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Beasley v. Wells Fargo Bank, N.A.

United States District Court, M.D. Tennessee, Nashville Division

January 31, 2017

TERRY JOE BEASLEY, Plaintiff,
v.
WELLS FARGO BANK, N.A., as Trustee for the Certificate Holders of PARK PLACE SECURITIES, INC., asset-backed pass-through Certificates, SERIES 2004-MCW1, Defendant.

          MEMORANDUM

          ALETA A. TRAUGER United States District Judge

         Judge Aleta A. Trauger

         The defendant, Wells Fargo Bank, N.A (“Wells Fargo”), as trustee for the certificate holders of Park Place Securities, Inc., asset-backed pass-through certificates, Series 2004-MCW1, has filed a Motion for Judgment on the Pleadings (Docket No. 16), to which the plaintiff, Terry Joe Beasley, has filed a Response in Opposition (Docket No. 18). For the following reasons, the motion will be granted.

         BACKGROUND[1]

         In 2004, the plaintiff, Terry Joe Beasley, borrowed $189, 000 from Ameriquest Mortgage Company (“Ameriquest”) to purchase a property located at 2009 College View Drive, Murfreesboro, Tennessee 37130 (the “Property”). (Docket No. 11-1 (Deed of Trust); Docket No. 17-1 (Note).) At some point in the last eight years, Ameriquest transferred and assigned the Deed of Trust and Note to Wells Fargo, which acts as trustee for Park Place Securities, Inc. (“Park Place”), a “securitized trust created for the purpose of pooling various residential home mortgages.” (Docket No. 1-1 ¶ 34.)[2] Also at some point in the last eight years - the Complaint does not clarify when[3] - Mr. Beasley defaulted on his mortgage. In April of 2016, Wells Fargo initiated foreclosure proceedings on the Property, but it appears that the foreclosure sale has been postponed while Mr. Beasley pursues this suit seeking to enjoin Wells Fargo from further action in connection with the foreclosure.

         In the Complaint, Mr. Beasley alleges multiple instances of wrongdoing in connection with his mortgage and the scheduled foreclosure on the Property that he claims warrant judicial intervention. For example, Mr. Beasley alleges that, at all times, the identity of the “true creditor” of his mortgage has been “shielded and made very confusing” for him and that the “actual creditor” of his loan is unknown. (Id. ¶¶ 39, 42, 45.) The Complaint further alleges that, “[o]ver the years, various entities have claimed to be the ‘creditor' or ‘lender' on Mr. Beasley's loan; including, but not limited to, Bank of America, [Ameriquest], and Countrywide.” (Id. ¶ 39.) The Complaint does not, however, identify any conduct on the part of Wells Fargo that Mr. Beasley claims contributed to his ignorance of the identity of his creditor.

         Mr. Beasley further alleges that “these actions in obscuring the real creditor have harmed [him] because, upon information and belief, he qualifies for loss mitigation options which would allow him to stay in his home and satisfy his debts.” (Id. ¶ 42.) Despite being qualified for this loss mitigation, Mr. Beasley further alleges that he was never “offered . . . any loss mitigation alternatives such as a loan modification or ‘short sale'” of the Property. (Id. ¶ 41.) The record does not, however, support Mr. Beasley's allegations regarding loss mitigation. On April 11, 2016, Rubin Lublin TN, PLLC sent a “Notice of Acceleration and Foreclosure” to Mr. Beasley on behalf of Wells Fargo. (Docket No. 11-4 (Notice).) This Notice advised Mr. Beasley that Wells Fargo was instituting non-judicial foreclosure proceedings against the Property and that, unless Mr. Beasley paid the entire amount of the debt in full, a foreclosure sale would take place on May 19, 2016. (Id. at p. 1.) The Notice directed Mr. Beasley to a website containing “information relative to loss mitigation options and saving [his] home from foreclosure.” (Id. at p. 2.) Mr. Beasley has not denied that he received this letter, nor has he alleged that he visited the loss mitigation website or submitted an application for loss mitigation to Wells Fargo at any point.

