UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
WANDA BUSBY, :
:
Plaintiff, : Civil Action No.: 10-1025 (RMU)
:
v. : Re Document Nos.: 6, 8
:
CAPITAL ONE, N.A. et al., :
:
Defendants. :
MEMORANDUM OPINION
GRANTING CAPITAL ONE’S MOTION TO DISMISS; GRANTING PRENSKY’S
MOTION TO PARTIALLY DISMISS
I. INTRODUCTION
The pro se plaintiff, Wanda Busby, has asserted a variety of statutory and common law
claims against the defendants, Capital One, N.A. (“Capital One”) and attorney David Prensky
(“Prensky”), in connection with a promissory note and deed of trust executed by the plaintiff in
1996. Capital One has moved to dismiss all of the claims against it pursuant to Federal Rule of
Civil Procedure 12(b)(6). Prensky has also filed a motion pursuant to Rule 12(b)(6) to dismiss
all but two of the claims asserted against him. As discussed below, the plaintiff has failed to
allege plausible claims for relief with respect to the claims addressed in the defendants’ motions.
The court therefore grants the defendants’ motions.
II. FACTUAL & PROCEDURAL BACKGROUND
In December 1996, the plaintiff purchased a property located in Northwest Washington,
D.C. Am. Compl. ¶¶ 7, 19. To finance the purchase, the plaintiff obtained a $207,000 loan from
the B.F. Saul Mortgage Company (“B.F. Saul”). Id. ¶ 19 & Ex. B. The loan was documented by
a promissory note (“the Note”), id. ¶ 19; Capital One’s Mot., Ex. A, and secured by a deed of
trust (“the Deed of Trust”), Am. Compl., Ex. B. Both instruments were filed with the D.C.
Recorder of Deeds on December 24, 1996. Am. Compl. ¶ 19. B.F. Saul subsequently assigned
its rights under the Note to Chevy Chase Bank, F.S.B. (“Chevy Chase”). Capital One’s Mot.,
Ex. A.
By early April 2010, the plaintiff had fallen three months behind on her loan payments.
Am. Compl. ¶ 32. The plaintiff “contacted Capital One, the apparent loan servicer, in order to
bring her payments up to date.” Id. During a conversation with a Capital One representative, the
plaintiff learned that there was, according to Capital One, “a sizable underpayment of her escrow
account.” Id. The plaintiff formally disputed these amounts and offered to pay all overdue
amounts of principal and interest pending resolution of the escrow dispute. Id. ¶ 34. Capital
One, however, rejected this offer. Id.
On April 12, 2010, the defendants sent the plaintiff a notice of foreclosure sale (“the
Notice”), advising her that she owed $168,842.38 on her note and that her property would be
sold at a foreclosure sale on May 19, 2010. Am. Compl., Ex. C. The Notice identified the
holder of the note as “Capital One NA.” Id. The Notice further stated that in the event the
plaintiff wished to stop the foreclosure sale, she should contact Prensky, id., who had purportedly
been appointed to act as trustee pursuant to a deed of appointment of substitute trustee (“the
Deed of Appointment”) executed on December 1, 2009, Am. Compl., Ex. B. Both the Notice
and the Deed of Appointment were filed with the D.C. Recorder of Deeds on April 14, 2010.
Am. Compl. ¶ 47.
On May 18, 2010, the plaintiff commenced this action against the defendants in the
Superior Court of the District of Columbia. See generally Compl. After being served with the
2
complaint, Prensky informed the plaintiff that Capital One had agreed to cancel the foreclosure
sale scheduled for May 19, 2010. Am. Compl. ¶¶ 93-94. Prensky, however, left open the
possibility that the foreclosure sale would be rescheduled at a later date. Id. ¶¶ 95-96.
The plaintiff filed an amended complaint in the Superior Court on June 9, 2010. See
generally id. In the amended complaint, the plaintiff alleges that the Notice was fraudulent and
ineffective because it misrepresented Capital One as the holder of the note, when, in reality,
Capital One was acting, at best, as the loan servicer. Id. ¶¶ 24, 40-45, 49-52, 98-102. The
plaintiff contends that under both the terms of the Deed of Trust and as D.C. law, a loan servicer
lacks the authority to commence foreclosure proceedings against a borrower like the plaintiff.
Id. The plaintiff also alleges that in the Notice, the defendants misrepresented the amounts owed
by the plaintiff. Id. ¶¶ 32-35; 123-24.
In addition, the plaintiff claims that the Deed of Appointment is fraudulent and
ineffective. Id. ¶¶ 25, 47-48, 54-79. The plaintiff asserts that there are errors in the notarization
on the form, id. ¶¶ 58-68, and that although the Deed of Appointment was executed by an
individual on behalf of Chevy Chase on December 1, 2009, Chevy Chase had merged with
Capital One four months earlier and therefore did not exist as of the date the Deed of
Appointment was executed, id. ¶¶ 70-75.
In her ten-count amended complaint, the plaintiff asserts a variety of statutory and
common law1 claims against the defendants. Id. ¶¶ 113-234. Specifically, the amended
complaint contains the following claims: fraud (Count I); breach of fiduciary duty (Count II);
violations of the D.C. Interest Rate Ceiling Amendment Act (“D.C. Usury Statute”), D.C. CODE
§ 28-3312, and the D.C. Consumer Protection Procedures Act (“CPPA”), D.C. CODE § 28-3904
1
There is no dispute that D.C. law governs the plaintiff’s common law claims. See generally
Capital One’s Mot. to Dismiss; Prensky’s Mot. to Dismiss; Pl.’s Opp’n.
3
(Count III); conversion (Count IV); violations of the Racketeer Influenced and Corrupt
Organization Act (“RICO”), 18 U.S.C. §§ 1961 et seq. (Counts V-VII); negligence (Count VIII);
unconscionability, bad faith and unfair dealing (Count IX); and “emotional distress” (Count X)
Id. Aside from the breach of fiduciary duty claim (Count II), which is asserted only against
Prensky, id. ¶¶ 116-19, and the D.C. Usury Statute claim (Count III), which is asserted only
against Capital One, id. ¶¶ 123, each claim is asserted against both defendants.
The defendants removed this action to this court on June 17, 2010. See generally Notice
of Removal. On July 16, 2010, Capital One and Prensky separately filed motions to dismiss the
amended complaint pursuant to Rule 12(b)(6). See generally Capital One’s Mot.; Prensky’s
Mot. Capital One seeks the dismissal of all the claims asserted against it. See generally Capital
One’s Mot. Prensky has moved to dismiss all of the claims against him except the breach of
fiduciary duty and negligence claims. See generally Prensky’s Mot. The plaintiff filed an
omnibus opposition to both motions on February 14, 2011,2 see generally Pl.’s Opp’n, and the
defendants filed separate replies on February 25, 2011, see generally Capital One’s Reply;
Prensky’s Reply.
