MEMORANDUM AND ORDER RE: MOTION TO DISMISS
MARVIN J. GARBIS, District Judge.
The Court has before it Defendant U.S. Bank, N.A., a/k/a U.S. Bank National Association, as Trustee for J.P. Morgan Alternative Loan Trust 2007-S1's Motion to Dismiss or, in the Alternative, for Declaration that Title to the Property Is Vested in the Foreclosure Purchaser [Document 22] and the materials submitted relating thereto. The Court finds a hearing unnecessary.
Three people, Plaintiff Anne Theune ("Plaintiff"), her husband Peter Theune, and Paul Sweatman ("Sweatman") became joint tenants on a Deed for the property located at 302 Goldenrod Drive, Pasadena, Maryland 21122 ("the Property"). In 2006, Sweatman - without the knowledge of Plaintiff or her husband - signed two loan notes and two corresponding deeds of trust that purported to use the property as security for the debts ("DOT 1" and "DOT 2"). However, DOT 1 and DOT 2 contained the forged signatures of Plaintiff and her husband.
In November 2007, the substitute trustees on DOT 1 initiated state foreclosure proceedings against the Property in the Circuit Court for Anne Arundel County, Maryland. In June 2010, Peter Theune passed away. On October 7, 2010, the substitute trustees conducted a foreclosure sale and sold the Property to Defendant U.S. Bank, N.A. a/k/a U.S. Bank National Association, as Trustee for J.P. Morgan Alternative Loan Trust 2007-S1 ("USB"). As reflected in the state foreclosure docket attached to both parties' briefs, the state court issued a final order ratifying the foreclosure sale on February 1, 2011 ("Ratification Order").
On November 13, 2012, Plaintiff filed the instant Complaint for Quiet Title and Declaratory Judgment [Document 2] in the Circuit Court for Anne Arundel County, Maryland against USB, MD TL, LLC ("MDTL"),  and "[a]ll persons unknown, claiming any legal or equitable right, title estate, lien or interest in the [P]roperty." Compl. at 1. On April 5, 2013, USB removed the action to this Court on the basis of diversity jurisdiction. In the Complaint, Plaintiff seeks a judicial declaration that her signature and her husband's signature were forged on DOT 1 and DOT 2, rendering such instruments invalid as to Plaintiff and her husband, and that title to the Property is vested in Plaintiff and USB as joint tenants.
By the instant motion, USB seeks dismissal of all claims against it or, alternatively, a declaratory judgment that the foreclosure sale conveyed fee simple title in the Property to USB as the foreclosure purchaser. USB seeks dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6) and relies upon the affirmative defense of res judicata and/or collateral estoppel.
As reflected in the state foreclosure docket and the various documents filed and issued therein, Plaintiff actively participated in the state foreclosure proceeding against the Property ("Foreclosure Proceeding") and, on several occasions, sought to preliminarily and/or permanently enjoin the foreclosure sale based upon, inter alia, the alleged forgery of Plaintiff's and her husband's signatures on DOT 1. The first of such complaints for injunctive relief was initially granted, but later dissolved through a consent order entered by the state court on November 12, 2008 ("Consent Order"). The preliminary injunctive relief requested in the second complaint was set aside on October 28, 2009. A third complaint for injunctive relief was denied outright by the state court in a one-sentence order on March 26, 2010. The foreclosure sale took place on October 7, 2010, and the Circuit Court for Anne Arundel County issued the Ratification Order on February 1, 2011. Plaintiff has not appealed or otherwise moved to set aside the Ratification Order.
Based upon Plaintiff's participation in the Foreclosure Proceeding and upon the Ratification Order, USB asserts the forgery-related claims in the Complaint are barred by res judicata and/or collateral estoppel. According to USB, Plaintiff did, and/or should have, raised her forgery claims in the Foreclosure Proceeding, and thus should not be permitted to re-litigate rights to title over the Property, an issue finally resolved in the Foreclosure Proceeding.
A. Res Judicata and Collateral Estoppel
Under Maryland law,  "[t]he doctrine of res judicata provides that a judgment on the merits in a previous suit between the same parties or their privies precludes a second suit predicated upon the same cause of action." Seminary Galleria, LLC v. Dulaney Valley Improvement Ass'n, Inc. , 995 A.2d 1068, 1077 (Md. Ct. Spec. App. 2010) (internal quotation marks omitted).
[T]he elements of res judicata, or claim preclusion, are:
(1) that the parties in the present litigation are the same or in privity with the parties ...