United States District Court, N.D. Georgia, Atlanta Division
HERETTA L. WEST, Plaintiff,
WELLS FARGO BANK, N.A., Defendant.
UNITED STATES MAGISTRATE JUDGE'S FINAL REPORT AND
J. BAVERMA UNITED STATES MAGISTRATE JUDGE
matter is before the Court on Defendant Wells Fargo Bank,
N.A.'s (“Defendant”) motion to dismiss
Plaintiff's complaint. [Doc. 3]. For the reasons set
forth below, the undersigned RECOMMENDS that the motion be
GRANTED and that the action be DISMISSED WITH PREJUDICE.
April 20, 2007, Plaintiff Heretta West
(“Plaintiff”) obtained a loan from MortgageIT,
Inc. (“MortgageIT”) in the amount of $743,
200.00. [Doc. 3-2].
secure repayment of the promissory note, Plaintiff executed a
security deed which conveyed legal title and power of sale of
the real property located at 2398 Monte Villa Court,
Marietta, Georgia 30062 (the “Property”) to
Mortgage Electronic Registration Systems, Inc.
(“MERS”) as nominee for MortgageIT.
[Id.].On January 20, 2012, MERS transferred and
assigned its rights, title, and interest in the security deed
to HSBC Bank USA, National Association as Trustee For
MortgageIT Securities Corp. Mortgage Loan Trust Series
2007-1, Mortgage Pass-Through Certificates
(“HSBC”). Wells Fargo is the servicer of the loan on
behalf of HSBC. [Doc. 1 at 9, ¶ 31 & Doc. 3-1 at 2].
November 27, 2013, Plaintiff, proceeding pro se,
filed a complaint in the Superior Court of Cobb County.
See West v. Wells Fargo Bank, N.A., Case No.
13-1-10266-34.3 (hereinafter “West I”).
[Doc. 3-4]. On April 9, 2014, Plaintiff voluntarily dismissed
that complaint. [Doc. 3-5]. On October 1, 2014, again
proceeding pro se, Plaintiff filed a another
complaint in the Superior Court of Cobb County that was
nearly identical to the complaint filed in West I.
See West v. Wells Fargo Bank, N.A., Case No.
14-1-7667-53 (hereinafter (“West II”).
[Doc 3-6]. Plaintiff voluntarily dismissed West II
on December 2, 2014. [Doc. 3-7].
January 9, 2015, Plaintiff, proceeding pro se, filed
a third complaint in the Superior Court of Cobb County.
See West v. Wells Fargo Bank, N.A., Case No.
15-1-175-52 (“West III”). [Doc. 3-8]. In
West III, Plaintiff asserted claims against
Defendant for conversion, attempted wrongful foreclosure,
breach of good faith and fair dealing, unfair and deceptive
business practices, fraud, violations under the Real Estate
Settlement Procedures Act (“RESPA”), unjust
enrichment, “adequate assurances of performance,
” unconscionability, and sought a declaratory judgment
and reasonable attorney's fees. [Doc. 3-8]. On December
21, 2015, the Cobb County Superior Court dismissed
Plaintiff's claims with prejudice. [Doc. 3-9].
proceeding pro se, filed a complaint in this Court
on February 9, 2016. [Doc. 1]. Plaintiff's complaint
asserts claims against Defendant for violation of the Fair
Debt Collections Practices Act (“FDCPA”) (Count
I), violation of the Fair Credit Reporting Act
(“FCRA”) (Count II), negligence (Count III),
intentional infliction of emotion distress
(“IIED”) (Count IV), declaratory judgment/quiet
title (Count V), injunctive relief, (Count VI), wrongful
foreclosure (Count VII), and violation of the Georgia Fair
Business Practices Act (“GFBPA”) (Count VIII).
[Doc. 1]. She seeks equitable and injunctive relief,
compensatory and punitive damages, and attorney's fees.
[Doc. 1 at 36-37].
moved to dismiss Plaintiff's complaint on two primary
grounds: (1) Plaintiff's claims are barred by the
doctrines of res judicata, collateral estoppel, and
the “two dismissal” rule; and (2) Plaintiff's
complaint fails to state a claim upon which relief can be
granted. [Doc. 3-1]. Plaintiff responded. [Doc. 4]. Defendant
did not file a reply. (See Dkt.). With briefing
concluded, the motion to dismiss is ripe for recommended
the motion to dismiss stage, all well-pleaded facts are
accepted as true, and the reasonable inferences therefrom are
construed in the light most favorable to the
plaintiff.” Bryant v. Avado Brands, Inc., 187
F.3d 1271, 1273 n.1 (11th Cir. 1999); see also
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)
(noting that all allegations in the complaint are to be taken
to be true even if doubtful in fact). However, “courts
may infer from the factual allegations in the complaint
‘obvious alternative explanation[s], ' which
suggest lawful conduct rather than the unlawful conduct the
plaintiff would ask the court to infer.” Am. Dental
Ass'n v. Cigna Corp., 605 F.3d 1283, 1290
(11th Cir. 2010) (quoting Ashcroft v.
