Williams v. Ocwen Loan Servicing, LLC

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

--------------------------------------,

CHERYLE WILLIAMS,

Plaintiff, Memorandum & Order

-against- 19-CV-2187 (KAM)(LB)

OCWEN LOAN SERVICING, LLC,

Defendant.

--------------------------------------X

MATSUMOTO, United States District Judge:

On April 15, 2019, pro se plaintiff Cheryle Williams

(“plaintiff”) commenced this action against Ocwen Loan

Servicing, LLC, an entity succeeded through merger by PHH

Mortgage Corporation (“defendant” or “Ocwen”), alleging

violations of the Fair Debt Collection Practices Act (“FDCPA”),

15 U.S.C. § 1692, et seq., and Regulation Z of the Truth-in-

Lending Act (“TILA”), 15 U.S.C. § 1601, et seq. (Compl., ECF

No. 1.) On November 15, 2019, plaintiff filed a motion for

leave to amend her complaint, requesting permission to add a new

defendant, Deutsche Bank, and asserting causes of action

sounding in common law fraud and alleged violations of due

process related to an allegedly fraudulent mortgage and mortgage

assignment. (Id.; Pl. Mem. in Support of Mot. to Amend (“Pl.

Mot. to Am.”), ECF No. 31; Am. Compl., ECF No. 32.)

Presently before the court are two motions. The first

is a motion by defendant, seeking dismissal of the complaint

under Federal Rule of Civil Procedure 12(b)(6) for failure to

state a claim. (Def. Mot. to Dis., ECF No. 26; Def. Mem. in

Support of Mot. to Dis. (“Def. Mem.”), ECF No. 27.) The second

is a motion by plaintiff, seeking leave to amend under Federal

Rule of Civil Procedure 15(a). (Pl. Mot. to Am., ECF No. 30.)

For the reasons detailed below, defendant’s motion to dismiss

this action is GRANTED and plaintiff’s motion to amend is

respectfully DENIED.

Background

I. Factual Background

a. Relevant Actors and Entities

On February 7, 2005, Plaintiff Cheryle Williams, a New

York State resident, and non-party Dolores Williams, executed a

mortgage on 124 Skiff Avenue, Unit G-11, Vineyard Haven, MA

02557 (“plaintiff’s property”). (See Compl. ¶¶ 12-13; Compl.,

Ex. A (the “mortgage assignment”).) On December 3, 2010, the

mortgage on the property was assigned from the original

mortgagee, Sand Canyon f/k/a Option One Mortgage Corporation

(“Sand Canyon”), to Deutsche Bank. (Compl. ¶ 12-13; Compl., Ex.

A.) A judgment was entered in a case before the Massachusetts

Land Court, allowing Deutsche Bank to foreclose on that same

property. (Id.; Pl. Aff., ECF No. 5; Pl. Mot. to Am. ¶¶ 9-14;

Deutsche Bank Nat. Trust Co. v. Williams, 18-SM-6098 (Mass. Land

Ct. 2018).)

Although plaintiff named Ocwen as the sole defendant

in her initial complaint, the proposed amended complaint seeks

to add Deutsche Bank Trust Company (“Deutsche Bank”) as Trustee

for Carrington Mortgage Loan Trust, Series 2005-OPT2, Asset-

Backed Pass-Through Certificate Series 2D05-OPT. (Am. Compl. ¶

3.) Deutsche Bank brought a successful suit in Massachusetts

Land Court to foreclose plaintiff’s property. (Compl. ¶ 13; Pl.

Mot. to Am. ¶ 10; Deutsche Bank Nat. Trust Co., 18-SM-006098.)

Deutsche Bank is also the assignee in the mortgage assignment

attached to plaintiff’s complaint. (Compl., Ex. A.) Ocwen is

the “non-bank servicer” of the loan. (Id. ¶ 10.)1

b. The Original and the Proposed Amended Complaint

The original complaint alleges that Ocwen attempted to

collect on a mortgage debt owed to plaintiff in violation of the

Fair Debt Collection Practices Act (“FDCPA”) and the Truth in

Lending Act (“TILA”). (Compl. ¶ 17.) The complaint attaches a

copy of a mortgage assignment, dated December 3, 2010, from Sand

Canyon to Deutsche Bank. (Compl., Ex. A.) Also attached is a

“cease and desist” letter from plaintiff, dated August 17, 2018,

1 The pleadings and the state court docket further demonstrate that

Deutsche Bank is the purported holder of the mortgage and the plaintiff in

Massachusetts Land Court, with Ocwen acting as a servicer of the debt. (Id.

at ¶¶ 10, 12-13; Pl. Mot. to Am. ¶¶ 9-14; Deutsche Bank Nat. Trust Co., 18-

SM-006098.)

alleging that the mortgage or mortgage assignment is fraudulent

and disputing the validity of the debt. (Compl., Ex. B.) The

complaint also attaches documents sent between Ocwen and

plaintiff in the months prior to the May 1, 2019 foreclosure

auction, including a “payoff quote” letter sent by Ocwen

summarizing the outstanding balance. (See Pl. Aff.; Pl. Aff.,

Ex. A.) Finally, the complaint includes a “Commercial

Affidavit,” arguing that: “Banks can not Lend Credit;” the

mortgage contract was without consideration; and that if

defendant Ocwen does not respond within 30 days it must “agree

to take no action against [plaintiff].” (Compl., Ex. C.)

In her proposed amended complaint, plaintiff alleges

that the assignment of the mortgage from the original mortgagee,

Sand Canyon, to Deutsche Bank, was invalid or “fraudulent.”

(See generally Am. Compl.; Pl. Mot. to Am.; Compl., Ex. A).