III. ANALYSIS
A. Legal Standard for a Rule 12(b)(6) Motion to Dismiss
A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of a complaint. Browning v.
Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). The complaint need only set forth a short and plain
statement of the claim, giving the defendant fair notice of the claim and the grounds upon which
2
Briefing on the defendants’ motions to dismiss was stayed pending resolution of the plaintiff’s
motion to remand this case to the Superior Court of the District of Columbia. Minute Order
(Sept. 10, 2010). The court ultimately denied the plaintiff’s motion. See generally Mem. Op.
(Jan. 6, 2011).
4
it rests. Kingman Park Civic Ass’n v. Williams, 348 F.3d 1033, 1040 (D.C. Cir. 2003) (citing
FED. R. CIV. P. 8(a)(2) and Conley v. Gibson, 355 U.S. 41, 47 (1957)). “Such simplified notice
pleading is made possible by the liberal opportunity for discovery and the other pretrial
procedures established by the Rules to disclose more precisely the basis of both claim and
defense to define more narrowly the disputed facts and issues.” Conley, 355 U.S. at 47-48
(internal quotation marks omitted). It is not necessary for the plaintiff to plead all elements of
his prima facie case in the complaint, Swierkiewicz v. Sorema N.A., 534 U.S. 506, 511-14 (2002),
or “plead law or match facts to every element of a legal theory,” Krieger v. Fadely, 211 F.3d
134, 136 (D.C. Cir. 2000) (internal quotation marks and citation omitted).
Yet, “[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.” Ashcroft v. Iqbal, 129 S.
Ct. 1937, 1949 (2009) (internal quotation marks omitted); Bell Atl. Corp. v. Twombly, 550 U.S.
544, 562 (2007) (abrogating the oft-quoted language from Conley, 355 U.S. at 45-46, instructing
courts not to dismiss for failure to state a claim unless it appears beyond doubt that “no set of
facts in support of his claim [] would entitle him to relief”). A claim is facially plausible when
the pleaded factual content “allows 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). “The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more
than a sheer possibility that a defendant has acted unlawfully.” Id. (citing Twombly, 550 U.S. at
556).
In resolving a Rule 12(b)(6) motion, the court must treat the complaint’s factual
allegations – including mixed questions of law and fact – as true and draw all reasonable
inferences therefrom in the plaintiff’s favor. Holy Land Found. for Relief & Dev. v. Ashcroft,
5
333 F.3d 156, 165 (D.C. Cir. 2003); Browning, 292 F.3d at 242. While many well-pleaded
complaints are conclusory, the court need not accept as true inferences unsupported by facts set
out in the complaint or legal conclusions cast as factual allegations. Warren v. District of
Columbia, 353 F.3d 36, 39 (D.C. Cir. 2004); Browning, 292 F.3d at 242. “Threadbare recitals of
the elements of a cause of action, supported by mere conclusory statements, do not suffice.”
Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 555).
B. The Court Grants the Defendants’ Motions to Dismiss the Amended Complaint
1. Count I: Fraud
The plaintiff appears to base her fraud claims on Capital One’s alleged misrepresentation
that it was the holder of the note and that it had the authority to institute foreclosure proceedings
against the plaintiff, Capital One’s alleged misrepresentations regarding the amounts owed by
the plaintiff and the alleged misrepresentations by Capital One and Prensky that Prensky was
authorized to act as trustee on behalf of the note holder in foreclosure proceedings. See Am.
Compl. ¶¶ 24-25, 40-79, 98-102, 123-24. According to the plaintiff, these misrepresentations
appear in the Notice and the Deed of Appointment. See id.
Both Capital One and Prensky contend that the plaintiff has failed to state a viable claim
for fraud because she has not alleged that she relied on these allegedly fraudulent representations
to her detriment, as required to state a claim for fraud under D.C. law.3 Capital One’s Mot. at 8-
9; Prensky’s Mot. at 5-6. Capital One also argues that that the plaintiff has alleged no facts to
support her contention that Capital One misrepresented the amounts owed by the plaintiff.
Capital One’s Mot. at 9-12. The plaintiff maintains that she has properly stated a claim for fraud,
3
Capital One also argues that the allegedly fraudulent misrepresentations on which the plaintiff
bases her claim are not material. Capital One’s Mot. at 9-12. Because the court concludes that
the plaintiff has failed to adequately plead detrimental reliance, it does not reach this alternative
argument.
6
asserting that the amended complaint addresses the essential elements of a fraud claim under
D.C. law. Pl.’s Opp’n at 16-22. In addition, the plaintiff contends that her amended complaint
contains a claim of conspiracy to commit fraud, which is properly pled and not addressed in the
defendants’ motions. Id. at 13-14.
Under D.C. law, “[t]he essential elements of common law fraud are: (1) a false
representation (2) in reference to material fact, (3) made with knowledge of its falsity, (4) with
the intent to deceive, and (5) action is taken in reliance upon the representation.” Fort Lincoln
Civic Ass’n, Inc. v. Fort Lincoln New Town Corp., 944 A.2d 1055, 1074 n.22 (D.C. 2008)
(quoting Bennett v. Kiggins, 377 A.2d 57, 59-60 (D.C. 1977)). To prevail on such a claim, “the
plaintiff must also have suffered some injury as a consequence of his reliance on the
misrepresentation.” Chedick v. Nash, 151 F.3d 1077, 1081 (D.C. Cir. 1998) (citing Dresser v.
Sunderland Apartments Tenants Ass’n, Inc., 465 A.2d 835, 839 (D.C. 1983)).
Furthermore, Federal Rule of Civil Procedure 9(b) requires that a claimant state with
particularity the circumstances constituting fraud. FED. R. CIV. P. 9(b). The claimant must plead
with particularity matters such as the time, place and content of the false misrepresentations, the
misrepresented fact and what the opponent retained or the claimant lost as a consequence of the
alleged fraud. United States ex rel. Williams v. Martin-Baker Aircraft Co., 389 F.3d 1251, 1256
(D.C. Cir. 2004) (citing Kowal v. MCI Commc’ns, Corp., 16 F.3d 1271, 1278 (D.C. Cir. 1994)).
This heightened pleading standard “discourage[s] the initiation of suits brought solely for their
nuisance value, and safeguards potential defendants from frivolous accusations of moral
turpitude.” Id. (quoting United States ex rel. Joseph v. Cannon, 642 F.2d 1373, 1386 (D.C. Cir.
1981)). Furthermore, “because ‘fraud’ encompasses a wide variety of activities, the
requirements of Rule 9(b) guarantee all defendants sufficient information to allow for
7
preparation of a response.” Id.
