FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT April 21, 2015
Elisabeth A. Shumaker
Clerk of Court
GENE A. SPREITZER,
Plaintiff - Appellant,
v. No. 14-8023
(D.C. No. 1:12-CV-00206-ABJ)
DEUTSCHE BANK NATIONAL (D. Wyo.)
TRUST COMPANY, as trustee for
Ameriquest Mortgage Securities, Inc.;
HOMEWARD RESIDENTIAL, INC.,
Defendants - Appellees,
and
JAMES H. WOODALL; HEATHER M.
MCGINLEY; JAMES H. WOODALL,
PLLC; DEFAULT RESOLUTION
NETWORK, LLC; AMERIQUEST
MORTGAGE COMPANY; DAVID
APPLEGATE,
Defendants.
ORDER AND JUDGMENT*
*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
Before MORITZ, PORFILIO, and BALDOCK, Circuit Judges.
Gene Spreitzer appeals from the district court’s order dismissing his amended
complaint with prejudice and denying his motion for leave to further amend his
complaint. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.
BACKGROUND
In 2003, Spreitzer obtained a home loan from Ameriquest Mortgage Company
(Ameriquest). The loan was evidenced by a note and secured by a mortgage (the
Note and Mortgage). In 2009, Ameriquest assigned the Note to Deutsche Bank
National Trust Company, as trustee for Ameriquest Mortgage Securities, Inc.,
Asset-backed Pass-through Certificates, 2003-11 (Deutsche Bank). In 2012,
Deutsche Bank began sending Spreitzer foreclosure notices, initially through attorney
James H. Woodall and later through Homeward Residential, Inc. (Homeward), which
acted as servicer of the loan for Deutsche Bank.
Spreitzer responded by filing the action underlying this appeal. After several
defendants moved to dismiss his initial pro se complaint, he filed an amended
complaint (Amended Complaint), also pro se. In the Amended Complaint, he alleged
Ameriquest’s indorsement of the Note “without recourse” was an acknowledgement
that it had received full payment on the loan, extinguished his obligation under the
Note, and required Ameriquest to release the Mortgage. He also alleged the
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assignment to Deutsche Bank was a sham. He asserted claims under the Fair Debt
Collection Practices Act (FDCPA) and the Racketeer Influenced and Corrupt
Organizations Act (RICO), and he sought to quiet title to the property subject to the
mortgage. Defendants filed motions to dismiss the Amended Complaint, and briefing
on those motions was completed by January 2013. In May 2013, an attorney entered
an appearance on Spreitzer’s behalf.
In mid-December 2013, the district court granted the motion to dismiss the
initial complaint filed by Campbell County Abstract Company and its president,
Barbara S. Redder (Campbell defendants), and denied as moot four other motions to
dismiss the initial complaint. In late January 2014, Spreitzer’s counsel filed a
“Motion for Leave to File Second Amended Complaint” (motion to amend) and
attached a proposed Second Amended Complaint. Several of the remaining
defendants opposed the motion. On March 3, 2014, the district court granted the
remaining motions to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil
Procedure, dismissed the Amended Complaint with prejudice, and denied the motion
to amend. This counseled appeal followed.
DISCUSSION
Because Spreitzer proceeds on appeal only against Deutsche Bank and
Homeward (together, the Bank Defendants), who jointly moved to dismiss, our focus
is on the district court’s resolution of the claims against them. We review a
Rule 12(b)(6) dismissal de novo. Colo. Envtl. Coal. v. Wenker, 353 F.3d 1221, 1227
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(10th Cir. 2004). We construe Spreitzer’s pro se filings in the district court liberally
but we do not advocate for him. See Yang v. Archuleta, 525 F.3d 925, 927 n.1
(10th Cir. 2008).
A. Motion to Amend
We first address the district court’s denial of Spreitzer’s motion to amend.1
The court noted that under Frank v. U.S. West, Inc., 3 F.3d 1357, 1365-66 (10th Cir.
1993), untimeliness alone is a sufficient basis to deny leave to amend. The court
reasoned that counsel had delayed too long (nearly nine months) after entering his
appearance, that his need to review prior filings was insufficient justification for the
delay, and that although Spreitzer’s counsel suggested “special counsel” prepared the
Second Amended Complaint, no other attorney had sought admission pro hac vice.
The court found Spreitzer’s actions dilatory for the independent reason that he filed
the motion to amend only after the court had dismissed the claims against the
Campbell Defendants. The court also concluded that granting the motion to amend
would substantially prejudice the Bank Defendants, would prejudice resolution of the
case, and would be contrary to justice.
