United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER OVERRULING PLAINTIFF'S
OBJECTIONS , ADOPTING THE MAGISTRATE JUDGE'S REPORT
AND RECOMMENDATION , AND GRANTING DEFENDANT'S MOTION
STEPHEN J. MURPHY, III UNITED STATES DISTRICT JUDGE
dispute involves a mortgage modification. Plaintiff's
active claims include: (1) violation of the Florida Deceptive
and Unfair Trade Practices Act, Fla. Stat. § 501.204;
(2) violation of the Real Estate Settlement Procedures Act,
12 U.S.C. § 2601; (3) breach of contract; (4) breach of
covenant of good faith and fair dealing; and (5) fraud. See
ECF 12 (alleging six counts); ECF 24 (withdrawing negligence
count). The Court referred the matter to the Magistrate
Judge, and then Defendant filed a motion to dismiss. ECF 14;
ECF 15. The Magistrate Judge issued a Report and
Recommendation ("Report") suggesting that the Court
grant Defendant's motion, ECF 31, and Plaintiff objected,
ECF 32. For the reasons set forth below, the Court will
overrule the objections, adopt the Report, grant
Defendant's motion, and dismiss the complaint.
Report properly details the underlying facts and procedural
history. ECF 31, PgID 694-97. The Court therefore adopts and
incorporates that portion of the Report.
Rule of Civil Procedure 72(b) governs the review of a
magistrate judge's report. A district court's
standard of review depends upon whether a party files
objections. The Court need not undertake any review of
portions of a report to which no party has objected. Thomas
v. Arn, 474 U.S. 140, 154 (1985). De novo review is required,
however, if the parties "serve and file specific written
objections to the proposed findings and
recommendations." Fed.R.Civ.P. 72(b)(2). In conducting a
de novo review, "[t]he district judge may accept,
reject, or modify the recommended disposition; receive
further evidence; or return the matter to the magistrate
judge with instructions." Fed.R.Civ.P. 72(b)(3).
Court may grant a Rule 12(b)(6) motion to dismiss if the
complaint fails to allege facts "sufficient 'to
raise a right to relief above the speculative level, '
and to 'state a claim to relief that is plausible on its
face.'" Hensley Mfg. v. ProPride, Inc., 579 F.3d
603, 609 (6th Cir. 2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555, 570 (2007)). The Court views the complaint
in the light most favorable to the plaintiff, presumes the
truth of all well-pled factual assertions, and draws every
reasonable inference in favor of the non-moving party.
Bassett v. Nat'l Collegiate Athletic Ass'n, 528 F.3d
426, 430 (6th Cir. 2008). If "a cause of action fails as
a matter of law, regardless of whether the plaintiff's
factual allegations are true or not, " then the Court
must dismiss. Winnett v. Caterpillar, Inc., 553 F.3d 1000,
1005 (6th Cir. 2009).
Report recommends dismissing all of Plaintiff's claims.
See ECF 31, PgID 720. Plaintiff raised four objections, but
none relate to the Report's analysis of the fraud claim.
See ECF 32. The Court therefore adopts the fraud analysis
without further review and will dismiss the claim. Thomas,
474 U.S. at 154. The Court will address Plaintiff's
remaining claims in turn.
Florida Deceptive and Unfair Trade Practices Act ("Trade
Court will dismiss Plaintiff's Trade Practices Act claim
because the statute does not apply to Defendant. The Trade
Practices Act states that it does not apply to "[b]anks,
credit unions, and savings and loan associations regulated by
federal agencies[.]" Fla. Stat. § 501.212(4)(c). It
is undisputed that Defendant is a federally regulated bank.
See ECF 12, PgID 257, ¶ 2; ECF 32, PgID 727-30.
Plaintiff argues, however, that the statutory exemption
should not apply because Defendant's underlying actions
pertained to mortgage servicing instead of banking activity.
ECF 32, PgID 727.
courts are split on how to interpret the exemption for
federally regulated banks, and some case law supports
Plaintiff's position. See, e.g., Larach v. Standard
Chartered Bank Int'l (Americas) Ltd., 724 F.Supp.2d 1228,
1238 (S.D. Fla. 2010). But the Report thoroughly explains why
Plaintiff's argument is ultimately unpersuasive, and the
Court independently agrees with the Magistrate Judge's
analysis. First, the majority view in Florida courts is that
a federally regulated bank is exempt from the Trade Practices
Act regardless of the nature of the underlying conduct.
Regions Bank v. Legal Outsource PA, No.
2:14-cv-476-FtM-29MRM, 2015 WL 7777516, at *5 (M.D. Fla. Dec.
3, 2015) (collecting cases). Second (and perhaps more
importantly), Plaintiff's argument contradicts the
statutory text. The Trade Practices Act plainly states that
it does not apply to banks "regulated by federal
agencies." Fla. Stat. § 501.212(4)(c). The text
does not suggest that there is an exception to the exemption
based on the federally regulated bank's pertinent
activity. And the Court will not add language to an
unambiguous statute. Because Defendant is exempt from suit
under the Trade Practice Act, the Court will dismiss
Plaintiff's Trade Practices Act claim.
Real Estate Practices Act
Court will dismiss Plaintiff's Real Estate Practices Act
claim because it is barred by the statute of limitations.
Plaintiff's claim pertains to Defendant's alleged
failure to timely respond to a "qualified written
request." ECF 12, PgID 269-70, ¶¶ 73 and 80;
12 U.S.C. § 2605(e). The statute of limitations for the
claim is three years. 12 U.S.C. § 2614. The question is:
When does the clock start running? And the statutory text
provides the answer: "from the date of the occurrence of
the violation[.]" Id.; see also Falcocchia v.
Saxon Mortg., Inc., 709 F.Supp.2d 860, 868-69 (E.D. Cal.
2010) ("Because the conduct complained of is the failure
to respond to the alleged qualified written request, the
claim accrued, and the claim began to run, at the time of
that failure."). The Report states that Defendant had
until November 2013 to respond to Plaintiff's qualified
written request, ECF 31, PgID 709, and Plaintiff does not
object to ...