Pacaya v. Freedom Mortgage Corp. et al

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
Elvis-Jack:Pacaya
v. Civ. No. 23-cv-279-LM
Freedom Mortgage Corp.
Orlans, PC
Federal Mortgage Home Loan Corp.
Grafton County Sheriff’s Dept.
REPORT AND RECOMMENDATION
Plaintiff Elvis-Jack:Pacaya has sued several defendants,
alleging violations of the Fair Debt Collection Practices Act,
15 U.S.C. §§ 1692-1692p (“FDCPA”) and the Real Estate Settlement
Procedures Act, 12 U.S.C. § 2605(e)(3) (“RESPA”). Before the
court is defendant Freedom Mortgage Corp.’s (“Freedom”) motion
to dismiss the three claims asserted against it for failure to
state a claim upon which relief can be granted (Doc. No. 13).
Plaintiff has filed no substantive objection.1 See Fed. R. Civ.
1 Plaintiff’s purported objection (Doc. No. 17) contains no
responses to Freedom’s motion. Instead, each of its twenty
paragraphs baselessly questions defense counsel’s “standing” to
represent Freedom. The court may not deem the lack of a response
to be procedural default. Pomerleau v. W. Springfield Pub. Sch.,
362 F.3d 143, 145 (1st Cir. 2004). Instead, the district court
remains obligated to “examine the complaint itself to see
whether it is formally sufficient to state a claim.” Id.
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P. 12(b)(6). Pursuant to LR 72.1, the motion has been referred
to the undersigned Magistrate Judge for a report and
recommendation. For the reasons that follow, the district judge
should grant Freedom’s motion.
Standard of Review
When evaluating a motion to dismiss for failure to state a
claim under Rule 12(b)(6), the court asks whether the plaintiff
has made allegations in his pleadings that are sufficient to
render his entitlement to relief plausible. See Manning v.
Boston Med. Ctr. Corp., 725 F.3d 34, 43 (1st Cir. 2013). The
court accepts all well-pleaded facts as true and draws all
reasonable inferences in the non-moving party's favor. Hamann v.
Carpenter, 937 F.3d 86, 88 (1st Cir. 2019). The court, however,
disregards conclusory allegations that simply parrot the
applicable legal standard. Manning, 725 F.3d at 43. In addition
to the allegations in the complaint, the court may also consider
judicially noticed documents, matters of public record, and
documents attached to the complaint, without converting this
12(b)(6) motion into a motion for summary judgment. See
Breiding v. Eversource Energy, 939 F.3d 47, 49 (1st Cir. 2019);
Greene v. Rhode Island, 398 F.3d 45, 49 (1st Cir. 2005). The
court can also consider “documents central to plaintiffs’ claim;
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or . . . documents sufficiently referred to in the complaint.”
Watterson v. Page, 987 F.2d 1, 3 (1st Cir. 1993).
Plaintiff’s Claims
A. Count I - Violation of 12 U.S.C. § 2605(e) (RESPA)
Stripped of legal conclusions, plaintiff alleges in Count I
that Freedom violated RESPA by failing acknowledge or answer
plaintiffs “qualified written request with regard to an alleged
mortgage contract.” Compl. (Doc. No. 1) ¶¶ 15, 18, 19. Freedom
has included both plaintiff’s letter and its response as
exhibits to its motion. Def. Mem. (Doc. No. 14) Exhs. A and B
(Doc. Nos. 14-1 and 14-2). As these documents are both “central
to plaintiff’s claim” and “referred to in the complaint,”
Watterson, 987 F.2d at 3, the court considers them in its
analysis.
RESPA defines a “qualified written request” (“QWR”) as “a
written correspondence . . . that (i) includes, or otherwise
enables the servicer to identify, the name and account of the
borrower; and (ii) includes a statement of the reasons for the
belief of the borrower, to the extent applicable, that the
account is in error or provides sufficient detail to the
servicer regarding other information sought by the borrower.”
Wood v. U.S. Bank, No. 1:22-CV-00235-JL, 2023 WL 3867254, at *4
(D.N.H. June 7, 2023) (quoting 12 U.S.C. § 2605(e)(1)(B)).
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Under REPSA, “[a] letter does not constitute a QWR . . . if the
letter does not relate to the servicing of a borrower's loan as
defined under 12 U.S.C. § 2605(i)(3) or does not identify any
error as required by § 2605(e)(1)(B).” Moody v. PennyMac Loan
Servs., LLC, No. 16-CV-21-JL, 2016 WL 11690622, at *5 (D.N.H.
June 6, 2016). Relatedly, challenges to a loan's validity or
its terms are not considered [QWRs] under Section 2605(e). Id.
Here, the plaintiff’s putative QWR, dated August 27, 2022,
contains plaintiff’s name and account number, and claims to
exercise a “right to rescind the mortgage” because he was not
provided with certain information. Def. Mem., Exh. A. (Doc. No.
14-1). The letter seeks the return of all payments made on the
account and termination of any security interest. Id. It does
not, however, request any information regarding servicing of the
loan. Instead, in seeking to rescind the loan, plaintiff is
challenging its validity. The letter is therefore not a QWR.