Plaintiff mentions various regulatory actions taken by

government agencies against Ocwen and Deutsche Bank in the past.

(See Am. Compl. ¶¶ 8-27; Am. Compl., Ex. A.) Plaintiff also

attaches a cease and desist letter from the Federal Reserve

Board of Governors identifying certain compliance and risk

management violations by Deutsche Bank and its affiliates. (See

Am. Compl., Ex. A.) Plaintiff does not describe how this letter

relates to the allegations or factual pleadings in the proposed

amended complaint. (Id.) Plaintiff also attaches a 2010 letter

from a Florida attorney claiming that a number of parties,

especially employees of an entity called Lender Processing

Services, Inc., allegedly produced hundreds of thousands of

fraudulent mortgage assignments for use in foreclosure actions.

(See Pl. Mot. to Am., Ex. A.) Plaintiff does not specify if or

how the letter relates to the specific mortgage assignment

challenged by the defendant that transferred the interest in the

property from Sand Canyon to Deutsche Bank. (See Compl., Ex.

A.)

II. Procedural History

Plaintiff filed this action pro se on April 15, 2019.

(See Compl.) Plaintiff filed a motion for a temporary

restraining order and preliminary injunction, seeking a stay on

a foreclosure auction scheduled for May 1, 2019, of the property

located at 124 Skiff Avenue, Unit G-11, Vineyard Haven, MA

02557. (Mot. for T. R. O. and Preliminary Injunction, ECF No.

4.) This court subsequently denied the motion for injunctive

relief. (Notice of Proposed Order, ECF No. 6; see ECF Docket

Order dated April 24, 2019.) On November 5, 2019, defendant

Ocwen filed the instant motion to dismiss for failure to state a

claim. (Def. Mot. to Dis., ECF No. 26.) On that same day,

plaintiff filed a motion for leave to amend the original

complaint. (Pl. Mot. to Am., ECF No. 30; Am. Compl., ECF No.

32.)

Legal Standard

I. Motion to Dismiss

On a motion to dismiss pursuant to Rule 12(b)(6), the

court accepts all well pleaded factual allegations in the

complaint as true and draws all reasonable inferences in favor

of the plaintiff. Chambers v. Time Warner, Inc., 282 F.3d 147,

152 (2d Cir. 2002). The court is not obligated to accept any

legal conclusions as correct. Ashcroft v. Iqbal, 556 U.S. 662,

678 (2009). In order to survive a motion to dismiss, the

complaint must include “sufficient factual matter...to ‘state a

claim to relief that is plausible on its face,’” Id. at 663

(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570

(2007)). “A claim has facial plausibility when the pleaded

factual content allows the court to draw the reasonable

inference that the defendant is liable for the misconduct

alleged.” Id.

For the purposes of deciding a 12(b)(6) motion the

court may consider not only the pleadings themselves, but also

“(1) documents attached to the complaint as an exhibit or

incorporated in it by reference, . . . (2) matters of which

judicial notice may be taken, or . . . (3) documents either in

plaintiffs’ possession or of which plaintiffs had knowledge and

relied on in bringing suit,” assuming these documents are

“integral to the Complaint.” Chambers., 282 F.3d at 153; see

Int’l Audiotext Network, Inc. v. Am. Tel. and Tel. Co., 62 F.3d

69, 72 (2d Cir. 1995). These documents “include[e] documents

filed in a related state court foreclosure proceeding.”

Harriott v. Nationstar Mortg. LLC, 2018 U.S. Dist. LEXIS 141120,

at *2 (E.D.N.Y. Aug. 17, 2018); see Global Network Commc’ns,

Inc. v. City of New York, 458 F.3d 150, 157 (2d Cir. 2006) (“A

court may take judicial notice of a document filed in another

court not for the truth of the matters asserted in the other

litigation but rather to establish the fact of such litigation

and related filings.”)

II. Motion to Amend

When considering a Rule 15 Motion to Amend, “[t]he

court should freely give leave when justice so requires.” Fed.

R. Civ. P. 15(a)(2). “Notwithstanding the liberality of the

general rule, it is within the sound discretion of the court

whether to grant leave to amend.” Copantitla v. Fiskardo

Estiatorio, Inc., 2010 U.S. Dist. LEXIS 33430, at *9 (S.D.N.Y.

Apr. 5, 2010) (citing John Hancock Mutual Life Insurance Co. v.

Amerford International Corp., 22 F.3d 458, 462 (2d Cir. 1994).

“[A] pro se plaintiff’s proposed amended complaint should be

construed to raise the strongest arguments it suggests.”

Grullon v. City of New Haven, 720 F.3d 133, 140 (2d Cir. 2013).

“Although district judges should, as a general matter,

liberally permit pro se litigants to amend their pleadings,

leave to amend need not be granted when amendment would be

futile.” Terry v. Inc. Vill. Of Patchogue, 826 F.3d 631, 633

(2d Cir. 2016) (citing Cuoco v. Moritsugu, 222 F.3d 99, 112 (2d

Cir. 2000)). A proposed amendment is futile as a matter of law

when it “fail[s] to state a claim on which relief could be

granted.” Schmidt v. Stone, No. 14-CV-2519 (RJD) (CLP), 2018

U.S. Dist. LEXIS 15048, at *17 (E.D.N.Y. Jan. 29, 2018). As a

result, in determining whether a proposed amended complaint

would be futile, “[t]he court applies the same standard as that

for a motion to dismiss under Rule 12(b)(6)...when deciding

whether to grant leave to amend.” Id. (citing Konrad v. Epley,

No. 12-CV-4021, 2013 U.S. Dist. LEXIS 169091, 2013 WL 6200009,

at *20 (E.D.N.Y. Nov. 25, 2013); see Balintulo v. Ford Motor

Co., 796 F.3d 160, 164–65 (2d Cir. 2015) (“A proposed amendment

to a complaint is futile when it could not withstand a motion to

dismiss.”)

