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PLS Investments, LLC v. Ocwen Loan Servicing, LLC

United States District Court, W.D. North Carolina, Statesville Division

January 31, 2017



          David C. Keesler, United States Magistrate Judge

         THIS MATTER IS BEFORE THE COURT on “Defendant's Motion For Summary Judgment” (Document No. 50) and “Defendant's Objection And Motion To Strike Evidence Submitted In Opposition To Summary Judgment” (Document No. 59). The parties have consented to Magistrate Judge jurisdiction pursuant to 28 U.S.C. § 636(c), and these motions are ripe for disposition. Having carefully considered the record, the motions, applicable authority, and the arguments of counsel at a hearing on January 24, 2017, the undersigned will grant the motion for summary judgment, and deny the motion to strike.


         Plaintiff initiated this action with the filing of a “Complaint” (Document No. 1-1) in the Superior Court of Ashe County, North Carolina, Case No. 14-CVS-282, on July 16, 2014.[1] The Complaint asserts claims for: (1) negligence; (2) gross negligence; and (3) unfair and deceptive trade practices. (Document No. 1-1, pp.8-10). The crux of Plaintiff's Complaint is that Defendants caused false information and/or advertisements to be posted on the Internet that described Plaintiff's property as a “foreclosure sale, ” and that such false information caused a reduction in the fair market value of Plaintiff's property. (Document No. 1-1, pp.6-7).

         On August 29, 2014, Ocwen Loan Servicing, LLC (“Ocwen”), HSBC Bank USA, National Association, as trustee for Fremont Home Trust 2004-B Asset Backed Certificates, Series 2004-B (“HSBC”), and Real Home Services and Solutions, Inc. (“RHSS”) (collectively, “Defendants”) filed a “…Motion To Dismiss” (Document No. 11) pursuant to Fed.R.Civ.P. 12(b)(6) seeking dismissal of Plaintiff's gross negligence and unfair and deceptive trades practices (“UDTPA”) claims. The Honorable Richard L. Voorhees denied the motion to dismiss on April 1, 2015. (Document No. 18). In denying the motion to dismiss, Judge Voorhees noted that there was no doubt that Defendants' original error was inadvertent; nevertheless, he found that Plaintiff's claims were plausible and the lawsuit should proceed to discovery. (Document No. 18, pp.11-12). Judge Voorhees further noted that the claims Defendants sought to dismiss might be more appropriately disposed of at summary judgment. Id.

         The “Affirmative Defenses And Answer Of The Defendants” (Document 26) was filed on May 8, 2015, and the parties' “Certification And Report of F.R.C.P. 26(f) Conference And Discovery Plan” (Document No. 27), as well as their “Joint Stipulation Of Consent To Exercise Of Jurisdiction By A United States Magistrate Judge” (Document No. 28), were filed on May 28, 2015. This case was reassigned to the undersigned United States Magistrate Judge on May 29, 2015.

         On June 8, 2015, the Court issued a “Pretrial Order And Case Management Plan” (Document No. 29) establishing case deadlines that were consistent with the parties' proposed deadlines. See (Document No. 27). The deadlines included the following: discovery completion - December 15, 2015; mediation report - January 15, 2016; dispositive motions - February 15, 2016; and trial - June 6, 2016. (Document No. 29).

         On December 15, 2015, the date discovery was due to be completed, the parties filed a “Consent Motion To Extend Discovery Period” (Document No. 30) stating that the “parties are cooperating in completing discovery, ” but need a sixty-day extension to complete discovery. On December 16, 2015, the undersigned granted the motion. (Document 31).

         On January 15, 2016, the parties filed a “Joint Motion To Extend Mediation Deadline” (Document No. 32). On January 19, 2016, the Court granted the extension, and adjusted other case deadlines. (Document No. 33).

         On March 9, 2016, the parties filed their “Joint Motion To Extend Scheduling Order Deadlines” (Document No. 38) requesting that the mediation and motions deadlines be extended, without any mention of further extending discovery. The Court granted the motion on March 15, 2016, and then further extended the mediation deadline at the request of the mediator on April 29, 2016. (Document Nos. 39 and 40).

         The parties again filed a “Joint Motion To Amend Scheduling Order” (Document No. 42) on May 9, 2016. The undersigned again granted the parties' request. (Document No. 43). Moreover, to accommodate the parties' latest request, the Court also had to move the trial date to February 20, 2017. Id.

         On May 23, 2016, the parties filed yet another “Joint Motion To Extend Scheduling Order Deadlines” (Document No. 44). This time, the parties reported that “the primary witness for Real Home Services and Solutions, Linda McCauley, has recently retired, ” and therefore, the parties need additional time to identify and depose another witness. (Document No. 44). Again, the Court allowed the parties' joint motion to extend deadlines. (Document No. 45). In granting the motion, the Court stated:

The parties shall have up to and including September 26, 2016 to complete all depositions, obtain transcripts of said depositions, and prepare and file dispositive motions and supporting memoranda. Further extension of these deadlines is unlikely.

