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Case 3:12-Cv-04336-BH Document 16 Filed 07/26/13 Page 1 of 20 Pageid 169 Case 3:12-cv-04336-BH Document 16 Filed 07/26/13 Page 1 of 20 PageID 169 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION KENNETH B. MCINTOSH, et al., § Plaintiffs, § § v. § Civil Action No. 3:12-CV-4336-BH § BANK OF AMERICA, N.A., et al., § Defendants. § Consent Case MEMORANDUM OPINION AND ORDER By order filed March 25, 2013, this matter has been transferred for the conduct of all further proceedings and the entry of judgment. (See doc. 14.) Before the Court is Defendants’ Motion to Dismiss, filed November 5, 2012 (doc. 4). Based on the relevant filings and applicable law, the motion is GRANTED. I. BACKGROUND This action involves attempted foreclosure of real property located at 625 Wentworth Drive, Richardson, Texas 75081 (the Property). (docs. 1-1 at 6; 4-3 at 1, 6.)1 On October 1, 2012, Kenneth B. McIntosh and Iweeta McIntosh (Plaintiffs) filed suit against Bank of America, N.A., successor by merger to BAC Home Loans Servicing, LP, f/k/a Countrywide Home Loans Servicing, LP (BANA) and Federal National Mortgage Association, Fannie Mae Remic Trust 2010-28 (Fannie Mae) (collectively, Defendants) in the 134th Judicial District Court of Dallas County, Texas. (doc. 1-1 at 5.) Plaintiffs’ verified state court petition alleges that on February 22, 2010, they obtained a mortgage loan from BANA. (Id. at 9.) They executed a promissory note and a deed of trust 1 Citations to the record refer to the CM/ECF system page number at the top of each page rather than the page numbers at the bottom of each filing. Case 3:12-cv-04336-BH Document 16 Filed 07/26/13 Page 2 of 20 PageID 170 securing the note in BANA’s favor. (docs. 1-1 at 9; 4-3 at 1–19.) Both the note and deed of trust named BANA as “Lender.” (doc. 4-3 at 1, 5.) The loan documents were “given in renewal and extension” of an existing obligation in favor of “Countrywide Bank, FSB.” (Id. at 19.) The deed of trust designated Lender as “the beneficiary” with legal title to the Property and the power of sale. (Id. at 5.) It stated that the loan could “be sold one or more times without prior notice to Borrower,” which would “result in a change in the entity ... known as the ‘Loan Servicer.’” (Id. at 14.) Lender could, “at its option and with or without cause ... from time to time, by power of attorney or otherwise, remove or substitute any trustee, add one or more trustees, or appoint a successor trustee ... without ... any formality other than a designation by Lender in writing.” (Id. at 15.) In April 2010, BANA assigned the mortgage servicing rights to BAC. (See doc. 4-3 at 20.) On May 12, 2011, BANA, through its “attorney-in-fact”, assigned the deed of trust to BAC. (doc. 1-1 at 48.) The assignment document identified BANA as “the mortgagee of record” and stated that “for value received” BANA transferred to BAC “all [the] rights accrued and to accrue under [the] Loan Agreement.” (Id.) The assignment was electronically filed with the Dallas County Clerk on June 9, 2011. (Id. at 48–49.) On June 15, 2011, BANA’s attorney-in-fact executed an appointment of substitute trustee. (Id. at 50.) The appointment was also filed with the Dallas County Clerk. (Id.) Plaintiffs claim that BANA was not the “true lender”; it was “a naked nominee whose name was rented by an undisclosed third [party].” (doc. 1-1 at 9–10.) They assert Defendants engaged in fraud by “falsely” naming BANA as Lender on the loan documents and “deliberately omitt[ing] the name of the real lender/creditor.” (Id. at 13.) Because they did not receive consideration from BANA, no contract was formed between them and BANA. (Id. at 10.) They also claim the assignment and the appointment of substitute trustee were fraudulent because BANA had no 2 Case 3:12-cv-04336-BH Document 16 Filed 07/26/13 Page 3 of 20 PageID 171 authority to execute them and because its attorney-in-fact was a “robo-signer”2 with “multiple false signatures.” (Id. at 12–15.) In addition, “both documents were falsely notarized by ... an employee” of the attorney-in-fact’s law firm. (Id. at 12.) They concede BANA could be “at best” Fannie Mae’s mortgage servicer, but claim that even in that capacity BANA did “not have the authority to appoint a substitute trustee.” (Id. at 16.) With regard to Fannie Mae, Plaintiffs contend that it allegedly claims to have acquired their loan seven days after they closed on it and three days before the deed of trust naming BANA as the Lender and beneficiary