Pike v. Bank of Am., N.A.

JOHN PIKE, et al., Plaintiff, v. BANK OF AMERICA, N.A., et al., Defendants.

CASE NO. 1:14 CV 2529

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO EASTERN DIVISION

February 12, 2016

JUDGE DONALD C. NUGENT

MEMORANDUM OPINION

This matter is before the Court on the Motion for Summary Judgment filed by Defendants, Wells Fargo Bank, N.A and Bank of America, N.A. (Docket #82); the Motion for Summary Judgment filed by Defendant, Real Time Resolutions, Inc. (Docket #84); and, the Motion for Summary Judgment filed by Plaintiffs, John Pike, aka John F. Pike, Jr. and Teresa M. Pike (Docket #88).

I. Factual and Procedural Background.¹

On June 19, 2006, the Pikes obtained a loan in the amount of $652,000.00 from Countrywide Home Loans, Inc. ("the Loan") as part of the refinancing of their home in Toledo, Ohio. (Complaint at Paragraphs 31 and 35.) The Note was secured by a Mortgage in favor ofCountrywide. (Id. at 36.) Monthly payments were calculated at $4,121.08. On June 21, 2011, the Loan was assigned to BAC Home Loans Servicing ("BACHLS") and, on April 1, 2013, Bank of America, N.A. ("BANA"), as successor by merger to BACHLS, assigned the Loan to Wells Fargo. At all times relevant to the Complaint, Wells Fargo owned the Loan and BANA serviced the Loan.

On or about July 26, 2006, the Pikes also executed a home equity line of credit ("HELOC") in the amount of $150,000.00 in favor of Countrywide. (Complaint at Paragraph 57.) The HELOC was secured by an open-end mortgage in favor of Countrywide.

A. Default.

The Pikes defaulted on the Loan and HELOC in October 2010. The Pikes admittedly have not made any payments toward the Loan and HELOC since October 2010 and have continued to reside in the house. Mr. Pike stated during deposition that around the time he stopped making the payments required under the Loan and HELOC, he contacted Bank of America regarding the possibility of a loan modification but, after speaking to four different people, was told he did not qualify for a modification. (Pike Depo. at p. 118-120.) Mr. Pike had no further communication with Bank of America regarding a loan modification. Mr. Pike never requested a loan modification or other relief with regard to the HELOC.

RTR commenced collection duties on the HELOC in June 2011. (Docket #85, Exhibit A.) RTR never received any payments from the Pikes and no payments were applied toward the account by RTR. (Id.)

On May 2, 2013, Wells Fargo filed a Complaint in Foreclosure against the Pikes in the Lucas County Court of Common Pleas, alleging that the Pikes defaulted on their Note and Mortgage as of September 1, 2010. (Id. at 37 and 40.) In the Fair Debt Collection Practices ActNotice attached to the Complaint, the amount owed was stated to be at least $788,786.52. The Pikes retained a law firm, Doucet & Associates, to represent them and, on May 30, 2013, answered the Foreclosure Complaint. The Foreclosure Complaint was dismissed on June 20, 2013, at the request of Wells Fargo. The Parties have not fully explained why the Foreclosure Complaint was voluntarily dismissed. Since that time, the Pikes have not tried to refinance their debt, nor have they attempted to sell the home. (Pike Depo. at p. 78

B. Qualified Written Requests for Information.

In the fall of 2013, after Wells Fargo requested dismissal of the Foreclosure Complaint, the Pikes, through their attorneys Doucet & Associates, sent written requests for information to certain named Defendants, which the Pikes purport to be Qualified Written Requests ("QWRs"), as contemplated by various consumer protection statutes. In the QWRs, the Pikes stated that several of the charges to their Loan were erroneous and requested additional information regarding their Loan and HELOC.

1. BANA.

On September 19, 2013, Doucet & Associates sent letters to BANA which they assert constitute QWRs as defined by the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C.§ 2605(e)(1)(B), requesting certain information regarding the Pikes' Loan. (Docket #88-7, Exhibit G.) The QWRs also indicated that the Pikes believed their Loan balance was erroneous; listed certain late charges and/or fees that they asserted were unauthorized or excessive; and, requested the Pikes' account be corrected by removing the unauthorized charges.²

The September 19, 2013 QWRs were not sent to the correct address. Nevertheless, on September 25, 2013, BANA sent a letter to the Pikes at their home address, acknowledging receipt of the QWRs. (Docket #88-8, Exhibit H.) On October 2, 2013, BANA sent the Pikes a letter, which explained that in order to ensure confidentiality, responses to the QWRs could not be provided to Doucet & Associates because the signature on the authorization letter received by BANA did not match the signature on file with BANA. (Docket #88-1.) The Pikes were instructed to send BANA a photocopy of a State-issued identification card showing Mr. Pike's current signature, or send a signed and dated authorization granting BANA permission to release the information. (Id.) The correspondence provided a fax number and address, as well as an 800 number for questions. (Id.) BANA also advised Doucet & Associates that it declined the request for information based on non-matching signatures and informed Counsel that the Pikes could call BANA and provide a verbal authorization which would allow same-day disclosure of the requested information. (Id.) Neither Plaintiffs nor their Counsel took any action to resolve the issue regarding non-matching signatures or to provide authorization at that time. (Pike Depo. at pp. 128-33.)

