United States District Court, D. Maryland
K. Bredar United States District Judge
David and Jovan Walker initiated this pro se action alleging
a claim in recoupment (Count I), breach of fiduciary duty
(Count II), and fraud (Count III) against Nationstar Mortgage
LLC (“Nationstar”); U.S. Bank National
Association (“U.S. Bank”); and Buonassissi,
Henning, and Lash, P.C. (Compl., ECF No. 1.) In addition to
injunctive relief and legal costs, Plaintiffs curiously seek
punitive damages to be paid in the form of 80, 000 silver,
one-ounce coins from each Defendant. (Compl. ¶ 46.)
Plaintiffs' have also asked to be recognized as class
representatives for those victimized by Defendants'
practices. (Id. at 48-55.) Pending is Defendants
Nationstar and U.S. Bank's joint motion to dismiss (ECF
No. 20),  which has been fully briefed (ECF Nos. 23,
26), and no hearing is necessary, Local Rule 105.6 (D. Md.
2016). For the reasons stated below, the Court will grant
Defendants' motion. Furthermore, because the docket
reflects no evidence that service has been effected on
Defendant Buonassissi, Henning, and Lash, P.C., the Court
will require Plaintiffs to show cause why this party should
not be dismissed from the case pursuant to Rule 4(m) of the
Federal Rules of Civil Procedure.
Standard for Dismissal for Failure to State a
complaint must contain “sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
Facial plausibility exists “when the plaintiff pleads
factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Iqbal, 556 U.S. at 678. An inference
of a mere possibility of misconduct is not sufficient to
support a plausible claim. Id. at 679. As the
Twombly opinion stated, “Factual allegations
must be enough to raise a right to relief above the
speculative level.” 550 U.S. at 555. “A pleading
that offers ‘labels and conclusions' or ‘a
formulaic recitation of the elements of a cause of action
will not do.' . . . Nor does a complaint suffice if it
tenders ‘naked assertion[s]' devoid of
‘further factual enhancement.'”
Iqbal, 556 U.S. at 678 (quoting Twombly,
550 U.S. at 555, 557). Although when considering a motion to
dismiss a court must accept as true all factual allegations
in the complaint, this principle does not apply to legal
conclusions couched as factual allegations. Twombly,
550 U.S. at 555.
Allegations of the Complaint
facts underlying Plaintiffs' complaint arise from a
mortgage they entered into on December 30, 2005, with SGB
Mortgage Corporation (“SGB”). (Compl. ¶ 5;
Securitization Audit 8, ECF No. 1.) Plaintiffs allege that
SGB approved them for a mortgage they could not afford and
understated the applicable finance charge and interest rate.
(Compl. ¶¶ 37-39, 41.)
Bank is presently the trustee of the mortgage, and Nationstar
is the loan servicer. (Id. at ¶¶ 2-3, 6.)
Plaintiffs allege that Nationstar has inaccurately presented
itself as the lender (id. at ¶ 2); that U.S.
Bank has failed to make required disclosures (id. at
¶ 37); that neither entity has complied with
Plaintiffs' request to produce the physical note securing
the mortgage (id. at ¶ 5); and that the
ownership of the note and mortgage have been unlawfully
separated, creating an invalid chain of title to the deed of
trust (id. at ¶ 22).
bring a claim under the Truth in Lending Act
(“TILA”) as well as claims for breach of
fiduciary duty and fraud pursuant to Maryland common law.
However, as Defendants have argued, none of these claims may
be brought in the present action and all run afoul of
applicable statutes of limitations.
first cause of action is a “claim in recoupment”
pursuant to the TILA. (Compl. ¶¶ 36-55.) The TILA
provides consumers with a number of private rights of action
that may be brought against creditors, assignees, or
servicers in mortgage transactions, but the statute of
limitations for all such actions is either one or three years
from the time of the violation. 15 U.S.C. § 1640(a), (e)
(2016). In a proceeding wherein a mortgage holder initiates a
foreclosure proceeding against a consumer, the TILA further
provides consumers with a defense by recoupment,
which is available regardless of any time limit. 15 U.S.C.
§ 1640(k) (2016). In attempting to bring a claim of
recoupment, Plaintiffs fail to differentiate between a
right of action and an affirmative defense. Because the
instant case is not a foreclosure action, and because the
Walkers are plaintiffs, the TILA does not allow them to
invoke recoupment. Therefore, the TILA's filing deadlines
govern any action Plaintiffs might bring. Because
Plaintiffs' allegations relate to events that transpired
at the signing of their mortgage in 2005, those filing
deadlines have long expired. Plaintiffs therefore have no
viable TILA claim.
second claim is for a breach of fiduciary duty. (Compl.
¶¶ 56-58, 47-53.)Significantly, Maryland does not
recognize a separate tort for breach of fiduciary duty;
rather, a breach of fiduciary duty may give rise to liability
under some other cause of action in tort or contract.
Int'l Bhd. of Teamsters v. Willis Corroon Corp. of
Md., 802 A.2d 1050, 1051 n.1 (Md. 2002). Furthermore,
Maryland courts do not ordinarily find a fiduciary
relationship to exist between a bank and its customer in a
loan transaction. Yousef v. Trustbank Sav., F.S.B.,
568 A.2d 1134, 1138 (Md. Ct. Spec. App. 1990). Finally, the
statute of limitations for a civil action in Maryland is
three years. Md. Code Ann., Cts. & Jud. Proc. §
5-101 (LexisNexis 2013). Because the alleged breach occurred
at the origination of the loan in 2005, because Defendants
are not and never were in fiduciary relationship with
Plaintiffs, and because Maryland does not recognize it as a
stand-alone claim, Plaintiffs fail to state a viable claim
for breach of fiduciary relationship.
final claim is for fraud. (Compl. ¶¶ 54-60.)
Maryland defines fraud as an intentionally or recklessly
false representation made with the intent to deceive the
plaintiff, wherein the plaintiff reasonably relied on the
misrepresentation and was injured as a result. SpinCycle,
Inc. v. Kalender, 186 F.Supp.2d 585, 590 (D. Md. 2002).
The section of the Complaint alleging fraud refers
exclusively to alleged misrepresentations made by SGB, the
original lender in Plaintiff's mortgage. (Compl.
¶¶ 56-60.) Because those representations were
allegedly made in 2005, they fall outside of the three-year
statute of limitations for a civil action in Maryland.
See Md. Code Ann., Cts. & Jud. Proc. §
5-101 (LexisNexis 2013). Furthermore, SGB is not a party to
the instant suit. Even if Plaintiffs incorporate into their
charge of fraud the allegation that Nationstar misrepresented
itself as an assignee (see Compl. ¶¶ 2,
21, 54),  Plaintiffs do not plead facts to show that
they relied on Nationstar's statements to their
detriment. Plaintiffs thus fail to state a claim for fraud,
foregoing reasons, a separate order will issue in which the
Court will deny Plaintiffs' request to be recognized as
class representatives; will grant Nationstar and U.S.
Bank's joint motion to dismiss the complaint against
them; and will require Plaintiffs to promptly show cause why