United States District Court, M.D. Georgia, Macon Division
T. TREADWELL, JUDGE UNITED STATES DISTRICT COURT.
Nationstar Mortgage, LLC. and U.S. Bank, N.A. have moved to
dismiss Plaintiff Kalpesh Shah's complaint for failure to
state a claim pursuant to Fed.R.Civ.P. 12(b)(6). Doc. 7. The
motion is GRANTED.
Shah's second lawsuit concerning the non-judicial
foreclosure sale of a residential property located at 113
Hunters Trace, Macon, Georgia 31210 resulting from Shah's
failure to make required mortgage payments. Doc. 7-1 at 2;
Kalpesh Shah v. Bank of America, N.A., Superior
Court of Bibb County, Georgia, No. 2011CV56185. Shah executed
a note in the principal amount of $256, 500.00 and a security
deed in favor of lender Bank of America, N.A. (BANA) on May
21, 2004. Docs. 1-1 ¶ 24; 7-2.BANA then transferred its
rights, title, and interests in the security deed to U.S.
Bank, an assignment that was recorded on April 18, 2011.
Docs. 1-1 ¶ 25; 7-3. At that time, Nationstar became the
servicer of Shah's loan on behalf of U.S. Bank. Doc. 7-1
at 4. Shah then defaulted on his mortgage payments, and a
non-judicial foreclosure sale was conducted on May 2, 2017.
Id. U.S. Bank then purchased the property as the
highest bidder. Doc. 7-4. Shah filed this lawsuit on June 30,
2017 in the Superior Court of Bibb County, Georgia, and the
Defendants removed the case to this Court the next day. Docs.
1, 1-1. Shah asserts ten claims under federal and Georgia
state law: (1) wrongful foreclosure; (2) fraud in the
concealment; (3) fraud in the inducement; (4) intentional
infliction of emotional distress; (5) slander of title; (6)
quiet title; (7) declaratory relief; (8) a violation of the
Truth in Lending Act (TILA), 15 U.S.C. § 1601, et
seq., and the Home Ownership and Equity Act (HOEPA),
which amended TILA;(9) a violation of the Real Estate
Settlement Procedures Act (RESPA), 12 U.S.C. § 2601,
et seq.; (10) and seeks rescission of the mortgage
Defendants now move to dismiss Shah's complaint for
failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6).
Doc. 7. Shah, who is proceeding pro se, failed to respond to
the Defendants' motion despite being ordered by the Court
to do so.
MOTION TO DISMISS STANDARD
Federal Rules of Civil Procedure require a pleading contain a
“short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed.R.Civ.P.
8(a)(2). To avoid dismissal pursuant to Fed.R.Civ.P.
12(b)(6), a complaint must contain sufficient factual matter
to “‘state a claim to relief that is plausible on
its face.'” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007)). “At 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.” Garfield v. NDC
Health Corp., 466 F.3d 1255, 1261 (11th Cir. 2006)
(quotation marks and citation omitted). However, “where
the well-pleaded facts do not permit the court to infer more
than the mere possibility of misconduct, the complaint has
alleged-but it has not ‘show[n]'-‘that the
pleader is entitled to relief.'“ Iqbal,
556 U.S. at 679 (quoting Fed.R.Civ.P. 8(a)(2)).
“[C]onclusory allegations, unwarranted deductions of
facts or legal conclusions masquerading as facts will not
prevent dismissal.” Oxford Asset Mgmt., Ltd. v.
Jaharis, 297 F.3d 1182, 1188 (11th Cir. 2002). The
complaint must “give the defendant fair notice of what
the . . . claim is and the grounds upon which it
rests.” Twombly, 550 U.S. at 555 (quotation
marks and citation omitted). Where there are dispositive
issues of law, a court may dismiss a claim regardless of the
alleged facts. Marshall Cnty. Bd. of Educ. v. Marshall
Cnty. Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993).
However, when a plaintiff is proceeding pro se, his pleadings
may be held to a less stringent standard than pleadings
drafted by attorneys and will be liberally construed,
although the pleading must still state a claim for relief.
Tannenbaum v. United States, 148 F.3d 1262, 1263
(11th Cir. 1998).
first argues that the foreclosure was wrongful because the
Defendants lacked standing to foreclose on the property. Doc.
