Coley v. Bank of America Corp.

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

)
MICHELE RENEE COLEY, )
)
Plaintiff, )
)
v. ) Civ. Action No. 12-1653 (EGS)
)
BANK OF AMERICA CORP., et al. )
)
Defendants. )
)

MEMORANDUM OPINION

Plaintiff Michele Renee Coley, proceeding pro se, brings

this action alleging, inter alia, fraud, deceptive practices,

and unfair business practices against Bank of America Corp.,

successor to Countrywide Financial Corp., Morris Hardwick

Schneider (hereinafter “MHS”), and Mortgage Electronic

Registration Systems, Inc. (hereinafter “MERS”). Pending before

the Court are motions to dismiss filed by Bank of America and

MHS pursuant to Rule 12(b)(6). Upon consideration of the

motions, the opposition and replies thereto, the applicable law,

and the record as a whole, the Court GRANTS Defendants’ motions

to dismiss. Additionally, Ms. Coley has failed to state a claim

against MERS. The Court dismisses this action against MERS, sua

sponte.

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I. BACKGROUND

On April 13, 2007, Plaintiff Michele Renee Coley, a

Washington D.C. resident, was issued a $247,000 mortgage loan by

Countrywide Home Loans, Inc., which was later bought by

Defendant Bank of America. Am. Compl. ¶¶ 7; Bank of America’s

Mot. to Dismiss (hereinafter “BAC Mot. to Dismiss”) at 3. The

mortgage loan, a 30-year fixed rate loan secured by real

property located at 734 Kenyon Street NW, Washington, D.C.

20010, was reduced to a Deed of Trust and Promissory Note. Am.

Compl. ¶¶ 31-33; BAC Mot. to Dismiss at 3. According to Ms.

Coley, the payment term ensured that the bulk of her monthly

payment would be applied to interest and that there would be

very little principal reduction in the first 15 years. Am.

Compl. ¶ 41.

Ms. Coley alleges that the manner in which the loan was

issued was fraudulent because Defendants failed to determine

whether she would be able to repay the loan. Id. ¶¶ 42-46.

Specifically, she alleges that the originator of the loan

created a fictional income figure to obtain approval for the

loan. Id. ¶ 38. She also alleges that the loan had a 68.87%

loan-to-value ratio, which made it “toxic.” Id. Plaintiff

claims that this type of loan is likely to strain the borrower,

and notes that Defendant never advised her of the risks

associated with the loan. Id. ¶¶ 51-53. Finally, she alleges

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that Defendants “breached their duty to [her] because [they]

knew, or should have known, that [she] would, or had a strong

likelihood of defaulting on this loan.” Id. ¶ 56.

At an unspecified time after the loan was issued, Ms. Coley

applied for a loan modification, which was denied. Am. Compl. ¶

36. Plaintiff alleges that there was an offer and acceptance of

the modification, but it did not ultimately take place. Id.

According to Plaintiff, the reason for the denial was that Bank

of America either did not have possession of the note or could

not locate it. Id. ¶ 37. On or about October 12, 2009,

Plaintiff defaulted on her loan. BAC Mot. to Dismiss at 4.

Notice of the Foreclosure Sale was recorded among the land

records in Washington, D.C. on November 4, 2009. However, prior

to the sale, Bank of America canceled the sale. It has not

since sought to foreclose on the property. Id.

Plaintiff filed a lawsuit against Defendant Bank of America

on October 5, 2012. Bank of America filed a motion to dismiss

pursuant to Rule 12(b)(6). Plaintiff filed an opposition

Defendant’s motion to dismiss as well as a motion to strike. In

those pleadings, Plaintiff raised new claims sounding in fraud

and pursuant to the Fair Debt Collections Practices Act

(hereinafter “FDCPA”), 15 U.S.C. § 1692, and the Real Estate

Settlement Procedures Act (hereinafter “RESPA”), 12 U.S.C. §

2601 et seq. Given the obligation of the Court to construe pro

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se filings liberally, the Court ordered Plaintiff to file an

Amended Complaint stating clearly all of her claims against

Defendant. See April 12, 2013 Minute Order. Plaintiff filed an

Amended Complaint on May 13, 2013 and added MHS and MERS as

Defendants. Both Bank of America and MHS have filed a motion to

dismiss Plaintiff’s Amended Complaint as well as a motion to

strike Plaintiff’s Opposition to their motions to dismiss.