The plaintiff first suggests that the reliance element needed to establish her fraud claim is
satisfied by her allegation that the D.C. Recorder of Deeds and other third parties relied on the
misrepresentations made in the Notice and Deed of Appointment. Pl.’s Opp’n at 17. Yet under
D.C. law, “[a] plaintiff may recover for a defendant’s fraudulent statement only if the plaintiff
took some action in reliance on that statement.” Aktieselskabet AF 21. Nov. 2001 v. Fame Jeans
Inc., 525 F.3d 8, 22-23 (D.C. Cir. 2008) (affirming the dismissal of the plaintiff’s fraud claim
because rather than suggesting its own reliance, the plaintiff alleged only that the United States
Patent and Trademark office relied on the defendant’s alleged misrepresentation (citing Va.
Acad. of Clinical Psychologists v. Grp. Hospitalization & Med. Servs., Inc., 878 A.2d 1226,
1237-38 (D.C. 2005) (emphasis added))). Thus, the plaintiff’s allegations concerning actions
taken by the D.C. Recorder of Deeds or any other third parties cannot, standing alone, satisfy the
detrimental reliance element required for fraud claims under D.C. law.
The plaintiff also contends that she relied to her detriment on the defendants’ fraudulent
statements by consulting legal counsel. Pl.’s Opp’n at 17. This allegation, however, does not
appear in the amended complaint. See generally Am. Compl.; see also Middlebrooks v. Godwin
Corp., 722 F. Supp. 2d 82, 87 n.4 (D.D.C. 2010) (observing that a plaintiff “may not amend her
complaint by the briefs in opposition to a motion to dismiss” (citing Calvetti v. Antcliff, 346 F.
Supp. 2d 92, 107 (D.D.C. 2004))). Furthermore, even if this allegation were considered part of
the plaintiff’s pleadings, it has not been pled with the requisite specificity, as the plaintiff has
offered no indication of what steps she took to consult with legal counsel or what costs she
incurred as a result. See Pl.’s Opp’n at 17. Finally, even if the plaintiff had alleged that she had
offered some factual allegation to substantiate her claim of loss, it is far from clear that the cost
8
of legal services can constitute detrimental reliance for purposes of fraud, given the American
Rule against fee shifting. See Oliver T. Carr Co. v. United Tech. Commc’n Co., 604 A.2d 881,
883 (D.C. 1992) (“[T]his jurisdiction follows ‘the American Rule under which . . . every party to
a case shoulders its own attorneys’ fees, and recovers from other litigants only in the presence of
statutory authority, a contractual arrangement, or certain narrowly-defined common law
exceptions’ such as the conventional ‘bad faith’ exception.” (internal quotation marks omitted)
(quoting Dalo v. Kivitz, 596 A.2d 35, 37, 39 (D.C. 1991)); see also Sloan v. Urban Title Servs.,
Inc., 689 F. Supp. 2d 94, 121 (D.D.C. 2010) (holding that a party asserting fraud “must provide
legal authority in support of his apparent claim that he is entitled to attorney’s fees and costs”).
Accordingly, the plaintiff’s assertion in her opposition that she consulted legal counsel as a result
of the defendants’ fraudulent representations does not satisfy the detrimental reliance
requirement.
Lastly, the plaintiff contends that she relied on the defendants’ misstatements regarding
escrow amounts owed and other penalties due “by paying some of the amounts demanded.” Pl.’s
Opp’n at 17 (citing Am. Compl. ¶¶ 125-26, 141, 182, 184). This allegation, however, falls well
short of Rule 9(b)’s heightened pleading standard, as the plaintiff does not offer any indication of
when she paid these fees or what amounts she paid. See Am. Compl. ¶¶ 125-26, 141, 182-84. In
fact, the amended complaint indicates that after the defendants filed the Notice and Deed of
Appointment, which contained the allegedly fraudulent statements at issue, the plaintiff did not
make any additional payments to Capital One. See id. ¶¶ 32-35. Rather, it appears that when the
plaintiff states that she “pa[id] some of the amounts demanded,” Pl.’s Opp’n at 17, she is
referring to the fact that before the defendants’ filed the Notice and Deed of Appointment, she
had made payments toward her loan that Capital One had applied to her purported escrow
9
balance and other penalty charges, see Am. Compl. ¶ 182 (“Plaintiff’s payments, upon
information and belief, [and] the payments of other D.C. homeowners, were applied to
overcharges, with Capital One misappropriating the amounts overcharged.”). These payments,
however, were made before the defendants’ alleged misrepresentations and plainly were not
taken in reliance on them.4 Thus, the plaintiff’s allegation regarding the payment of erroneous
charges does not support her claim of detrimental reliance on the defendants’ allegedly
fraudulent statements.
The plaintiff’s failure to plead that she took any steps in reasonable reliance on the
defendants’ fraudulent statements warrants dismissal of her fraud claim. See Aktieselskabet AF
21. Nov. 2001, 525 F.3d at 22-23. Nonetheless, the plaintiff asserts that such a finding does not
preclude her from proceeding with a claim of conspiracy to commit fraud. Pl.’s Opp’n at 13-14;
see also Am. Compl. ¶ 114. As a threshold matter, however, it is hardly clear that a plaintiff can
proceed with a claim for conspiracy to commit fraud in the absence of a viable underlying fraud
claim. See Hill v. Medlantic Health Care Grp., 933 A.2d 314, 334 (D.C. 2007) (observing that
civil conspiracy “is not an independent tort but only a means for establishing vicarious liability
for an underlying tort” (quoting Paul v. Howard Univ., 754 A.2d 297, 310 (D.C. 2000))); Ali v.
Mid-Atlantic Settlement Servs., Inc., 640 F. Supp. 2d 1, 9 (D.D.C. 2009) (holding that the entry
of summary judgment for the defendant on the plaintiff’s fraud claim required dismissal of the
plaintiff’s conspiracy to commit fraud claim because “civil conspiracy depends on performance
4
Furthermore, the amended complaint contains no indication of why the escrow charges and other
penalty fees assessed by Capital One were erroneous. See generally Am. Compl. The absence of
such allegations renders the plaintiff’s fraud claim deficient under Rule 9(b). See Skypala v.
Mortg. Elec. Registration Sys., Inc., 655 F. Supp. 2d 451, 458 (D.N.J. 2009) (concluding that the
plaintiff failed to state a fraud claim based on allegedly unwarranted “Late Charges” and other
charges demanded by the defendant because the plaintiff had offered no explanation for its
assertion that these charges were unwarranted).
