court also finds that Plaintiffs
motion for leave to amend his complaint is untimely, dilatory, and prejudicial to the
administration of justice. The Court, therefore, DENIES his motion, ECF No. 136.

Dated this

A

day of March, 2014.

Alan B. Johnson

United Slates District Judge

16