Discussion

The operative complaint charges that (1) Ocwen is a

debt collector that violated the FDCPA; and (2) Ocwen also

violated Regulation Z of the Truth-in-Lending Act. Plaintiff

seeks to amend the complaint to add Deutsche Bank as a defendant

and allege that Deutsche Bank: (1) fraudulently assigned her

mortgage; and violated her (2) “due process” rights for which

she demands a five million dollar remedy. For the foregoing

reasons, the court agrees with defendant that plaintiff’s

proposed amendment would be futile and thus denies plaintiff’s

motion to amend her complaint.

Plaintiff alleges that the assignment of the mortgage

was invalid or otherwise fraudulent and, as a result, neither

Ocwen nor Deutsche Bank had a right to collect on the loan.

(Am. Compl. ¶¶ 30-35.) Plaintiff alleges that Deutsche Bank

failed to abide by the closing date in the Pooling and Service

Agreement (“PSA”) and that consequently, the mortgage assignment

was invalid. (Am. Compl. ¶¶ 37-43.) Plaintiff also asserts the

assignment she attached to her original complaint was forged.

(Compl., Ex. A.; Am. Compl. ¶¶ 5-29; Pl. Mot. to Am., Ex. A.)

The documents plaintiff attaches, however, largely fail to

relate to the assignment of her mortgage and relate instead to

regulatory and compliance deficiencies at Ocwen and Deutsche

Bank. (Id., Exhs. A, B.) Finally, plaintiff asks for five

million dollars in damages for an unspecified harm. (Id. at ¶

36.) The court assumes the request for monetary damages is

related to the alleged error in the assignments, fraud, or the

unspecified violation of plaintiff’s due process rights under

the Fifth and Fourteenth Amendments, as alleged in the

complaint. (Id. ¶¶ 2-3.) Defendants argue that plaintiff lacks

standing to challenge the validity of a mortgage assignment,

that the court lacks subject matter jurisdiction to disturb the

state court judgment pursuant to the Rooker-Feldman doctrine,

and that plaintiff cannot sustain a fraud claim against

defendant. The court addresses each argument in turn.

I. Futility of the Proposed Amendment

a. Plaintiff Lacks Standing to Challenge the Validity

of a Mortgage Assignment

Defendant argues that plaintiff lacks standing to

bring a third-party challenge to the validity of an assignment,

given that assignments are agreements to transfer a debt between

two creditors that do not affect the obligation of plaintiff,

the mortgagor, to pay. (See Def. Reply, ECF No. 34 at 5-7.)

The court agrees. The only specific allegations plaintiff

levels regarding the assignment’s validity is that Deutsche Bank

violated the closing date mandated by the Pooling Services

Agreement (“PSA”). (Am. Compl. ¶¶ 37-43.)

Plaintiff does not have standing to allege violations

of the PSA2. See Rajamin v. Deutsche Bank Nat. Tr. Co., 757 F.3d

2 The property that is the subject of the assignment lies in

Massachusetts. (Compl. ¶ 13.) The law in the First Circuit occasionally

allows for third-party challenges to assignments. See Culhane v. Aurora Loan

Servs. of Nebraska, 708 F.3d 282, 290 (1st Cir. 2013) (Finding standing since

“a Massachusetts real property mortgagor finds herself in an unusual position

because... Massachusetts law permits foreclosure without prior judicial

authorization”). However, even the Culhane exception does not support

standing for the instant plaintiff, because it is limited to cases where the

mortgagor alleges the assignment is void. Id. “[A] void mortgage assignment

is one in which the putative assignor ‘never properly held the mortgage and,

thus, had no interest to assign.’” Wilson v. HSBC Mortg. Servs., Inc., 744

F.3d 1, 10 (1st Cir. 2014) (quoting Culhane, 708 F.3d at 291). The exception

does not apply when the plaintiff merely alleges that the assignment of the

mortgage is “voidable.” Woods v. Wells Fargo Bank, N.A., 733 F.3d 349, 354

(1st Cir. 2013) (Voidable claims are “claims that merely assert procedural

infirmities in the assignment of a mortgage, such as a failure to abide by

the terms of a governing trust agreement”).

79, 84 (2d Cir. 2014) (noting that “[t]he weight of caselaw

throughout the country holds that a non-party to a PSA

lacks standing to assert noncompliance with the PSA as a claim

or defense unless the non-party is an intended...third party

beneficiary of the PSA”)(citing Rajamin v. Deutsche Bank

National Trust Co., No. 10-CV-7531, 2013 WL 1285160, at *3–4

(S.D.N.Y. Mar. 28, 2013)); Karamath v. U.S. Bank, N.A., 2012 WL

4327613, at *7 (E.D.N.Y. Aug. 29, 2012), adopted by 2012 WL

4327502 (E.D.N.Y. Sept.20, 2012) (“[P]laintiff is not a party to

the PSA or to the Assignment of Mortgage, and is not a third-

party beneficiary of either, and therefore has no standing to

challenge the validity of that agreement or the assignment”);

Boco v. Argent Mortg. Co, LLC, No. 13-CV-1165 (DLI)(CLP), 2014

WL 1312101, at *3 (E.D.N.Y. Mar. 31, 2014); Berezovskaya v.