10
of some underlying tortious act” (quoting Exec. Sandwich Shoppe, Inc. v. Carr Realty Corp., 749
A.2d 724, 738 (D.C. 2000))); but see Wiggins v. Dist. Cablevision, Inc., 853 F. Supp. 484, 498
n.27 (D.D.C. 1994) (“Often when a claim for fraud fails for lack of the requisite elements, courts
will search to find evidence of a conspiracy to defraud.” (citing Higgs v. Higgs, 472 A.2d 875,
877 (D.C. 1994))).
At any rate, in order to state a civil conspiracy claim under D.C. law, the plaintiff must
allege “(1) an agreement between two or more persons (2) to participate in an unlawful act, and
(3) injury caused by an unlawful overt act performed by one of parties to the agreement, and in
furtherance of the common scheme.” Hill, 933 A.2d at 334. Here, the plaintiff has offered no
factual allegations whatsoever indicating the existence of an agreement between Capital One and
Prensky. See generally Am. Compl. Rather, the plaintiff’s conspiracy claim is grounded on the
bare, conclusory assertion that the defendants “conspired to commit, and did commit fraud, on
which Plaintiff relied to her detriment.” Id. ¶ 114. Such an allegation, unadorned by any
substantiating factual allegations, is insufficient to state a viable conspiracy claim. See Kissi v.
Panzer, 664 F. Supp. 2d 120, 126 (D.D.C. 2009) (holding that the plaintiff’s allegation that the
defendants “conspired to rip off him and his spouse” were insufficient to state a claim for
conspiracy to commit fraud); Brady v. Livingood, 360 F. Supp. 2d 94, 104 (D.D.C. 2004)
(concluding that the plaintiff’s allegation that the defendants “agreed among themselves” to
engage in tortious conduct was insufficient to state a viable civil conspiracy claim).
Accordingly, the plaintiff has failed to state a cognizable claim for conspiracy to commit
fraud, just as she failed to state a cognizable claim for fraud. The court therefore grants the
defendants’ motions to dismiss these claims.
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2. Count III: D.C. Statutory Claims
a. The Plaintiff’s Claim Under the D.C. Usury Statute
The plaintiff alleges that Capital One violated the D.C. Usury Statute “by both
misrepresenting material facts and failing to state material facts.” Am. Compl. ¶122. Although
the plaintiff does not specify the misrepresentations and omissions on which she bases this claim,
see id., it appears that the plaintiff rests her D.C. Usury Statute claim on the same allegedly
fraudulent statements underlying her fraud claim, see id.¶¶ 24-25, 40-79, 98-102, 120-29.
Capital One contends that the plaintiff has failed to state a claim under the D.C. Usury
Statute because the statute applies only to “lenders” and not loan servicers. Capital One’s Mot.
at 12-13. Capital One further contends that to the extent the plaintiff premises this claim on
allegedly unwarranted escrow fees and other charges demanded by Capital One, the plaintiff has
offered no explanation for why these fees were unauthorized, overstated or otherwise improper.
Id. at 13. The plaintiff responds that Capital One constitutes a “lender” for purposes of the D.C.
Usury Statute and that Capital One violated the statute by making material misrepresentations to
the plaintiff. Pl.’s Opp’n at 23-24.
The D.C. Usury Statute provides that “[i]t shall be a violation of this chapter for any
lender to” engage in certain specified conduct, including “misrepresent[ing] as to a material fact”
and “fail[ing] to state a material fact.” D.C. CODE § 28-3312. By its terms, the statute applies
only to “lenders.” See id.; see also Young v. 1st Am. Fin. Servs., 992 F. Supp. 440, 444 & n.7
(D.D.C. 1998) (dismissing the plaintiffs’ claim under the D.C. Usury Statute because the statute
applies only to lenders and not brokers like the defendant, notwithstanding the plaintiffs’
allegation that the defendant fraudulently led them to believe that it was acting as the lender
rather than the broker).
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In the amended complaint, the plaintiff repeatedly asserts that Capital One was not the
lender in the underlying loan transaction. See, e.g., Am. Compl. ¶¶ 32, 97. Indeed, the
plaintiff’s fraud claim is premised in significant part on the assertion that Capital One falsely
represented itself as the holder of the Note. See supra Part III.B.1. Although the plaintiff asserts
in her opposition brief that Capital One functioned as a “lender” for purposes of the D.C. Usury
Statute, she provides neither any authority nor any cogent argument in support of this assertion.
See Pl.’s Opp’n at 23-24. Accordingly, the court dismisses the plaintiff’s claim asserting
violations of D.C. Usury Statute.
b. The Plaintiff’s CPPA Claim
The plaintiff alleges that the defendants violated the CPPA by misrepresenting material
facts in connection with the plaintiff’s loan obligations. Am. Compl. ¶¶ 121, 123. Again, this
claim appears to be based on the same alleged misrepresentations underlying the plaintiff’s fraud
claim. See id. ¶¶ 24-25, 40-79, 98-102, 120-29.
Both Capital One and Prensky contend that the plaintiff’s CPPA claim fails because the
plaintiff was not a “consumer” of goods or services provided by either defendant.5 Capital One’s
Mot. at 14-15; Prensky’s Mot. at 6-7. The plaintiff maintains that the CPPA gives rise to a claim
against Capital One because the statute applies to mortgage transactions and Capital One held
itself out to be the mortgagee. Pl.’s Opp’n at 25-26. The plaintiff also argues that she has stated
a CPPA claim against Prensky – despite the fact that Prensky did not provide any legal services
to her – because he engaged in unethical conduct by falsely holding himself out as the trustee
under the Deed of Appointment. Id. at 27-28.
5
Although Capital One has also pointed out a number of additional purported deficiencies in the
plaintiff’s CPPA claim, Capital One’s Mot. at 15-16, the court does not reach these alternative
arguments because the amended complaint fails to allege the existence of a consumer-merchant
relationship.
13
The CPPA prohibits a wide variety of deceptive trade practices perpetrated against
consumers. D.C. CODE § 28-3904. The practices prohibited by the statute include
misrepresenting the existence of a sponsorship or affiliation, misrepresenting a material fact
which has the tendency to mislead and failing to state a material fact which has the tendency to
mislead. Id. § 28-3904(b), (e), (f). “The purpose of the CPPA is to protect consumers from a
broad spectrum of unscrupulous practices by merchants, therefore the statute should be read
broadly to assure that the purposes are carried out.” Modern Mgmt. Co. v. Wilson, 997 A.2d 37,
62 (D.C. 2010).
Despite its broad reach, the CPPA applies only to consumer-merchant relationships.
