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Thomas v. Nationstar Mortgage, LLC

United States District Court, N.D. West Virginia

February 20, 2018

ANTHONY R. THOMAS and ERICA D. THOMAS, Plaintiffs,
v.
NATIONSTAR MORTGAGE, LLC, FORTRESS INVESTMENT GROUP, and JOHN DOE, Defendants.

          MEMORANDUM OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS AS TO THE FDCPA, HMDA, AND FCRA CLAIMS AND GRANTING WITH LEAVE TO AMEND DEFENDANTS' MOTION TO DISMISS AS TO THE ECOA AND FHA CLAIMS

          FREDERICK P. STAMP, JR. UNITED STATES DISTRICT JUDGE

         I. Background

         Defendants Fortress Investment Group and Nationstar Mortgage, LLC (“Nationstar”) removed this civil action to this Court from the Circuit Court of Wetzel County, West Virginia. The plaintiffs, Anthony R. Thomas and Erica D. Thomas, commenced the civil action in state court seeking to recover damages arising out of the defendants' alleged violations of the Fair Debt Collections Practice Act (the “FDCPA”), the Home Mortgage Disclosures Act (the “HMDA”), the Equal Credit Opportunity Act (the “ECOA”), and the Fair Housing Act (the “FHA”). The plaintiffs also seem to allege a violation of the Fair Credit Reporting Act (the “FCRA”). The complaint names a third defendant, John Doe, to include “any parent corporations and/or subsidiaries of the Defendant of which the Plaintiffs are unaware.” The facts alleged in the complaint can be summarized as follows: The plaintiffs sold their home, at which time they owed $53, 281.25 to defendant Nationstar pursuant to a promissory note by which they borrowed funds to purchase the home. After the sale, the plaintiffs paid the amount owed to Nationstar in the form of a check drawn on a trust account. Nationstar would not accept the check, indicating that it required a certified check, cashier's check, or money order. The defendants would not return the check drawn on the trust account to the plaintiffs in exchange for an acceptable form of payment. As a result, the defendants have reported to major credit bureaus that the plaintiffs are in default of their loan obligation.

         The defendants have filed a motion to dismiss. In the motion to dismiss, the defendants argue (1) that the plaintiffs' complaint fails to meet the pleading standard of Federal Rule of Civil Procedure 8 and (2) that, even if the plaintiffs' complaint was sufficient under Rule 8, the individual counts as stated fail as a matter of law. The defendants' motion to dismiss is now fully briefed and ripe for decision. For the following reasons, the motion to dismiss is granted as to the FDCPA, HMDA, and FCRA claims and granted with leave to amend as to the ECOA and FHA claims.

         II. Applicable Law

         In assessing a motion to dismiss for failure to state a claim under Rule 12(b)(6), a court must accept all well-pled facts contained in the complaint as true. Nemet Chevrolet, Ltd v. Consumeraffairs.com, Inc, 591 F.3d 250, 255 (4th Cir. 2009). However, “legal conclusions, elements of a cause of action, and bare assertions devoid of further factual enhancement fail to constitute well-pled facts for Rule 12(b)(6) purposes.” Id. (citing Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009)). This Court also declines to consider “unwarranted inferences, unreasonable conclusions, or arguments.” Wahi v. Charleston Area Med. Ctr., Inc., 562 F.3d 599, 615 n.26 (4th Cir. 2009).

         The purpose of a motion under Rule 12(b)(6) is to test the formal sufficiency of the statement of the claim for relief; it is not a procedure for resolving a contest about the facts or the merits of the case. 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1356 (3d ed. 1998). The Rule 12(b)(6) motion also must be distinguished from a motion for summary judgment under Federal Rule of Civil Procedure 56, which goes to the merits of the claim and is designed to test whether there is a genuine issue of material fact. Id. For purposes of the motion to dismiss, the complaint is construed in the light most favorable to the party making the claim and essentially the court's inquiry is directed to whether the allegations constitute a statement of a claim under Federal Rule of Civil Procedure 8(a). Id. § 1357.

         A complaint should be dismissed “if it does not allege ‘enough facts to state a claim to relief that is plausible on is face.'” Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Facial plausibility is established once the factual content of a complaint ‘allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Nemet Chevrolet, 591 F.3d at 256 (quoting Iqbal, 129 S.Ct. at 1949). Detailed factual allegations are not required, but the facts alleged must be sufficient “to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555.

         III. Discussion

         A. The FDCPA

         The defendants argue that the plaintiffs' claims under the FDCPA fail because the claims are barred by the statute of limitations. Even if not barred by the statute of limitations, the defendants contend that the FDCPA claims are insufficient as a matter of law because the plaintiffs do not allege that either defendant is a “debt collector as defined by the FDCPA” or that either defendant “engaged in an act or omission prohibited by the FDCPA.” ECF No. 7 at 7. The plaintiffs respond that the FDCPA claims are not barred by the statute of limitations because the alleged violations are still ongoing.

         To state a claim under the FDCPA, 15 U.S.C. §§ 1692-1692p, “a plaintiff must show: (1) the plaintiff has been the object of collection activity arising from consumer debt, (2) the defendant is a debt collector as defined by the FDCPA, and (3) the defendant has engaged in an act or omission prohibited by the FDCPA.” Patrick v. Teays Valley Trs., LLC, No. 3:12-CV-39, 2012 WL 5993163, at *10 (N.D. W.Va. Nov. 30, 2012) (citing Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373, 377-79 (4th Cir. 2006)). More importantly in the present case, “the statute of limitations relating to violations of the FDCPA is one year.” Heinemann v. Jim Walter Homes, Inc., 47 F.Supp.2d 716, 722 (N.D. W.Va. 1998) (citing 15 U.S.C. § 1692k(d)).

         Here, the allegations in the plaintiffs' complaint reference events that occurred on September 24, 2015. Thus, the plaintiffs had until September 24, 2016 to bring their FDCPA claims. However, the plaintiffs did not file this suit until June 29, 2017. Although the plaintiffs contend that the statute of limitations does not bar their FDCPA claims because the alleged violations were ongoing, this Court finds that the plaintiff's “continuing violations” argument fails. Additionally, this Court notes that the plaintiffs did not allege in their complaint that the alleged violations are ongoing. Rather, the plaintiffs allege that the alleged violations are ongoing for the first time in their response to the defendants' motion to dismiss.

         “Generally, an action under the FDCPA accrues ‘when a communication violating the FDCPA is sent.' Lovegrove v. Ocwen Loan Servicing, LLC, No. 7:14-CV-00329, 2015 WL 5042913, at *15 (W.D. Va. Aug. 26, 2015) (quoting Akalwadi v. Risk Mgmt. Alts., Inc., 336 F.Supp.2d 492, 501 (D. Md. 2004)). “Declining to restart the statute of limitations for related subsequent communications is consistent with the statutory text, Fourth Circuit precedent, and even legislative history, which suggests that the purpose of the FDCPA is to be effectuated ‘without imposing unnecessary ...


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