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Reaves v. American Home Mortgage Servicing, Inc.

United States District Court, E.D. North Carolina, Western Division

September 29, 2017

MARGARET REAVES, Plaintiff,
v.
AMERICAN HOME MORTGAGE SERVICING, INC. and OCWEN LOAN SERVICING, LLC, Defendants.

          ORDER

          LOUISE W. FLANAGAN UNITED STATES DISTRICT JUDGE

         This matter is before the court on defendant's motion for summary judgment. (DE 57). Pursuant to 28 U.S.C. § 636(b)(1) and Federal Rule of Civil Procedure 72(b), United States Magistrate Judge Robert B. Jones, Jr., entered memorandum and recommendation (“M&R”), wherein it is recommended that the court deny defendant's motion. Defendants timely filed objections to the M&R[1], and the issues raised are ripe for ruling. For the reasons that follow, the court accepts the recommendation in the M&R, and denies defendant's motion.

         STATEMENT OF THE CASE

         Plaintiff, proceeding pro se, commenced this action April 28, 2015, asserting violations of federal consumer protection law, breach of contract, and related state law torts against defendants American Home Mortgage Servicing, Inc. (“AHMSI”) and Ocwen Loan Servicing, LLC (“Ocwen”). Plaintiff's claims arise from defendants' alleged failures to service properly a loan secured by property located at 2521 Springhill Ave, Raleigh, North Carolina (“2521 Springhill Ave property”). Plaintiff seeks compensatory and punitive damages.

         Plaintiff initiated prior action asserting similar claims against AHMSI in the General Court of Justice, Superior Court Division, for Wake County on April 1, 2014, alleging that AHMSI failed to properly credit her mortgage payments in violation of the North Carolina Unfair and Deceptive Trade Practices Act. Reeves v. Am. Home Mortg., Inc. (“Reaves I”), No. 14 CVS 4069; see App. to Defs.' Stmt. of Material Facts (“SOMF”) Ex. A (DE 62-1). On May 29, 2014, the trustee for non-party Option One, which was the original servicer for the loan, initiated foreclosure proceedings against the 2521 Springhill Ave property in Wake County Superior Court. In re Foreclosure of Real Property Under Deed of Trust from Margaret W. Reeves (“the foreclosure proceeding”), Notice of Hr'g., No. 14 SP 1727; see App. Defs.'s SOMF Ex. B (DE 62-2). On December 29, 2014, the Wake County Superior Court stayed Reaves I pending resolution of the foreclosure proceeding. Reaves I, No. 14 CVS4069, Dec. 29, 2014 Order; see App. to Defs.' SOMF Ex. C (DE 62-3). The record taken into this court indicates that the foreclosure proceeding remains pending. (DE 77-2 at 3). Nothing before the court indicates that the stay of Reaves I has been lifted.

         On June 25, 2014, plaintiff filed a complaint against Wells Fargo Bank, Trustee Services of Carolina, and Brock and Scott in Wake County Superior Court alleging that those defendants did not credit properly plaintiff's payments for property taxes, and, as a result, she overpaid her taxes. Reeves v. Wells Fargo Bank (“Reaves II”), No. 14 CVS 8427; see App. to Defs.' SOMF Ex. D (DE 62-4). Plaintiff filed a third action August 26, 2014, against Sand Canyon Corporation, Dale Sugimoto, Brock and Scott, and Ocwen Loan Servicing, alleging that the defendants filed a fraudulent affidavit with the Wake County Register of Deeds on April 7, 2014, in connection with the foreclosure proceeding. Reeves v. Sand Canyon Corp. (“Reaves III”), No. 14 CVS 11169; see App. to Defs.' SOMF Ex. F (DE 62-6). On December 29, 2014, the Wake County Superior Court dismissed Reaves II and Reaves III with prejudice. Reaves II, No. 14 CVS 8427, Dec. 29, 2014 Order; see App. to Defs.' SOMF Ex. E (DE 62-5); Reaves III, No. 14 CVS 11169, Dec. 29, 2014 Order, App. to Defs.' SOMF Ex. G (DE 62-7).