Deutsche Bank Nat. Tr. Co., No. 12-CV-6055 (KAM), 2014 WL

4471560, at *8 (E.D.N.Y. Aug. 1, 2014) (“[E]ven assuming that

Here, plaintiff alleges the assignment is invalid because

Deutsche Bank failed to abide by the closing date in the Pooling and Service

Agreement. (Am. Compl. ¶¶ 37-43; Pl. Mot. to Am., Ex. A.) Plaintiff,

however, does not allege that Sand Canyon, the original holder of the note

and assignor to Deutsche Bank, never held the mortgage. (Id.) Though this

court does not purport to issue a ruling on law in the First Circuit, on the

facts alleged, plaintiff would likely not have a basis for standing even in

Massachusetts. See Halacy v. Wells Fargo Bank, N.A., No. CIV.A. 12-11447-TSH,

2013 WL 6152351, at *3 (D. Mass. Nov. 21, 2013) (“while a mortgagor

has standing in limited circumstances to challenge an assignment of his

mortgage, he cannot invoke the terms of PSA to challenge an otherwise

valid assignment”); Orellana v. Deutsche Bank Nat. Tr. Co., No. CIV.A. 12-

11982-NMG, 2013 WL 5348596, at *5 (D. Mass. Aug. 30, 2013) (“[C]ourts have

held that a plaintiff lacks standing to challenge an assignment to a trust

that occurred after its closing date.”) (internal quotation omitted).

Moreover, Plaintiff has not explained whether her current allegation

regarding the assignment was raised in the Massachusetts foreclosure action.

the transfer of the CEMA to the Trust took place after

the closing date set forth in the PSA, this would render the

transfer merely voidable at the election of either party to

the PSA, not void. Most importantly, this transfer is not

subject to a challenge by plaintiff, who is not a party to

the PSA.”); In re Lake Charles Retail Dev. LLC, No. 13-44093

(NHL), 2014 WL 4948234, at *9 (Bankr. E.D.N.Y. Sept. 30, 2014)

(Finding that “because the Debtor predicates its claims for

relief on an alleged failure to comply with the PSA, the

Complaint is dismissed”).

The court agrees with defendant that plaintiff lacks

standing to bring a claim alleging a violation of the PSA, and

thus her motion to amend would be futile.

c. The Court Lacks Subject Matter Jurisdiction Pursuant

to the Rooker-Feldman Doctrine

Plaintiff argues in her proposed amended complaint

that Deutsche Bank lacked standing to bring the Massachusetts

foreclosure action and asks this court to effectively invalidate

the state court proceeding. (Compl. ¶ 13; Am. Compl. ¶¶ 29, 36,

48.) A judgment was entered against plaintiff in Massachusetts

Land Court on December 14, 2018, about five months before the

commencement of this action. (See Deutsche Bank Nat. Trust Co.,

18-SM-006098; Compl. ¶ 13; Pl. Mot. to Am. ¶ 10.) To the extent

that plaintiff requests that this court exercise jurisdiction

over any issue in the Massachusetts Land Court adjudication,

this court lacks subject matter jurisdiction pursuant to the

Rooker-Feldman doctrine. “Four requirements must be met for the

doctrine to apply: (i) the federal court plaintiff must have

lost in state court, (ii) the plaintiff must complain of

injuries caused by a state court judgment, (iii) the plaintiff

must invite district court review and rejection of that

judgment, and (iv) the state court judgment must have been

rendered before the district court proceedings commenced.”

Pennicott v. JPMorgan Chase Bank, N.A., No. 16 CV 3044 (VB),

2018 WL 1891312, at *3 (S.D.N.Y. Apr. 18, 2018). All of the

foregoing factors are satisfied here.

The court must dismiss plaintiff’s claim that Deutsche

Bank lacked standing or was otherwise ineligible to bring the

state court foreclosure action. See Rockwood v. Cenlar FSB, No.

17-CV-10153 (VB), 2018 WL 2122820, at *3 (S.D.N.Y. May 8, 2018)

(“Rooker-Feldman bars claims that ask a court to find a

defendant lacked standing to pursue foreclosure in a prior state

court action, because such claims require a court to sit in

review of the state court judgment.”). The allegations of fraud

in relation to allegedly forged documents are also the exact

type of collateral attack prohibited by Rooker-Feldman. Gifford

v. United N. Mortg. Bankers, Ltd., No. 18-CV-6324(PAE)(HBP),

2019 WL 2912489, at *8 (S.D.N.Y. July 8, 2019) (“[P]laintiff’s

allegation that defendants engaged in fraudulent conduct by

presenting the state court with allegedly ‘void’ and ‘forged’

documents does not save her proposed fraud claims because ‘if

the court were to accept the plaintiff’s claim that the loan

documents were forged, the court’s ruling would necessitate a

finding that the judgment of foreclosure and sale was

erroneously entered, and thus, void which ... is precisely the

result that the Rooker-Feldman doctrine seeks to avoid.’”)

(quoting Ashworth v. Boggio, 15-CV-948 (JFB)(ARL), 2016 WL

4398956 at *5 (E.D.N.Y. July 26, 2016) (Report &

Recommendation), adopted at, 2016 WL 4399311 (E.D.N.Y. Aug. 15,

2016)). Because this court lacks jurisdiction to consider and

rule on matters that were decided by an earlier state court

proceeding, plaintiff’s claims are futile and her motion to

amend is denied.