Those motions are now ripe for determination by this Court.

II. STANDARD OF REVIEW

A motion to dismiss under Rule 12(b)(6) tests the legal

sufficiency of the complaint. Browning v. Clinton, 292 F.3d

235, 242 (D.C. Cir. 2002). To be viable, a complaint must

contain “a short and plain statement of the claim showing that

the pleader is entitled to relief, in order 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) (internal quotation marks omitted). The plaintiff

need not plead all of the elements of a prima facie case in the

complaint, Swierkiewicz v. Sorema N.A., 534 U.S. 506, 511-14

(2002), nor must the plaintiff plead facts or law that match

every element of a legal theory. Krieger v. Fadely, 211 F.3d

134, 136 (D.C. Cir. 2000).

However, despite these liberal pleading standards, to

survive a motion to dismiss, “a complaint must contain

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sufficient factual matter, accepted as true, to state a claim

for relief that is plausible on its face.” Ashcroft v. Iqbal,

129 S. Ct. 1937, 1949 (2009) (internal quotation marks omitted);

Twombly, 550 U.S. at 562. A claim is facially plausible when

the facts pled in the complaint allow the Court “to draw the

reasonable inference that the defendant is liable for the

misconduct alleged.” Iqbal, 129 S. Ct. at 1949 (citing Twombly,

550 U.S. at 556). While this standard does not amount to a

“probability requirement,” it does require more than a “sheer

possibility that a defendant has acted unlawfully.” Id. (citing

Twombly, 550 U.S. at 556).

“[W]hen ruling on a defendant’s motion to dismiss, a judge

must accept as true all of the factual allegations contained in

the complaint.” Atherton v. D.C. Office of the Mayor, 567 F.3d

672, 681 (D.C. Cir. 2009) (quoting Erickson v. Pardus, 551 U.S.

89, 94 (2007)). The court must also give the plaintiff “the

benefit of all inferences that can be derived from the facts

alleged.” Kowal v. MCI Commc’ns Corp., 16 F.3d 1271, 1276 (D.C.

Cir. 1994) (internal citations omitted). Nevertheless, a court

need not “accept inferences drawn by plaintiff[] if such

inferences are unsupported by the facts set out in the

complaint.” Id. Further, “[t]hreadbare recitals of elements of

a cause of action, supported by mere conclusory statements” are

not sufficient to state a claim. Iqbal, 129 S. Ct. at 1949.

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Although a pro se complaint “must be held to less stringent

standards than formal pleadings drafted by lawyers,” Erickson,

551 U.S. at 94 (internal quotation marks and citations omitted),

it too “must plead ‘factual matter’ that permits the court to

infer “more than the mere possibility of misconduct.’”

Atherton, 567 F.3d at 681-82 (quoting Iqbal, 129 S.Ct. at 1950).

III. DISCUSSION

Defendant Bank of America argues that Plaintiff’s Amended

Complaint should be dismissed on the grounds that she has failed

to state a claim and because certain of her claims are time

barred. BAC Mot. to Dismiss at 8. Defendant MHS argues that

Plaintiff’s Amended Complaint should be dismissed as to it

because the Amended Complaint fails to even mention it, except

to name it as a Defendant. MHS Mot. to Dismiss at 5. The Court

agrees with respect to both motions to dismiss. Even assuming

the facts alleged in Plaintiff’s Amended Complaint are true, and

giving Plaintiff the “benefit of all reasonable inferences,”

Aktieselskabet AF 21. November 21 v. Fame Jeans, 525 F.3d 8, 17

(D.C. Cir. 2008) (internal citations and quotation marks

omitted), the Court finds that Plaintiff has failed to state a

claim upon which relief can be granted.

