Reedy v. Freedom Mortgage Corporation

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IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
JASON MARC REEDY,
Plaintiff,
v.
FREEDOM MORTGAGE
CORPORATION,
Defendant.
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Case No. 3:25-cv-01810-L-BT
FINDINGS, CONCLUSIONS, AND RECOMMENDATION
OF THE UNITED STATES MAGISTRATE JUDGE
Before the Court is Defendant Freedom Mortgage Corporation’s Motion to
Dismiss Pursuant to Federal Rule of Procedure 12(b)(6) (ECF No. 4). For the
following reasons, the District Judge should GRANT the Motion to Dismiss.
Background
This case concerns Plaintiff Jason Marc Reedy’s home on Wisteria Way in
Red Oak, Texas (the “Property”). See Pl. Original Pet. (ECF No. 1-4). Reedy alleges
that “according to communications between [Reedy] and [Freedom],” Freedom
asserted “that: (1) it is the holder of the Deed of Trust on the Property under a
Mortgage Note with Reedy; (2) the Mortgage Note is in default; (3) Freedom has
accelerated the maturity of the debt on the Mortgage Note; and, (4) as holder of
the Deed of Trust, Freedom was obliged to sell the Property at public sale on July
1, 2025.” See id. ¶ 10. Reedy admits that, “in the years prior to receiving the Notice
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of Acceleration,” he “[fell] behind with his payment,” and that he “applied for but
was denied a modification of the mortgage note.” Id. ¶ 11. Reedy asserts that, on
April 24, 2025, he “renewed his effort to catch up on the mortgage payments” and
Freedom informed him that “he could potentially receive a forbearance,
modification, short sale, or refinance” of the mortgage note. Id ¶ 12. Reedy further
asserts that he “relied on these representations” and “declined selling the
[Property].” Id.
On June 1, 2025, Reedy allegedly learned that the Property was “subject to
a foreclosure sale set for July 1, 2025.” Id. Yet, Reedy asserts, Freedom did not
provide him with notice of the foreclosure sale by “certified mail.” Id. Instead, he
alleges that he heard about the sale from other potential purchasers who left their
information on Reedy’s front door. Id. Reedy further alleges that, in or around
June 2025, he had a potential purchaser for the Property and would lose a
“substantial amount” of equity if Freedom went ahead with the foreclosure sale.
Id. ¶ 13.
On June 19, 2025, Reedy, proceeding pro se, filed this action in state court,
along with an application for a temporary restraining order (TRO) and permanent
injunction, seeking “monetary relief of less than $100,000.00 including damages
of any kind, penalties, costs, expenses, pre-judgment interest and attorneys’ fees.”
See id. ¶ 5, 16. In his Original Petition, Reedy asserts that, by not allowing him “to
pursue a Repayment Program,” Freedom violated “Section 5 of the Real Estate
Settlement Procedures Act (RESPA), 12 U.S.C. § 2604(c).” Id. ¶ 23.
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On June 30, 2025, the state court granted Reedy a TRO and set a Temporary
Injunction hearing for July 14, 2025. See Temporary Rest. Order (ECF No. 1-4).1
On July 10, 2025, however, Freedom removed the case to this Court based on
diversity and federal-question jurisdiction. See Not. Removal 2–4 (ECF No. 1).
On July 17, 2025, Freedom filed this Motion to Dismiss under FRCP
12(b)(6). See Def.’s Mot. Dismiss (ECF No. 4). In its Motion, Freedom asserts: (1)
Reedy fails to allege sufficient facts to support his claim; (2) there is no private
right of action under 12 U.S.C. § 2604(c); (3) Reedy failed to allege any actual
damages resulting from Freedom’s conduct; and (4) Reedy is not entitled to
injunctive relief because his RESPA claim fails as a matter of law and there is no
imminent threat of foreclosure. See Def.’s Br. Mot. Dismiss ¶¶ 4–12 (ECF No. 5).
