Strickland-Lucas v. Citibank, N.A.

256 F.Supp.3d 616

JoWanda STRICKLAND–LUCAS, et al., Plaintiffs,

v.CITIBANK, N.A. Doing Business as CWABS, Inc., Asset–Backed Certificates, Series 2007–QH2, Defendant.

Civil Action No. ELH-16-0805.

United States District Court, D. Maryland.

Signed June 8, 2017

Filed June 9, 2017

Jowanda Strickland–Lucas, Aberdeen, MD, pro se.

James Strickland–Lucas, Aberdeen, MD, pro se.

Mark E. Shaffer, McGuireWoods LLP, McLean, VA, Sydney Fairchild Fitch, Hogan Lovells US LLP, Baltimore, MD, for Defendant.

MEMORANDUM OPINION

Ellen Lipton Hollander, United States District Judge

JoWanda and James Strickland–Lucas, the self-represented plaintiffs, filed suit on March 18, 2016, against Citibank, N.A., "DBA CWABS, Inc., Asset–Backed Certificates, Series 2007–QH2" ("Citibank"). Several exhibits are appended to the suit. The litigation is rooted in a foreclosure action pending in the Circuit Court for Harford County as to plaintiffs' property. In this case, plaintiffs allege violations of the Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1635 & 1640, in connection with a 2007 loan that they obtained to finance the purchase of their property. ECF 1.¹ According to plaintiffs, they were not provided with the requisite disclosures during the origination of the loan, and they properly rescinded their obligations under the loan in 2015. ECF 1.

On June 23, 2016, a summons return was executed evidencing service on defendant on June 21, 2016, via Corporation Trust, Inc. ECF 9. Because the defendant did not respond to the Complaint, the Court entered an Order on September 6, 2016 (ECF 10), setting a deadline for plaintiffs to move for entry of default or show cause why such action was not appropriate. In response, on September 12, 2016, plaintiffs filed a Motion for Clerk's Entry of Default as to Citibank, pursuant to Fed. R. Civ. P. 55(a). ECF 11. The Clerk entered an order of default as to the defendant on September 14, 2016. ECF 12.

Citibank filed a motion to set aside entry of default on October 28, 2016. ECF 16; ECF 16–1. Plaintiffs opposed the motion (ECF 17) and Citibank replied. ECF 18. Pursuant to a Memorandum (ECF 19) and Order (ECF 20) of November 29, 2016, I granted Citibank's motion and directed Citibank to respond to the Complaint within fourteen days.

Thereafter, Citibank filed a motion to dismiss (ECF 21) pursuant to Fed. R. Civ. P. 8(a) and 12(b)(6), supported by a memorandum of law (ECF 21–1) (collectively, "Motion"), and two exhibits. ECF 21–2; ECF 21–3. Plaintiffs oppose the Motion (ECF 24, "Opposition"), supported by an exhibit. ECF 24–1. Citibank has replied. ECF 25, "Reply."

No hearing is necessary to resolve the Motion. See Local Rule 105.6. For the reasons that follow, I shall grant the Motion.

I. Factual Background²

On March 2, 2007, plaintiffs executed a Deed of Trust to secure payment of a promissory note payable to Quality Home Loans in connection with a loan to plaintiffs in the amount of $161,000.00 (the "Loan"). ECF 1 at 2; ECF 21–2 (Deed of Trust, recorded on April 10, 2007, in the land records for Harford County, Maryland at Liber 07296, Folio 595).³ The Loan was secured by the property located on Old Stepney Road in Aberdeen, MD (the "Property"). Id.⁴

Quality Home Loans, the original lender, is not a party to this case. Notably, Citibank was not involved in the origination of the Loan. However, on August 26, 2011, four years after the Loan transaction, the Deed of Trust was assigned to Citibank, as Trustee for the Certificateholders of CWABS, Inc. Asset–Backed Certificates, Series 2007–QH2, on August 26, 2011. ECF 21–3 (Assignment to Citibank, recorded on September 6, 2011, in the land records for Harford County, Maryland at Liber 09310, Folio 364.)

On August 12, 2014, a foreclosure action was initiated against the Property in the Circuit Court for Harford County, Case No. 12C14002475, Richard A Lash, et al. v. Jowanda StricklandLucas, et al. (the "Foreclosure Case"). See Maryland Judiciary Case Search Criteria, http://casesearch.courts.state.md.us/casesearch//process Disclaimer.jis (searching by court and case number) (last visited May 26, 2017); see also Foreclosure Case Docket, ECF 16–2. By Order of November 4, 2016, in the Foreclosure Case, the Strickland–Lucas's motion to dismiss and stay the Foreclosure Case was denied. Foreclosure Case, Case No. 12C14002475, Doc. No. 45. Then, on December 6, 2016, the Strickland–Lucases noted an appeal to the Maryland Court of Special Appeals. Foreclosure Case, Case No. 12C14002475, Doc. No. 48. As of this date, that appeal remains pending.

