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McClain v. Deutsche Bank National Trust Co.

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

June 4, 2018

MAURICE MCCLAIN, Plaintiff,
v.
DEUTSCHE BANK NATIONAL TRUST COMPANY, et al., Defendants.

          ORDER GRANTING DEFENDANTS' MOTION TO DISMISS [ECF No. 4] AND DISMISSING THE COMPLAINT

          VICTORIA A. ROBERTS UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Plaintiff Maurice McClain (“McClain”) filed this case in state court seeking to set aside the foreclosure sale of property located at 3950 Oak Pointe Court, Rochester Hills, Michigan (the “Property”). Defendants Deutsche Bank National Trust Company (the “Trustee”) and Ocwen Loan Servicing, LLC (“Ocwen”; collectively “Defendants”) removed the case from state court and filed a motion to dismiss, which is now before the Court.

         For the reasons below, Defendants' motion to dismiss [ECF No. 4] is GRANTED. The Complaint is DISMISSED WITH PREJUDICE for failure to state a claim upon which relief may be granted, pursuant to Federal Rule of Civil Procedure 12(b)(6).

         II. FACTS

         On September 27, 2006, McClain obtained a $780, 000 loan (the “Loan”) from New Century Mortgage Company. As security for the Loan, McClain granted a mortgage on the Property to Mortgage Electronic Registration Systems, Inc. (the “Mortgage”). The Mortgage was later assigned to the Trustee. Ocwen services the Loan.

         In 2016, Ocwen sent McClain a Notice of Default letter. McClain complained to Ocwen that the default letter was improper and demanded a payoff quote. Ocwen sent McClain a payoff quote on September 13, 2016, showing that the Loan was past due since June 2014, and indicating that the total amount to pay off the Loan was $942, 059.87, which - in part - included: (i) the outstanding principal balance of $567, 494.01; (ii) accrued interest of $27, 145.32; (iii) escrow advances of $35, 007.07; and (iv) a “Share Waive Adjustment” charge of $305, 867.32 (the “Payoff Quote”).

         McClain did not pay off the loan, and Ocwen did not foreclose on the Property. Instead, on September 25, 2016, McClain executed a Loan Modification Agreement (the “Loan Modification”). Under the Loan Modification the principal balance of the Loan was $940, 608.91 as of October 1, 2016, and the annual interest rate was 2.00001 percent.

         In March 2017, the Trustee initiated foreclosure proceedings pursuant to the power of sale contained in the Mortgage and Mich. Comp. Laws § 600.3201, et seq. A Notice of Foreclosure was published for four consecutive weeks - on March 21, March 28, April 4 and April 11, 2017 - in the Oakland County Legal News and was posted in a conspicuous place at the Property on March 24, 2017. The Notice of Foreclosure stated that the outstanding balance due on the Loan was $958, 399.58. The outstanding balance included unpaid interest and escrow advances in excess of $17, 000.

         On April 25, 2017, the Trustee purchased the Property at the foreclosure sale for $962, 461.23. The statutory redemption period expired on October 25, 2017, without McClain redeeming the Property.

         On January 17, 2018, McClain filed his complaint in Oakland County Circuit Court. The complaint contains five counts: (i) violation of Michigan's foreclosure by advertisement statute; (ii) declaratory relief; (iii) injunctive relief; (iv) quiet title; and (v) exemplary damages.

         Defendants timely removed the case to this Court. On February 14, 2018, Defendants moved to dismiss the complaint for failure to state a claim.

         The Court entered an order requiring McClain to file a response to the motion or amend the complaint by March 8, 2018. The parties subsequently stipulated that McClain had until April 5, 2018 to respond or amend the complaint. After that date passed without McClain complying with the order, the Court emailed the attorneys asking the status of the case. McClain's counsel responded that he was out of town and “had the due date as the 12th [of April].” Despite his response, April 12th passed without any action from McClain. On April 23, 2018, with McClain still having not filed a response or an amended complaint, the Court entered an order stating that it would decide Defendants' motion to dismiss on its merits, without a response from McClain.

         III. ...


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