Ware v. Bank of Am.

1

LEIGHANDRA WARE and PATRICK ESTRIPLET, Plaintiffs, v. BANK OF AMERICA, NATIONAL ASSOCIATION et al., Defendants.

Civil Action No. 3:21-CV-2824-M-BH

United States District Court, N.D. Texas, Dallas Division

August 28, 2023

Referred to U.S. Magistrate Judge^[1]

FINDINGS, CONCLUSIONS, AND RECOMMENDATION

IRMA CARRILLO RAMIREZ UNITED STATES MAGISTRATE JUDGE

Based on the relevant filings, evidence, and applicable law Bank of America, N.A.'s Motion for Summary Judgment, filed January 19, 2023 (doc. 24), should be GRANTED and Bank of America, N.A.'s Objections to and Motion to Strike Plaintiffs' Summary Judgment Evidence, filed February 23, 2023 (doc. 43) is DENIED as moot.

I. BACKGROUND

This dispute arises out of two mortgage loans obtained for the purchase of real property located at 4939 Eyrie Court, Grand Prairie, Texas 75052 (Property). (doc. 17 at 2.)^[2] On March 22, 2007, Leighandra Ware (Borrower) executed an Adjustable Rate Note (First Note) in favor of First Franklin Financial Corp. (Lender) for a loan in the principal amount of $221,150.00 (First Mortgage). (doc. 20-25.) Borrower and Patrick Estriplet (collectively Plaintiffs) contemporaneously executed a deed of trust (First Deed of Trust) that granted a security interest in the Property to Lender to secure repayment of the First Note. (Id. at 26-44.) On the same day, Borrower also executed a Fixed Rate Note (Second Note) in the amount of $55,300.00 (Second Mortgage) payable to Lender. (Id. at 59-62.) Plaintiffs contemporaneously executed a Deed of Trust-Secondary Lien (Second Deed of Trust) that granted a security interest in the Property to Lender to secure repayment under the Second Note. (Id. at 63-79.)

On or about October 1, 2010, Lender transferred servicing of both mortgages to BAC Home Loans Servicing, LP, a Bank of America, N.A. company (Defendant). (docs. 25 at 80; 35 at 104.) According to Plaintiffs, they had phone conversations with Defendant about both mortgages in or around May 2011. (doc. 35 at 4, 7.) Defendant's agent told them that they would receive a loan modification on the First Mortgage, reducing the principal amount by over $60,000, if they maintained “good status” during a trial period, and that the Second Mortgage did not need a loan modification because it “was already forgiven.” (Id.) The agent explained that they were receiving both debt forgiveness and debt reduction as part of a settlement with the Federal Government. (Id.) After this conversation, Plaintiffs stopped receiving monthly mortgage statements associated with the Second Mortgage, and it was deleted from Borrower's credit report. (Id.)

On May 25, 2011, Defendant sent Borrower a letter (First Notice of Servicing Transfer) notifying her that the servicing of the Second Mortgage would be transferred to Carrington Mortgage Services, LLC (Carrington) effective June 1, 2011. (doc. 25 at 82-83.) On December 30, 2011, Plaintiffs received a loan modification on the First Mortgage and executed a Home Affordable Modification Agreement (Loan Modification). (Id. at 45-58.) On or about September 17, 2015, a letter (Second Notice of Servicing Transfer) was sent to Borrower stating that the servicing of the Second Mortgage had been transferred from Carrington to Specialized Loan Servicing LLC (SLS) effective September 11, 2015. (doc. 35 at 124-30.) Beginning in or around 2021, SLS sent notices to Plaintiffs attempting to collect on the Second Mortgage. (Id. at 4, 7.)

On October 6, 2021, Plaintiffs sued Defendant and SLS in state court. (doc. 1-2 at 6-59.) After the lawsuit was removed to federal court, Plaintiffs filed their first amended complaint on June 30, 2022. (See doc. 17.) They assert claims against Defendant for violations of the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act (FCRA) and for fraud, breach of contract, and promissory estoppel. (Id. at 11-20.)

On January 19, 2023, Defendant moved for summary judgment on all of Plaintiffs' claims against it. (doc. 24). Plaintiffs responded on February 9, 2023, and Defendant replied on February 22, 2023. (docs. 33-35, 40.) On February 23, 2023, Defendant moved to strike portions of Plaintiffs' summary judgment evidence. (doc. 43.) Plaintiff responded on March 16, 2023, and Defendant replied on March 30, 2023. (docs. 45-47.)