(Document No. 44, p.1).

         “Defendant's Motion For Summary Judgment” (Document No. 50) was timely filed on September 26, 2016. After being allowed an extension of time, “Plaintiff's Response To Defendant's Summary Judgment” (Document No. 56) was filed on October 28, 2016. Defendants failed to file a timely reply brief, or notice of intent not to reply, and the Court then ordered Defendants to file a reply brief. (Document No. 57) (citing Local Rule 7.1 (E)). Defendants filed a reply brief (Document No. 58), and the pending “…Objection And Motion To Strike Evidence Submitted In Opposition To Summary Judgment” (Document No. 59), on November 18, 2016.

         On December 16, 2016, one (1) month after the summary judgment motion ripened, and almost three (3) months after all depositions were due to be complete, and transcripts obtained, Plaintiff filed motions for leave to take depositions of Linda McCauley, and of Altisource, Inc. (Document Nos. 63 and 64). Then, on January 6, 2017, more than three (3) years after the initial lawsuit was filed regarding the underlying dispute, and less than six (6) weeks from trial, Plaintiff filed its “Motion For Leave to Amend Complaint And to Add New Defendant Altisource Solutions, Inc.” (Document No. 68). On January 12, 2017, the undersigned denied Plaintiff's motions to conduct additional depositions and to amend the Complaint. (Document No. 71).

         “Defendant's Motion For Summary Judgment” (Document No. 50) and “Defendant's Objection And Motion To Strike Evidence Submitted In Opposition To Summary Judgment” (Document No. 59) are now ripe for disposition, and immediate review is appropriate.


         Summary judgment shall be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The movant has the “initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal citations omitted). Only disputes between the parties over material facts (determined by reference to the substantive law) that might affect the outcome of the case properly preclude the entry of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute about a material fact is “genuine” only if the evidence is such that “a reasonable jury could return a verdict for the nonmoving party.” Id.

         Once the movant's initial burden is met, the burden shifts to the nonmoving party. Webb v. K.R. Drenth Trucking, Inc., 780 F.Supp.2d 409 (W.D. N.C. 2011). The nonmoving party opposing summary judgment “may not rest upon the mere allegations or denials of his pleading, but ... must set forth specific facts showing there is a genuine issue for trial.” Anderson, 477 U.S. at 248. In deciding a motion for summary judgment, a court views the evidence in the light most favorable to the non-moving party, that is, “[t]he evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Anderson, 477 U.S. at 255. At summary judgment, it is inappropriate for a court to weigh evidence or make credibility determinations. Id.


         A. Factual Background

         James Kevin Jordan and wife Sherry D. Jordan (the “Jordans”) purchased three adjacent lots in the Jefferson Township of Ashe County, North Carolina in or about April 2000 - April 2001. (Document No. 1-1, p.5) (Document No. 12, p.2). The first lot was acquired on or about April 14, 2000, and is located at 374 Bower Lane, Jefferson, NC 28640. (Document No. 12, p.2) (Document No. 12-1). This lot consists of approximately three acres, and is identified by Ashe County parcel number 09302-237-004 (“004” or the “PLS Property”). Id.; see also (Document No. 1-1, p.5).

         On or about April 24, 2001, the Jordans acquired title to two vacant lots adjacent to the PLS Property. (Document No. 12, p.2; Document No. 12-2). These two adjacent and vacant lots (together the “Jordan Lots”) bear Ashe County parcel numbers 09302-237-006A (“006A”) and 09302-237-006B (“006B”), with a property address of 374 Bower Lane, Jefferson, NC 28640. (Document No. 12, p.2); see also (Document No. 1-1, p.5). One of these lots is approximately one acre, and the other lot is approximately two acres. (Document No. 1-1, p.5).

         A few years later, on February 11, 2004, the Jordans executed a Deed of Trust that was recorded in the Ashe County Registry at Book 308, page 749, regarding the two adjacent lots. Id.; (Document No. 56-3). Apparently, the Deed of Trust secured a loan of $500, 000.00 to the Jordans. (Document No. 56-3, p.3). The lender under the Deed of Trust was originally Freemont Investment and Loan, but the Deed of Trust was later assigned to Defendant HSBC in or about May 2004. (Document No. 56-3); (Document No. 1-1, pp.5-6); (Document No. 56, p.1).

         On March 10, 2008, Plaintiff PLS purchased the Jordans' first lot, 004, now referred to as the PLS Property. (Document No. 1-1, p.5); (Document No. 56, p.1). This lot includes a home and about three acres at 374 Bower Lane, and was purchased by Plaintiffs from the Jordans for $1, 180, 000, “for investment purposes.” Id. The Jordans retained ownership of their two adjacent lots, 006A and 006B. ...

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