Under the Federal Rules of Civil Procedure, a plaintiff

must meet “a minimal pleading standard to ensure that the

adverse party is reasonably informed of the asserted causes of

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action such that he can file a responsive answer and prepare an

adequate defense.” McCarter v. Bank of New York, 873 F. Supp.

2d 246, 249 (D.D.C. 2012). Specifically, Fed. R. Civ. P.

8(a)(2) requires that a complaint contain “a short and plain

statement of the claim showing that the pleader is entitled to

relief.” Though this standard is fairly liberal, pleadings

that: (1) are “confused and rambling narrative[s] of charges and

conclusions;” (2) are “untidy assortment[s] of claims that are

neither plainly nor concisely stated;” or (3) fail to allege

“even with modest particularity the dates and places of alleged

transactions” must be dismissed. Poblete v. Goldberg, 680 F.

Supp. 2d 18, 19 (D.D.C. 2009) (quoting Brown v. Califano, 75

F.R.D. 497, 499 (D.D.C. 1977)).

Plaintiff’s 48-page Amended Complaint is largely devoted to

broad generalizations about the banking industry as well as a

lengthy discussion of how MERS operates. See generally Am.

Compl. Many of the allegations are so overbroad that Defendants

could not possibly discern the factual basis for those claims or

properly respond. With respect to Defendant MHS, Plaintiff does

not even make a single allegation referencing the firm in the

entire Amended Complaint.

In Count One, Plaintiff seeks declaratory relief, claiming

that Defendants “did not have the right to initiate foreclosure

proceedings on the Subject Property” because the loan was a

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“flip” prohibited by District of Columbia law and because they

“did not properly comply with applicable statutes regarding

filing of all transfer documents prior to foreclosure.” Am.

Compl. ¶¶ 159, 161. Ms. Coley also alleges that Defendants

illegally foreclosed on her property pursuant to Executive Law §

63(12), a New York state statute that she claims renders the

Power of Sale Clause in the Deed of Trust inoperative. Id. ¶¶

163-66. She also seeks relief against Bank of America’s

“foreclosure Attorney.” Id. ¶ 163. Plaintiff does not identify

the “foreclosure attorney” and it is unclear whether she intends

this to be a reference to MHS. These allegations seem to be

based on Ms. Coley’s contention that Bank of America’s cancelled

foreclosure of her property was pursuant to an assignment of the

Deed of Trust by MERS. Id. ¶¶ 12-16.

Bank of America argues that it has never claimed standing

to foreclose on the basis of a purported assignment of rights

facilitated by MERS. BAC Mot. to Dismiss at 5. Instead, Bank

of America’s right to foreclose arose from its merger with

Countrywide, pursuant to which it was the successor to any

interest that Countrywide had in Plaintiff’s loan. Id. 5-6.

Additionally, Defendant argues that Plaintiff has failed to cite

to any law, regulation, or legal precedent that would empower a

Court to strike a Power of Sale clause from a Deed of Trust.

Id. at 6.

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 The Court agrees and finds that Plaintiff has failed to

plead any facts that plausibly support a claim for declaratory

relief. Not only is Plaintiff’s focus on MERS misplaced, but

she has failed entirely to state any claim regarding the alleged

foreclosure of her property to justify the Court voiding the

Power of Sale in the Deed of Trust. Ms. Coley apparently

concedes that Bank of America did not actually foreclose on her

property, arguing that “courts have recognized a cause of action

for wrongful attempted foreclosure when foreclosure action was

commenced, but not completed, where plaintiff[s] have shown that

a defendant knowingly published an untrue and derogatory

statement concerning the plaintiffs’ financial conditions and

that damages were sustained as a direct result.” Am. Compl. ¶

14. Even if the Court were to recognize such an action,

Plaintiff has not stated any facts regarding untrue and

derogatory statements published by any Defendant.