c. Fraud Claims

Plaintiff makes a series of fraud claims throughout

her proposed amended complaint against both Deutsche Bank and

Ocwen. (See generally Am. Compl.) Plaintiff alleges that the

signatures on the mortgage assignment to Deutsche Bank were

“forged” and alleges in conclusory language that Deutsche Bank

has engaged in fraud. (Am. Compl. ¶¶ 30-32.) In support of her

claim, plaintiff references a series of regulatory actions

against the original and proposed defendants. These include an

investigation by the Multi-State Mortgage Committee, which found

deficiencies in Ocwen’s management and regulatory compliance

systems. (Am. Compl. ¶¶ 7-24.) Plaintiff also references a

lawsuit filed by the Consumer Financial Protection Bureau

against Ocwen. (Id. ¶¶ 25-28.) Plaintiff does not explain the

connection between these government actions and the instant case

other than to allege that they “go[] to the credibility of

Defendant Ocwen.” (Id. ¶ 27.) Plaintiff attaches a cease and

desist order filed by the Federal Reserve Board of Governors

identifying shortcomings in Deutsche Bank’s risk management

practices. (Am. Compl., Ex. A.) In plaintiff’s memorandum in

support of her amendment, she includes a letter written by one

Lynn E. Szymoniak, Esq. to the Securities and Exchange

Commission in 2010. (Pl. Mot. to Am., Ex. A.) This letter

alleges that a mortgage default management company had its

employees masquerade as employees of lenders, including Deutsche

Bank and Sand Canyon, in order to fraudulently recreate lost or

invalid assignments. (Id.) The letter does not allege that the

lenders themselves committed fraud, but instead that companies

they hired to process assignments conducted the fraud by

creating documents that were not “in recordable form.” (Id.)

The letter claims the Trusts would have to incur millions of

dollars replacing fraudulent assignments or litigating

foreclosure cases where there were missing assignments. (Id.)

The letter also makes legal arguments that these assignments

would be insufficient to enforce a foreclosure action. (Id.)

There is no discernable, specific connection between the 2010

letter and the instant case.

Plaintiff’s proposed amended pleading is insufficient

to state a fraud claim under New York law. The elements of a

common law fraud claim are: “(1) a material, false

representation, (2) an intent to defraud thereby, and (3)

reasonable reliance on the representation, (4) causing damage to

the plaintiff.” Knox v. Countrywide Bank, 4 F. Supp. 3d 499,

509 (E.D.N.Y. 2014) (quoting Chanayil v. Gulati, 169 F.3d 168,

171 (2d Cir.1999)); see also Woods v. Wells Fargo Bank, N.A.,

733 F.3d 349, 357 (1st Cir. 2013). Reading the proposed

pleading in the light most favorable to the pro se plaintiff,

plaintiff argues that the assignment of the mortgage was

fraudulent or that the mortgage itself was fraudulent, and

supports that assertion with the “false representation” of the

assignment document. (See Compl., Ex. A.) Plaintiff has not,

however, presented particularized facts that could support a

claim that Ocwen or Deutsche Bank made material false

representations to her, had “intent to defraud” her, or that she

“reasonably relied” on their representations, and provides no

specific explanation of what damage she suffered other than the

foreclosure action in state court. (Am. Compl. ¶ 29.)

Furthermore, plaintiff has not pled the elements of a

fraud claim with sufficient particularity. “Federal Rule of

Civil Procedure 9(b) imposes a heightened pleading

standard...requiring that ... [p]laintiffs’ allegations must (1)

specify the statements that the plaintiff contends were

fraudulent, (2) identify the speaker, (3) state where and when

the statements were made, and (4) explain why the statements

were fraudulent” for each element of the fraud claim. Zutel v.

Wells Fargo Bank, N.A., No. 12-CV-3656 (RRM)(VMS), 2014 WL

4700022, at *6 (E.D.N.Y. Sept. 22, 2014) (internal quotation

omitted); see Fed. R. Civ. P. 9(b). Plaintiff has failed to

meet this standard in her current and proposed amended

complaints. See Ocampo v. JP Morgan Chase Bank, N.A., 93 F.

Supp. 3d 109, 119 (E.D.N.Y. 2015) (“Plaintiffs...merely assert

in a conclusory fashion that the copies of the documents sought

to be recorded...were forgeries. Thus...Plaintiffs fail to state

a claims [sic] for forgery, and [the court] grants Defendant's

motion to dismiss...”); Levin v. Am. Document Servs., LLC, No.

17-CV-1285 (JMA)(AYS), 2019 WL 3883640, at *8 (E.D.N.Y. June 25,

2019), Report and Recommendation adopted, No. 17-CV-1285

(JMA)(AYS), 2019 WL 3859402 (E.D.N.Y. Aug. 16, 2019)

(“Plaintiffs base their claim of fraud on their contention that

the assignment ‘bears false signature.’ However, Plaintiffs are

not parties or beneficiaries to the assignment...Thus,

misrepresentations as to the manner of assignment would not make

any difference.”).

Plaintiff’s motion to amend to include claims of fraud

and is futile and therefore denied.

II. Defendant’s Motion to Dismiss FDCPA and TILA Claims in

the Operative Complaint

Having denied plaintiff’s motion to amend for

futility, the court next evaluates defendant’s motion to dismiss

plaintiff’s operative complaint. Because plaintiff fails to

state a claim for reasons to be discussed, defendant’s motion to

dismiss is granted.

a. Fair Debt Collection Practices Act Claim

In the context of the FDCPA, the court evaluates debt

collection communications from the perspective of the “least

sophisticated consumer.” See Russell v. Equifax A.R.S., 74 F.3d

30, 34 (2d Cir. 1996) (“[T]he test is how the least

sophisticated consumer — one not having the astuteness of a

‘Philadelphia lawyer’ or even the sophistication of the average,

everyday, common consumer — understands the notice he or she

receives”); Jacobson v. Healthcare Fin. Servs., Inc., 516 F.3d

85, 90 (2d Cir. 2008) (“The purpose of the least-sophisticated-

consumer standard, here as in other areas of consumer law, is to

ensure that the statute protects the gullible as well as the

shrewd.”).