Snowder v. Dist. of Columbia, 949 A.2d 590, 599 (D.C. 2008) (observing that the CPPA “was
designed to police trade practices arising only out of consumer-merchant relationships” (quoting
Howard v. Riggs Nat’l Bank, 432 A.2d 701, 709 (D.C. 1981))). The statute defines a
“consumer” as “a person who does or would purchase, lease (from), or receive consumer goods
or services . . . or a person who does or would provide the economic demand for a trade
practice.” Id. § 28-3901(a)(2). A “merchant” is defined as “a person who does or would sell,
lease (to), or transfer, either directly or indirectly, consumer goods or services, or a person who
does or would supply the goods or services which are or would be the subject matter of a trade
practice.” Id. § 28-3901(a)(3).
Here, the amended complaint contains no factual allegations whatsoever indicating the
existence of a consumer-merchant relationship between the plaintiff and either defendant. See
generally Am. Compl. The plaintiff has identified no goods or services she purchased or
received from Capital One or Prensky. See generally id.; see also Ali v. Tolbert, 2011 WL
691364, at *5 (D.C. Cir. Mar. 1, 2011) (holding that an individual who facilitated a residential
14
property transaction was not a “merchant” for CPPA purposes because there was “no evidence
that he supplied, or held himself out as a person who would supply any goods or services to the
purchaser in connection with her ownership or sale of the house”). Although the plaintiff notes
that the CPPA applies to lenders in residential mortgage transactions, see Ihebereme v. Capital
One, N.A., 730 F. Supp. 2d 40, 50-53 (D.D.C. 2010), as previously discussed, the plaintiff has
alleged here that Capital One was not the lender and that its role in the lender-borrower
relationship was limited to serving as the loan servicer, at best, see Am. Compl. ¶¶ 32, 97.
Accordingly, the court dismisses the plaintiff’s CPPA claim against both defendants.
3. Count IV: Conversion
The plaintiff alleges that the defendants “engaged in conversion by asserting ownership
over the Note and [Deed of Trust], including, but not limited to, the power of sale provisions
within the [Deed of Trust].”6 Am. Compl. ¶ 131. The defendants argue that the plaintiff’s
allegations do not give rise to a plausible conversion claim because, among other reasons, the
plaintiff is not the owner of allegedly converted property and there has been no dispossession of
the plaintiff’s property rights. Capital One’s Mot. at 17-18; Prensky Reply at 8. The plaintiff
maintains that she has asserted a viable claim of conversion, contending that the
misappropriation of notes, titles and deeds can give rise to a claim of conversion and that even if
she is not the owner of the Note or the Deed of Trust, she has an interest in those instruments.
Pl.’s Opp’n at 28-33.
Under D.C. law, the elements of conversion are “(1) an unlawful exercise, (2) of
6
According to the plaintiff, “Capital One’s conversion scheme began when it caused its employees
to assert falsely that [Chevy Chase], a defunct corporation, owned the Note and [Deed of Trust]”
and then later, “in its own right, asserted ownership over the Note and the [Deed of Trust].” Am
Compl. ¶ 132. The plaintiff also alleges that “[b]y filing the Fraudulent Notice . . . and Forged
Deed [of Appointment], Prensky also asserted ownership over the Property under the [Deed of
Trust].” Id. ¶ 133.
15
ownership, dominion, or control, (3) of the personal property of another, (4) in denial or
repudiation of that person’s rights thereto.’” O’Callaghan v. Dist. of Columbia, 741 F. Supp.
273, 279 (D.D.C. 1990) (citing Duggan v. Keto, 554 A.2d 1126, 1137 (D.C. 1989)). According
to the plaintiff, her conversion claim is grounded on the defendants’ misappropriation of her
“beneficial interest in both the Property and the Deed of Trust.” Pl.’s Opp’n at 30; see also Am.
Compl. ¶¶ 131-33. The plaintiff is mistaken. The Deed of Trust is a security instrument given
by the plaintiff for the benefit of the lender. See generally Am. Compl., Ex. B. The authorities
relied on by the plaintiff stand only for the proposition that the mortgagor has a beneficial
interest in the underlying property securing the transaction, not in the deed of trust itself. See,
e.g., Democratic Cent. Comm. of Dist. of Columbia v. Wash. Metro. Area Transit Comm’n, 21
F.3d 1145, 1153 (D.C. Cir. 1994) (observing that legal title of property held under a deed of trust
lies with the trustee, while equitable title rests with the debtor).
The plaintiff also attempts to base her conversion claim on the defendants’ alleged
interference with her right to have the Deed of Trust returned to her once she has repaid the loan
in full. Pl.’s Opp’n at 31. Indeed, as the plaintiff points out, courts in other jurisdiction have
permitted conversion claims to proceed based on the mortgagor’s refusal to return a deed of trust
to the mortgagee after fully satisfying his or her loan obligations. See, e.g., Save Charleston v.
Murray, 333 S.E.2d 60, 66 (S.C. Ct. App. 1985); Rose v. Tilden Lumber & Mill Co., 14 P.2d
137, 137-38 (Cal. App. 1932). In this case, however, the amended complaint makes clear that
the plaintiff has not been satisfied her underlying debt, see Am. Compl. ¶ 32, and that the
plaintiff has no right to the return of the Deed of Trust, cf. Rose, 14 P.2d at 137-38 (observing
that the conversion “took place immediately upon appellant’s assumption of ownership
following the payment of the original obligation”). Accordingly, the plaintiff’s right to have the
16
Deed of Trust returned upon the satisfaction of her loan obligations does not give rise to viable
conversion claim.
Lastly, the court notes that “an action for conversion is recognized only when a defendant
has unlawfully exercised ‘ownership, dominion or control over the personal property of another
in denial or repudiation of his rights thereto.’” Kaempe v. Myers, 367 F.3d 958, 964 (D.C. Cir.
2004) (quoting Shea v. Fridley, 123 A.2d 358, 361 (D.C. 1956)). “When there has been no
dispossession of property rights, there can be no action for conversion.” Id. Here, the amended
complaint contains no allegations indicating that the actions taken by the defendants have
dispossessed the plaintiff of any right she currently possesses in the property or the Deed of
Trust. See generally Am. Compl. Accordingly, the plaintiff’s conversion claim is deficient in
this respect as well, and the court grants the defendants’ motion to dismiss this claim.
4. Counts V, VI and VII: RICO
Counts V, VI and VII of the amended complaint set forth alternative civil RICO claims.