         In this case, standing as Reaves IV, defendants filed the instant motion November 30, 2016, asserting that plaintiff's claims are barred by the Rooker-Feldman doctrine and res judicata, or, in the alternative, that the court should stay this action pursuant to Colorado River abstention pending resolution of the foreclosure proceeding. In support of their motion, defendants rely upon the state court files and plaintiff's complaint. Plaintiff's response in opposition does not address defendants' arguments, but constitutes an attempt to present evidence pertinent to the merits of her claims.

         STATEMENT OF THE UNDISPUTED FACTS

         The court incorporates as follows the statement of facts set forth in the M&R, where such statement accurately reflects the evidence of record:

Plaintiff's claims relate to actions taken by Defendants in the course of servicing her mortgage loan, including during foreclosure proceedings in North Carolina state court. Plaintiff and her now-deceased husband obtained a loan for $117, 600.00 from First Greensboro Home Equity, Inc. on or about December 23, 2002, secured by Plaintiff's residence. Am. Compl. [DE-38] ¶¶ 17, 19. At the time of origination, Option One was the servicer of the loan, and AHMSI became the servicer on or about May 2008. Id. ¶¶ 20, 36. AHMSI changed its name to Homeward Residential Holdings in December 2012, and was acquired that same month by Ocwen's parent corporation (Ocwen Financial Corporation). Id. ¶¶ 2-3. On or about June 7, 2013, Plaintiff received a letter from Ocwen on behalf of Homeward Residential informing her that she was delinquent on the loan by 21 payments. Id. ¶ 54. According to Plaintiff, Defendants violated federal, state, and common law in connection with servicing Plaintiffs mortgage loan by wrongfully taking the following actions:
(i) adjusted escrow withholdings in amounts and at times that are not permitted; (ii) failed to respond to inquiries by [P]laintiff within the time required by law; (iii) when they did respond, Defendants failed to do so timely as required by law; (iv) failed to properly credit payments received from [P]laintiff; (v) failed to notify Plaintiff [that] payments received from her were not being credited, but rather held for an unreasonable duration of time; (vi) failed to return funds which Defendants [were] under [an] obligation to return; (vii) making written and verbal false and misleading statements as to the amount owed and status of Plaintiff's account; (viii) notified Plaintiff that they and other Defendants had commenced foreclosure or other proceedings, notwithstanding that they were not permitted to commence those proceedings; (ix) failed to timely and clearly advise Plaintiff of changes to her obligations predicated upon Defendants' files; and (x) frustrated and/or harassed Plaintiff who attempted to find out more information concerning her mortgages and her rights and obligations [thereunder]. Id. ¶ 14.
Specifically, Plaintiff claims that Defendants violated the Real Estate Settlement Practices Act (“RESPA”), 12 U.S.C. § 2601 et seq., by failing to respond to qualified written requests sent by Plaintiff, Am. Compl. [DE-38] ¶¶ 60-66; violated the Truth in Lending Act (“TILA”);15 U.S.C. § 160.1 et seq., by failing to provide required notices, Am. Com pl. [DE-3 ¶¶ 67-7]; violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by making false and misleading representations to Plaintiff about the character, amount, and legal status of her debt, Am. Compl. [DE-38] ¶¶ 72-80; violated the North Carolina Fair Debt Collection Practices Act (“NCDCPA”), N.C. Gen. Stat. § 75-50 et seq., by engaging in unfair acts in collecting Plaintiff's debt, Am. Compl. [DE 38] ¶¶ 81-87; violated the North Carolina Unfair and Deceptive Trade Practices Act (“NC UDTPA”), N.C. Gen; Stat.§ 75-1.1 et seq., by failing to properly credit Plaintiff's account, charging unauthorized fees and costs, and sending false and misleading communications, Am. Compl. [DE-38] at ¶¶ 88-94; breached Plaintiffs contract by improperly crediting Plaintiff's account, charging unauthorized fees and costs, and attempting to foreclose on Plaintiff's residence when she was not in default, Am. Compl. [DE-38] ¶¶ 95-99; breached the implied covenant of good faith and fair dealing by acting to deprive Plaintiff of her contractually-bestowed benefits and preventing her from fulfilling her contractual obligations, Id. ¶¶ 100-04; and acted negligently in the course of servicing Plaintiff's mortgage loan, Id. ¶¶ 105-09. Plaintiff seeks monetary relief, to include actual, statutory, compensatory, and punitive damages, costs, and attorney's fees. Id. at 23-24 ¶¶ 1-10.

(DE 73 at ...


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