On March 18, 2016, approximately nine years after plaintiffs obtained the Loan at issue in this case, plaintiffs filed suit in this Court. They allege: "The creditor failed to provide the plaintiffs with the appropriate form of written notice published and adopted under [TILA] ... and a comparable written notice of the rights of the plaintiff [sic]...." ECF 1 at 2. Further, plaintiffs allege that on or about October 24, 2015, they sent a "notice to rescind" to Citibank with respect to the Deed of Trust and Note, but Citibank failed to respond or "re-establish" the Loan following rescission. Id. at 3; see also ECF 1–1 ("Notice to Rescind Deed of Trust and Note", dated October 21, 2015).⁵ Accordingly, plaintiffs conclude that the Deed of Trust and Note are void and unenforceable. ECF 1 at 3. Nevertheless, they complain that the "defendant continued to act as if the note and trust deed were enforceable and subsequently foreclosure continued upon the plaintiff's [sic] property." Id.

On the basis of these facts, plaintiffs assert that the parties to this case "were parties to a consumer credit transaction that existed or was consummated on or after September 30, 1995." ECF 1 at 2. Further, they assert that defendant is a creditor within the meaning of 15 U.S.C. §§ 1601 and 1635 et seq. Id. And, plaintiffs seek $314,200.00 in damages. Id. at 4.

II. Standard of Review

A defendant may test the legal sufficiency of a complaint by way of a motion to dismiss under Rule 12(b)(6). Goines v. Valley Cmty, Servs, Bd. , 822 F.3d 159, 165–66 (4th Cir. 2016) ; McBurney v. Cuccinelli , 616 F.3d 393, 408 (4th Cir. 2010), aff'd sub nom. McBurney v. Young , 569 U.S. 221, 133 S.Ct. 1709, 185 L.Ed.2d 758 (2013) ; Edwards v. City of Goldsboro , 178 F.3d 231, 243 (4th Cir. 1999). A Rule 12(b)(6) motion constitutes an assertion by a defendant that, even if the facts alleged by a plaintiff are true, the complaint fails as a matter of law "to state a claim upon which relief can be granted."

Whether a complaint states a claim for relief is assessed by reference to the pleading requirements of Fed. R. Civ. P. 8(a)(2). It provides that a complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." The purpose of the rule is to provide the defendants with "fair notice" of the claims and the "grounds" for entitlement to relief. Bell Atl., Corp. v. Twombly , 550 U.S. 544, 555–56, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007).

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." Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ; see Ashcroft v. Iqbal , 556 U.S. 662, 684, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ("Our decision in Twombly expounded the pleading standard for ‘all civil actions’ ...." (citation omitted)); see also Simmons v. United Mortg. & Loan Inv., LLC , 634 F.3d 754, 768 (4th Cir. 2011). But, a plaintiff need not include "detailed factual allegations" in order to satisfy Rule 8(a)(2). Twombly , 550 U.S. at 555, 127 S.Ct. 1955. Moreover, federal pleading rules "do not countenance dismissal of a complaint for imperfect statement of the legal theory supporting the claim asserted." Johnson v. City of Shelby , ––– U.S. ––––, 135 S.Ct. 346, 346, 190 L.Ed.2d 309 (2014) (per curiam).

Nevertheless, the rule demands more than bald accusations or mere speculation. Twombly , 550 U.S. at 555, 127 S.Ct. 1955 ; see Painter's Mill Grille, LLC v. Brown , 716 F.3d 342, 350 (4th Cir. 2013). If a complaint provides no more than "labels and conclusions" or "a formulaic recitation of the elements of a cause of action," it is insufficient. Twombly , 550 U.S. at 555, 127 S.Ct. 1955. Rather, to satisfy the minimal requirements of Rule 8(a)(2), the complaint must 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." Id. at 556, 127 S.Ct. 1955 (internal quotations omitted).

In reviewing a Rule 12(b)(6) motion, a court " ‘must accept as true all of the factual allegations contained in the complaint’ " and must " ‘draw all reasonable inferences [from those facts] in favor of the plaintiff.’ " E.I. du Pont de Nemours & Co. v. Kolon Indus., Inc. , 637 F.3d 435, 440 (4th Cir. 2011) (citations omitted); see Semenova v. Maryland Transit Admin. , 845 F.3d 564, 567 (4th Cir. 2017) ; Belmora LLC v. Bayer Consumer Care AG , 819 F.3d 697, 705 (4th Cir. 2016) ; Houck v. Substitute Tr. Servs., Inc. , 791 F.3d 473, 484 (4th Cir. 2015) ; Kendall v. Balcerzak , 650 F.3d 515, 522 (4th Cir. 2011), cert. denied , 565 U.S. 943, 132 S.Ct. 402, 181 L.Ed.2d 257 (2011). But, a court is not required to accept legal conclusions drawn from the facts. See Papasan v. Allain , 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). "A court decides whether [the pleading] standard is met by separating the legal conclusions from the factual allegations, assuming the truth of only the factual allegations, and then determining whether those allegations allow the court to reasonably infer" that the plaintiff is entitled to the legal remedy sought. A Society Without a Name v. Virginia , 655 F.3d 342, 346 (4th. Cir. 2011), cert. denied , 566 U.S. 937, 132 S.Ct. 1960, 182 L.Ed.2d 772 (2012).

In general, courts do not "resolve contests surrounding...