was filed. (Id. at 12.) Yet, documents from the securitization trust “clearly state” that the trust owns their loan. (Id.) Plaintiffs dispute Fannie Mae’s and the trust’s ownership of the loan, arguing that there is no recorded assignment evidencing BANA’s sale or transfer of the loan to either entity. (Id.) Further, there is a cloud on their title because BANA, Fannie Mae, and the trust all claim to have an interest in the Property. (Id. at 20.) They contend only a “full and accurate accounting” will determine which of these parties has a valid claim. (Id.) 3 Plaintiffs assert claims against Defendants for fraud and violations of the Texas Deceptive Trade Practices Act (DTPA). (Id. at 21–23.) They seek declaratory judgment, injunctive relief to 2 “Robo-signing” is: [T]he colloquial term the media, politicians, and consumer advocates have used to describe an array of questionable practices banks deployed to perfect their right to foreclose in the wake of the subprime mortgage crisis, practices that included having bank employees or third-party contractors: (1) execute and acknowledge transfer documents in large quantities within a short period of time, often without the purported assignor's authorization and outside of the presence of the notary certifying the acknowledgment,4 and (2) swear out affidavits confirming the existence of missing pieces of loan documentation, without personal knowledge and often outside of the presence of the notary. Reinagel v. Deutsche Bank Nat. Trust Co., No. 12-50569, 2013 WL 3480207, at *2 (5th Cir. July 11, 2013) (citations omitted). 3 Plaintiffs also allege the note was pooled with other notes and transferred into the “2010-28 Trust” to be “converted” into saleable mortgage-backed securities. (doc. 1-1 at 19.) This allegedly extinguished the note by causing it to be deleted from the Lender’s balance sheet. (Id.) By being “converted into a stock as a permanent fixture” the note is now “governed ... [by] the rules and regulations of the [Securities and Exchange Commission].” (Id.) Plaintiffs do not support any of their claims for relief with these allegations. (See id. at 9–29.) 3 Case 3:12-cv-04336-BH Document 16 Filed 07/26/13 Page 4 of 20 PageID 172 enjoin Defendants from foreclosing and taking possession of the Property, attorney’s fees, actual and “treble” damages, and court costs. (Id. at 23–29.) On October 1, 2012, the state court issued a temporary restraining order (TRO) restraining Defendants from foreclosing on the Property. (Id. at 52–54.) On October 29, 2012, Defendants removed the case to this Court asserting diversity jurisdiction under 28 U.S.C. § 1332(a) (doc. 1), and they moved to dismiss the complaint on November 5, 2012 (doc. 4). With a timely-filed response (docs. 7–9), the motion is now ripe for determination. II. RULE 12(b)(6) MOTION Defendants move to dismiss Plaintiffs’ complaint under Fed. R. Civ. P. 12(b)(6) for failure to state a claim upon which relief can be granted. (doc. 4.) A. Rule 12(b)(6) Standard Rule 12(b)(6) allows motions to dismiss for failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). Motions to dismiss under Rule 12(b)(6) are disfavored and rarely granted. Sosa v. Coleman, 646 F.2d 991, 993 (5th Cir. 1981). Under the 12(b)(6) standard, a court cannot look beyond the face of the pleadings. Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996); see also Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999), cert. denied, 530 U.S. 1229 (2000). It is well-established that “pro se complaints are held to less stringent standards than formal pleadings drafted by lawyers.” Miller v. Stanmore, 636 F.2d 986, 988 (5th Cir. 1981). Nonetheless, regardless of whether the plaintiff is proceeding pro se or is represented by counsel, pleadings must show specific, well-pleaded facts, not mere conclusory allegations to avoid dismissal. Guidry v. Bank of LaPlace, 954 F.2d 278, 281 (5th Cir. 1992). The court must accept those well-pleaded facts as true and view them in the light most favorable to the plaintiff. Baker, 75 F.3d at 196. “[A] 4 Case 3:12-cv-04336-BH Document 16 Filed 07/26/13 Page 5 of 20 PageID 173 well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of [the alleged] facts is improbable, and ‘that a recovery is very remote and unlikely.’” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007) (citation omitted). Nevertheless, a plaintiff must provide “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. at 555; accord Ashcroft v.
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