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Melvin Neagle v. Altisource Solutions, 19-35272 (2020)

Court: Court of Appeals for the Ninth Circuit Number: 19-35272 Visitors: 18
Filed: Sep. 09, 2020
Latest Update: Sep. 09, 2020
Summary: NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS SEP 9 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT MELVIN RAY NEAGLE, No. 19-35272 Plaintiff-Appellant, D.C. No. 6:18-cv-00754-MC v. MEMORANDUM* ALTISOURCE SOLUTIONS, INC., a Delaware Corporation; et al., Defendants-Appellees, and GOLDMAN SACHS GROUP INC., a Delaware Corporation, Defendant. Appeal from the United States District Court for the District of Oregon Michael J. McShane, District Judge, Presiding Submitt
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                           NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        SEP 9 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

MELVIN RAY NEAGLE,                              No.    19-35272

                Plaintiff-Appellant,            D.C. No. 6:18-cv-00754-MC

 v.
                                                MEMORANDUM*
ALTISOURCE SOLUTIONS, INC., a
Delaware Corporation; et al.,

                Defendants-Appellees,

and

GOLDMAN SACHS GROUP INC., a
Delaware Corporation,

                Defendant.

                   Appeal from the United States District Court
                             for the District of Oregon
                   Michael J. McShane, District Judge, Presiding

                              Submitted July 8, 2020**
                                 Portland, Oregon




      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: M. MURPHY,*** BENNETT, and MILLER, Circuit Judges.

      Melvin Ray Neagle brought this action against various entities involved in

servicing his mortgage: Ocwen Loan Servicing, LLC, Ocwen Mortgage Servicing,

Inc., and Ocwen Financial Corporation (collectively, Ocwen)—Neagle’s loan

servicers; MTGLQ Investors, L.P., an assignee of Ocwen’s; and Altisource

Solutions, Inc., a provider of default-related services to Ocwen. As relevant here,

Neagle asserted claims under the Sherman Act, 15 U.S.C. §§ 1, 2, seeking damages

for the additional debt added to his mortgage based on fees incurred as a result of

an alleged conspiracy to inflate the cost of third-party default-related services. The

district court dismissed the complaint for failure to state a claim. We have

jurisdiction under 28 U.S.C. § 1291. We affirm.

      We review the district court’s order dismissing the complaint de novo.

Kahle v. Gonzales, 
487 F.3d 697
, 699 (9th Cir. 2007). To survive a motion to

dismiss, the 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 Atl. Corp. v. Twombly, 
550 U.S. 544
, 570 (2007)).

We may affirm on any ground supported by the record. Salameh v. Tarsadia Hotel,

726 F.3d 1124
, 1129 (9th Cir. 2013).



      ***
            The Honorable Michael R. Murphy, United States Circuit Judge for
the U.S. Court of Appeals for the Tenth Circuit, sitting by designation.

                                            2
      The district court dismissed Neagle’s claims against Ocwen and MTGLQ

because Neagle failed to allege that he complied with the notice requirement in his

deed, which required him to give Ocwen and MTGLQ opportunity to cure any

breach before bringing this lawsuit. The parties dispute whether the district court

correctly interpreted the deed, but we need not resolve that dispute.

      Instead, we affirm the district court’s dismissal of all of Neagle’s damages

claims under the direct-purchaser rule of Illinois Brick Co. v. Illinois, 
431 U.S. 720
, 745–46 (1977). Under Section 4 of the Clayton Act, only “‘the immediate

buyers from the alleged antitrust violators’ may maintain a suit against the antitrust

violators.” Apple Inc. v. Pepper, 
139 S. Ct. 1514
, 1520 (2019) (quoting Kansas v.

UtiliCorp United Inc., 
497 U.S. 199
, 207 (1990)). Neagle did not directly purchase

the default-related services whose prices he says that the alleged antitrust

conspiracy inflated. Instead, Neagle alleges that Ocwen directed Altisource to

order default-related services from third-party vendors who charge Altisource for

those services; that Altisource marked up the price for those services and passed

the markup on to Ocwen; and that Ocwen then billed the marked-up cost to

borrowers, like Neagle. Neagle claims that the antitrust conspiracy inflated the

prices that Ocwen had to pay for those services and, consequently, the prices it

charged to borrowers.




                                          3
      Neagle relies on Freeman v. San Diego Ass’n of Realtors, 
322 F.3d 1133
(9th Cir. 2003), in which we held that indirect purchasers have antitrust standing

when there is “no realistic possibility that the direct purchaser will sue its supplier

over the antitrust violation.”
Id. at 1145–46.
He argues that there is no realistic

possibility that Ocwen would sue Altisource because Altisource was spun-off from

Ocwen as a separate company in 2009, and the companies share “key executives.”

But we have explained that Freeman’s holding is narrow and that the key fact

supporting antitrust standing in that case was “the [supplier’s] ownership and

control of [the direct purchaser].” In re ATM Fee Antitrust Litig., 
686 F.3d 741
,

754 (9th Cir. 2012). That type of direct corporate relationship is not present here.

      To the extent Neagle seeks injunctive relief, Illinois Brick would not bar his

claims. See 
Freeman, 322 F.3d at 1145
. But although the complaint sought an

injunction, Neagle did not mention the possibility of injunctive relief on appeal.

We therefore hold that Neagle abandoned his claim for injunctive relief. See In re

Rigel Pharm., Inc. Sec. Litig., 
697 F.3d 869
, 871 n.3 (9th Cir. 2012). In any event,

we agree with the district court that Neagle did not state a plausible claim for relief

because he did not “allege a relevant market for Ocwen and [did not] allege that

Altisource has market power in the default-related services market.”

      AFFIRMED.




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