United States District Court, E.D. Michigan, Southern Division
Honorable Matthew F. Leitman, Judge
REPORT AND RECOMMENDATION TO GRANT IN PART AND DENY
IN PART DEFENDANTS' MOTION TO DISMISS [ECF NO.
ELIZABETH A. STAFFORD United States Magistrate Judge
Kelly Pacifico filed this action in state court against
Nationstar Mortgage LLC (Nationstar) and The Bank of New York
Mellon, as trustee for Structured Asset Securities
Corporation Mortgage Pass-Through Certificates, Series
2003-40A (NY Mellon) (collectively,
“defendants”), alleging wrongful foreclosure,
breach of contract, fraudulent misrepresentation by servicer,
RESPA violations, and negligence. Defendants removed the
action to this Court. [ECF No. 1]. Before the Court is
defendants' motion to dismiss. [ECF No.
11]. The Court RECOMMENDS that defendants'
motion to dismiss be GRANTED IN PART AND DENIED IN PART.
action involves residential property located at 5210 Glenwood
Creek, Clarkston, Michigan 48348. [ECF No. 1-2, PgID 14; ECF
No. 11-2, PageID 101]. On July 31, 2003, Pacifico obtained a
mortgage loan for $240, 000.00 from non-party Westminster
Mortgage Corporation to purchase the property. [ECF No. 11-2,
PageID 101]. The loan was secured by a mortgage interest in
the property. [Id.]. The mortgage was then assigned
to NY Mellon. [ECF No. 1-2, PageID 14]. The servicing rights
to the mortgage were transferred to Nationstar.
[Id.]. Pacifico defaulted on her loan obligations
and on April 28, 2015, a sheriff's sale was scheduled to
occur, but was postponed due to the filing of her lawsuit a
week before the sale was to occur. [ECF No. 1-2, PageID 12;
ECF No. 11-4, PgID 127; ECF No. 12-1, PageID 245].
claims in her complaint that, prior to the foreclosure
notice, Nationstar had deemed her eligible for its Home
Affordable Unemployment Program (HAMP) and that a
representative told her to sign a new agreement and forward
it back immediately. [ECF No. 1-2, PageID 15]. But she
received the new agreement almost 30 days after her first
payment under the new agreement was to be due.
[Id.]. Pacifico called Nationstar's
representative, but the representative was unhelpful and
Pacifico hung up. [Id.]. Despite her
representative's efforts over the next several months,
Nationstar refused to allow her to perform under the new
agreement. [Id., PageID 15-16]. Ultimately,
Nationstar sent a letter stating, with explanation, that her
request for participation in the HAMP program was declined.
[Id., PageID 16-17]. As a timeline, Pacifico states
that Nationstar received her complete loan modification
package on or about January 2014, but that she did not
receive written notice from Nationstar that it denied her
application until August 2014. [Id., PageID 16, 19].
She states that she submitted multiple completed loss
mitigation packages throughout 2014 and 2015, until
Nationstar noticed her home for the foreclosure sale in April
2015. [Id., PageID 20].
motion to dismiss pursuant to Federal Rule of Civil Procedure
12(b)(6) tests a complaint's legal sufficiency. Although
the federal rules only require that a complaint contain a
“short and plain statement of the claim showing that
the pleader is entitled to relief, ” Federal Rule of
Civil Procedure 8(a)(2), the statement of the claim must be
plausible. “To survive a motion to dismiss, a complaint
must contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its
face.'” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). The Iqbal Court explained,
“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Id.
plausibility standard “does not impose a probability
requirement at the pleading stage; it simply calls for enough
fact to raise a reasonable expectation that discovery will
reveal evidence of illegal [conduct].”
Twombly, 550 U.S. at 556. In deciding whether a
plaintiff has set forth a “plausible” claim, the
Court must construe the complaint in the light most favorable
to the plaintiff and accept as true all well-pleaded factual
allegations. Id.; see also Erickson v.
Pardus, 551 U.S. 89, 94 (2007).
preliminary matter, defendants point out that Pacifico has
not asserted any claims against NY Mellon; her only reference
to NY Mellon in the complaint is that it is the current
holder and owner of the mortgage. [ECF No. 1-2, PageID 14].
Pacifico does not address this deficiency, so she has
abandoned any claim against NY Mellon and it should be
dismissed as a defendant. Bazinski v. JPMorgan Chase
Bank, N.A., No. 13-14337, 2014 WL 1405253, at *2 (E.D.
Mich. Apr. 11, 2014) (“Claims left to stand undefended
against a motion to dismiss are deemed abandoned.”).
I - Real Estate Settlement Procedures (RESPA)
motion to dismiss with respect to Count I of Pacifico's
complaint should be granted in part and denied in part. In
Count I, Pacifico alleges that Nationstar failed to properly
evaluate her loan modification and mitigation requests as
required by 12 C.F.R. §§ 1024.38 and 1024.41, and
that those violations are actionable under Section 6(f) of
RESPA, 12 U.S.C. § 2605(f). For these alleged
violations, Pacifico requests relief in the form of
restraining the Sheriff's sale, ordering Nationstar to
conduct a proper evaluation of her loan modification request,
and awarding damages under RESPA. [ECF No. 1-2, PageID
reliance on Section 1024.38, which sets forth
“[r]easonable policies and procedures” for
servicers, is without merit because violations of that
section “cannot support a private action.”
Smith v. Nationstar Mortg., No. 15-13019, 2015 WL
7180473, at *4 (E.D. Mich. Nov. 16, 2015). See also
Austerberry v. Wells Fargo Home Mortg., No. 15-CV-13297,
2015 WL 8031857, at *5 (E.D. Mich. Dec. 7, 2015)
(“[T]he Court concludes that while Plaintiff ...