Regardless of whether the plaintiff’s letter was a QWR,
Freedom, contrary to the allegation in the complaint, met its
obligation to respond by letter dated September 14, 2022 –
eighteen days later. Freedom’s letter acknowledged receipt of
plaintiff’s putative QWR, indicated that it had researched
plaintiff’s account and found no error, and that the account was
in arrears. See 12 U.S.C. § 2605(e)(2)(B)(i) (requiring
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servicer, after receiving QWR, to “provide the borrower with a
written explanation or clarification that includes . . . a
statement of the reasons for which the servicer believes the
account of the borrower is correct as determined by the servicer
. . . .”)
In addition to plaintiff’s letter not serving as a valid
QWR, and Freedom’s timely and sufficient response, Count I is
also deficient because the plaintiff claims only that he “was
caused harm, damage and loss.” Compl. (Doc. No. 1) ¶ 21. This
is inadequate to support a RESPA claim, which requires an
allegation of “specific damages and . . . how the purported
RESPA violations caused those damages. Wood, 2023 WL 3867254, at
*6 (quoting Moore v. Mortg. Elec. Registration Sys., Inc. 848 F.
Supp. 2d 107, 122 (D.N.H. 2012)). Based on the foregoing, Count
I should be dismissed.
B. Count II – Violation of 15 U.S.C. § 1692(g) (FDCPA)
In Count II, plaintiff alleges that Freedom violated the
FDCPA by failing to respond to plaintiff’s “demand for
validation of a claim with regards to their claim of debt.”
Compl. (Doc. No. 1) ¶ 22. This claim fails because Freedom is
not a “debt collector,” as that term is defined in the statute.
Pursuant to 15 U.S.C. § 1692a(6), a “debt collector”
means any person who uses any instrumentality of
interstate commerce or the mails in any business the
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principal purpose of which is the collection of any
debts, or who regularly collects or attempts to
collect, directly or indirectly, debts owed or due or
asserted to be owed or due another. Notwithstanding
the exclusion provided by clause (F) of the last
sentence of this paragraph, the term includes any
creditor who, in the process of collecting his own
debts, uses any name other than his own which would
indicate that a third person is collecting or
attempting to collect such debts.
(emphasis added). Here, plaintiff’s allegation in Count I as to
a “mortgage contract,” Compl. (Doc. No. 1) ¶ 15, and his request
in Count II for Freedom to “validate . . . their claim of a
debt,” demonstrates that Freedom was not a “debt collector,” but
was instead a “creditor,” defined as
“any person who offers or extends credit creating a
debt or to whom a debt is owed, but such term does not
include any person to the extent that he receives an
assignment or transfer of a debt in default solely for
the purpose of facilitating collection of such debt
for another.
15 U.S.C. § 1692a(4). As a “creditor,” Freedom is “generally
exempt from the definition of ‘debt collector’ and is thereby
exempt from FDCPA liability.” Johnson-Toothaker v. Bayview Loan
Servicing LLC, No. 2:20-CV-00371-JDL, 2022 WL 3278883, at *7 (D.
Me. Aug. 11, 2022). Accordingly, Count II should be dismissed.
C. Count VI - Violations of 15 U.S.C. §§ 1692c-1692g (FDCPA)
In Count VI, plaintiffs allege that Freedom (and others)
violated numerous provisions of the FDCPA by:
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• communicating with the plaintiff without his consent;
• threatening the plaintiff with violence or other criminal
means;
• using obscene and profane language;
• instilling a false representation of the legal status of an
alleged debt;
• instilling a false representation regarding plaintiff’s
ability to defend against payment;
• instilling a false representation that plaintiff committed
a crime; and
• attempting to collect a debt without authority.
Compl. (Doc. No. 1) ¶¶ 47-53.
Although the plaintiff has accurately identified FDCPA
provisions which prevent debt collectors from engaging in
certain actions, he has failed to allege any “supporting facts,”
see Wood, 2023 WL 3867254, at *2 (cleaned up), “such as the
dates, times, or content of the allegedly unlawful”
communications or representations. Chiras v. Associated Credit
Servs, Inc., No 12-10871-TSH, 2012 WL 3025093, at *1 (D. Mass.
July 23, 2012) (dismissing FDCPA claim). Plaintiff’s conclusory
allegations of Freedom’s illegal conduct are insufficient to
state a claim for relief. See Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007) (holding that “a plaintiff's obligation to
provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires
more than labels and conclusions, and a formulaic recitation of
the elements of a cause of action will not do . . . .”) (cleaned
up). Accordingly, Freedom’s motion to dismiss Count VI should
be granted.
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Conclusion
Based on the foregoing, the district court should grant
defendant Freedom Mortgage Corp.’s motion to dismiss (Doc. No.
13).2
Any objections to this Report and Recommendation must be
filed within fourteen days of receipt of this notice. See Fed.
R. Civ. P. 72(b)(2). The fourteen-day period may be extended
upon motion. Only those issues raised in the objection(s) to
this Report and Recommendation are subject to review in the
district court. See Sch. Union No. 37 v. United Nat'l Ins. Co.,
617 F.3d 554, 564 (1st Cir. 2010). Any issues not preserved by
such objection(s) are precluded on appeal. See id. Failure to
file any objections within the specified time waives the right
to appeal the district court's Order. See Santos-Santos v.
Torres-Centeno, 842 F.3d 163, 168 (1st Cir. 2016).
______________________________
Andrea K. Johnstone
United States Magistrate Judge
February 5, 2024
cc: Elvis-Jack: Pacaya, pro se
counsel of record
2 As the court recommends dismissal based on plaintiff’s
failure to state a claim for relief, it does not reach Freedom’s
res judicata defense.
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