Iqbal, 556 U.S. 662, 682 (2009)). Additionally, the
Court is not required to accept Plaintiff's legal
conclusions. See Sinaltrainal v. Coca-Cola Co., 578
F.3d 1252, 1260 (11th Cir. 2009), abrogated
on other grounds by Mohamad v. Palestinian
Auth., 132 S.Ct. 1702 (2012) (citing Iqbal, 556
U.S. at 678). Nor will the Court “accept as true a
legal conclusion couched as a factual allegation.”
See Twombly, 550 U.S. at 555.
avoid dismissal under Rule 12(b)(6) of the Federal Rules of
Civil Procedure, “a complaint must contain sufficient
factual matter, accepted as true, to ‘state a claim to
relief that is plausible on its face.' ”
Iqbal, 556 U.S. at 678 (quoting Twombly,
550 U.S. at 570). Under Rule 8 of the Federal Rules of Civil
Procedure, a pleading states a claim when it contains,
inter alia, “a short and plain statement of
the claim showing that the pleader is entitled to
relief.” Fed R. Civ. P. 8(a)(2). Although the factual
allegations of a complaint must generally be taken as true
when ruling on a motion to dismiss, a court should not accept
“conclusory allegations, unwarranted deductions of
facts or legal conclusions masquerading as facts.”
Oxford Asset Mgmt., Ltd. v. Jaharis, 297 F.3d 1182,
1188 (11th Cir. 2002). While a complaint need not
contain detailed factual allegations, mere “labels and
conclusions” or “a formulaic recitation of the
elements of a cause of action will not do.”
Twombly, 550 U.S. at 555; accord Iqbal, 556
U.S. at 678-79 (“Threadbare recitals of the elements of
a cause of action, supported by mere conclusory statements,
do not suffice” and are “not entitled to the
assumption of truth.”). Rather, plaintiffs are required
to make factual allegations that are “enough to raise a
right to relief above the speculative level.”
Twombly, 550 U.S. at 555. Complaints must
“contain either direct or inferential allegations
respecting all the material elements necessary to sustain a
recovery under some viable legal theory.” Fin. Sec.
Assurance, Inc. v. Stephens, Inc., 500 F.3d 1276,
1282-83 (11th Cir. 2007) (per curiam) (internal
quotation marks omitted). The Court also may dismiss a claim
pursuant to Rule 12(b)(6) when, on the basis of a dispositive
issue of law, no construction of the factual allegations will
support the cause of action. Marshall Cnty. Bd. of Educ.
v. Marshall Cnty. Gas Dist., 992 F.2d 1171, 1174
(11th Cir. 1993).
“document filed pro se is ‘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.' ” Erikson v. Pardus, 551 U.S.
89, 94 (2007) (quoting Estelle v. Gamble, 429 U.S.
97, 106 (1976)); see also Mederos v. United States,
218 F.3d 1252, 1254 (11th Cir. 2000) (discussing
that pro se filings are entitled to liberal
construction). “Courts do and should show a leniency to
pro se litigants not enjoyed by those with the
benefit of a legal education. . . . Yet even in the case of
pro se litigants this leniency does not give a court
license to serve as de facto counsel for a party, .
. . or to rewrite an otherwise deficient pleading in order to
sustain an action.” GJR Invs., Inc. v. Cnty. of
Escambia, Fla., 132 F.3d 1359, 1369 (11th
Cir. 1998) (citations omitted), overruled on other
grounds as recognized in Randall v. Scott, 610 F.3d 701,
709 (11th Cir. 2010).
