United States District Court, D. Maryland
EDWARD J. AND VICKI FANGMAN, et al., Plaintiffs,
GENUINE TITLE, LLC, . Defendants.
Richard D. Bennett United States District Judge
Second Amended Complaint, the operative complaint in this
putative class action, alleges violations of the Real Estate
Settlement Procedures Act (“RESPA”), 12 U.S.C.
§§ 2607(a), (b), and Md. Code Ann., Real Prop.
§ 14-127 (“Section 14-127”)(Count
by Defendants Genuine Title, LLC (“Genuine
Title”); Brandon Glickstein, Inc.; Dog Days
Marketing, LLC (“Dog Days Marketing”);
Competitive Advantage Media Group, LLC (“Competitive
Advantage”) (collectively “Genuine
Defendants”); Wells Fargo Home Mortgage, Inc. and Wells
Fargo, N.A. (“Wells Fargo”); West Town Bank
& Trust (“West Town”); PNC Mortgage and PNC
Bank, N.A. (“PNC”); MetLife Home Loans, LLC and
MetLife Bank, N.A. (“MetLife”); Net Equity
Financial (“Net Equity”); E Mortgage Management
(“E Mortgage”); and JP Morgan Chase Bank
(“Chase”) (collectively “Defendant
Lenders”). Additionally, Plaintiffs allege violations
of Section 14-127 alone against Defendant Eagle National Bank
Defendants West Town, Net Equity, Wells Fargo, PNC, Eagle
National, MetLife, Competitive Advantage, Dog Days Marketing,
Chase, and E Mortgage Management have filed motions to
dismiss Plaintiffs’ claims under Md. Code Ann., Real
Prop. § 14-127, pursuant to Rule 12(b)(6) of the Federal
Rules of Civil Procedure (ECF Nos. 161, 162, 163, 165, 167,
168, 169, 170, and 203).
Rule 8(a)(2) of the Federal Rules of Civil Procedure, a
complaint must contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief.” Fed. R. Civ. P 8(a)(2). Rule 12(b)(6) of the
Federal Rules of Civil Procedure authorizes the dismissal of
a complaint if it fails to state a claim upon which relief
can be granted. The purpose of Rule 12(b)(6) is “to
test the sufficiency of a complaint and not to resolve
contests surrounding the facts, the merits of a claim, or the
applicability of defenses.” Presley v. City of
Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006).
Supreme Court’s opinions in Bell Atlantic Corp. v.
Twombly, 550 U.S. 544 (2007), and Ashcroft v.
Iqbal, 556 U.S. 662 (2009), “require that
complaints in civil actions be alleged with greater
specificity than previously was required.” Walters
v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (citation
omitted). In Twombly, the Supreme Court articulated
“[t]wo working principles” that courts must
employ when ruling on Rule 12(b)(6) motions to dismiss.
Iqbal, 556 U.S. at 678. First, while a court must
accept as true the factual allegations contained in the
complaint, the court is not so constrained when the factual
allegations are conclusory or devoid of any reference to
actual events. United Black Firefighters v. Hirst,
604 F.2d 844, 847 (4th Cir. 1979). Moreover, a court need not
accept any asserted legal conclusions drawn from the
proffered facts. Iqbal, 556 U.S. at 678 (stating
that “[t]hreadbare recitals of the elements of a cause
of action, supported by mere conclusory statements, do not
suffice” to plead a claim); see also Wag More Dogs,
LLC v. Cozart, 680 F.3d 359, 365 (4th Cir. 2012)
(“Although we are constrained to take the facts in the
light most favorable to the plaintiff, we need not accept
legal conclusions couched as facts or unwarranted inferences,
unreasonable conclusions, or arguments.” (internal
quotation marks omitted)). Second, a complaint must be
dismissed if it does not allege “a plausible claim for
relief.” Iqbal, 556 U.S. at 679.
CODE. ANN., Real Prop. § 14-127 provides that “[a]
person who has a connection with the settlement of real
estate transactions involving land in the State may not pay
to or receive from another any consideration to solicit,
obtain, retain, or arrange real estate settlement
business.” Md. Code. Ann., Real Prop. §
14-127(c)(1). “A person who violates [Section 14-127]
is guilty of a misdemeanor and on conviction is subject to
imprisonment not exceeding 6 months or a fine not exceeding
$1, 000 or both.” Id. at § 14- 127(e). In
this case, Plaintiffs allege that their “[l]enders by
and through their agents and/or employees received Free
Marketing Materials and/or Referring Cash for referrals of
business as part of real estate settlement services provided
to Plaintiffs and Class members, in violation of . . .
