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Garland v. Servicelink LP

United States District Court, Fourth Circuit

September 25, 2013

LISA GARLAND, et al., Plaintiffs,


GEORGE L. RUSSELL, III, District Judge.

Plaintiffs Lisa and Henry Garland (the "Garlands") filed this action, on behalf of themselves and a putative class of similar persons, against Defendant ServiceLink L.P. d/b/a ServiceLink, Inc., ServiceLink, LLC, ServiceLink, FNF, and Service Link, a division of Chicago Title Insurance Company ("ServiceLink"), [1] for the alleged violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL"), 73 Pa. Stat. Ann. ยง 201-1 et seq. (West 2013) (Count I), and breach of contract (Count II). The Garlands seek class action certification, damages, and injunctive relief. Presently before the Court is ServiceLink's Motion to Dismiss the Garlands' Amended Class Action Complaint. (ECF No. 15).

The Court, having reviewed the pleadings and supporting documents, finds no hearing necessary pursuant to Local Rule 105.6 (D.Md. 2011). For the reasons outlined below, ServiceLink's Motion will be granted as to Count I and denied as to Count II. The Garlands will be granted fourteen days leave to amend their Amended Class Action Complaint as to Count I.


ServiceLink is a Pennsylvania company that provides real estate settlement services to consumers in various states. ServiceLink performs a bulk of its operations from its headquarters in Pennsylvania but relies on subcontractors, known as "closing agents, " to deliver the paperwork it prepares to consumers in other states. In addition to the fees consumers pay for its settlement services, ServiceLink typically withholds filing fees, property taxes, and recordation taxes from the loan proceeds disbursed at closing. It then assumes the responsibility to pay the fees and taxes on its consumers' behalf. Using this method, ServiceLink has closed thousands of residential mortgage loans throughout the United States since 2010.

The Garlands are Maryland residents and own the property located at 614 Lee Place in Frederick, Maryland (the "Property"). On November 11, 2011, the Garlands went to settlement with Bank of America, N.A. on a refinancing loan for the Property in which ServiceLink acted as the Garlands' settlement agent. ServiceLink offered to provide settlement services to complete the loan refinance, and the Garlands accepted the offer and paid ServiceLink in reliance. Despite the arrangement, the Garlands do not allege to having signed a formal agreement, noting only that the terms were detailed in a HUD-1 Settlement Statement (the "HUD-1 Statement"), which the Garlands concede is not a contract.

On November 11, ServiceLink collected $1, 303.00 from the Garlands' loan proceeds to pay fees and taxes on their behalf, evidenced by the HUD-1 Statement. In addition, the Garlands allege that ServiceLink claimed to have: (1) completed an Affidavit of Consideration and Disbursement on or about November 15, 2011; (2) completed a tax certification on October 27, 2011; (3) requested a payoff of Lisa's prior loan and sent the confirmation letter to her prior lender on November 11, 2011; (4) accepted and processed the settlement documents from the Garlands' closing agent; (5) collected the loan proceeds and disbursed them appropriately; (6) completed the closing instructions as required by Bank of America, N.A.; and (7) prepared the deed to add Henry as an additional owner of the Property. The Garlands allege that ServiceLink never rendered any of those services, and that repeated efforts to obtain copies of the deed and other settlement documents went unanswered.

On April 15, 2013, the Garlands, for themselves and all others nationwide who, within the last six years, paid ServiceLink for services it did not render, filed suit in the Circuit Court for Baltimore City. (ECF No. 2). Shortly thereafter, ServiceLink removed the action to this Court (ECF No. 1), and moved to dismiss the Garlands' first Class Action Complaint (ECF No. 11).[3] The Garlands subsequently filed an Amended Class Action Complaint on June 14, 2013. (ECF No. 14). ServiceLink now moves to dismiss the Amended Class Action Complaint for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 15).


A. Standard of Review

To survive a Rule 12(b)(6) motion, the complaint must allege facts that, when accepted as true, "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)) (internal quotation marks omitted). A claim is plausible on its face 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 . (citing Twombly , 550 U.S. at 556). Legal conclusions or conclusory statements do not suffice and are not entitled to the assumption of truth. Id . (citing Twombly , 550 U.S. at 555). Thus, the Court "must determine whether it is plausible that the factual allegations in the complaint are enough to raise a right to relief above the speculative level." Monroe v. City of Charlottesville , 579 F.3d 380, 386 (4th Cir. 2009) (quoting Andrew v. Clark , 561 F.3d 261, 266 (4th Cir. 2009)) (internal quotation marks omitted).

In determining whether to dismiss, the Court must examine the complaint as a whole, consider the factual allegations in the complaint as true, and construe the factual allegations in the light most favorable to the plaintiff. Albright v. Oliver , 510 U.S. 266, 268 (1994); Lambeth v. Bd. of Comm'rs of Davidson Cnty. , 407 F.3d 266, 268 (4th Cir. 2005).

B. Analysis

1. Violation of the Pennsylvania Consumer ...

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