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Cooke v. Carrington Mortgage Services

United States District Court, D. Maryland

December 3, 2018

GLORIA COOKE, Plaintiff,



         Plaintiff Gloria Cooke has filed this action against Carrington Mortgage Services (“Carrington”) alleging various federal and state statutory violations in connection with Carrington's servicing of Cooke's mortgage loan. Pending before the Court is Carrington's Motion to Dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Having reviewed the submitted materials, the Court finds that no hearing is necessary. D. Md. Local R. 105.6. For the reasons set forth below, the Motion to Dismiss is GRANTED IN PART and DENIED IN PART.


         For purposes of the Motion, the Court accepts the facts asserted in Cooke's Amended Complaint.

         In May 2003, Cooke obtained a mortgage loan from Countrywide Home Loans, Inc., (“Countrywide”). The loan was later assigned to Bank of America (“BOA”). After Cooke missed payments or made late payments on her loan in 2014, BOA sent a Notice of Intent to Foreclose to Cooke on July 16, 2014. In the ensuing months, Cooke and BOA tried but failed to negotiate a loan modification agreement. Then, in December 2015, BOA transferred Cooke's mortgage account to Carrington, a loan servicer. According to BOA, Cooke's mortgage loan was in default at the time of the transfer.

         On or about December 15, 2015, Cooke received an official Notice of Servicing Transfer from Carrington. Also contained in the Notice was a description of Cooke's rights under the Fair Debt Collection Practices Act, including that Cooke had 30 days to request verification or validation of the debt. A week later, on December 22, 2015, Carrington sent to Cooke a Notice of Intent to Foreclose, which was accompanied by a letter stating that Cooke's loan could be accelerated and sold at a foreclosure sale if Cooke failed to cure the default within 45 days.

         On February 10, 2016, Shapiro & Brown, LLP (“S&B”) sent a letter to Cooke stating that it had been retained by Carrington to enforce the deed of trust; that as of February 9, 2016, the debt was $25, 045.69; that the creditor for the mortgage loan was BOA; and that it would cease foreclosure activities if Cooke disputed the debt. The next day, February 11, 2016, Carrington retained S&B as the substitute trustee in order to enforce the deed of trust. In the absence of any communication from Cooke disputing the debt, S&B filed an Order to Docket Foreclosure on March 7, 2016. Five days later, on March 12, 2016, Cooke sent S&B a letter disputing the debt and requesting that it be verified. In response, S&B sent a letter to Cooke dated April 12, 2016 accompanied by a copy of the Promissory Note, a copy of the Deed of Trust, a copy of the Assignment of Deed of Trust and a Statement of Debt identifying the payoff amount as $29, 489.31.

         Carrington continued to service Cooke's mortgage loan after S&B filed the Order to Docket Foreclosure. Between July 2016 and August 2017, Cooke sent several written inquiries to Carrington regarding her mortgage loan. Specifically, Cooke sent letters to Carrington on July 2, 2016, October 27, 2016, December 22, 2016, March 6, 2017, April 6, 2017, April 29, 2017, June 12, 2017, and August 24, 2017. In all but the October 2016 and March 2017 letters, Cooke disputed various charges that appeared in her mortgage statements from Carrington and requested information about the charges in her letters. In addition, in her letters dated July 2, 2016, October 27, 2016, March 6, 2017, April 6, 2017, and August 24, 2017, Cooke requested information regarding the Note and asked that Carrington provide her with a certified copy of the Note. Cooke also challenged Carrington's ability to enforce the Note in her letters dated April 6, 2017 and August 24, 2017. Carrington responded to some of Cooke's inquiries but failed to respond to others. Cooke was not satisfied with Carrington's responses to her multiple inquiries and with its overall servicing of her loan.

         On December 19, 2016, Cooke filed the present case in the Circuit Court for Prince George's County, Maryland, which Carrington timely removed to this Court. In her Amended Complaint, Cooke alleges violations of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§ 1692-1692p (2012); the Maryland Consumer Debt Collection Practices Act (“MCDCA”), Md. Code Ann., Com. Law §§ 14-201 to 14-204 (West 2010); the Maryland Consumer Protection Act (“MCPA”), Md. Code Ann., Com. Law §§ 13-101 to 13-501; the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. §§ 2601-2617 (2012); and the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. §§ 1681-1681x.


