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Suggs v. M & T Bank

United States District Court, E.D. Virginia, Richmond Division

January 18, 2017

M & T BANK, Defendant.


          John A. Gibney, Jr United States District Judge

         Mary Jane Suggs lost her home to foreclosure in June 2013. To avoid eviction, she sued in state court with the help of a lawyer, and then sued in this Court with the help of the internet. Through her downloaded complaint, Suggs asserts ten causes of action against three defendants. Two defendants escaped the case because Suggs did not serve them as required by the applicable rules. The remaining defendant, M&T Bank ("M&T"), has moved to dismiss the case. Because her complaint contains few facts, many legal conclusions, and misguided legal theories, the Court will grant the motion and dismiss the case.


         The Federal Rules of Civil Procedure require a plaintiffs complaint to contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). In cases where the plaintiff appears pro se, courts do not expect the pro se plaintiff to frame legal issues with the clarity and precision expected from lawyers. Accordingly, courts construe pro se complaints liberally. Beaudett v. City of Hampton, 775 F.2d 1274, 1278 (4th Cir. 1985) This principle of liberal construction, however, has its limits. Id. Courts do not need to discern the unexpressed intent of the plaintiff or to conjure up issues on the plaintiffs behalf. See Laber v. Harvey, 438 F.3d 404, 413 n.3 (4th Cir. 2006); Beaudett, 775 F.2d at 1276.

         M&T has moved to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure. A Rule 12(b)(6) motion gauges the sufficiency of a complaint. Goines v. Valley Cmty. Servs. Bd, 822 F.3d 159, 165 (4th Cir. 2016). Accordingly, in evaluating such a motion, courts typically focus only on the complaint, documents attached to the complaint, and documents explicitly incorporated into the complaint by reference. Id. at 166. In appropriate cases, however, courts may also (1) take judicial notice of public records, such as state court records, and (2) consider documents submitted by the movant if the documents are integral to the complaint and indisputably authentic. Id.; Witthohn v. Fed. Ins. Co., 164 F.App'x 395, 396 (4th Cir. 2006). When considering the complaint itself, courts must accept all allegations as true and must draw all reasonable inferences in favor of the plaintiff. Nemet Chevrolet, Ltd. v., Inc., 591 F.3d 250, 253 (4th Cir. 2009) (citing Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Cir. 1999)). The principle that a court must accept all allegations as true, however, does not apply to legal conclusions. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

         Considering the facts gleaned from these principles, to survive a Rule 12(b)(6) motion to dismiss, the complaint must contain sufficient facts to state a claim to relief that is plausible on its face. Id. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 565 (2007)). In motions where the defendant raises an affirmative defense for its misconduct, courts may rule on the affirmative defense at this stage only where the necessary facts appear on the face of the complaint. Goodman v. Praxair, Inc., 494 F.3d 458, 464 (4th Cir. 2007).


         In January 2001, Suggs obtained a mortgage loan from Mortgage Amenities Corporation ("MAC") secured by her home. The parties executed a Note and a Deed of Trust. The Deed of Trust permits the lender to foreclose on the property if the borrower goes into default.[1] MAC assigned the Note to M&T.

         Later in 2001, after the mortgage closing, Suggs's mortgage went through the securitization process. Securitization is the process of converting assets-typically a group of illiquid assets, such as mortgages-into negotiable securities for resale in the financial market. See Securitize, Black's Law Dictionary (10th ed. 2014). Securitization agreements between the parties to the securitization process govern the transaction. According to Suggs, her loan became part of the Ginnie Mae REMIC Trust 2001-10, for which Ginnie Mae served as trustee.[2]

         At some point, Suggs fell behind on mortgage payments and went into default. M&T appointed Surety Trustees, LLC ("Surety Trustees"), as substitute trustee of the Deed of Trust and instructed Surety Trustees to foreclose on the home. In June 2013, Surety Trustees conducted a foreclosure proceeding, at which it sold the home to M&T. Surety Trustee then conveyed title of the home to M&T.

         In May 2014, M&T filed an action in state court seeking to evict Suggs (the "Eviction Action"). Suggs hired a lawyer who, in October 2014, filed a complaint against M&T seeking to rescind the foreclosure for failure to meet all the necessary requirements prior to foreclosure (the "Foreclosure Action"). In December 2014, counsel for Suggs and M&T signed an Agreed Final Order in the Eviction Action in which the M&T agreed not to evict Suggs until after the parties resolved the Foreclosure Action. Suggs alleges that her lawyer signed this Order without her consent. Displeased, Suggs got rid of her lawyer. In September 2016, the state court dismissed the Foreclosure Action. Suggs has appealed this dismissal.

         In July 2015, Suggs filed this case against MAC, M&T, and Ginnie Mae (collectively, the "Defendants"). Suggs failed to serve MAC or Ginnie Mae, so after multiple warnings, the Court dismissed these two defendants from the case. M&T has filed a motion to dismiss.


         Suggs asserts ten claims against the Defendants[3]: (I) lack of standing to foreclose; (II) fraud in the concealment; (III) fraud in the inducement; (IV) intentional infliction of emotional distress; (V) quiet title; (VI) slander of title; (VII) declaratory relief; (VIII) violation of the Truth in Lending Act ("TILA") and the Home Ownership and Equity Protection Act ("HOEPA"); (IX) violation of the Real Estate Settlement Procedures Act ("RESPA"); and (X) rescission. Suggs seemingly downloaded this complaint from the internet[4] and filled in the blanks with the information about her property and the entities involved with her mortgage.

         M&T has moved to dismiss the case. It first argues that res judicata bars this case. If a court has issued a final judgment on the merits, res judicata bars the same parties from bringing another action on claims arising from the same conduct that the parties litigated in the first action. Raley v. Haider, 286 Va. 164, 170, 747 S.E.2d 812, 815 (2013). M&T argues that the Agreed Final Order in the Eviction Action should operate to bar this case. The Court will not decide the motion on this ground, as it seems dubious that the agreement to let the Foreclosure Action dictate the outcome of the Eviction Action qualifies as a final judgment on the merits, especially where the Foreclosure Action is on appeal. Additionally, Suggs alleges that she did not consent to her lawyer signing the Agreed Final Order on her behalf. Accordingly, the Court turns to M&T's alternative arguments, that all of the counts fail to state claims on which the Court could grant relief.

         A. Lack of "Standing" to Foreclose

         In Count I, Suggs alleges that the Defendants lacked "standing" to foreclose on her home because of various aspects of the securitization of her mortgage. She asserts that the Defendants did not comply with the securitization agreements, (Compl. ¶ 56), that the securitization impermissibly "split" the Deed of Trust from the Note, (Compl. ¶ 61), and that the Defendants could not "show ...

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