Joseph v. Navy Federal Credit Union

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IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
FORT WORTH DIVISION
JAHAUA JOSEPH, 	§
Plaintiff, 	§
§
V. 	§ 	CIVIL ACTION NO. 4:25-CV-827-P
§
NAVY FEDERAL CREDIT UNION 	§
Defendant. 	§
FINDINGS, CONCLUSIONS, AND RECOMMENDATION OF THE UNITED STATES
MAGISTRATE JUDGE
On August 18, 2025, pro se Plaintiff Jahaua Joseph (“Joseph”) filed a Third Amended
Complaint against Navy Federal Credit Union (“Defendant”). In his Third Amended Complaint,
Plaintiff, inter alia, alleges the following:
2. Between December 2024 and July 2025, Plaintiff submitted multiple credit
applications to Defendant, Navy Federal Credit Union, via official digital channels,
each containing a lawful tender of value supported by notarized Power of Attorney,
legal declarations, and instructions to perform on behalf of the Plaintiff’s estate.
3. Each application was accompanied by a declaration asserting secured party
status, the existence of a finance charge instrument under federal credit law, and
lawful authorization to offer estate-backed performance under contract.
4. 	Upon 	receipt, 	Defendant 	conducted 	hard 	credit 	inquiries 	on 	Plaintiff’s
TransUnion file on December 9, 2024 and July 16, 2025, triggering the conversion
of Plaintiff’s tender into financial instruments under the Federal Reserve Act and
Truth in Lending Act. These inquiries constitute legal receipts of transaction,
establishing fiduciary and contractual obligations on the part of Defendant.
. . . .
6. Plaintiff submitted multiple rounds of follow-up notices, including a Claim to
Interest, Tender Letter, Letter to underwriting team, Letter to CFO, Conditional
Trust Waiver, Lawful Adverse Action Letter Rebuttals, Default Judgment, and
other notices of fiduciary breach—documented in Exhibit C—but Defendant failed
to respond lawfully or in good faith.
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7. Despite these receipts, Defendant issued no lawful approval, no rejection with
cause, no offer to return the benefit, and no disclosure of any monetization, escrow,
or securitization related to Plaintiff’s submitted credit instruments.
. . . .
Plaintiff respectfully seeks $3,500,000.00 in total damages for breach of contract,
fiduciary misconduct, emotional and financial harm, statutory violations, and
deliberate mishandling of secured credit instruments. The amount is derived from
the following itemized breakdown. . . .
(Pl.’s Third. Am. Compl. at 3-4, 7.)
In an order dated August 7, 2025, Plaintiff was granted leave to proceed in forma pauperis
(“IFP”) [doc. 7]. 	Section 1915 of Title 28 of the United States Code sets forth provisions for
claimants proceeding IFP. 	Pursuant to 28 U.S.C. § 1915(e)(2)(B), the Court shall, sua sponte,
dismiss a case proceeding IFP if the court determines that it is frivolous or fails to state a claim on
which relief may be granted. 28 U.S.C. § 1915(e)(2)(B). A complaint is frivolous if it “lacks an
arguable basis either in law or in fact.” Neitzke v. Williams, 490 U.S. 319, 325 (1989). A complaint
fails to state a claim upon which relief can be granted when, assuming that all the allegations in
the complaint are true even if doubtful in fact, such allegations fail to raise a right to relief above
the speculative level. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotation
marks and citations omitted).
In this case, based on Plaintiff’s Third Amended Complaints, Joseph appears to believe
that he is entitled to a loan of some sort from Defendant in the amounts that he requests, solely
because he sent in various self-created and signed documents demanding such benefits. 	Nowhere
in Plaintiff’s Complaint does he articulate a coherent legal claim capable of satisfying Rule
12(b)(6). See Fed. R. Civ. P. 12(b)(6). The rambling Third Amended Complaint, as well as his
previously filed complaints, lack an arguable basis in law because the facts alleged are “clearly
baseless, a category encompassing allegations that are fanciful, fantastic, and delusional.” Denton
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v. Hernandez, 504 U.S. 25, 32-33 (1992) (internal quotation marks and citations omitted).
Accordingly, the Court FINDS and CONCLUDES that this case should DISMISSED, sua
sponte, for being frivolous as well as for failing to state a claim on which relief can be granted.
See Miller v. Sam Houston State Univ., 986 F.3d 880, 888-89 (5th Cir. 2021) (stating that a district
court may dismiss a complaint for failure to state a claim sua sponte as long as the procedure is
fair or as long as the plaintiff has alleged his best case).
Because he appears pro se, Joseph’s pleadings are entitled to more lenient scrutiny than
pleadings drafted by lawyers. 	See Estelle v. Gamble, 429 U.S. 97, 106 (1976). 	In this case,
however, Joseph has already been allowed to file a total of three complaints. Thus, it is clear that
Plaintiff has pled his best case, and no amount of liberal construction could manufacture a viable
legal claim. See Miller, 986 F.3d at 888-89.
RECOMMENDATION
For 	the 	foregoing 	reasons, 	the 	undersigned 	RECOMMENDS 	that 	this 	case 	be
DISMISSED WITH PREJUDICE for being frivolous and for failure to state a claim upon which
relief can be granted.
NOTICE OF RIGHT TO OBJECT TO PROPOSED
FINDINGS, CONCLUSIONS AND RECOMMENDATION
AND CONSEQUENCES OF FAILURE TO OBJECT
Under 28 U.S.C. § 636(b)(1), each party to this action has the right to serve and file specific
written objections in the United States District Court to the United States Magistrate Judge’s
proposed findings, conclusions, and recommendation within fourteen (14) days after the party has
been served with a copy of this document. The United States District Judge need only make a de
novo determination of those portions of the United States Magistrate Judge’s proposed findings,
conclusions, and recommendations to which specific objection is timely made. 	See 28 U.S.C.
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§ 636(b)(1). 	Failure to file by the date stated above a specific written objection to a proposed
factual finding or legal conclusion will bar a party, except upon grounds of plain error or manifest
injustice, from attacking on appeal any such proposed factual findings and legal conclusions
accepted by the United States District Judge. See Douglass v. United Services Auto Ass’n, 79 F.3d
1415, 1428-29 (5th Cir. 1996) (en banc), modified by statute on other grounds, 28 U.S.C. §
636(b)(1) (extending the time to file objections to 14 days).
ORDER
Under 28 U.S.C. § 636, it is hereby ORDERED that each party is granted until December
19, 2025, to serve and file written objections to the United States Magistrate Judge’s proposed
findings, conclusions and recommendation. It is further ORDERED that if objections are filed
and the opposing party chooses to file a response, the response shall be filed within seven (7) days
of the filing date of the objections.
It is further ORDERED that the above-styled and numbered action, previously referred to
the United States Magistrate Judge for findings, conclusions and recommendation, be and hereby
is returned to the docket of the United States District Judge.
SIGNED December 5, 2025.
___________________________________
JEFFREY L. CURETON
UNITED STATES MAGISTRATE JUDGE
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