United States District Court, W.D. North Carolina, Statesville Division
CALVIN A. TAUSS, Plaintiff,
MIDLAND STATES BANK, Defendant.
Richard L. Voorhees United States District Judge
MATTER IS BEFORE THE COURT on Defendant Midland
States Bank's Motion to Dismiss Pro Se Complaint as
Amended (Doc. 13; see Doc. 16) and on
Defendant's Motion to Strike Plaintiff Calvin A.
Tauss' “Memorandum Act of RESPA”
(“Motion to Strike”) (Doc. 19). Following the
Court's June 26, 2017 Roseboro Notice, Plaintiff filed a
response to the Motion to Dismiss on July 17, 2017. (Doc.
21). The time for filing a reply has passed and both Motions
are ripe for review. For the reasons set out below,
Defendant's Motion to Dismiss Pro Se Complaint as Amended
(Doc. 13) is DENIED, Defendant's Motion
to Strike (Doc. 19) is GRANTED and
Plaintiff's “Memorandum Act of RESPA” (Doc.
18) is STRICKEN.
is an action alleging violations of the Real Estate
Settlement Procedures Act, 12 U.S.C. §§ 2601 et
seq. (“RESPA”). As made clear in pro
se Plaintiff's pleadings and as construed by the
Court, Plaintiff brings claims under 12 U.S.C. § 2605.
Any action pursuant to § 2605 “may be brought in
the United States district court . . . for the district in
which the property involved is located, or where the
violation is alleged to have occurred, within 3 years in the
case of a violation of section 2605 of this title . . . from
the date of the occurrence of the violation.” 12 U.S.C.
alleges that the property involved is located at 527 Margaret
Drive, Statesville, North Carolina, an allegation not
disputed by Defendant in its Motion to Dismiss and an
allegation supported by documents filed with Plaintiff's
pleadings. (See Doc. 10 at 1, 19). Statesville is
located in the Statesville Division of the Western District
of North Carolina. Plaintiff filed this action in a proper
district court and proper division. Plaintiff alleges, as a
violation of § 2605, a lapse in insurance coverage as of
September 2015 due to Defendant's failure to pay premiums
from an escrow account. (Doc. 10 at 2). Plaintiff also
alleges later-occurring violations of § 2605. (Doc. 10
at 3-4, 17; Doc. 15-1). Plaintiff filed the original
Complaint on September 23, 2016 (Doc. 3), an Amended
Complaint on October 17, 2016 (Doc. 10), and a supplemental
pleading on February 16, 2017 (Docs. 15, 15-1). All pleadings
have been filed well-within three years from the date of the
occurrence of the first violation. The Court, therefore, has
jurisdiction under 12 U.S.C. § 2614.
proceeding pro se, commenced this action on
September 19, 2016, by moving for an emergency order
directing Defendant to authorize restoration of normal water
service at Plaintiff's home. (Doc. 1). On that same day,
Plaintiff filed a Motion to Proceed in Forma
Pauperis. (Doc. 2). On September 23, 2016, Plaintiff
filed his original Complaint (Doc. 3) and the Court denied
Plaintiff's motion for an emergency order (Doc. 4). On
September 27, 2016, the Court granted Plaintiff's Motion
to Proceed in Forma Pauperis. (Doc. 5). Within 21
days following service of the original Complaint, Plaintiff
filed an Amended Complaint. (Doc. 10). Defendant timely
responded with a Motion to Dismiss Pro Se Complaint as
Amended pursuant to Fed.R.Civ.P. 12(b)(6) (“Motion to
Dismiss”). (Doc. 13).
did not respond to the Motion to Dismiss and, before the
Court issued a Roseboro Notice, Plaintiff filed a
“second” Amended Complaint on February 16, 2017,
without first seeking leave of the Court or Defendant's
written consent. (Doc. 15). Defendant responded to the
“second” Amended Complaint, incorporating its
prior Motion to Dismiss. (Doc. 16).
April 17, 2017, Plaintiff filed a “Memorandum Act of
RESPA.” (Doc. 18). Defendant moves to strike the
“Memorandum Act of RESPA” on the grounds that
Plaintiff failed to first obtain leave to file the additional
pleading and the content of the pleading appears to be
irrelevant to the matter presently before the Court. (Doc.
