United States District Court, D. Maryland
DEBORAH K. CHASANOW UNITED STATES DISTRICT JUDGE
pending and ready for resolution in this whistleblower
retaliation case are a motion for summary judgment filed by
Defendants The O'Neil Group, LLC, MSO Legal Partners,
LLC, and William O'Neil (collectively,
“Defendants”) and a motion for leave to file a
surreply filed by Plaintiff Erik Yoder
(“Plaintiff”). (ECF Nos. 33; 38). The issues have
been fully briefed, and the court now rules, no hearing being
deemed necessary. Local Rule 105.6. For the following
reasons, the motions will be denied.
Factual Background 
O'Neil Group, LLC (“TOG”) was formed in 2011
to perform foreclosure work for MCM Capital Partners, LLC
(“MCM”), and its related mortgage loan servicer
BSI Financial (“BSI”). (ECF Nos. 33-2 ¶ 1;
36-2, at 8, 10). TOG created a national network of law firms
to handle the legal work arising from MCM's purchase of
non-performing mortgage debts on behalf of third-party
investors. (ECF No. 33-2 ¶ 1). TOG hired the law firms,
oversaw their work, and reviewed and approved invoices for
the work that were then submitted to the loan servicer BSI.
(Id.). The standards for approval or rejection of
invoices were provided by BSI to be implemented by
Defendants. (Id. ¶ 2). BSI policy was that
costs were to be billed as incurred and not marked up.
(Id. ¶ 6). In addition, BSI policy limited the
payment for title work to $350 for a full report and $175 for
a title update - known as the “allowable amount.”
(ECF Nos. 33-2 ¶¶ 2, 6; 33-5 ¶ 1; 36-7 ¶
9). After BSI paid TOG, TOG paid the law firms. (ECF No. 33-2
2013, Defendant O'Neil and Terry Shanahan formed a new
entity, MSO Legal Partners, LLC (“MSO”), to
handle foreclosure referrals in Maryland from BSI. (ECF Nos.
33-2 ¶ 3; 36-2, at 20, 25). In order to keep costs down,
MSO used TOG personnel for its staff. (ECF No. 33-2 ¶
3). In September 2013, Defendants hired Plaintiff, an
experienced foreclosure attorney, to run the foreclosure
practice at MSO. (ECF Nos. 33-2 ¶¶ 4, 5; 36-2, at
24; 36-3, at 27-29; 36-5, at 9). While conducting an audit in
early June 2014 to be filed in a mortgage foreclosure case
(the “Windon case”), Plaintiff asked
Defendants' administrative personnel to provide him with
the relevant title report and title update invoices. (ECF No.
36-7 ¶¶ 10, 12). Instead of providing the invoices
as requested, Sally Shanahan, an administrative employee and
Mr. Shanahan's wife, informed Plaintiff that Defendants
billed the full allowable amounts of $350 per title report
and $175 per title update. (Id. ¶ 12). Kristin
Ferraro, another administrative employee, confirmed that
information. (Id.). In order to obtain the actual
costs for title reports and updates in the Windon case,
Plaintiff contacted All Star Title, the company that
performed title reports and title updates in Defendants'
foreclosure cases. Plaintiff was informed that All Star Title
billed $150 per title report until April 2014 when the price
increased to $250 per title report. All Star Title billed $15
per title update. (Id.). With that information,
Plaintiff realized that Defendants had been billing BSI more
than double the actual cost for title reports and over 11
times the actual cost for title updates. (Id.). Mrs.
Shanahan later informed Plaintiff that Defendants billed BSI
for title work before Defendants received any invoices from
All Star, that BSI took 30 days to process and pay bills
after receipt, and that Defendants needed payments more
quickly in order to pay their own expenses. (Id.
12, 2014, Plaintiff sent an email to Mr. O'Neil notifying
him of the overbilling of costs and expressing his belief
that the practice was unlawful. (ECF Nos. 33-2 ¶ 12;
36-7 ¶ 13; 36-9). That evening, Mr. O'Neil responded
stating that he was out of the office until the following
week but that “there should not be any mark up of costs
. . . . So let's take a look at this to make sure
it's right.” (ECF No. 36-10). Plaintiff and Mr.
O'Neil had a meeting on June 17 to discuss the billing
error. (ECF No. 36-2, at 32). Mr. O'Neil confirmed that
Defendants “were supposed to bill the actual amount
charged, ” as it had “always been the firm
policy, ” and that “[Defendants] would have to
refund the money [to BSI].” (Id.). Mr.
O'Neil told Plaintiff that an investigation would be done
to “figure out how much the refund was supposed to be,
” and that, in regard to the process of creating
invoices, “[Defendants] had to change and/or implement
a process since [Defendants] didn't appear to have
one.” (ECF Nos. 33-2 at 3, 24; 36-2, at 33). That same
day, Plaintiff sent an e-mail to Mr. O'Neil to ensure
that “within the next two weeks” BSI would be
informed that invoices for title work were submitted to them
that did not reflect actual costs, that BSI would be offered
a refund, and that BSI would agree to “remediate this
billing error . . . by correcting or reconciling any and all
of the borrower's accounting of debt . . . so that none
of the borrowers are charged costs which were not
actual.” (ECF No. 36-13).