         In its Motion to Dismiss, Carrington argues that (1) the ongoing state foreclosure proceeding bars Cooke's FDCPA and MCDCA claims; (2) the FDCPA claims should be dismissed because Cooke makes only conclusory allegations without factual support; (3) the MCDCA claims should be dismissed because Cooke fails plausibly to allege that Carrington did not have a right to collect on the Note; (4) the MCPA claims should be dismissed because Cooke fails to allege sufficiently a violation of the provision of the MCPA requiring a response to written complaints within 15 days, including by failing to plead an actual injury or loss; (5) the RESPA claims should be dismissed because Cooke fails plausibly to allege that her letters constituted Qualified Written Requests such that RESPA's requirements were triggered; and (6) the FCRA claims should be dismissed because Cooke fails plausibly to allege a violation of the FCRA.

         I. Legal Standard

         To defeat a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the complaint must allege enough facts to state a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A claim is plausible when the facts pleaded allow “the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. Legal conclusions or conclusory statements do not suffice. Id. 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 Cty., 407 F.3d 266, 268 (4th Cir. 2005).

         II. The State Foreclosure Proceeding

         Carrington first argues that Cooke's FDCPA and MCDCA claims must be dismissed because they contest the right to foreclose, in circumvention of the exclusive state court foreclosure process and state law rules governing such challenges. See Md. R. 14-211. This argument fails because Cooke's FDCPA and MCDCA claims do not seek injunctive relief barring foreclosure; rather they seek damages relating to the manner in which Carrington attempted to collect the debt owed by Cooke. “When a[n] FDCPA claim concerns collection activities, a[n] FDCPA claim does not arise out of the transaction creating the debt.” Senftle v. Landau, 390 F.Supp.2d 463, 469-70 (D. Md. 2005) (holding that an FDCPA claim “pertaining to the manner in which [the defendant] collected [the] debt” was not an appeal of the state court determination that the plaintiff owed the underlying debt). See also Bauman v. Bank of Am., N.A., 808 F.3d 1097, 1102 (6th Cir. 2015) (holding that the lenders' claim on the underlying mortgage was not a compulsory counterclaim in the debtor's FDCPA action because an FDCPA claim “raises different issues of law from those that a foreclosure action would present” and “does not focus on the validity of the debt, but instead on the use of unfair methods to collect it”) (citations omitted); Peterson v. United Accounts, Inc., 638 F.2d 1134, 1136-37 (8th Cir. 1981) (holding that an FDCPA claim, which is brought to enforce federal policy regulating debt collection practices, is not a compulsory counterclaim to a debt collection action). Accordingly, the FDCPA and MCDCA claims are distinct from foreclosure claims and are properly before the Court.

         III. FDCPA

         In Count One of the Amended Complaint, Cooke alleges that Carrington committed multiple violations of the FDCPA, including violations of 15 U.S.C. §§ 1962e, 1692f, and 1692g. “The FDCPA protects consumers from abusive and deceptive practices by debt collectors, and protects non-abusive debt collectors from competitive disadvantage.” United States v. Nat'l Fin. Servs., Inc., 98 F.3d 131, 135 (4th Cir. 1996). To state a claim under the FDCPA, Cooke must allege that (1) she has been the object of collection activity arising from consumer debt; (2) Carrington is a debt collector as defined by the FDCPA; and (3) Carrington has engaged in an act or omission prohibited by the FDCPA. Ademiluyi v. PennyMac Mortg. Inv. Trust Holdings I, LLC, 929 F.Supp.2d 502, 524 (D. Md. 2013) (citations omitted); see also Levins v. Healthcare Revenue Recovery Grp. LLC, 902 F.3d 274, 280 (3d Cir. 2018). Carrington does not dispute the first two elements and instead argues generally that Cooke “makes conclusory statements without factual support” and thus fails to allege sufficient facts to demonstrate that it engaged in conduct prohibited by the FDCPA.

         A. Section 1692g

          The only alleged FDCPA violation against which Carrington offers a specific argument is Cooke's claim that Carrington violated 15 U.S.C. § 1692g by contradicting or overshadowing her rights to dispute the debt. Section 1692g provides that a debt collector must disclose certain information in its initial communication to a debtor or within five days of that communication. 15 U.S.C. § 1692g. Specifically, a debt collector must send the consumer a written debt validation notice containing the amount of the debt, the name of the creditor to whom the debt is owed, and “[a] statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector.” 15 U.S.C. § 1692g(a). To prevent debt collectors from engaging in collection practices that might confuse debtors about their debt validation rights, § 1692g also bars sending a technically compliant notice, but then “overshadowing” it with other communications: “Any collection activities and communication during the 30-day [validation] period may not overshadow or be inconsistent with the disclosure of the [debtor's] right to dispute the debt.” Id. ยง 1692g(b). ...

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