Debt collectors may be liable for failing to meet the

statutory requirements for debt collection letters or for

sending “false or misleading” communications to the debtor. 15

U.S.C. § 1692g(a)-(b); 15 U.S.C. § 1692e. Liberally construing

plaintiff’s pleadings as the law requires, plaintiff appears to

attempt to allege violations of 15 U.S.C. § 1692g and 15 U.S.C.

§ 1692e in her complaint. (See Compl. ¶¶ 14, 18.)

“To state a claim under the FDCPA, a plaintiff must

allege that (1) plaintiff is a consumer, (2) defendant is a debt

collector, and (3) the defendant has engaged in any

act or omission in violation of FDCPA requirements.” Fraser v.

Aames Funding Corp., No. 16-CV-448 (AMD)(LB), 2017 U.S. Dist.

LEXIS 10491, at *11 (E.D.N.Y. Jan. 23, 2017). First, the

parties agree that plaintiff is a “consumer” under the meaning

of the statute. (Compl. ¶ 1; Def. Mem. at 5.) “The term

‘consumer’ means any natural person obligated or allegedly

obligated to pay any debt.” (15 U.S.C. § 1692(a).

Second, typically the owner of a mortgage cannot be

considered a debt collector under the FDCPA because

“the FDCPA limits its reach to those collecting the dues ‘of

another’ and does not restrict the activities of creditors

seeking to collect their own debts.” Somin v. Total Cmty. Mgmt.

Corp., 494 F. Supp. 2d 153, 159 (E.D.N.Y. 2007) (citing Maguire

v. Citicorp Retail Services, Inc., 147 F.3d 232, 235 (2d Cir.

1998)). Ocwen could be considered a debt collector if it was

servicing a debt that was not its own and if that debt was in

default at the time it was assigned. In re Jacques, 416 B.R.

63, 75 (Bankr. E.D.N.Y. 2009) ("[T]he FDCPA does not apply to

mortgage servicing companies unless the mortgage at issue was

already in default at the time when servicing began") (emphasis

added); Cummins v. Select Portfolio Servicing, Inc., No. 14-CV-

5121 (MKB)(LB), 2016 U.S. Dist. LEXIS 113565, at *17 (E.D.N.Y.

Aug. 23, 2016) (“[A]n entity collecting or attempting to collect

any debt owed to another is treated as a debt collector if the

debt sought to be collected was in default at the time the debt

was obtained.”). The pleadings allege that Ocwen serviced the

debt on behalf of Deutsche Bank. (Compl. ¶ 10; see generally

Am. Compl.) The original complaint alleges that the mortgage

was in default on the date Ocwen attempted to collect on it.

(Compl. ¶¶ 12-13.) Although the complaint claims that defendant

“attempted to collect...after default,” plaintiff does not

specify when plaintiff defaulted or when Ocwen attempted to

collect. (Id. ¶ 12.) While unclear, plaintiff may be

referencing a debt collection letter not provided in the

pleadings, which she references in an August 17, 2018 cease and

desist letter. (Compl., Ex. B.)3 Construing the complaint in

3 Plaintiff may also be referencing a letter dated February 19, 2019, sent

by Ocwen shortly before the foreclosure auction, summarizing her outstanding

mortgage balance in a “payoff quote” letter with language in the footer

the light most favorable to the plaintiff, it is “plausible”

that Ocwen is a debt collector under the definition of the act.

See, e.g., Pereira v. Ocwen Loan Servicing, LLC., No. 11-CV-2672

(SJF) (ETB), 2012 U.S. Dist. LEXIS 56044, at *7 (E.D.N.Y. Mar.

12, 2012) (given a dearth of information about the status and

ownership of the debt, the court found it “plausible that Ocwen

was servicing the mortgage loan and is therefore considered a

debt collector within the meaning of the FDCPA.”).

Third, drawing all favorable inferences that plaintiff

is a consumer, and that Ocwen may be considered a debt

collector, plaintiff has failed to sufficiently plead that “the

defendant has engaged in any act or omission in violation of

FDCPA requirements” under 15 U.S.C. § 1692g. See Fraser, LEXIS

10491, at *11. Section 1692g “was enacted to eliminate the

recurring problem of debt collectors dunning the wrong person or

attempting to collect debts which the consumer has already

paid.” Ellis v. Solomon & Solomon, P.C., 591 F.3d 130, 134 (2d

Cir. 2010) (internal quotations omitted). In order to prevent

such errors, Section 1692g(a) requires that a proper debt

collection notice include the following information:

(1) the amount of the debt; (2) the name of the

creditor to whom the debt is owed; (3) a statement

that unless the consumer, within thirty days after

receipt of the notice, disputes the validity of the

indicating that Ocwen is attempting to collect on the debt. (See Pl. Aff.,

Ex. C.)

debt, or any portion thereof, the debt will be assumed

to be valid by the debt collector; (4) a statement

that if the consumer notifies the debt collector in

writing within the thirty-day period that the debt, or

any portion thereof, is disputed, the debt collector

will obtain verification of the debt or a copy

of a judgment against the consumer and a copy of such

verification or judgment will be mailed to the

consumer by the debt collector; and (5) a statement

that, upon the consumer's written request within the

thirty-day period, the debt collector will provide the

consumer with the name and address of the original

creditor, if different from the current creditor.

15 U.S.C. § 1692g(a). Plaintiff fails to make any specific

allegations about any alleged deficiencies in any debt

collection document(s). (See generally Compl.) Plaintiff

provides her own cease and desist letter, dated August 17, 2018,

the first sentence of which asserts “you have chosen not to

respond to my request for a valid proof of claim.” (Compl., Ex.

A.) Plaintiff also attaches a “Payoff Quote” sent by Ocwen on

February 19, 2019, that allegedly functioned as an attempt to

collect a debt against the instant property. (Pl. Aff., Ex. C.)