18, Plaintiff sent an email to Mr. O'Neil regarding a
proposal by Mr. Shanahan to switch auctioneers from their
established vendor to an inexperienced vendor. (ECF No.
36-14). Plaintiff disagreed with the proposal and stated that
if Defendants were going to switch to an auctioneer that
charged higher costs and had less experience that it was
appropriate “within the rules of ethics” to
obtain the consent of their client BSI. (Id.). Mr.
O'Neil became irate and requested that Plaintiff
“please refrain from the ethics lectures.” (ECF
No. 36-15, at 2). Mr. Shanahan found Plaintiff's
statements “accusatory” and they “caused
[him] considerable concern such that [he] recommended to Mr.
O'Neil that Plaintiff should be asked to resign.”
(ECF Nos. 33-2 ¶ 21; 33-3 ¶ 8).
27, Mr. O'Neil informed Plaintiff that he was not firing
him but that, due to the “financial condition of the
firm, ” Defendants would not be able to continue paying
Plaintiff what they had been and that “[Plaintiff]
would be better off looking for another job.” (ECF Nos.
33-2 ¶ 22; 36-2, at 39). Mr. O'Neil told Plaintiff
that he would not have to work while he was looking for a
job, and Defendants offered to pay Plaintiff's salary,
commission, and benefits through the end of July. (ECF Nos.
33-2 ¶ 22; 36-7 ¶ 19). Plaintiff was shocked by
this news and walked out of the office. (ECF Nos. 33-2 ¶
24; 36-7 ¶ 19). Plaintiff did not tell Mr. O'Neil
that he was quitting his job. (ECF No. 36-7 ¶ 20).
Subsequently, Plaintiff and Mr. O'Neil arranged to meet
on June 30 at the office. (ECF No. 36-7 ¶ 21). However,
Mr. Shanahan, rather than Mr. O'Neil, was present at the
meeting and informed Plaintiff that there was no need for him
to come into the office but that he could use the office
until the end of July. (ECF Nos. 36-7 ¶ 21; 36-19).
Plaintiff subsequently e-mailed Mr. O'Neil regarding the
meeting with Mr. Shanahan. (ECF Nos. 33-2, at 11; 36-19, at
2). Mr. O'Neil replied, attaching a resignation letter
and stating, “you will need to sign the attached. If
you do not want to resign, then I will accommodate your
insistence that you be fired. Let me know which of those two
options you prefer.” (ECF Nos. 33-2, at 9-10; 36-18;
36-19). Plaintiff refused to sign the resignation letter.
(ECF No. 36-7 ¶ 21). Upon that action, Defendants
concluded that Plaintiff had quit and that his last day of
employment would be considered June 30, 2014. Plaintiff was
paid his salary and commission up until June 30. (ECF No.
33-2 ¶ 26).
March 25, 2016, Plaintiff filed a complaint against
Defendants alleging unlawful termination of his employment in
violation of the employee protection (whistleblower)
provision of the Consumer Financial Protection Act of 2010,
Section 1057 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act (the “CFPA”), 12 U.S.C.
§ 5567. (ECF No. 1). Defendants moved for summary
judgment on May 16, 2017. (ECF No. 33). Plaintiff submitted
an opposition on June 19 (ECF No. 36), and Defendants replied
(ECF No. 37). On July 17, Plaintiff filed the pending motion
for leave to file a surreply. (ECF No. 38).
Motion for Leave to File Surreply
otherwise ordered by the court, surreply memoranda are not
permitted to be filed. Local Rule 105.2(a). Surreplies may be
permitted when the moving party would be unable to contest
matters presented to the court for the first time in the
opposing party's reply. Lewis v. Rumsfeld, 154
F.Supp.2d 56, 61 (D.D.C. 2001).
motion for leave to file a surreply, Plaintiff contends that
Defendants argue for the first time in their reply that they
held a subjective belief that their business faced
considerable financial and personnel issues and that their
reasons for asking Plaintiff to look for another job should
be judged by what Defendants believed at the time to be true.
(ECF No. 38 ¶¶ 2-3). Plaintiff also argues that
Defendants assert for the first time in their reply that they
never focused on the economic impact of losing their client
Woods Cove, but instead on the fact that losing that client
freed up Mr. Shanahan's time and Plaintiff's services
were no longer needed. (Id. ¶¶ 4-5).
Defendants did not raise any new issues or legal theories in
their reply brief and merely responded to arguments in
Plaintiff's opposition that “Defendants did not
honestly believe that their business was in decline”
when Plaintiff was asked to look for another job (ECF ...