Because the district court did not deny leave to amend based on futility, our
review is only for abuse of discretion. See Fields v. City of Tulsa, 753 F.3d 1000,
1
Because Spreitzer’s appeal involves the denial of the motion to amend, he had
an obligation to include the motion in the appendix. See 10th Cir. R. 10.3(D)(2),
30.1(B)(1). He did not do so, but we exercise our discretion to take judicial notice of
the motion. See Guttman v. Khalsa, 669 F.3d 1101, 1127 n.5 (10th Cir. 2012).
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1012 (10th Cir. 2014). Rule 15(a)(2) of the Federal Rules of Civil Procedure governs
amendments requiring leave of court and provides leave to amend should be freely
given “when justice so requires.” Fed. R. Civ. P. 15(a)(2). “[U]ndue delay,”
“dilatory motive,” and “undue prejudice to the opposing party” are among the
reasons a district court “may withhold leave to amend.” U.S. ex rel. Ritchie v.
Lockheed Martin Corp., 558 F.3d 1161, 1166 (10th Cir. 2009) (internal quotation
marks omitted).
Spreitzer argues that any prejudice to the defendants resulted from the district
court’s delay in ruling on the motions to dismiss the Amended Complaint. He claims
his counsel waited to seek leave to file the second amended complaint until after the
district court ruled on the pending motions to dismiss “so that the proposed Second
Amended Complaint,” which was the first pleading filed by counsel, “could be
properly structured.” Opening Br. at 43. And he distinguishes Frank on the ground
that in Frank, unlike here, the court denied leave to amend after an amendment
deadline.
We are not persuaded. First, the time that passed while motions to dismiss
were pending in the district court only served to exacerbate Spreitzer’s delay because
that time provided his counsel additional opportunity (again, nearly nine months) to
consider whether to seek leave to amend Spreitzer’s pro se Amended Complaint.
Although Spreitzer alleged in his motion to amend that he only “recently” retained
special counsel who drafted the proposed Second Amended Complaint, Doc. 136
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at 1, Spreitzer stated in a supportive reply that “the initial work by special counsel
involved months of factual and legal research,” Aplt. App. at 244. Yet during all
those “months” Spreitzer’s counsel of record took no action in the district court
despite being on notice that the court could rule on the motions to dismiss at any
time.
Second, in the district court, Spreitzer did not argue strategic reasons justified
his delay, and he has not argued plain error here. Thus, he has forfeited our
consideration of that argument. See Richison v. Ernest Group, Inc., 634 F.3d 1123,
1127-31 (10th Cir. 2011) (declining to conduct plain-error review of theory presented
for first time on appeal when appellant did not “argue for plain error and its
application on appeal”); Utah Animal Rights Coal. v. Salt Lake Cnty., 566 F.3d 1236,
1244 (10th Cir. 2009) (stating “we generally do not consider new theories on
appeal—even those that fall under the same general category as one that was
presented in the district court”).2
2
In any event, Spreitzer’s argument that his delay was strategic is unconvincing,
because he filed his motion to amend before the district court had ruled on the Bank
Defendants’ motion to dismiss. Therefore, the court’s ruling on that motion to
dismiss could not have informed counsel as to how to “properly structure” an
amended complaint. Nor did the district court’s dismissal of the claims against the
Campbell Defendants provide Spreitzer any guidance. The court dismissed the
claims against those defendants (a title company and one of its employees) because
Spreitzer failed to allege any facts showing their involvement with the foreclosure
efforts or any alleged extortion or mail fraud. That rationale has nothing to do with
the changes Spreitzer sought to make with the proposed Second Amended Complaint,
in which he did not even name the Campbell Defendants.
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Finally, Frank may be factually distinguishable, but the district court relied on
Frank only for its general rule that undue delay is a sufficient reason to deny leave to
amend, then applied that rule to the facts here. And we see no abuse of discretion in
the court’s determination that the delay was undue or, as Frank also requires, without
“adequate explanation,” Frank, 3 F.3d at 1365-66.
Because the district court did not abuse its discretion in denying the motion to
amend, Spreitzer’s pro se Amended Complaint remains the controlling pleading.
Therefore, we base the following review of the district court’s denial of his motion to
dismiss on the facts alleged in that pleading, disregarding those portions of the
factual statement and argument in Spreitzer’s opening brief based solely on the
proposed Second Amended Complaint.