Court provided Defendant with a Roseboro Notice (Doc. 20) and
Plaintiff timely responded to the Motion to Dismiss (Doc.
21). The time for a reply has passed.
STANDARD OF REVIEW
12(b)(6) of the Federal Rules of Civil Procedure provides for
the dismissal of a claim based upon a plaintiff's
“failure to state a claim upon which relief can be
granted.” Fed.R.Civ.P. 12(b)(6). A complaint must
contain a “short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). In evaluating a motion to dismiss, a
court must construe the complaint's factual allegations
“in the light most favorable to the plaintiff”
and “must accept as true all well-pleaded
allegations.” Randall v. United States, 30
F.3d 518, 522 (4th Cir. 1994). A court, however,
“‘need not accept the legal conclusions drawn
from the facts, '” nor “‘accept as true
unwarranted inferences, unreasonable conclusions, or
arguments.'” Giarratano v. Johnson, 521
F.3d 298, 302 (4th Cir. 2008) (quoting E. Shore Mkts.,
Inc. v. J.D. Assocs. Ltd. P'ship, 213 F.3d 175, 180
(4th Cir. 2000)).
Fed.R.Civ.P. 8(a)(2) does not require “detailed factual
allegations, ” a complaint must offer more than
“naked assertion[s]” and unadorned “labels
and conclusions.” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009). In order to survive a Fed.R.Civ.P. 12(b)(6)
motion to dismiss, the facts alleged must be sufficient to
“raise a right to relief above the speculative
level” and “state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555, 570 (2007). Requiring
plausibility “does not impose a probability requirement
at the pleading stage” id. at 556, but does
demand more than “a sheer possibility that a defendant
has acted unlawfully, ” Iqbal, 556 U.S. at
678. Ultimately, a claim is facially plausible when the
factual content allows for the reasonable inference that the
defendant is liable for the misconduct alleged. Id.
applying this standard, the Supreme Court has reiterated that
“[a] document filed pro se is to be liberally
construed and a pro se complaint, however inartfully
pleaded, must be held to less stringent standards than formal
pleadings drafted by lawyers.” Erickson v.
Pardus, 551 U.S. 89, 94 (2007) (internal citations and
quotation marks omitted). However, the Fourth Circuit has
“not read Erickson to undermine
Twombly's requirement that a pleading contain
more than labels and conclusions[.]”
Giarratano, 521 F.3d at 304 n.5 (internal quotation
marks omitted); accord Atherton v. Dist. of Columbia Off.
of Mayor, 567 F.3d 672, 681-82 (D.C. Cir. 2009)
(“But even a pro se complainant must plead
‘factual matter' that permits the court to infer
‘more than the mere possibility of
misconduct.'” (quoting Erickson, 551 U.S.
at 94; Iqbal, 556 U.S. at 679)). The rules governing
the generous construction of pro se pleadings
“do not relieve the plaintiff of the burden of
alleging sufficient facts on which a recognized legal claim
could be based.” Ashby v. City of Charlotte,
121 F.Supp.3d 560, 562 (W.D. N.C. 2015) (internal quotation
Court will first consider Defendant's Motion to Dismiss
Pro Se Complaint as Amended (Doc. 13). The Court will
separately consider Defendant's Motion to Strike (Doc.
Allegations Relevant to Motion to Dismiss
Pleadings Properly Before the Court
threshold question is which pleadings may be considered by
the Court in addressing the Motion to Dismiss. Plaintiff
filed his first Amended Complaint on October 17, 2016, which
included RESPA claims. (Doc. 10). A party may amend its
pleading once as a matter of course within 21 days after
serving it. Fed.R.Civ.P. 15(a)(1)(A). The summons and
original Complaint were served on October 3, 2016. (Doc. 9 at
1, 4). Thus, Plaintiff's first Amended Complaint, which
is titled “Amended Complaint Act of RESPA, ” was
filed within the 21-day period and, therefore, properly filed
as a matter of course under Fed.R.Civ.P. 15(a)(1)(A).
Defendant filed a Motion to Dismiss Pro Se Complaint as
Amended on November 23, 2016. (Doc. 13).
seeking leave of Court, Plaintiff filed a
“second” Amended Complaint on February 16, 2017.
