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Sutters v. U.S. Bank, N.A.

United States District Court, E.D. Michigan, Southern Division

July 8, 2015

U.S. BANK, N.A., and NATIONSTAR MORTGAGE, L.L.C., Defendants.


DAVID M. LAWSON, District Judge.

In this case, plaintiff Lenwood Sutters disputes the defendants' right to foreclose the mortgage on his Flint, Michigan residence. He filed a complaint pro se alleging violations of the Fair Debt Collection Practices Act (FDCPA) and the Real Estate Settlement Procedures Act (RESPA), and he contends that the chain of assignments of his mortgage is invalid because they were achieved in violation of the terms of a trust pooling and service agreement, by which the mortgage was securitized. The Court referred this case to Magistrate Judge Anthony P. Patti for pretrial management. Thereafter, the defendants filed a motion to dismiss. Judge Patti filed a report on April 30, 2015 recommending that the motion be granted. The plaintiff filed timely objections, and the matter is before the Court for de novo review. After considering the motion, the pleadings, and the magistrate judge's report in light of the objections filed, the Court finds that the magistrate correctly determined the issues. Therefore, the Court will adopt the report and recommendation, and dismiss the case.


The facts of the case, as discussed by the magistrate judge, are taken from the complaint and the motions papers. It appears that the plaintiff and his wife borrowed money from First Franklin Financial Group on June 1, 2007. On that same day, the Sutterses granted a mortgage to Mortgage Electronic Registration Systems (MERS) as security for the loan. MERS assigned the mortgage to U.S. Bank on August 24, 2011, and then on July 12, 2013, Nationstar Mortgage sent Mr. Sutters a letter stating that Bank of America had transferred the mortgage servicing to Nationstar as of July 1, 2013. Three weeks later, Bank of America assigned the mortgage to Nationstar. The obvious disconnect was rectified in July 2014 when corporate assignments were recorded to reflect the assignment of the mortgage from U.S. Bank to Bank of America.

On April 28, 2014, Mr. Sutters sent a document to Nationstar titled "R.E.S.P.A. QUALIFIED WRITTEN REQUEST" (QWR). The plaintiff's complaint characterizes the letter as a demand for an audit history of the loan payments, an itemized statement of the charges to his account, and an itemized statement of his escrow account. However, the letter itself, which is an exhibit to the complaint, states:

Please treat this letter as a "qualified written request" under the Federal Servicer Act, which is a part of the Real Estate Settlement Procedures Act, 12 U.S.C. 2605(e).
I am disputing the accuracy of the current owed balance of my mortgage loan account. Specifically, there are discrepancies as to how my mortgage loan account is being serviced and how credits for money that I have paid have been applied to my mortgage loan account.
Additionally, I am disputing (a) the identity of a true secured lender/creditor, and (b) the existence of debt, and (c) your authority and capacity to collect on behalf of the alleged lender/creditor. Because of extensive criminal activity and fraud in this arena, I am require [ sic ] proof of the chain of secured ownership from the original alleged lender/creditor to the alleged current lender/creditor. Further, I require proof that you are the entity that has been contracted to work on behalf of the alleged lender/creditor.
Pursuant to "Subtitle E Mortgage Servicing" of the Dodd-Frank Wall Street Reform and Consumer Protection Act and pursuant to 12 U.S.C. Section 2605(e)(1)(A) and Reg. X Section 3500.21(e)(1), please provide:
1. A full, double sided, certified "true and accurate" copy of the original promissory note and security instrument and all assignments of the security instrument.

2. Full name, address and telephone number of the actual entity that funded the transaction."

Compl. attachment.

Nationstar did not respond to the request. On August 18, 2014, Nationstar assigned the mortgage to U.S. Bank. The plaintiff does not allege in the complaint that he defaulted on his loan payments, although that fact appears uncontested. The plaintiff does state that he was notified by an attorney on behalf of U.S. Bank on September 5, 2014 that foreclosure proceedings would be instituted. He filed the present lawsuit ten days later.

The magistrate judge read the complaint to allege the following claims: (1) assignment in contravention of trust; (2) request for preliminary injunctive relief; (3) violation of the Fair Debt Collection Practices Act (FDCPA); and (4) violation of section 2605(e) of the Real Estate Procedures Settlement Act (RESPA). He concluded that the various assignments were not void from the beginning but merely voidable, and that the plaintiff did not have standing to contest them; injunctive relief should not be granted because the plaintiff failed to demonstrate a likelihood of success on the merits; the defendants are not "debt collectors" within the meaning of the FDCPA, and therefore they cannot be held accountable for violations of the Act; and the plaintiff's letter to Nationstar did not amount to a proper QWR, and therefore it did not trigger an obligation ...

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