B. Motion to dismiss
1. FDCPA claims
The district court concluded Spreitzer’s FDCPA claims failed because the
Bank Defendants are not “debt collectors” within the meaning of the FDCPA. In
relevant part, the term “debt collector” excludes “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 . . . (iii) concerns a debt which was not in default at the time it was
obtained by such person.” 15 U.S.C. § 1692a(6)(F). Applying that provision, the
district court determined that, under Wyoming law, the application of which no party
challenges, Ameriquest’s indorsement of the Note “without recourse” did not mean
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that the note was paid off or that Spreitzer no longer was obligated under it, as he
argued. Instead, such an indorsement disclaims the indorser’s liability, and if the
instrument is dishonored, the indorser is not obligated to pay the amount due on it.
See Wyo. Stat. Ann. § 34.1-3-415(a), (b). Based on this analysis, the district court
concluded Spreitzer failed to advance plausible allegations that he was not obligated
under the Note when it was assigned to Deutsche Bank in 2009.
Spreitzer has not challenged the district court’s analysis of this issue (other
than to rely on facts solely pled in his proposed Second Amended Complaint, which
we have determined is not controlling). But he takes issue with the court’s rejection
of his argument that the assignment itself was invalid because it occurred in 2009,
after the closing date (in 2003) of the securitized trust into which the Note and
Mortgage were placed (and of which Deutsche Bank was the trustee), and therefore
was in violation of a related pooling and service agreement (PSA). Applying the
Iqbal3 standard for determining the sufficiency of a complaint, the district court
concluded Spreitzer failed to allege any facts supporting a plausible claim that the
assignment was void. The court therefore concluded, as have other courts to
consider the issue, that Spreitzer lacked standing to challenge the assignment as
voidable based on non-compliance with the PSA.
Spreitzer argues the cases relied upon by the district court are not binding and
the law is unsettled because other courts have reached a different conclusion. But we
3
Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009).
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need not resolve this issue because we can affirm on another ground supported by the
record but not relied upon by the district court. See Bixler v. Foster, 596 F.3d 751,
760 (10th Cir. 2010). The Bank Defendants argue, as they did below, that a valid
assignment was not necessary for them to have obtained the Note at a time when it
was not in default.4 We agree. When a negotiable instrument is indorsed in blank, it
is “payable to bearer.” Wyo. Stat. Ann. § 34.1-3-205(b). When an instrument is
“payable to bearer,” “the person in possession” of it is the “[h]older,” id.
§ 34.1-1-201(xx), and the holder of an instrument is a “[p]erson entitled to enforce
[it],” id. § 34.1-3-301. Further, “a transfer of [a note] will carry with it the mortgage
security and operate as an equitable assignment thereof unless it is agreed otherwise.”
Bradburn v. Wyo. Trust Co. of Casper, 63 P.2d 792, 797 (Wyo. 1936).
Spreitzer admitted in his Amended Complaint that Ameriquest indorsed the
Note “in blank without recourse . . . by the hands of Kirk Langs, COB and CEO, and
John P. Grazer, E.VP and CFO.” Aplt. App. at 37. The document itself reveals as
much. See Aplee. Supp. App. at 4. He does not allege that Deutsche Bank was not in
possession of the Note (i.e., not a holder) or that he was in default when Deutsche
Bank came into possession of it, which is the relevant point in time for the inquiry,
not, as Spreitzer suggests, the time when foreclosure proceedings commence, see
Reply at 6. Accordingly, the Amended Complaint contains no plausible allegations
4
Because the Bank Defendants raised this ground in the district court and again
on appeal, Spreitzer has had an adequate opportunity to address it. See Bixler,
596 F.3d at 760.
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that the Bank Defendants obtained the Note while it was in default – allegations that
would be necessary to skirt the relevant exclusion from the FDCPA’s definition of
“debt collector” in 15 U.S.C. § 1692a(6)(F).5
2. RICO claims
Spreitzer asserted two civil RICO claims, one for extortion and one for mail
fraud. In his extortion claim, he alleged the Bank Defendants “attempted to extort
roughly $150,000 from [him] by threatening to sell and seize [his] home under color
of official right by and through the use of a fabricated, phony, false, sham, fraud
on-its-face, alleged ‘Assignment of Mortgage,’ which had no enforceable security
interest granting Defendants any present right of possession.” Aplt. App. at 53
(emphases omitted).