The undersigned ordered Reedy to file a response to Defendant’s Motion by August
7, 2025. See Order (ECF No. 6) To date, Reedy has not responded.
This is not Reedy’s first suit involving this Property, this Defendant, or these
claims. In 2023, Reedy filed a virtually identical action, attempting to prevent
foreclosure of the Property based on the same purported violation of 12 U.S.C. §
2604(c). See Reedy v. Freedom Mortg. Co., 3:23-cv-02403-X-BN. (hereinafter,
“Reedy I”). Freedom removed that lawsuit, which was also initially filed in state
court, to this Court on October 30, 2023. See id., Not. Removal (ECF No. 1). In
1 The state court judge set the TRO in this case for an expedited hearing, noting that Reedy
had “filed 2 prior lawsuits involving the same subject real property in an effort to prevent
Freedom Mortgage from foreclosing upon the property.” See ECF No.1-4 at 22. One of the
cases cited by the state court judge, Cause No. 112301, was Reedy I, discussed below. Id.
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Reedy I—as here—Freedom moved to dismiss under 12(b)(6) asserting, among
other things, that Reedy failed to state a claim under 12 U.S.C. § 2604(c) and that
Section 2604 did not provide a private right of action. See id., Def.’s Br. Mot.
Dismiss (ECF No. 14). In Reedy I, too, the magistrate judge ordered Reedy respond
to the Motion to Dismiss, but Reedy failed to do so. See id., Order (ECF No. 15). On
April 22, 2024, the magistrate judge issued findings, conclusions, and a
recommendation (FCR) that 12 U.S.C. § 2406 “does not appear to apply to a
repayment program application or a good faith estimate of the settlement of a
Mortgage Note.” See id., FCR (Horan, J.) (ECF No. 16). Thus, the magistrate judge
concluded that Reedy had not pleaded facts sufficient to show that his claim under
§2406(c) was plausible.2 Id. Noting that Reedy’s citation to that section appeared
to be a “mistake,” the magistrate judge recommended dismissal without prejudice
and that Reedy be granted 21 days to file an amended complaint. See id. On May
22, 2024, the district judge accepted the magistrate judge’s recommendation,
dismissed Reedy’s complaint without prejudice, and granted him 21 days to file an
amended complaint curing the deficiencies. See id., Order Accepting FCR (ECF No.
17) (Starr, J.). But Reedy never filed an amended complaint—and on August 14,
2024, the district judge dismissed the case with prejudice. See id., Mem. Op. and
J. (ECF No. 18).
2 The magistrate judge also recommended denying Reedy’s claim for injunctive relief.
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Legal Standards
To survive a Rule 12(b)(6) motion, a plaintiff’s complaint must contain
sufficient factual matter to state a claim for relief that is plausible on its face. Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “To be plausible, the complaint’s
‘[f]actual allegations must be enough to raise a right to relief above the speculative
level.’” In re Great Lakes Dredge & Dock Co. LLC, 624 F.3d 201, 210 (5th Cir.
2010) (quoting Twombly, 550 U.S. at 555).
This pleading standard does not require “detailed factual allegations,” but it
does demand more than an unadorned accusation devoid of factual
support. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S.
at 555). “A claim has facial plausibility when the plaintiff pleads factual content
that allows the court to draw a reasonable inference that the defendant is liable for
the misconduct alleged.” Id. at 678 (citing Twombly, 550 U.S. at 556). “[A]
formulaic recitation of the elements of a cause of action will not do.” Twombly, 550
U.S. at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). “While legal
conclusions can provide the framework of a complaint, they must be supported by
factual allegations.” Iqbal, 556 U.S. at 679. Where the facts do not permit the court
to infer more than the mere possibility of misconduct, the complaint has stopped
short of showing that the plaintiff is plausibly entitled to relief. Id. at
678 (citing Twombly, 550 U.S. at 557).