However, it appears that the funds to be reclaimed were against

the property itself before the foreclosure auction and after a

judgment was entered in state court in the foreclosure action.

Id. As the court previously held, the court lacks jurisdiction

to consider collateral challenges to state foreclosure

proceedings. (See ECF Docket Order dated April 24, 2019.)4

4 This is afforded more thorough treatment in this court’s discussion of

the Rooker-Feldman doctrine, supra.

Further, plaintiff has not alleged that she disputed

the debt within the thirty day window. In order to dispute the

validity of a debt under § 1692g, a plaintiff must dispute it

within thirty days of receipt of the collection letter. 15

U.S.C. § 1692g(a)(3); Ritter v. Cohen & Slamowitz, LLP, 118 F.

Supp. 3d 497, 500 (E.D.N.Y. 2015). Even drawing a favorable

inference that plaintiff in fact disputed the validity of the

debt she referenced in her August 17, 2018 letter, she supplies

no dates for defendant’s response. (Compl., Ex. B.) This

deficiency is fatal to plaintiff’s claim. See Bonner v. The

Bank of New York Mellon, No. 15-CV-3280 (SJF)(GRB), 2016 WL

1426515, at *4 (E.D.N.Y. Feb. 22, 2016) (“[A]lthough [plaintiff]

alleges that he repeatedly requested that the Collection

Defendants verify the questioned debts, he does not allege that

he made any of these requests within the thirty day time window

...Without such factual pleading, it is entirely speculative,

and not ‘plausible,’ that Plaintiff has a cognizable claim)

(quoting Agu v. Rhea, No. 09-CV-4732 (JS)(AKT), 2010 WL 5186839,

at *5 (E.D.N.Y. Dec. 15, 2010).

Plaintiff sent a “Conditional Acceptance for Value and

Counter Offer/Claim for Proof of Claim” asking for confirmation

of the validity of a claimed debt on April 1, 2019. (Pl. Aff.,

Exhs. C, D.) Plaintiff claims defendant sent her a collection

notice on March 1, 2019, exactly one month before plaintiff’s

April 1, 2019 letter. (Pl. Aff., Ex. C.) Plaintiff, however,

proffers Ocwen’s February 19, 2019 letter, assuming it can be

construed as a collection notice, informing plaintiff of her

outstanding mortgage balance. (Id.) When considering a motion

to dismiss, “[i]f a document relied on in the complaint

contradicts allegations in the complaint, the document, not the

allegations, control[s], and the court need not accept the

allegations in the complaint as true.” Roberts v. Bliss, 229 F.

Supp. 3d 240, 248 (S.D.N.Y. 2017) (quoting Poindexter v. EMI

Record Grp. Inc., No. 11-CV-559, 2012 WL 1027639, at *2

(S.D.N.Y. Mar. 27, 2012)). Consequently, the court finds that

even if the court were to construe defendant’s February 19, 2019

letter as a collection notice, plaintiff did not respond until

April 1, 2019, well outside the thirty day window.

The court also cannot find that the plaintiff

plausibly alleges “[t]he use of any false representation or

deceptive means to collect or attempt to collect any debt or to

obtain information concerning a consumer” by defendant. 15

U.S.C. § 1692e(10); Easterling v. Collecto, Inc., 692 F.3d 229,

233 (2d Cir. 2012)(under the least sophisticated consumer

standard “collection notices can be deceptive if they are open

to more than one reasonable interpretation, at least one of

which is inaccurate”). The cease and desist letter sent by

plaintiff to defendant cannot serve as the basis for a claim,

since “[t]he FDCPA's protections are not triggered by

communications initiated by someone other than the debt

collector.” Boyd v. J.E. Robert Co., No. 05-CV-2455 (KAM)(RER),

2010 WL 5772892, at *13 (E.D.N.Y. Mar. 31, 2010).

Because plaintiff cannot state a claim on which relief

can be granted, defendant’s motion to dismiss plaintiff’s FDCPA

claims is granted.

b. Truth in Lending Act Claim

Plaintiff alleges a violation of Regulation Z of the

Truth in Lending Act (“TILA”) by defendant, stemming from

defendant’s purported failure to respond to plaintiff’s letters

seeking validation of funds and other unspecified failures to

disclose information. (Compl. ¶ 17.) These are substantially

the same facts that underlie plaintiff’s FDCPA claim. (See

generally, id.) It is unclear what remedy plaintiff seeks for

the alleged violation of TILA, although the court, reading the

pleadings in the light most favorable to the plaintiff, assumes

that plaintiff is seeking to rescind the loan and/or claim

monetary damages. (Id. ¶ 17.)

First, plaintiff’s TILA claim is time barred.

Borrowers have an unconditional right to rescind particular

types of loans up to three days after the loan transaction is

consummated. 15 U.S.C. § 1635(a); see Smith v. Wells Fargo

Bank, N.A., 666 F. App'x 84, 85 (2d Cir. 2016). If plaintiff

alleges that the disclosures required by statute were never

provided, she may assert a claim for rescission within three

years after the closing. Id. at § 1635(f); Jesinoski v.

Countrywide Home Loans, Inc., 574 U.S. 259, 260 (2015). The

documents provided in the pleadings indicate that the instant

loan was closed on February 7, 2005, over 14 years before the

commencement of this suit. (Compl., Ex. A.) Plaintiff’s TILA

claim for recission is well outside of the eligible time window5.

