Jones v. Specialized Loan Servicing, LLC

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TIAVONDE L. JONES, Plaintiff, v. SPECIALIZED LOAN SERVICING, LLC et al, Defendants.

Civil Action No. RDB-22-1987

United States District Court, D. Maryland

February 1, 2023

MEMORANDUM OPINION

Richard D. Bennett United States District Judge

Plaintiff Tiavonde Jones (“Plaintiff” or “Jones”) brings this real property action against Defendant Specialized Loan Servicing, LLC (“SLS”), Defendant HSBC Bank USA (“HSBC”), and Defendant BWW Law Group, LLC (“BWW”) for their part in foreclosure proceedings against her home located in Catonsville, Maryland. (Complaint, ECF No. 4.) Defendant BWW has filed a Motion to Dismiss (ECF No. 13) and Defendants SLS and HSBC have also filed a Motion to Dismiss (ECF No. 14). The Court has considered the Defendants' Motions and Plaintiff's responses (ECF Nos. 15, 16).^[1]No hearing is necessary. Loc. R 105.6 (D. Md. 2021). For the reasons that follow, the Defendants' Motions (ECF Nos. 13, 14) shall be GRANTED, and this case is DISMISSED WITH PREJUDICE.

BACKGROUND

In ruling on a motion to dismiss, this Court “accept[s] as true all well-pleaded facts in a complaint and construe[s] them in the light most favorable to the plaintiff.” Wikimedia Found v. Nat'l Sec. Agency, 857 F.3d 193, 208 (4th Cir. 2017) (citing SD3, LLC v. Black & Decker (U.S.) Inc., 801 F.3d 412, 422 (4th Cir. 2015)). Plaintiff purchased a home in Catonsville, Maryland, on July 16, 2007 with a mortgage loan from Wells Fargo Bank, N.A. (ECF No. 4 at 6.) The loan was a ten-year interest only loan secured by a deed of trust and promissory note, which has since been transferred to HSBC. Id. at 5-6. At some point, the loan reverted to a fully amortizing loan and Plaintiff was unable to continue making her mortgage payments. Id. Consequently, the Substitute Trustees, comprised of attorneys and employees at Defendant BWW representing the interests of Defendant SLS and Defendant HSBC, initiated a foreclosure action on April 12, 2019, in the Circuit Court for Baltimore County. Id.; (ECF No. 13-1 at 2.)

During the foreclosure proceedings and as part of the State of Maryland's mediation process, Plaintiff applied for a loan modification with Defendant SLS, the loan servicer, on April 25, 2021, and SLS acknowledged receipt on May 24, 2021. (ECF No. 4 at 5.) As part of the foreclosure proceedings, mediation was held on June 14, 2021, while Plaintiff's loan modification was under review. Id. The next day, on a letter dated June 15, 2021, SLS stated that it was waiting for documents necessary to process the application. (ECF No. 4 at 9.)

Jones was permitted to file a motion to stay or dismiss the foreclosure action fifteen days from the date of the mediation under the Maryland Rules. (ECF No. 4 at 9) (citing Maryland Rule 14-211). Because Plaintiff's loan modification application was still under review, her attorney requested the Substitute Trustees' consent in extending Jones' time to file a motion under the Maryland Rules. Id. The Substitute Trustees did not respond to Plaintiff's request. Id. Jones filed a motion to extend her time with the Circuit Court for Baltimore County on June 23, 2021, in anticipation of the upcoming June 29, 2021, motions deadline. Id. Jones did not receive a ruling on her motion to extend time from the Circuit Court by June 29, 2021, so she filed a motion to stay or dismiss the foreclosure action to avoid harm from untimely filing. Id.

The Circuit Court ultimately granted Jones' request to extend the time for filing and she was given until fifteen days after Defendant SLS's loan modification decision. (ECF No. 4 at 10.) Despite this, the Substitute Trustees filed an opposition to Jones' still-pending June 29, 2021, motion on August 2, 2021, and the Circuit Court then issued an order on August 5, 2021, denying Jones' motion to stay or dismiss the foreclosure action. Id. Jones subsequently filed a motion for reconsideration on August 9, 2021, which the Substitute Trustees opposed on August 23, 2021. Id. A few days earlier, by letter to Jones dated August 16, 2021, SLS stated that the loan's investor had “not provided the necessary confirmation of the loss mitigation review” and her loan modification application had still not been reviewed. (ECF No. 4 at 9.) Thereafter, the Circuit Court denied Jones' pending motion for reconsideration on September 1, 2021. Id. Jones' home has yet to be sold at foreclosure sale. She states that she continues to face the threat of foreclosure, has incurred various legal fees and additional interest, and her credit score has suffered as a result of Defendant SLS's actions and inactions. Id. She has also sustained non-economic damages in the form of emotional distress. Id.