When applying the plausibility standard, the court “accepts all well-pleaded
facts as true, viewing them in the light most favorable to the plaintiff.” In re
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Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007) (internal
quotation marks and citations omitted). But a court may not look beyond the
pleadings. Spivey v. Robertson, 197 F.3d 772, 774 (5th Cir. 1999). Review is
“limited to the complaint, any documents attached to the complaint, and any
documents attached to the [motion to dismiss] that are central to the claim and
referenced by the complaint.” Smith v. Buffalo Wild Wings, 2021 WL 4265849, at
*2 (N.D. Tex. Sept. 20, 2021) (citing Lone Star Fund V (U.S.), L.P. v. Barclays
Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010)); see also Inclusive Communities
Project, Inc. v. Heartland Cmty. Ass'n, Inc., 399 F. Supp. 3d 657, 665 (N.D. Tex.
2019) (“In ruling on [a Rule 12(b)(6)] motion, the court cannot look beyond the
pleadings.”) (citing Spivey, 197 F.3d 772, 774 (5th Cir. 1999)), aff'd, 824 F. App'x
210 (5th Cir. 2020).
The undersigned liberally construes Reedy’s Original Petition with all
possible deference due a pro se litigant. See Erickson v. Pardus, 551 U.S. 89, 94
(2007) (pro se pleadings are “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.”) (citing Estelle v. Gamble, 429 U.S. 97, 106 (1976)).
But such liberal treatment does not require a court to “create causes of action
where there are none.” Smith v. CVS Caremark Corp., 2013 WL 2291886, at *8
(N.D. Tex. May 23, 2013). And pro se status does not provide an “impenetrable
shield,” “for one acting pro se has no license to harass others, clog the judicial
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machinery with meritless litigation and abuse already overloaded court
dockets.” Farguson v. MBank Houston, N.A., 808 F.2d 358, 359 (5th Cir. 1986).
Generally, a district court may not dismiss a pro se complaint for failure to
state a claim under 12(b)(6) without giving the plaintiff a chance to
amend. Bazrowx v. Scott, 136 F.3d 1053, 1054 (5th Cir. 1998). Even so, dismissal
with prejudice is proper under Rule 12(b)(6) if the plaintiff has been afforded
ample opportunities to plead his best case. Jones v. Greninger, 188 F.3d 322, 327
[(5th Cir. 1999).
Additionally, where—as here—a nonmoving party does not file any response
to a motion to dismiss, the court cannot properly grant “the motion . . . solely
because the [nonmoving party] failed to oppose [it].” See Webb v. Morella, 457 F.
App’x 448, 452 n.4 (5th Cir. 2012) (citing John v. La., 757 F.2d 698, 707-10 (5th
Cir. 1985) (“[A]lthough we have endorsed the adoption of local rules that require
parties to file responses to opposed motions, we have not approved the automatic
grant, upon failure to comply with such rules, of motions that are dispositive of the
litigation.”))
As the United States Court of Appeals for the Fifth Circuit has explained,
Rule 12 does not by its terms require an opposition; failure to oppose
a 12(b)(6) motion is not in itself grounds for granting the motion.
Rather, a court assesses the legal sufficiency of the complaint. See Fed.
R. Civ. P. 12(b)(6).
Servicios Azucareros de Venezuela, C.A. v. John Deere Thibodeaux, Inc., 702 F.3d
794, 806 (5th Cir. 2012). The undersigned therefore turns to the legal sufficiency
of Reedy’s Petition.
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Analysis
A. Reedy fails to state a claim under RESPA.
Reedy alleges that, under the Mortgage Note, he was “permitted to apply for
loss mitigation or [a] modification.” Pl. Original Pet. At ¶ 23 (ECF No. 1-4). And
Reedy further asserts that, although Freedom agreed to review his application for
the Repayment Program, Freedom did not review his application and did not
provide a good faith estimate of the settlement of the Mortgage Note. Id. Thus,
Reedy claims that Freedom’s conduct, and specifically their failure to allow him “to
pursue a Repayment Program,” violated “Section 5 of the Real Estate Settlement
Procedures Act (RESPA), 12 U.S.C. § 2604(c).” Id.