On June 24, 2014, over 9 months later, Doucet & Associates sent a second set of QWRs to BANA, virtually identical to the September 19, 2013 QWRs, to a different incorrect address. (Docket #88-9.) On July 1, 2014, BANA responded, advising the Pikes and Doucet & Associates that there was still an issue with non-matching signatures that needed to be resolved. (Docket #82-1.) BANA again explained what the Pikes needed to do to authorize Doucet & Associates to communicate with BANA on their behalf. (Id.) Neither the Pikes nor their attorneys took any action.

On September 11, 2014, Doucet & Associates sent BANA a third set of QWRs, to the incorrect address used in the first set of QWRs, requesting the same information. This time the correspondence included the photocopy of a State-issued identification card showing Mr. Pike's signature. (Docket #88-1.) BANA provided a timely response to the third set of QWRs. (Docket #82-1.) The Parties disagree as to whether BANA's response was adequate.

2.. RTR.

On September 19, 2013, Doucet & Associate sent two letters to RTR which they assert were QWRs as contemplated under RESPA, 12 U.S.C. § 2605(e)(1)(B). (Docket #88-5.) One of the letters included Paragraphs entitled "FDCPA Demand" and "TILA Demand" and requested, in pertinent part, as follows:

FDCPA DEMAND

In accordance with the Fair Debt Collection Practices Act, 15 U.S.C. § 1692a, et seq., specifically 15 U.S.C. § 1692c(a)(2), you are hereby directed to cease all communication with our client(s) and direct all correspondence and communications to: Doucet & Associates, LLC, at 4200 Regent Street, Suite 200, Columbus, Ohio 43219.

Furthermore, pursuant to 15 U.S.C. § 1692g, our client disputes the validity of the debt and requests that you provide verification of the same to my address above. Our client also requests the name and address of the original creditor.

TILA DEMAND

In accordance with the Truth in Lending Act, 15 U.S.C. § 1641(f)(2), our client hereby requests the name, address, and telephone number of the owner of their note, plus the name of the master servicer of their note.

The Pikes only claim against RTR is brought pursuant to RESPA, not the FDCPA or TILA.

The second letter from the Pikes to RTR did not refer to any particular statute and reads, in pertinent part, "In accordance with the Note and Mortgage, please provide a current reinstatement quote for the above-reference account(s). (Docket #88-5.) Also, please provide acurrent payoff as soon as possible and mail to the address listed above. A copy of my client's authorization is enclosed." (Id.)

On September 25, 2013, RTR sent Doucet & Associates a letter in response to their QWRs, indicating that it had completed its research and that it was "servicing" the Pikes' account on behalf of Countrywide Home Loans ("BofA") pursuant to a transfer effective 6/22/2011. (Docket #88-6.) The letter also stated as follows:

Real Time does offer a variety of ways to assist your client during the delinquency of the above referenced account including payment options and settlements. As requested, we will direct all communication regarding this account through your office until otherwise instructed.

RTR included a copy of a June 14, 2011 Notice from BANA to Mr. Pike, indicating that he had been in default on the HELOC since October 2010 ("Next Payment Due: 11/25/2010") and listing the outstanding balance; a copy of the "Mortgage Collection, Processing and Reporting Transfer Notification" sent to Mr. Pike on June 23, 2011, indicating a balance of $147,218.23 and a payoff amount of $153,644.69 and disclosing that RTR was acting as a "debt collector;" a copy of the Pikes' signed Home Equity Credit Line Agreement and Disclosure Statement and Open-End Mortgage; and, a copy of the "Special Servicing Agreement" between Countrywide and RTR.

C. The Pikes' Complaint in this Court

On November 18, 2014, the Pikes, through their attorneys Doucet & Associates, filed this lawsuit, alleging that Defendants in this case violated various Federal consumer protection statutes by failing to adequately respond to Qualified Written Requests for information; by failing to adequately explain and correct charges the Pikes allege were erroneously added to their total delinquent balance; by continuing to direct communications to the Pikes rather thanCounsel as requested; and, by continuing to report their...