Res Judicata and Collateral
extent that Plaintiff's claims are predicated upon her
contention that Defendant has no right to initiate
foreclosure proceedings or foreclose on the Property, or can
be construed to be part of the same foreclosure proceeding
that was scheduled for February 2015 (even though a new
foreclosure date has subsequently been scheduled for March 1,
2016, [Doc. 1 at 2]), Plaintiff's claims are barred by
res judicata .
the principle of res judicata, or claim preclusion,
a final judgment on the merits in a civil action operates to
preclude a party, or those in privity with that party, from
re-litigating in a subsequent proceeding issues that were or
could have been raised in the original action. Federated
Dep't Stores, Inc., v. Moitie, 452 U.S. 394, 398
(1981); Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235,
1238 (11th Cir. 1999) (holding that res
judicata “bars the filing of claims which were
raised or could have been raised in an earlier
proceeding”) (citation omitted). The doctrine is
“a rule of fundamental and substantial justice, of
public policy and of private peace, ” operating to
protect defendants against duplicative litigation over the
same claims, and accordingly, may not be overridden based on
equitable considerations. Federated Dep't Stores,
Inc., 452 U.S. at 401 (quotation omitted). “The
doctrine of res judicata is one of finality, providing that a
final judgment rendered by a court of competent jurisdiction
on the merits is conclusive as to the rights and
responsibilities of the parties and their privies. As to the
parties in the prior proceeding and their privies, res
judicata constitutes an absolute bar to a subsequent judicial
proceeding involving the same cause of action.”
Baptiste v. IRS, 29 F.3d 1533, 1539 (11th
considering whether to give preclusive effect to state-court
judgments under res judicata or collateral estoppel,
the federal court must apply the rendering state's law of
preclusion. Cmty. State Bank v. Strong, 651 F.3d
1241, 1263 (11th Cir. 2011) (citing Kizzire v.
Baptist Health Sys., Inc., 441 F.3d 1306, 1308
(11th Cir. 2006) (res judicata);
Agripost, Inc. v. Miami-Dade Cnty., ex rel. Manager,
195 F.3d 1225, 1229 n.7 (11th Cir. 1999)
(collateral estoppel); and 28 U.S.C. § 1738); see
also N.A.A.C.P. v. Hunt, 891 F.2d 1555, 1560
(11th Cir. 1990). “Under Georgia law, the
fundamental elements of res judicata, codified at
O.C.G.A. § 9-12-40, are: (1) the parties are identical;
(2) the causes of action are identical; and (3) the prior
adjudication was made on the merits by a court of competent
jurisdiction. QOS Networks Ltd. v. Warburg, Pincus &
Co., 294 Ga.App. 528, 531, 669 S.E.2d 536, 540 (2008)
(citing O.C.G.A. § 9-12-40); Starship Ent. of
Atlanta, Inc. v. Coweta Cnty, Ga., 708 F.3d 1243, 1253
(11th Cir. 2013) (applying § 9-12-40). The
party asserting res judicata bears the burden of
showing that the later-filed suit is barred.
Batchelor-Robjohns v. United States, 788 F.3d 1280,
1285 (11th Cir. 2015) (citing In re Piper
Aircraft, 244 F.3d 1289, 1296 (11th Cir.
these factors, first, West III resulted in the entry
of a final judgment on the merits by a court of competent
jurisdiction. After Defendant filed a motion to dismiss based
on Plaintiff's failure to state a claim, in December 2015
the Cobb County Superior Court dismissed Plaintiff's
claim with prejudice. [Doc. 3-9]. A dismissal for failure to
state a claim is a judgment on the merits. SFM Holdings,
Ltd. v. Banc of America Securities, LLC, 764 F.3d 1327,
1344 (11th Cir. 2014) (citations omitted);
Lobo v. Celebrity Cruises, Inc., 704 F.3d 882, 893
(11th Cir. 2013) (holding that a Rule 12(b)(6)
dismissal with prejudice is an adjudication on the merits);
Hunt, 891 F.2d at 1560 (same); see also Harris
v. Deutsche Bank Nat'l Trust Co., 338 Ga.App. 838,
840 n.6, 792 S.E.2d 111, 114 n.6 (2016) (A “dismissal
for failure to state a claim is a dismissal on the merits and
is with prejudice.”) (punctuation and footnote omitted
in original; citations omitted).
the parties are identical in both cases. E.E.O.C. v.
Pemco Aeroplex, Inc., 383 F.3d 1280, 1285
(11th Cir. 2008) (“[B]efore the doctrines of
either res judicata or collateral estoppel may be asserted
against a party, it must be established that the party in the
second action was either a party in the previous action or a
privy of the party in that action.”). Plaintiff filed
both her present complaint and West III against
Defendant. [Docs. 1, 3-8].
final issue is whether such an identity of subject matter
exists between the two cases so that the dismissal with
prejudice in West III constituted an adjudication on
the merits of Plaintiff's present claims against
Defendant. A cause of action in Geogia is defined as
“being the entire set of facts which give rise to an
enforceable claim.” Haley v. Regions Bank, 277
Ga. 85, 91, 586 S.E.2d 633, 638 (2003)(emphasis, citation,
and internal marks omitted). As a consequence, “when a
subsequent action arises from the same wrong as a prior
action and is based on essentially the same facts, the
subsequent actions should be barred by res judicata.”