But 12 U.S.C. §2604(c) does not address Repayment Program applications
or a good faith estimate of the settlement of a Mortgage Note. Instead, Section
2604(c) provides:
(c) Estimate of Charges. Each lender shall include with the booklet a
good faith estimate of the amount or range of charges for specific
settlement services the borrower is likely to incur in connection with
the settlement as prescribed by the Bureau. Each lender shall also
include with the booklet a reasonably complete or updated list of
homeownership counselors who are certified pursuant to section
1701x(e) of this title and located in the area of the lender.
12 U.S.C. §2604. As Freedom correctly points out, Section 2604(c) concerns home-
buying information booklets and requires a mortgage lender to provide borrowers
with a booklet containing a “good faith estimate of . . . charges for settlement
services” and a list of “homeownership counselors.” See id. (emphasis added).
Thus, Reedy has not pleaded facts sufficient to show that it is plausible that
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Freedom violated 12 U.S.C. § 2604(c). Although Reedy is pro se, the Court will not
“create causes of action where there are none.” See Smith v. CVS Caremark Corp.,
2013 WL 2291886, at *8 (N.D. Tex. May 23, 2013) (Boyle, J.). Thus, dismissal
under 12(b)(6) is proper. See Iqbal, 556 U.S. at 678–79 (2009).
Additionally, § 2604(c) does not contain a private right of action. See 12
U.S.C. § 2614; Smith v. First Choice Loan Services Inc., 2020 WL 5759967, at *4
(N.D. Tex. Sept. 28, 2020) (Pittman, J.) (recognizing that 12 U.S.C. § 2604 “does
not create a private cause of action for failure to provide an accurate or good faith
estimate”); Cf. Alexander v. Sandoval, 532 U.S. 275, 286 (holding that private
rights of action to enforce federal law must be created by Congress). And where no
private right of action exists, dismissal under Rule 12(b)(6) is proper. See, e.g.,
Harris v. City of Grand Prairie, 2023 WL 3984665, at *8 (N.D. Tex. May 25, 2023)
(Horan, J.), rec. adopted, 2023 WL 3984839 (N.D. Tex. June 13, 2023) (Boyle, J.)
(dismissing Title 18 claim under 12(b)(6) because plaintiff did not have a private
right of action under the statute).
B. Reedy’s claim for injunctive relief fails.
Reedy also seeks injunctive relief under Tex. Civ. Prac. & Rem. Code §
65.011(1). See Pl. Original Pet. ¶¶ 16–21. But injunctive relief is an equitable
remedy based on underlying claims. See, e.g., Cook v. Wells Fargo Bank, N.A.,
2010 WL 2772445, at *4 (N. D. Tex. July 12, 2010) (Fitzwater, J.). Where a court
dismisses all of plaintiff’s substantive claims, as the undersigned recommends that
the District Judge do here, a plaintiff cannot maintain a claim for injunctive relief.
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See Thomas v. EMC Mortg. Corp., 499 F. App’x 337, 343 n.15 (5th Cir. 2012) (“[A]
request for injunctive relief absent an underlying cause of action is fatally
defective.”). Absent any other underlying substantive claim that should survive
dismissal, the District Judge should dismiss Reedy’s request for permanent
injunctive relief. See id.
C. Reedy is not entitled to attorney’s fees.
Reedy also seeks attorney’s fees “pursuant to the Mortgage Note and Section
38.001 of the Texas Civil Practices and Remedies Code.” See Pl. Original Pet. ¶ 26
(ECF No. 1-4). Because Reedy is proceeding pro se, is not an attorney, and has not
stated a viable claim from relief, the District Judge should deny Reedy’s request
for attorneys’ fees. See McLean v. Int'l. Harvester Co., 902 F.2d 372, 373 (5th
Cir.1990) (“Attorney’s fees are not available to a non-attorney pro se litigant.”); see
also Green Int'l, Inc. v. Solis, 951 S.W.2d 384, 390 (Tex. 1997) (to recover
attorney’s under section 38.001 “a party must (1) prevail on a cause of action for
which attorney’s fees are recoverable, and (2) recover damages”).