         PROCEDURAL HISTORY

         On June 13, 2016, Mr. Beasley filed an action against Wells Fargo in the Chancery Court of Rutherford County, Tennessee, seeking an injunction prohibiting Wells Fargo from taking further action on the scheduled foreclosure. (Docket No. 1-1.) In the Complaint, Mr. Beasley alleges that Wells Fargo (1) wrongfully foreclosed on the Property when it “fail[ed] to comply with the terms of the securitized trust” in violation of Tenn. Code Ann. § 35-5-101 et seq. and Article 1, Section 8 of the Tennessee Constitution; (2) violated the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq., by using false, deceptive, and misleading statements in attempting to foreclose on the Property; and (3) violated regulations promulgated pursuant to the Consumer Financial Protection Act (“CFPA”), 12 U.S.C. § 5511 et seq., by failing to offer him loss mitigation alternatives to foreclosure. (Id. ¶¶ 44-57.) Shortly after the Complaint was filed, Wells Fargo removed the action to this court on the grounds that the court possesses federal question jurisdiction over the claims. (Docket No. 1.) On July 21, 2016, Wells Fargo filed its Answer, attaching multiple documents referenced in the pleadings and denying any wrongdoing in connection with the scheduled foreclosure on the Property. (Docket No. 11.)

         On September 16, 2016, Wells Fargo filed the pending Motion for Judgment on the Pleadings (Docket No. 16), accompanied by a Memorandum of Law arguing that the Complaint fails to state a claim upon which relief can be granted. (Docket No. 17.) Wells Fargo argues that Mr. Beasley's wrongful foreclosure claim is deficient as a matter of law and fact because (1) it is not ripe until Wells Fargo completes foreclosure proceedings against the Property, (2) Mr. Beasley has no standing to challenge any breach of the terms of the securitized trust, and (3) Mr. Beasley has failed to allege facts demonstrating that Wells Fargo has violated any law in the course of the foreclosure. (Id. at pp. 4-8.) Wells Fargo also argues that the Complaint fails to state a claim under the FDCPA because it fails to allege facts supporting the inference that Wells Fargo is a “debt collector” within the meaning of that statute or used false, deceptive, or misleading statements in attempting to foreclose on the Property. (Id. at pp. 8-9.) Finally, Wells Fargo argues that the Complaint fails to allege facts supporting a claim under the CFPA, because the cited regulation does not “impose[] a duty on a servicer to provide any borrower with any specific loss mitigation option.” (Id. at pp. 9-10 (quoting 12 C.F.R. § 1024.41).)

         On October 10, 2016, Mr. Beasley filed a Response in Opposition to the Motion. (Docket No. 18.) In it, Mr. Beasley argues that his claims are ripe because Wells Fargo has merely postponed the scheduled foreclosure sale of the Property and will in all likelihood proceed with the sale, should the court decline to hear his claims. (Id. at pp. 3-4.) Mr. Beasley also argues that his wrongful foreclosure claim is supported by Wells Fargo's failure to follow certain “statutory requirements” in pursuing foreclosure, but he does not mention the violations of Tenn. Code Ann. § 35-5-101 et seq. or the Tennessee Constitution that are alleged as the basis for the claim in the Complaint. (See Id. at pp. 3-6.) Rather, Mr. Beasley argues that the wrongful foreclosure is based on Wells Fargo's failure to follow the “specific and detailed actions” required of a servicer pursuant to 12 C.F.R. § 1024.41. (Id. at p. 5.) According to Mr. Beasley, Wells Fargo was required to “evaluate [him] for loss mitigation options” but failed to notify him of those options, in violation of this regulation (which also serves as the basis for his claim under the CFPA). (Id. at pp. 5, 8.) Finally, Mr. Beasley argues that Wells Fargo acquired his debt from Ameriquest after he had already defaulted on his mortgage and is, therefore, a “debt collector” within the meaning of the FDCPA. (Id. at pp. 7-8.)

         LEGAL STANDARD

         Rule 12(c) of the Federal Rules of Civil Procedure provides that “[a]fter the pleadings are closed - but early enough not to delay trial - a party may move for judgment on the pleadings.” Conversely, a motion under Rule 12(b) “must be made before pleading if a responsive pleading is allowed.” Rule 12(c) motions for judgment on the pleadings and Rule 12(b)(6) motions are evaluated under the same standard of review. Fritz v. Charter Twp. of Comstock, 592 F.3d 718, 722 (6th Cir. 2010). Accordingly, the court must “construe the complaint in the light most favorable to the nonmoving party, accept the well-pled factual allegations as true, and determine whether the moving party is entitled to judgment as a matter of law.” Commercial Money Ctr., Inc. v. Ill. Union Ins. Co., 508 F.3d 327, 336 (6th Cir. 2007). Although the court's decision regarding a motion for judgment on the pleadings rests primarily upon the allegations of the complaint, “matters of public record, orders, items appearing in the record of the case, and exhibits attached to the complaint[ ] also may be taken into account.” Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001) (quoting Nieman v. NLO, Inc., 108 F.3d 1546, 1554 (6th Cir. 1997)). In considering a motion for judgment on the pleadings, the court “need not accept ...


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