Franklin v. Gwinnett Cnty. Pub. Sch., 200 Ga.App.
20, 24, 407 S.E.2d 78, 83 (1991) (citing Spence v.
Erwin, 200 Ga. 672, 673, 38 S.E.2d 394, 396-97 (1946)).
The doctrine of res judicata . . . prevents re-litigation of
matters that were or could have been litigated in a
previously-adjudicated action. The doctrine applies even if
some new factual allegations have been made[ or] some new
relief has been requested. . . . It is only where the merits
were not and could not have been determined under a proper
presentation and management of the case that res judicata is
not a viable defense. If, [however], the merits were or could
or have been determined, then the defense is valid.
Neely v. City of Riverdale, 298 Ga.App. 884, 887,
681 S.E.2d 677, 679 (2009) (first alteration in original)
(citations and internal marks omitted).
careful comparison between the complaint in West III
and the complaint in this case, it is clear that Plaintiff
could have raised most of the claims in the instant case in
the prior action. Both lawsuits are premised on
Plaintiff's allegations that Defendant does not have the
authority to foreclose on the Property because Defendant was
not the secured creditor, and that Defendant acted improperly
as the loan servicer on behalf of HSBC by, for example,
charging “false servicer fees” and
misrepresenting the balance on the loan and the identify of
the secured creditor. [Docs. 1, 3-8].
present action, in Count I, Plaintiff alleges that Defendant
violated the FDCPA “starting on or about February 2013,
” which was twenty three months before Plaintiff filed
West III on January 9, 2015. [Doc. 1 at 18, ¶
65]. Defendant's conduct/status as a loan servicer is at
issue in both complaints and by Plaintiff's own
admission, the conduct of which Plaintiff complains occurred
as early as February 2013. Although a plaintiff can have
“different theories of recovery arising from the same
wrong, [she] should properly [have] assert[ed] those
different theories of recovery in separate counts in one
suit.” Franklin, 200 Ga.App. at 25, 407 S.E.2d
at 83. Accordingly, because Plaintiff should have raised her
FDCPA claim in West III,  the FDCPA claim now before
this Court is barred by res judicata.
Counts IV - VIII of the federal complaint, Plaintiff asserts
state law claims for negligence, IIED, quiet title and
declaratory judgment, injunctive relief, wrongful
foreclosure, and violations of the GFBPA. While many of these
claims do not set forth a factual basis to support
themselves, they do appear to refer to allegations in the
complaint which are substantially similar to the allegations
Plaintiff made in West III, that is, that Defendant
does not have authority to foreclose on the Property and that
Defendant acted improperly as the loan servicer acting on
behalf of HSBC. Accordingly, because Plaintiff's claims
in the instant action arise out of the same set of operative
facts that were brought against Defendant in West
III, Plaintiff's claims in this case for negligence,
IIED, quiet title and declaratory judgment, injunctive
relief, wrongful foreclosure and violation of the GFBPA are
barred by res judicata.
analysis for Counts II and III warrants a different result
because it is unclear when the conduct Plaintiff complains
about occurred. In Count III, Plaintiff asserts a FCRA claim
based on allegations that Defendant improperly obtained
Plaintiff's credit report and misreported Plaintiff's
credit information. [Doc. 1 at 26-27, ¶¶ 95-98].
However, Plaintiff does not allege when the disputed conduct
occurred. If the conduct alleged in the complaint occurred
before January 9, 2015, the date Plaintiff filed West
III, the res judicata bar applies as Plaintiff
initially raised Defendant's loan servicing activities in
that complaint. However, to the extent that Plaintiff is
asserting an FCRA claim for conduct that occurred after
West III was filed, the res judicata
doctrine would not apply since the conduct Plaintiff
complains about would not yet have occurred so as to be ripe
at that time. Similarly, Count III of Plaintiff's
complaint alleges negligence based wholly on the same conduct
alleged in Plaintiff's FCRA claim. [Doc. 1 at 29, ¶
106]. Therefore, the same analysis applies to Count III.
Because it is not clear from Plaintiff's complaint when
the alleged conduct occurred in relation to the filing of
West III, Defendant has not met its burden ...