D. The District Judge should dismiss Reedy’s claims with prejudice.
The undersigned recommends that the District Judge dismiss Reedy’s
claims with prejudice. Generally, pro se plaintiffs should be granted leave to amend
before dismissal with prejudice is proper under 12(b)(6). Bazrowx 136 F.3d at
1054. But, in this case, Reedy has had ample opportunity to plead his best case. See
Greninger, 188 F.3d at 327. Indeed, both the magistrate judge and the district
judge in Reedy I advised Reedy that the allegations in his complaint did not state
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a claim for relief under 12 U.S.C. § 2406(c). Reedy then had several months to
amend before the district judge ultimately dismissed that lawsuit. And, when
Reedy filed this action—rather than correcting the issues identified in Reedy I—he
asserted the same § 2406(c) claim, based on the same conduct, against the same
defendant. See Pl. Original Pet. (ECF No. 1-4).
Additionally, in both Reedy I and in this case, Reedy was ordered to respond
to the Motions to Dismiss. See Order, Jul. 21, 2025 (ECF No. 6); Reedy I, 3:23-cv-
02403-X-BN, Order, Nov. 14, 2023 (ECF No. 15). But Reedy disregarded both
Orders and did not file responses. Thus, it appears that Reedy has no real intention
of engaging in the litigation he initiated and is instead abusing the judicial process
to delay foreclosure. Dismissal with prejudice is appropriate where “there is bad
faith or willful abuse of the judicial process.” Woodson v. Surgitek, Inc., 57 F.3d
1406, 1417 (5th Cir. 1995).
To be sure, the time to file objections to this recommendation (further
explained below) allows Reedy an opportunity to explain how he would cure the
deficiencies identified above and thus show that this case should not be dismissed
with prejudice and that the District Judge should instead grant leave to amend the
complaint. See Scott v. U.S. Bank Nat'l Ass'n, 16 F.4th 1204, 1209 (5th Cir.
2021) (per curiam) (“A court should freely give leave to amend when justice so
requires, Fed. R. Civ. P. 15(a)(2), but a movant must give the court at least some
notice of what his or her amendments would be and how those amendments would
cure the initial complaint's defects. If the plaintiff does not provide a copy of the
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amended complaint nor explain how the defects could be cured, a district court
may deny leave.” (citations omitted)). But, if Reedy fails to show that he should be
granted leave to amend, the District Judge should dismiss this case with prejudice.
Recommendation
For these reasons, the District Judge should GRANT Defendant Freedom
Mortgage Corporation’s Motion to Dismiss Pursuant to Federal Rule of Procedure
12(b)(6) (ECF No.4) and dismiss Reedy’s claims with prejudice.
SO RECOMMENDED.
December 10, 2025.
__________________________
REBECCA RUTHERFORD
UNITED STATES MAGISTRATE JUDGE
INSTRUCTIONS FOR SERVICE AND
NOTICE OF RIGHT TO APPEAL/OBJECT
A copy of this report and recommendation shall be served on all parties in
the manner provided by law. Any party who objects to any part of this report and
recommendation must file specific written objections within 14 days after being
served with a copy. See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b). To be specific, an
objection must identify the specific finding or recommendation to which objection
is made, state the basis for the objection, and specify the place in the magistrate
judge’s report and recommendation where the disputed determination is found.
An objection that merely incorporates by reference or refers to the briefing before
the magistrate judge is not specific. Failure to file specific written objections will bar
the aggrieved party from appealing the factual findings and legal conclusions of the
magistrate judge that are accepted or adopted by the district court, except upon
grounds of plain error. See Douglass v. United Servs. Auto. Ass’n, 79 F.3d 1415,
1417 (5th Cir. 1996).
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