See Am. Compl. ¶¶ 136-210. The thrust of these claims is that the defendants engaged in a
fraudulent scheme, involving mail fraud, wire fraud and witness tampering, to misappropriate the
plaintiff’s interest in the Deed of Trust and unjustifiably force the foreclosure sale of her
property. See id. Both Capital One and Prensky contend that the plaintiff has not stated a viable
RICO claim because she has not pled the existence of a pattern of racketeering activity.7 Capital
One’s Mot. at 20-23; Prensky’s Mot. at 8-9. The plaintiff maintains that she has properly pled a
pattern of racketeering activity based on her allegations of mail and wire fraud and witness
7
Capital One also argues that the plaintiff’s allegations of mail fraud, wire fraud and witness
tampering are too conclusory to support a RICO claim and that the plaintiff has not properly pled
that she suffered injury as a result of the alleged RICO violation. Capital One’s Mot. at 18-20,
23-25. Because the court dismisses the plaintiff’s RICO claims based on other deficiencies
pointed out by the defendants, it does not reach this additional argument.
17
tampering. Pl.’s Opp’n at 37-41.
To establish a RICO violation, the plaintiff must show “(1) conduct (2) of an enterprise
(3) through a pattern (4) of racketeering activity.” W. Assocs. Ltd. P’ship v. Market Square
Assocs., 235 F.3d 629, 633 (D.C. Cir. 2001) (citing 18 U.S.C. § 1961(1)(B)). The RICO statute
defines the term “pattern of racketeering activity” as requiring the commission of at least two
predicate racketeering offenses over a ten year period. 18 U.S.C. § 1961(5). Predicate offenses
satisfying the statute include acts punishable under certain state and federal criminal laws, such
as mail and wire fraud. Id. § 1961(1)(B). To satisfy the “pattern of racketeering activity”
requirement, the plaintiff must establish that the predicate acts “are related, and that they amount
to pose a threat to continued criminal activity.” H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 239
(1989).
It is well established that a “single scheme . . . designed to frustrate one transaction and
inflict[] a single, discrete injury on a small number of victims . . . fails to meet RICO’s
requirement of a ‘pattern of racketeering activity.’” Edmondson & Gallagher v. Alban Towers
Tenants Ass’n, 48 F.3d 1260, 1263 (D.C. Cir. 1995) (holding that the plaintiff’s allegation that a
tenant’s association engaged in a scheme to unlawfully block the sale of a residential building
complex failed to state a RICO claim because “the scheme entail[ed] but a single discrete injury,
the loss of the sale . . . suffered by a small number of victims” and that “the combination of these
factors (single scheme, single injury, and few victims) makes it virtually impossible for plaintiffs
to state a RICO claim”); see also W. Assocs. Ltd. P’ship, 235 F.3d at 633 (affirming the dismissal
of the plaintiff’s RICO claims because the defendant’s alleged misconduct, which included
“concealing cost overruns or shifting the burden of financing them,” was “more accurately
characterized as a single effort to diminish the value of [the plaintiff’s] partnership interest”);
18
Zernik v. United States, 630 F. Supp. 2d 24, 27 (D.D.C. 2009) (dismissing the plaintiff’s civil
RICO claim for failure to plead a “pattern of racketeering activity” because the plaintiff’s
allegations amounted to a single scheme to defraud). The plaintiff in Zernik alleged that the
defendants violated RICO by engaging in various acts of mail and wire fraud in connection with
the forced sale of the plaintiff’s home at foreclosure. Zernik, 630 F. Supp. 2d at 26. The court
dismissed the RICO claim pursuant to Rule 12(b)(6):
Plaintiff alleges seven predicate racketeering offenses to support his claim,
including collusion in robbery, mail fraud, and wire fraud. Each and every [one]
of plaintiff’s alleged predicate racketeering offenses, however, relates solely to
the compelled sale of plaintiff’s house in 2007. As such, plaintiff fails, at a
minimum, to allege a pattern of racketeering activity, as his claims relate to a
single alleged scheme, for which he was the sole injured party.
Id. at 27 (citing W. Assocs. Ltd. P’ship, 235 F.3d at 634).
In this case, the plaintiff has provided no factual allegations indicating the existence of an
ongoing, widespread scheme on the part of the defendants to unlawfully compel the sale of
homeowners in the District of Columbia. See generally Am. Compl. To the contrary, the
plaintiff’s RICO claims focus exclusively on the actions taken by the defendants to foreclose on
the plaintiff’s property. See id. ¶¶ 136-210. Although the plaintiff states in a conclusory fashion
that other D.C. homeowners have been similarly victimized by the defendants, the plaintiff has
identified no similar actions taken by the defendants against any other homeowners. See
generally id.; cf. Corley v. Rosewood Care Ctr., Inc., 142 F.3d 1041, 1051 (7th Cir. 1998)
(concluding that the plaintiff had adequately pled the existence of a pattern of racketeering
activity “by referencing his own experiences with Rosewood in contracting for the care of his
mother and alleging in some detail that other residents and their relatives also were victimized by
the identical scheme”). Accordingly, the plaintiff has not alleged the existence of a “pattern of
19
racketeering activity” as required for a viable RICO claim.8
5. Count VIII: Negligence
The plaintiff alleges that the defendants negligently misrepresented themselves in the
Notice and the Deed of Appointment as the lender and trustee, respectively. Am. Compl. ¶¶
211-17. The plaintiff states that she “reasonably and justifiably relied on Defendant[s’]
misrepresentations and omissions to [her] detriment and paid [more] that amounts due and
owing.” Id. ¶ 218. The plaintiff further alleges that Capital One is liable for negligent
supervision because it “failed to train or monitor its employees properly about the amounts due
and owing for escrow payments under security instruments, and about the requirements that they
adhere to the terms of those security instruments, thereby negligently allow[ing] the collection of
improper and illegal insurance premiums from Plaintiff.” Id. ¶ 221.
Capital One contends9 that the plaintiff’s negligent misrepresentation and negligent
supervision claims both fail because the amended complaint contains no factual allegations
indicating that Capital One proximately caused injury to her. See Capital One’s Mot. at 25-26.
The plaintiff maintains that she has pled all of the requisite elements of a negligence claim with
the necessary specificity. Pl.’s Opp’n at 43.
As a general matter, a claim for negligence in the District of Columbia has four elements:
8
The authorities cited by the plaintiff do not dictate a different result. See, e.g., Corley v.
Rosewood Care Ctr., Inc., 142 F.3d 1041, 1050 (7th Cir. 1998) (observing that the plaintiff would
have a difficult time of establishing a RICO claim “if the predicate acts of racketeering were
addressed only to a single victim for a closed-ended period of twelve to fourteen months”);
Hargraves v. Capital City Mortg. Corp., 140 F. Supp. 2d 7, 26 (D.D.C. 2000) (declining to
dismiss the plaintiff’s RICO claims in part because the plaintiff had alleged multiple frauds
against multiple borrowers clearly related in purpose and method).
9
Prensky does not address the plaintiff’s negligence claim in his motion to dismiss, see generally
Prensky’s Mot.; Prensky’s Reply, despite the fact that the amended complaint asserts a claim of
negligent misrepresentation against him as well, see Am. Compl. ¶¶ 212-17.