Extortion is defined as “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). The district court dismissed
5
Spreitzer also argues that, because only a motion to dismiss was at issue, the
district court erred in discussing the facts he was required to “prove” and in relying
on a case decided at summary judgment. But contrary to Spreitzer’s suggestion, the
district court did not conduct improper fact-finding at the Rule 12(b)(6) stage or
wrongfully construe inferences against him. Instead, the court simply reviewed the
facts Spreitzer would be required to prove in order to prevail on his FDCPA claim in
determining whether he alleged facts giving rise to a plausible claim for relief under
Iqbal, then determined the facts he alleged were legally insufficient. We also reject
Spreitzer’s assertion that the district court converted the motion to dismiss into one
for summary judgment without providing him notice and an opportunity to present
any relevant evidence. We conclude the court appropriately confined itself to the
allegations of the Amended Complaint and the documents attached to it or referred to
in it.
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the extortion claim because the Bank Defendants were private entities, as Spreitzer
himself had alleged, not entities acting “under color of official right,” which requires
“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). Spreitzer apparently concedes
that point, and now argues that by alleging the Bank Defendants were threatening to
seize his home, he adequately (if inartfully) pled the alternative “wrongful use of
actual or threatened force” iteration of extortion under § 1951(b)(2). But even if we
accept his claim that his pleading adequately alerted the district court to an
alternative basis for his argument, his claim fails because, as explained in our
analysis of his FDCPA claims, the Bank Defendants’ foreclosure efforts were not
“wrongful.”
A predicate RICO mail-fraud claim under 18 U.S.C. § 1341 involves “use of
the United States mails” to execute a scheme “to defraud or obtain money or property
by false pretenses, representations or promises.” Tal v. Hogan, 453 F.3d 1244, 1263
(10th Cir. 2006). A plaintiff must plead mail fraud with the particularity required by
Rule 9(b) of the Federal Rules of Civil Procedure. Id. The district court observed
that Spreitzer failed to specify the allegedly false representation sent by mail but the
court assumed it was the representation that the Note, Mortgage, and assignment
were valid and gave the Bank Defendants the right to foreclose. Based on that
assumption, the district court concluded that Spreitzer’s allegation that the Bank
Defendants made a “false” representation failed because it was premised on his
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“misguided belief that [indorsement] ‘without recourse’ represents a satisfaction of
the debt.” Aplt. App. at 279. The court also held Spreitzer failed to plead fraud with
the particularity required by Rule 9(b).
On appeal, Spreitzer argues the district court erred in assuming that the Bank
Defendants’ allegedly false representation concerned their right to foreclose. Yet
Spreitzer fails to identify any other false representation, and he ironically overlooks
the district court’s assumption in his favor. The court could simply have dismissed
the mail-fraud claim based on Spreitzer’s failure to identify any allegedly false
representation.
3. Quiet-title claim
The district court dismissed Spreitzer’s quiet-title claim concluding he based
that claim on the weakness of the Bank Defendants’ title rather than the strength of
his own. See Kirby Royalties, Inc. v. Texaco, Inc., 458 P.2d 101, 106 (Wyo. 1969)
(explaining the “plaintiff in a quiet title action[] has the burden of proof and must
stand on the strength of its own title and not the weakness of the title of defendants”).
The court observed that although Spreitzer attacked the Note, the Mortgage, and the
assignment, he never alleged he satisfied the Note or was not in default. Relying on
an unpublished federal district court case applying Utah law, the district court held
that “[i]t is [Spreitzer’s] default that clouds his title.” Aplt. App. at 280.
Spreitzer argues he sufficiently pled a cause of action to quiet title under
Wyoming law, that the district court’s reference to his burden of proof shows that the
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court impermissibly converted the motion to dismiss into one for summary judgment,
and that the court’s reliance on Utah case law conflicts with Wyoming’s quiet-title
statute. We are unpersuaded. The district court properly considered Spreitzer’s
burden of proof in determining whether his allegations set forth a plausible claim for
relief, and in doing the court so did not convert the motion to dismiss into one for
summary judgment. The district court relied on a case applying Utah law only for a
general legal principle and that case was not, in any event, dispositive of Spreitzer’s
quite-title claim. Instead, Spreitzer predicated that claim wholly on his legally
incorrect allegation that Ameriquest’s “without recourse” indorsement of the Note
“render[ed the] ‘Mortgage’ a nullity” and that the Mortgage, along with the
assignment, “should be stricken from the chain of title.” Id. at 56. Thus, we affirm
the district court’s dismissal of Spreitzer’s quiet-title claim.
CONCLUSION
The judgment of the district court is affirmed.
Entered for the Court
Nancy L. Moritz
Circuit Judge
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