Plaintiff's Complaint alleges violations of the Maryland Consumer Protection Act against Defendants SLS and BWW (Count One), violations of the Maryland Mortgage Fraud Protection Act against Defendants SLS and BWW (Count Two), fraud by Defendant SLS (Count Three), violations of the Real Estate Settlement Procedures Act against Defendant SLS (Count Four), breach of contract against Defendant HSBC (Count Five), negligence against Defendant SLS (Count Six), and violation of a consent order against Defendants SLS and BWW (Count Seven). (ECF No. 4.)

Defendant BWW has filed a Motion to Dismiss (ECF No. 13) those counts against it (Counts One, Two, and Seven) principally arguing that Jones has failed to plead facts necessary for each of the Counts against it. Similarly, Defendants SLS and HSBC have filed a Motion to Dismiss (ECF No. 14) arguing that Plaintiff has failed to plead certain facts with particularity as required under Federal Rule of Civil Procedure 9(b), and that she has generally failed to sufficiently plead all other facts necessary for her claims. Plaintiff's brief responses summarily assert that she has stated viable causes of actions.^[2] (ECF Nos. 15, 16.)

STANDARD OF REVIEW

A complaint must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Rule 12(b)(6) of the Federal Rules of Civil Procedure authorizes the dismissal of a complaint if it fails to state a claim upon which relief can be granted. The purpose of Rule 12(b)(6) is “to test the sufficiency of a complaint and not to resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses.” Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006).

To survive a motion under Fed.R.Civ.P. 12(b)(6), a complaint must contain facts sufficient to “state a claim to relief that is plausible on its face.” Ashcroft v Iqbal, 556 U.S. 662, 684 (2009) (quoting Bell Atl., Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Under the plausibility standard, a complaint must contain “more than labels and conclusions” or a “formulaic recitation of the elements of a cause of action.” Twombly, 550 U.S. at 555; see Painter's Mill Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013). A complaint need not include “detailed factual allegations.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). A complaint must, however, set forth “enough factual matter (taken as true) to suggest” a cognizable cause of action, “even if . . . [the] actual proof of those facts is improbable and . . . recovery is very remote and unlikely.” Twombly, 550 U.S. at 556 (internal quotations omitted). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice” to plead a claim. Iqbal, 556 U.S. at 678; see A Soc'y Without a Name v. Virginia, 655 F.3d 342, 346 (4th. Cir. 2011).

For claims which allege fraud, Rule 9(b) of the Federal Rules of Civil Procedure requires that “the circumstances constituting fraud be stated with particularity.” Fed.R.Civ.P. 9(b). The rule “does not require the elucidation of every detail of the alleged fraud, but does require more than a bare assertion that such a cause of action exists.” Mylan Labs., Inc. v. Akzo, N.V., 770 F.Supp. 1053, 1074 (D. Md. 1991). To satisfy the rule, a plaintiff must “identify with some precision the date, place and time of active misrepresentations or the circumstances of active concealments.” Johnson v. Wheeler, 492 F.Supp.2d 492, 509 (D. Md. 2007). As the United States Court of Appeals for the Fourth Circuit stated in United States ex rel. Nathan v. Takeda Pharmaceuticals North America, Inc., 707 F.3d 451 (4th Cir. 2013), the aims of Rule 9(b) are to provide notice to defendants of their alleged misconduct, prevent frivolous suits, eliminate fraud actions where all the facts are learned after discovery, and protect defendants from harm to their goodwill and reputation. 707 F.3d at 456 (citation omitted).

When ruling on motion to dismiss, a court's evaluation is generally limited to allegations contained in the complaint. Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159 166-67 (4th Cir. 2016). However, courts may also consider documents explicitly incorporated into the complaint by reference. Id. at 166 (citing Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007)). In addition, a court may “consider a document submitted by the movant that was not attached to or expressly incorporated in a complaint, so long as the document was integral to the complaint and there is no dispute about the document's authenticity.” Id. (citing Sec'y of State for Defence v. Trimble Nav. Ltd., 484 F.3d 700, 705 (4th Cir. 2007)). A document is “integral” when “its ‘very existence, and not the mere information it contains, gives rise to the legal rights asserted.'” Chesapeake Bay Found., Inc. v. Severstal Sparrows Point, LLC, 794 F.Supp.2d 602, 611 (D. Md. 2011) (citation omitted) (emphasis omitted). Considering such documents does not...