20
(1) the defendant owed a duty to the plaintiff, (2) the defendant breached its duty, (3) and that
breach was the proximate cause of (4) damages sustained by the plaintiff. Powell v. Dist. of
Columbia, 634 A.2d 403, 406 (D.C. 1993). The plaintiff’s negligent misrepresentation claim
suffers from a similar to defect to the one that afflicted her fraud claim. See supra Part III.B.1.
Namely, the plaintiff has failed to plausibly allege that the defendants’ misrepresentations
proximately caused any injury to her. See Am. Compl. ¶¶ 211-18. The plaintiff claims that the
defendants negligently misrepresented themselves as the note holder and trustee in the Notice
and Deed of Appointment, id. ¶ 215, and that as a result, the plaintiff paid amounts in excess of
what she owed, id. ¶ 218. Yet, as previously discussed, the amended complaint indicates that the
plaintiff made no additional payments to Capital One after the defendants commenced
foreclosure proceedings by filing the Notice and Deed of Appointment containing the allegedly
fraudulent statements at issue. See id. ¶¶ 32-35. Accordingly, the plaintiff has failed to
adequately plead that the defendants’ misrepresentations proximately resulted in her alleged
injury.10
The plaintiff’s negligent supervision claim against Capital One is equally deficient. To
establish a claim of negligent supervision, the plaintiff must establish that (1) the employee
behaved in a dangerous or otherwise incompetent manner, (2) the employer knew or should have
known its employee’s dangerous or incompetent behavior and (3) the employer, “armed with that
actual or constructive knowledge, failed to adequately supervised the employee.” Brown v.
Argenbright Sec., Inc., 782 A.2d 752, 760 (D.C. 2001) (citing Giles v. Shell Oil Corp., 487 A.2d
10
Because this deficiency equally afflicts the plaintiff’s negligent misrepresentation claim against
Prensky, the court dismisses the negligence claim against him as well. See Baker v. Director,
U.S. Parole Comm’n, 916 F.2d 725, 727 (D.C. Cir. 1990) (observing that sua sponte dismissal
pursuant to Rule 12(b)(6) is appropriate when it is patently obvious that the plaintiff cannot
prevail based on the facts alleged in the complaint).
21
610, 613 (D.C. 1984)). In this case, as previously noted, the plaintiff has provided no indication
as to how Capital One’s employees improperly assessed escrow charges or any other fees against
the plaintiff. See generally Am. Compl.; see infra Part III.B.1 n.4. In addition, the amended
complaint contains only the conclusory allegation that Capital One knew or should known about
its employee’s incompetent conduct. See Am. Compl. ¶ 219; see also Iqbal, 129 S. Ct. at 1949.
Thus, the plaintiff’s negligent supervision claim, like its negligent misrepresentation claim, fails
to adequately state a claim for which relief can be granted.
6. Count IX: Unconscionability, Bad Faith and Unfair Dealing
In Count IX of the amended complaint, which the plaintiff titles “unconscionability, bad
faith, [and] unfair dealing,” the plaintiff alleges that the defendants “used both their superior
positions as a financial institution and foreclosure attorney, respectively, to take oppressive and
unfair advantage of Plaintiff by filing the Forged Deed [of Appointment] and Fraudulent Notice
of Sale.” Am. Compl. ¶¶ 226. In so doing, the plaintiff alleges that the defendants “acted in bad
faith.” Id. ¶ 227.
The defendants contend that this claim must be dismissed because claims of
unconscionability, bad faith and unfair dealing require the existence of a contractual relationship
between the plaintiff and the defendant, which is absent here. Capital One’s Mot. at 26-27;
Prensky’s Mot. at 9-10. The plaintiff responds by asserting that the defendants’ conduct was
outrageous and amounts to unconscionable behavior. Pl.’s Opp’n at 43-44.
“Liability for common law unconscionability requires two findings: ‘an absence of
meaningful choice on the part of one of the parties together with contract terms which are
unreasonably favorable to the other party.’” Williams v. First Gov. Mortg.& Investors Corp.
225 F.3d 738, 748 (D.C. Cir. 2000) (quoting Williams v. Walker-Thomas Furniture Co., 350
22
F.2d 445, 449 (D.C. Cir. 1965)) (emphasis added). Thus, the claim for unconscionability
requires the existence of a contract between the plaintiff and the defendant. See id.
Likewise, a claim for breach of the implied covenant of good faith and fair dealing cannot
exist in the absence of a contractual relationship. See Kerrigan v. Britches of Georgetowne, Inc.,
705 A.2d 624, 627 (D.C. 1997) (concluding that because the plaintiff, “as an employee at will,
not under any contract,” had no basis for claiming that the defendant breached the implied
covenant of good faith and fair dealing); Brown v. Countrywide Home Loans, Inc., 319 B.R. 278,
290 (D.D.C. 2004) (granting summary judgment to the defendant on the plaintiff’s claim that the
defendant breached the implied covenant of good faith and fair dealing because “no reasonable
fact-finder could determine that a contract existed between [the parties]”); see also Choharis v.
State Farm Fire & Casualty Co., 961 A.2d 1080, 1089 (D.C. 2008) (concluding that D.C. law
does not recognize an independent tort of bad faith).
The amended complaint is devoid of any allegation indicating a contractual relationship
between the plaintiff and either defendant. See generally Am. Compl. Indeed, as previously
discussed, the plaintiff’s claims are premised on the allegation that Capital One falsely held itself
out as the lender in the underlying transaction, when in fact it was serving, at best, as the loan
servicer. See generally id.; see supra Part III.B.1. Accordingly, the court grants the defendants’
motions to dismiss this claim.
7. Count X: “Emotional Distress”
The plaintiff has asserted a claim of “emotional distress,” through which she appears to
be asserting a claim of intentional infliction of emotional distress (“IIED”). See Am. Compl. ¶¶
229-34. The defendants contend that this claim should be dismissed because the amended
complaint is devoid of any factual allegations suggesting a plausible claim of intentional
23
infliction of emotional distress. Capital One’s Mot. at 27-29; Prensky’s Reply at 12 n.5. Relying
on case law preceding the Supreme Court’s decisions in Iqbal and Twombly, the plaintiff
maintains that dismissal of this claim is unwarranted because the defendants have not established
that the plaintiff “can prove no set of facts in support of [her] claim which would entitle her to
relief.” Pl.’s Opp’n at 43 (quoting Fed. Information Systems, Corp. v. Boyd, 753 F. Supp. 971,
974 (D.D.C. 1990)).