(Docs. 15, 15-1 (“Amended #2 Act of RESPA”)). The
“second” Amended Complaint repeats the language
of the first Amended Complaint and then adds language
relating to an alleged failure by Defendant to pay 2016 real
property taxes from an escrow account, claimed to be a
further violation of RESPA. (Doc. 15-1 at 1-2). After
amending once as a matter of course, a party may amend its
pleading only with the opposing party's written consent
or the court's leave. Fed.R.Civ.P. 15(a)(2). Defendant
did not specifically object to the “second”
Amended Complaint but instead responded by incorporating its
earlier Motion to Dismiss. (Doc. 16). The Court does not view
Defendant's response as written consent to a second
“second” Amended Complaint may be construed as a
supplemental pleading because the events described in new
allegations occurred after Plaintiff filed the first Amended
Complaint on October 17, 2016. The “second”
Amended Complaint alleges that on February 10, 2017,
Plaintiff received a notice of delinquent taxes for the
property subject to the mortgage. (Doc. 15- 1 at 4).
Plaintiff included a copy of a monthly statement provided by
Defendant which showed payments being made to an escrow
account for taxes and insurance. (Doc. 15-1 at 3). These
events occurred months after the filing of the first Amended
Complaint. The filing of February 16, 2017, occurred promptly
after the events alleged. Thus, the “second”
Amended Complaint will be construed as an attempted
supplemental pleading under Fed.R.Civ.P. 15(d).
15(d) provides that “[o]n motion and reasonable notice,
the court may, on just terms, permit a party to serve a
supplemental pleading setting out any transaction,
occurrence, or event that happened after the date of the
pleading to be supplemented.” Plaintiff has not moved
to supplement his pleadings. Courts in this Circuit, however,
have liberally construed a pro se pleading as a
motion seeking leave to supplement a complaint. See,
e.g., Dicks v. Flury, 2015 WL 847409, at *2 (D.
Md. Feb. 25, 2015) (declining to strike supplement to amended
complaint even though pro se party failed to seek
permission as required by Rule 15(d)); Smith v.
Stevenson, 2010 WL 1257510, at *6 n.6 (D.S.C. Mar. 24,
2010) (addressing pro se supplemental pleading
despite fact party failed to file a proper motion under Rule
15(d)). The Court will, therefore, consider whether to grant
leave with respect to the pro se supplemental
15(d) motions are to be evaluated under the same standards
used to evaluate motions to amend pleadings under Rule 15(a),
which generally states that leave to amend should be freely
granted when justice requires unless there are valid reasons
for denying leave, such as undue delay, bad faith or
futility.” Estate of Williams-Moore v. Alliance One
Receivables Mgmt., Inc., 335 F.Supp.2d 636, 644 (M.D.
N.C. 2004). The Court finds that because the supplemental
pleading arises from the same alleged obligations of
Defendant to make timely payments from the escrow account
related to Plaintiff's mortgage, no valid reason for
denying leave to supplement exists. Plaintiff filed the
supplemental pleading within one week of the alleged receipt
of the delinquent tax notice (Doc. 15-1 at 1) and there is no
indication of bad faith or futility as the new allegations
are of the type contained in the first amended Complaint.
Defendant has responded to the supplemental pleading (Doc.
16) and leave to file will not delay resolution of the Motion
to Dismiss. The Court, therefore, grants leave to file the
purposes of addressing the Motion to Dismiss, the operative
pleading is the “Amended Complaint Act of RESPA,
” including exhibits (Doc. 10), as supplemented by
“Amended #2 Act of RESPA, ” including exhibits
(Doc. 15-1), collectively the “Supplemented
relevant Supplemented Complaint allegations, taken as true
for purposes of a Rule 12(b)(6) motion to dismiss, are as
(1) Plaintiff had a loan from Midland States Bank on which he
made payments on principal and interest as well as into an
escrow account for taxes and insurance. (Doc. 15-1 at 3).
(2) In December 2015, torrential rains and inclement weather
caused severe damage to Plaintiff's home, including the
roof and interior. Plaintiff informed his homeowners
insurance company of the event and the insurance company sent
an adjuster to survey the damage. (Doc. 10 at 1).
(3) Shortly thereafter, Plaintiff learned that his homeowners
insurance had been cancelled in September 2015 because
premiums had ...