In Count II, Plaintiff alleges that Defendants engaged in

deceptive acts or practices because they attempted to defraud

her with a “non-judicial foreclosure without proof of the true

Promissory Note’s existence, or having the Security Deed

Properly Assigned or retained.” Am. Compl. ¶ 171. Bank of

America again argues that this claim should be dismissed because

Plaintiff seems to believe that MERS was somehow involved in the

attempted foreclosure of her property. BAC Mot. to Dismiss at

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6. The Court agrees – Bank of America initiated foreclosure

proceedings on Ms. Coley’s property pursuant to its merger with

Countrywide, not because of an allegedly faulty assignment

through MERS.

Plaintiff purports to plead a claim for unfair and

deceptive business practices pursuant to “General Business Law §

349” in Count III. Am. Compl. ¶ 180. As Bank of America points

out, that is a New York statute which does not apply in this

jurisdiction. BAC Mot. to Dismiss at 6. Because Ms. Coley

claims that Defendants failed to properly underwrite her loan

and failed to follow accepted appraisal guidelines, Am. Compl.

¶¶ 178-180, the Court will construe Count III as a claim for

fraud. As such, the claim is subject to the heightened pleading

requirements of Fed. R. Civ. P. 9(b). However, Plaintiff has

made no factual allegations against Defendants to raise her

right to relief above a speculative level, much less with the

requisite particularity to meet the standards of Rule 9(b). She

has not provided specific dates when fraudulent statements were

made to her, nor does she describe the nature of those

statements. Under such circumstances, the Court “need not

accept inferences drawn by plaintiff if those inferences are not

supported by the facts set out in the complaint, nor must the

court accept legal conclusions cast as factual allegations.”

Hettinga v. United States, 677 F.3d 471, 476 (D.C. Cir. 2012)

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(internal citations omitted). See also Carter v. Bank of

America, 888 F. Supp. 2d 1, 14-15 (D.D.C. 2012) (dismissing

fraud claims in an almost identical complaint where plaintiff

failed to plead the elements of common law fraud and instead set

forth a number of conclusory allegations); McCarter, 873 F.

Supp. 2d at 250 (same).

In Count IV, Plaintiff seeks to Quiet Title to her property

and to forever enjoin Bank of America “from asserting any

estate, right, title, or interest” in the property that is

adverse to her own. Am. Compl. ¶ 185. Again, Plaintiff has

stated no basis for such prospective declaratory relief nor has

she offered any facts to suggest that her quiet enjoyment of the

property has been disturbed. Thus, this claim is also

dismissed. See Diably v. Bierman, 795 F. Supp. 2d 108, 111-13

(D.D.C. 2011) (dismissing a quiet title claim under similar

circumstances).

Plaintiff makes fleeting references to the Truth in Lending

Act (hereinafter “TILA”), 15 U.S.C. § 1601 et seq., and RESPA

throughout her Amended Complaint. To the extent that she seeks

to state a claim pursuant to those statutes, her claims are

time-barred. Claims brought under TILA must be brought within a

year of the violation for money damages or within three years of

the violation for rescission. 15 U.S.C. § 1640(e). For the

purposes of the statute, a TILA action accrues “no later than

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the settlement date” of the loan. Lawson v. Nationwide Mortg.

Corp., 628 F. Supp. 804, 807 (D.D.C. 1986) (internal citations

omitted). Similarly, RESPA actions must be brought within one

year of the violation. 21 U.S.C. § 2614.

Finally, despite a lengthy discussion of how MERS operates,

Plaintiff has failed to state a claim – either explicitly or

implicitly – against Defendant MERS anywhere in the Amended

Complaint. Accordingly, the Court will dismiss the claims

pending against MERS as well.

IV. CONCLUSION

For the reasons set forth above, the Court GRANTS

Defendants’ Motions to Dismiss and DENIES Defendant Bank of

America’s Motion to Strike as moot. An appropriate order

accompanies this memorandum opinion.

Signed: Emmet G. Sullivan
United States District Judge
March 31, 2014

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