As a threshold matter, the court reiterates that the “no set of facts” standard on which the
plaintiff relies has been abrogated by the Supreme Court’s rulings in Twombly and Iqbal. See
supra Part III.A; Twombly, 550 U.S. at 562 (abrogating Conley, 355 U.S. at 45-46). As
previously noted, “[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.” Iqbal, 129 S. Ct.
at 1949. It is, therefore, not enough for the plaintiff to assert that there could be a set of facts
consistent with her pleadings that would entitle her to relief. See Pl.’s Opp’n at 43. Rather, the
plaintiff must plead sufficient factual content to allow “the court to draw the reasonable inference
that the defendant is liable for the misconduct alleged.” Iqbal, 129 S. Ct. at 1949.
To succeed on her IIED claim, the plaintiff must show “(1) extreme and outrageous
conduct on the part of the defendant[s] which (2) intentionally or recklessly (3) cause[d] the
plaintiff severe emotional distress.” Khan v. Parsons Global Servs. Ltd., 521 F.3d 421, 428
(D.C. Cir. 2008) (citing Darrow v. Dillingham & Murphy, LLP, 902 A.2d 135, 139 (D.C. 2006)).
Conduct is “extreme and outrageous” when it is “so outrageous in character, and so extreme in
degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and
utterly intolerable in a civilized community.” Homan v. Goyal, 711 A.2d 812, 818 (D.C. 1998)
(quoting Drejza v. Vaccaro, 650 A.2d 1308, 1312 n.10 (D.C. 1994)). As a general matter, a case
24
of IIED is made out only if “the recitation of the facts to an average member of the community
would arouse his resentment against the actor, and lead him to exclaim, ‘Outrageous!’”
RESTATEMENT (SECOND) OF TORTS § 46 cmt. d.
Although the amended complaint does not specify the precise conduct on which the
plaintiff grounds her IIED claim, the court presumes that she bases the claim on all of the
allegations of misconduct set forth in the amended complaint: Capital One’s misrepresentation
that it was the holder of the note rather than the loan servicer, Capital One’s improper assessment
of escrow charges and other penalties and Prensky’s holding himself out as the trustee under the
Deed of Appointment. See generally Compl. This conduct, stemming from the parties’
disagreements over their rights and obligations in a commercial loan transaction, does not
plausibly rises to the level of “atrocious” conduct going “beyond all bounds of decency” as
required to support an IIED claim.11 See Williams v. Fed. Nat’l Mortg. Ass’n, 2006 WL
1774252, at *10 (D.D.C. June 26, 2006) (concluding that the plaintiff’s allegations of “active,
conspiratorial, malicious and secretive attempts [by the defendants] to curtail or terminate [the
plaintiff’s] prospective and ongoing business relationships” and the defendants’ “efforts to
damage her personal and business reputation all during a period when they gave false
appearances of intending to do business with her” did not, as a matter of law, “rise to the level of
extreme and outrageous conduct under District of Columbia law”); see also Lyles v. Micenko,
404 F. Supp. 2d 182, 187 (D.D.C. 2005) (holding that no reasonable fact-finder could conclude
that the filing of a false police complaint rose to the level of “extreme and outrageous” behavior
necessary to give rise to an IIED claim under D.C. law). Accordingly, the plaintiff’s allegations
11
The plaintiff’s reliance on Osbourne v. Capital City Mortg. Co., 667 A.2d 1321 (D.C. 1995), is
misplaced. See Pl.’s Opp’n at 43. Osbourne held merely that damages for emotional distress are
recoverable upon a finding of intentional misrepresentation and did not address the pleading
standards governing IIED claims. See Osbourne, 667 A.2d at 1328.
25
fail to satisfy the first element necessary to state a claim for IIED under D.C. law.
Furthermore, the amended complaint contains no factual allegations indicating that the
defendants acted “intentionally or recklessly” or that the plaintiff suffered “severe emotional
distress” as a result of the defendants’ behavior. See Khan, 521 F.3d at 428. The plaintiff has
alleged no facts suggesting that the defendants intended to cause her emotional distress or acted
recklessly in initiating foreclosure proceedings against her. See generally Am. Compl. Rather,
the plaintiff acknowledges that she had fallen three months behind on her mortgage payments at
the time the defendants initiated foreclosure proceedings and the defendants halted the
foreclosure proceedings once the plaintiff commenced this action. Id. ¶¶ 32, 94. Likewise,
although the plaintiff alleges that the defendants’ conduct “inflicted severe mental anguish and
emotional distress,” id. ¶ 231, these conclusory allegations are unsupported by any factual
content established that the plaintiff suffered “emotional upset ‘of so acute a nature that harmful
physical consequences might be not unlikely to result,” Sere v. Grp. Hospitalization, Inc., 443
A.2d 33, 37 (D.C. 1982) (quoting Clark v. Associated Retail Credit Men of D.C., 105 F.2d 62, 65
(D.C. Cir. 1939)).
For all these reasons, the plaintiff has failed to state a plausible IIED claim under D.C.
law. The court therefore grants the defendants’ motions to dismiss this claim.
C. The Court Dismisses the Aforementioned Claims Without Prejudice
As described above, nearly all of the plaintiff’s claims, as set forth in the amended
complaint, are seriously flawed and insufficient to withstand the defendants’ motions to dismiss.
See supra Part III.B. As a result, the only claim to survive the defendants’ rulings is the
plaintiff’s breach of fiduciary duty claim against Prensky, which Prensky did not move to
dismiss. See id.; see generally Am. Compl.
26
Although the aforementioned claims are woefully inadequate and must be dismissed, this
Circuit has cautioned that “dismissal with prejudice should be granted only when a trial court
determines that ‘the allegation of other facts consistent with the challenged pleading could not
possibly cure the deficiency.’” Jarrell v. U.S. Postal Serv., 753 F.2d 1088, 1091 (D.C. Cir.
1985) (quoting Bonanno v. Thomas, 309 F.2d 320, 322 (9th Cir. 1962)). Because it is not
entirely clear at this stage of the litigation that the plaintiff cannot remedy the deficiencies in her
pleading with additional factual allegations consistent with those in her amended complaint, the
court dismisses these claims without prejudice.12
IV. CONCLUSION
For the foregoing reasons, the court grants Capital One’s motion to dismiss and Prensky’s
motion for partial dismissal. An Order consistent with this Memorandum Opinion is separately
and contemporaneously issued this 28th day of March, 2011.
RICARDO M. URBINA
United States District Judge
12
As noted in the foregoing analysis, the court has not addressed every alleged deficiency in the
amended complaint raised by the defendants in their motions to dismiss. See supra Part III.B.
The parties should not interpret the court’s decision not to address certain arguments as any
indication of the court’s view of the merits of those arguments.
27