II. EVIDENTIARY OBJECTIONS

Defendant objects to and moves to strike portions of Plaintiffs' affidavits offered in support of their response to the motion for summary judgment. (doc. 43.) Because the objected statements, even if considered, do not affect the disposition of the pending motion for summary judgment, Defendant's objections are OVERRULED and its motion to strike is DENIED as moot. See Continental Casualty Co. v. St. Paul Fire & Marine Ins. Co., 2006 WL 984690, at *1 n. 6 (N.D. Tex. Apr. 14, 2006) (overruling as moot objections to evidence that was not considered by the court in deciding motion for summary judgment).

III. SUMMARY JUDGMENT STANDARD

Summary judgment is appropriate when the pleadings and evidence on file show that no genuine issue exists as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). “[T]he substantive law will identify which facts are material.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine issue of material fact exists “if the evidence is such that a reasonable jury could return a verdict for the non-moving party.” Id.

The movant makes a showing that there is no genuine issue of material fact by informing the court of the basis of its motion and by identifying the portions of the record that reveal there are no genuine material fact issues. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the movant bears the burden of proof on an issue, it must “establish beyond peradventure all of the essential elements of the claim or defense.” Guzman v. Allstate Assurance Co., 18 F.4th 157, 160 (5th Cir. 2021) (quoting Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986)) (emphasis original). The moving party can also meet its summary judgment burden by “pointing out to the district court [] that there is an absence of evidence to support the nonmoving party's case.” Celotex, 477 U.S. at 325 (internal quotation omitted). There is “no genuine issue as to any material fact [where] a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.” Id. at 323.

Once the movant meets its summary judgment burden, the non-movant must then direct the court's attention to evidence in the record sufficient to establish that there is a genuine issue of material fact for trial. Id. at 324. It must go beyond its pleadings and designate specific facts to show there is a genuine issue for trial. Id.; Anderson, 477 U.S. at 249.^[3] Rule 56 imposes no obligation “to sift through the record in search of evidence to support a party's opposition to summary judgment.” Adams v. Travelers Indem. Co., 465 F.3d 156, 164 (5th Cir. 2006) (quoting Ragas v. Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998)). Parties must “identify specific evidence in the record” supporting challenged claims and “articulate the precise manner in which that evidence supports [those] claim[s].” Ragas, 136 F.3d at 458 (citing Forsyth v. Barr, 19 F.3d 1527, 1537 (5th Cir. 1994)). While all of the evidence must be viewed in a light most favorable to the motion's opponent, Anderson, 477 U.S. at 255 (citing Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970)), neither conclusory allegations nor unsubstantiated assertions satisfy the non-movant's summary judgment burden. Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc); Topalian v. Ehrman, 954 F.2d 1125, 1131 (5th Cir. 1992).

A. Common Law Fraud

Defendant moves for summary judgment on Plaintiffs' fraud claim on the ground that it does not comply with Rule 9(b)'s heightened pleading standard. (doc. 25 at 8.)

In Texas,^[4] the elements of common law fraud are: (1) the defendant made a representation to the plaintiff; (2) the representation was material; (3) the representation was false; (4) when the defendant made the representation, the defendant knew it was false or made the representation recklessly and without knowledge of its truth; (5) the defendant made the representation with the intent that the plaintiff act on it; (6) the plaintiff relied on the representation; and (7) the representation caused the plaintiff injury. Shandong Yinguang Chem. Indus. Joint Stock Co., Ltd. v. Potter, 607 F.3d 1029, 1032-33 (5th Cir. 2010).

Rule 9(b) contains a heightened pleading standard and requires a plaintiff to plead the circumstances constituting fraud with particularity. See Fed.R.Civ.P. 9(b); City of Clinton, Ark. v. Pilgrim's Pride Corp., 632 F.3d 148, 153 (5th Cir. 2010). “[A]rticulating the elements of fraud with particularity requires a plaintiff to specify the statements contended to be fraudulent, identify the speaker, state when and where the statements were made, and explain why the statements were fraudulent.” Williams v. WMX Techs., 112 F.3d 175, 177 (5th Cir. 1997). “Put simply, Rule 9(b) requires ‘the who, what, when, where, and how' to be laid out” with respect to a fraud claim. Benchmark Electronics, Inc. v. J.M. Huber Corp., 343 F.3d 719, 724 (5th Cir. 2003) (internal quotations omitted). A dismissal for failure to plead fraud with particularity in accordance with Rule 9(b) is treated the same as a Rule 12(b)(6) dismissal for failure to state a claim. McCall v. Genentech, Inc., No. 3:10-CV-1747-B, 2011 WL 2312280, at *3 (N.D. Tex. June 9, 2011) (citing Lovelace v. Software Spectrum Inc., 78 F.3d 1015, 1017 (5th Cir. 1996)).

“[W]hile ...