United States District Court, W.D. North Carolina, Charlotte Division
ROBERT J. CONRAD, Jr., District Judge.
THIS MATTER comes before the Court on Magistrate's Memorandum and Recommendation (M&R), (Doc. 41), the Defendants' Motions to Dismiss, (Docs. 20, 26, 27), and Plaintiffs' responses, (Docs. 30, 31, 40, 50). It is now ripe for review.
Plaintiffs Curtis Steele and Yolanda Harrington, proceeding pro se, allege ten causes of action against Defendants for an improper transfer of notes on Plaintiffs' loans into a "Common Law Trust." (Doc. 1-1). In general terms, Plaintiffs challenge the legality of the process of securitizing loans. Additionally, Plaintiffs contest the title and ownership of the property in question, seeking damages, rescission, declaratory judgment and injunctive relief. (Id.)
Plaintiffs allege that the first loan was obtained from Defendant Capital One Home Loans, LLC on April 12, 2005, in the amount of $135, 000, and was secured by a Deed of Trust on Plaintiffs' home (Property) in Charlotte, North Carolina. (Id.) The second loan was obtained on June 29, 2005, from Defendant HSBC Finance Corporation in the amount of $918, 850, 000.00, and was also allegedly secured by a promissory note and deed of trust. (Id.) The notes were then transferred improperly into a trust, thereby preventing Defendants from having a perfected title to the Property. (Id.; Doc. 41). Plaintiffs also allege that Defendants Capital One and HSBC improperly qualified them for the loans. (Doc. 41).
Plaintiffs' Complaint, filed on November 13, 2013, alleges the following: (1) Lack of Standing/Wrongful Foreclosure; (2) Fraud in Concealment; (3) Fraud in Inducement; (4) Intentional Infliction of Emotional Distress (IIED); (5) Slander of Title; (6) Quiet Title; (7) Declaratory Relief; (8) Truth in Lending Act (TILA) and the Home Ownership and Equity Protection Act ("HOEPA"), 15 U.S.C. § 1601 et seq.; (9) the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. sec 2601 et seq.; and, (10) Rescission. The matter was referred to the Magistrate Judge who recommended that Defendants' Motions to Dismiss be granted. Plaintiffs filed timely objections to the M&R.
II. STANDARD OF REVIEW
A party may file specific, written objections to a magistrate judge's M&R within fourteen days after being served with a copy of the recommended disposition. 28 U.S.C. § 636(b)(1); see FED. R. CIV. P. 72(b); see United States v. Midgette , 478 F.3d 616, 621 (4th Cir. 2007) (holding that "a party must object to the finding or recommendation on that issue with sufficient specificity so as reasonably to alert the district court of the true ground for the objection"). A district judge must conduct a de novo review of those portions of the report to which proper objections are made. 28 U.S.C. § 636(b)(1).
In its review of a Rule 12(b)(6) motion, "the court should accept as true all well-pleaded allegations and should view the complaint in a light most favorable to the plaintiff." Mylan Labs, Inc. v. Matakari , 7 F.3d 1130, 1134 (4th Cir. 1993). The plaintiff's "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 545 (2007). "[O]nce a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint." Id. at 1969. A complaint attacked by a Rule 12(b)(6) motion to dismiss will survive if it contains "enough facts to state a claim to relief that is plausible on its face." Id. at 1974.
Plaintiffs' causes of action can be divided into three groupings: claims found by the Magistrate Judge to be time-barred, claims asserting Defendants lack standing to foreclose, and the remaining claim of IIED. The Court will analyze each grouping of claims in turn.
A. Matters Considered
In considering a 12(b)(6) motion, courts may consider exhibits such as contracts that are integral to and were relied upon in the complaint and whose authenticity is not in dispute. Blankeship v. Manchin , 471 F.3d 523, 525 n.1 (4th Cir. 2006). Here, Defendants have submitted relevant documents associated with the closing of the ...