The statute of limitations may not be tolled in this

case. “Equitable tolling is available in ‘rare and exceptional

circumstances,' where the court finds that ‘extraordinary

circumstances' prevented the party from timely performing a

required act, and that the party ‘acted with reasonable

diligence throughout the period he sought to toll.’” Williams

v. Aries Fin., LLC, No. 09-CV-1816 (JG)(RML), 2009 WL 3851675,

at *6 (E.D.N.Y. Nov. 18, 2009)(alterations omitted) (quoting

Walker v. Jastremski, 430 F.3d 560, 563 (2d Cir.2005)).

Equitable tolling is only available when: “(1) the defendant

5 The right of rescission under the Truth in Lending Act is not available

for residential mortgages. Grimes v. Fremont Gen. Corp., 785 F. Supp. 2d

269, 284 (S.D.N.Y. 2011) (citing Ng v. HSBC Mortg. Corp., No. 07–CV–5434,

2010 WL 889256, at *2 (E.D.N.Y. Mar. 10, 2010)). However, because plaintiff

does not specify whether she bought and intended to use the property as a

home, the court cannot dismiss on this ground alone. See Nembhard v.

Citibank, N.A., No. 96–CV–3330, 1996 WL 622197, at *2 (E.D.N.Y. Oct. 22,

1996) (“[S]ince the complaint itself and the loan documents submitted as

exhibits to the complaint unambiguously state that the funds were used to

finance the acquisition of the home ... to be occupied by the plaintiff,”

there is no right of rescission under TILA) (emphasis added).

wrongfully concealed material facts relating to defendant's

wrongdoing; (2) the concealment prevented plaintiff's discovery

of the nature of the claim within the limitations period; and

(3) plaintiff exercised due diligence in pursuing the discovery

of the claim during the period plaintiff seeks to have tolled.”

Corcoran v. N.Y. Power Auth., 202 F.3d 530, 543 (2d Cir. 1999).

“In cases involving TILA, ‘the courts have held uniformly that

fraudulent conduct beyond the nondisclosure itself is necessary

to equitably toll the running of the statute of limitations.’”

Cardiello v. The Money Store, Inc., 2001 WL 604007, at *5

(S.D.N.Y. June 1, 2001) (emphasis added) (quoting Pettola v.

Nissan Motor Accept. Corp., 44 F.Supp. 2d. 442, 450

(D.Conn.1999)); Grimes, 785 F. Supp. 2d at 284; Gonzalez v. J.P.

Morgan Chase Bank, N.A., 228 F. Supp. 3d 277, 291 (S.D.N.Y.

2017). Plaintiff has provided no facts showing or supporting an

inference that defendants violated the disclosure requirements

of TILA, let alone facts which show fraudulent concealment

beyond the TILA violations. (See generally Compl.)

Plaintiff also has no damages remedy. A borrower

seeking monetary damages under TILA must file suit “within one

year from the date of the occurrence of the violation.” 15

U.S.C. § 1640(e). Again, plaintiff entered into her mortgage

agreement in February 2005, over fifteen years ago. (Compl.,

Ex. A.) Although plaintiff does not specify what disclosure

violations defendant committed or when, “[i]t is well-settled

law that where a claim for damages under TILA is premised on the

failure to provide material disclosures, ‘the date of the

occurrence of the violation is no later than the date the

plaintiff enters the loan agreement or, possibly, when defendant

performs by transmitting the funds to plaintiffs.’” Midouin v.

Downey Sav. & Loan Ass'n, F.A., 834 F. Supp. 2d 95, 108

(E.D.N.Y. 2011) (citing Cardiello v. Money Store, Inc., No. 00–

CV–7332, 2001 WL 604007, at *3, aff'd, 29 Fed. App’x 780 (2d

Cir. 2002)). Plaintiff also cannot argue that the “recoupment”

exception to the statute of limitations applies because “in

order to bring a claim for damages after the one-year

limitations period has expired, plaintiff must assert her

damages claims as a defense by recoupment ‘in a collection

action brought by the lender.’” Id. (citing Beach v. Ocwen Fed.

Bank, 523 U.S. 410, 412, 118 S.Ct. 1408, 140 L.Ed.2d 566

(1998)). Here, the plaintiff borrower filed suit against the

defendant lender, and so the recoupment exception does not

apply. Id.

Again, the doctrine of equitable tolling does not

apply, as plaintiff has made no allegations of fact regarding

the required elements. See Semper v. New York Methodist Hosp.,

786 F. Supp. 2d 566, 578 (E.D.N.Y. 2011) (“[E]quitable

tolling may be appropriate where, for instance, the claimant has

actively pursued his judicial remedies by filing a defective

pleading during the statutory period, or where the complainant

has been induced or tricked by his adversary's misconduct ...’”)

(quoting Irwin v. Dep't of Veterans Affairs, 498 U.S. 89, 96

(1990); Latouche v. Well[s] Fargo Home Mortg. Inc., No. 16-CV-

1175 (ERK), 2017 WL 8776975, at *7 (E.D.N.Y. Aug. 25, 2017) (“To

survive a motion to dismiss an otherwise untimely TILA claim,

the pleading must first allege, with specificity, efforts by the

defendant, above and beyond the wrongdoing upon which the

plaintiff’s claim is founded, to prevent ... the plaintiff from

suing in time.”) (emphasis added) (internal quotation omitted).

Accordingly, defendant’s motion to dismiss plaintiff’s

TILA claims is granted.

Conclusion

For the foregoing reasons, plaintiff’s motion to amend is

respectfully DENIED. Defendant’s motion to dismiss the complaint

is GRANTED. The Clerk of the Court is respectfully directed to

enter judgment and close the case, and send a copy of the

Memorandum and Order and the judgment to the plaintiff, and note

service on the docket.

SO ORDERED.

Dated: Brooklyn, New York

September 27, 2020

_____________ /______________

Hon. Kiyo A. Matsumoto

United States District Judge