[Section] 14-127.” Second Am. Compl. at ¶ 246, ECF
have contended that Section 14-127 does not contain a private
right of action under Maryland state real estate law.
See, e.g., Mem. Supp. Eagle National Mot. to Dismiss, p.
18, ECF No. 167-1. Plaintiffs cite no case concluding
otherwise and admit that “[t]his is a case of first
impression, ” but have argued that Section 14-127
implicitly provides a private right of action. Opp’n
Mot. to Dismiss, p. 41-42, ECF No. 180-1. They have proposed
that this Court consider three factors relied upon by the
Court of Appeals of Maryland in determining whether a statute
implies a private right of action: (1) the presence or
absence of an indication of legislative intent to create a
private remedy; (2) whether the plaintiff is one of the class
for whose special benefit the statute was enacted; and (3)
whether it is consistent with the underlying purposes of the
legislative scheme to imply such a remedy for the plaintiff.
Id. (citing Erie Ins. Co. v. Chops, 332 Md.
79, 90-91 (1991) (citing Cort v. Ash, 422 U.S. 66
(1975))). Based on these factors, they have contended, this
Court should find an implied right of action in Section
Memorandum Opinion dated December 9, 2015 (ECF No. 211), this
Court considered the parties arguments, but did not decide on
its own whether Section 14-127 implies a private right of
action. Rather, via a separate Certification Order, this
Court certified the following question of law to the Court of
Appeals of Maryland: “Does Md. Code Ann., Real Prop.
§ 14-127 imply a private right of action?”
Certification Order, ECF No. 213. Accordingly, this Court
stayed all pending motions to dismiss with respect to
Plaintiffs’ Section 14-127 claims, pending a response
from the Court of Appeals of Maryland. See Amended
Order (ECF No. 214).
20, 2016, the Court of Appeals of Maryland responded to this
Court’s certified question. The Court “answer[ed]
the certified question of law ‘no’ and [held]
that [Section] 14-127 does not contain an express or implied
private right of action as neither [Section] 14-127’s
plain language, legislative history, nor legislative purpose
demonstrates any intent on the General Assembly’s part
to create a private right of action.” Fangman, et
al. v. Genuine Title, et al., Misc. No. 19, at * 1 (Md.
May 20, 2016). “From [Section] 14-127’s plain
language and legislative history, ” the Court reasoned,
“we have no difficulty in concluding that [Section]
14-127’s purpose was criminal in nature, and not to
create an implied private right of action on behalf of a
specified protected class of individuals.” Id.
Md. Code Ann., Real Prop. § 14-127 does not contain a
private right of action, Plaintiffs cannot state a claim for
relief under Section 14-127 in this putative class action.
See, e.g., Jacobsen v. Towers Perrin Forster &
Crosby, Inc., No. RDB 05-2983, 2006 WL 3147732, at *3
(D. Md. Oct. 31, 2006) (granting Defendant’s Rule
12(b)(6) Motion to Dismiss action under Article 49B of the
Maryland Code, where it was conceded that the statute did not
give rise to a private right of action); Uhre v. Emmett
A. Larkin Co., 205 F.Supp.2d 475, 478 (D. Md. 2002)
(granting Defendants’ Rule 12(b)(6) Motion to Dismiss
mail and wire fraud claims where courts in this circuit had
expressly held that “ ‘[n]o private right of
action exists for ‘mail fraud, ’ or for wire
all motions to dismiss the Second Amended Complaint,
previously stayed by this Court as to Plaintiffs’
Section 14-127 claims (ECF Nos. 161, 162, 163, 165, 167, 168,
169, 170, and 203) are now GRANTED IN PART, with respect to
Plaintiffs’ Section 14-127 claims. Accordingly, all of
Plaintiffs’ state law claims under Md. Code Ann., Real
Prop. § 14-127 are DISMISSED. Because Plaintiffs’
Section 14-127 claim against Defendant Eagle National Bank
was the only remaining claim against that Defendant, Eagle
National Bank’s Motion to Dismiss the Second Amended
Complaint (ECF No. 167) is now GRANTED in its totality. All
claims against Eagle National Bank are now DISMISSED.
Accordingly, this action survives only with respect to
Plaintiffs’ federal claims under the Real Estate
Settlement Procedures Act, ...