1-1 ¶ 51-62. To the extent Shah claims that only BANA
had the right to foreclose based on the initial loan, that
argument fails because BANA lawfully transferred its rights
under the note to U.S. Bank. Doc. 7-2. And a mortgagee's
assignee has the right to foreclose as a matter of law.
O.C.G.A. § 23-2-114 (“Unless the instrument
creating the power specifically provides to the contrary, a
personal representative, heir, heirs, legatee, devisee, or
successor of the grantee in a mortgage, deed of trust, deed
to secure debt, bill of sale to secure debt, or other like
instrument, or an assignee thereof, or his personal
representative, heir, heirs, legatee, devisee, or successor
may exercise any power therein contained.”). Next, Shah
appears to argue that the process of securitization itself is
per se improper and thus the Defendants lacked standing to
foreclose. See Doc. 1-1 ¶ 50-62. This argument
lacks merit, and Shah only provides conclusory allegations
with no legal support. Indeed, that the loan was sold and
securitized did not affect the Defendants' standing to
foreclose on the property if, in fact, that right to
foreclose was transferred, which it was. See Tonea v.
Bank of America, N.A., 6 F.Supp.3d 1331, 1336 (N.D.Ga.
2014). Finally, Shah appears to argue the Defendants lacked
standing because they violated the “pooling and
servicing agreement” (PSA), which governs the rights
and obligations of U.S. Bank and BANA regarding the
securitization of the loan, but Shah himself lacks standing
to allege breach of the PSA because he is not a party to that
agreement. Docs. 1-1 ¶53; 7-1 at 12.
to the extent Shah argues that the securitization of the loan
altered his obligations to pay under the note, affecting the
Defendants' standing to foreclose, that argument fails as
well. Despite the securitization of his loan, Shah was still
obligated to make the payments owed under the note. See
Tonea v. Bank of America, N.A., 6 F.Supp.3d 1331, 1336
(N.D.Ga. 2014). And because Shah was still obligated to pay
under the note, he has failed to state a claim.
state a claim of wrongful foreclosure under Georgia law, a
plaintiff must “establish a legal duty owed to it by
the foreclosing party, a breach of that duty, a causal
connection between the breach of that duty and the injury it
sustained, and damages.” Heritage Creed Dev. Corp.
v. Colonial Bank, 268 Ga.App. 369, 371, 601 S.E.2d 842,
844 (2007); see also All Fleet Refinishing, Inc. v. West
Georgia Nat. Bank, 280 Ga.App. 676, 681, 634 S.E.2d 802,
807 (2006); Racette v. Bank of America, N.A., 318
Ga.App. 171, 174, 733 S.E.2d 457, 462 (2012). But if a party
has not tendered or attempted to tender the payments owed
under the note then any damage they suffered as a result of
the foreclosure are because of their own actions, and not
those of the Defendants, thus defeating any claim for
wrongful foreclosure. See Heritage, 268 Ga.App. at
371-72, 601 S.E.2d at 845. Here, Shah does not allege that he
has either tendered the payments owed or attempted to do so.
Accordingly, Shah has failed to allege that any damages he
suffered are a result of the Defendants' actions. In
addition, Shah has not alleged any legal duty owed to him by
the Defendants. As such, he has failed to state a claim for
Shah alleges the Defendants committed fraud in the inducement
and fraud in the concealment. Doc. 1-1 ¶ 63-79. To state
a claim for fraud, both in the inducement and concealment, a
plaintiff must allege: “(1) a false representation or
omission of a material fact; (2) scienter; (3) intention to
induce the party claiming fraud to act or refrain from
acting; (4) justifiable reliance; and (5) damages.”
Lehman v. Keller, 297 Ga.App. 371, 372-72, 677
S.E.2d 415, 417 (2009); see also JarAllah v. Schoen,
243 Ga.App. 402, 403-04, 531 S.E.2d 778, 780 (2000). To
allege a claim for fraud in the inducement, a plaintiff must
also allege “that the defendant failed to perform a
promised act and that the defendant had no intention of
performing when the promise was made.” Nash v.
Roberts Ridge Funding, LLC, 305 Ga.App. 113, 116, 6999
S.E.2d 100, 102 (2010). Further, under Rule 9(b), fraud must
be pled with particularity, which requires a plaintiff set
(1) precisely what statements were made in what documents or
oral representations or what omissions were made; and (2) the
time and place of each such statement and the person
responsible for making (or, in the case of omissions, not
making) same; and (3) the content of such statements and the
manner in which they misled ...