JEFFREY T. MILLER, District Judge.
Pursuant to Fed.R.Civ.P. 12(f), Plaintiffs Atley and Laura Henry move to strike the affirmative defenses alleged by Defendants Ocwen Loan Servicing, LLC ("Ocwen") and Deutsche Bank National Trust Company ("Deutsche Bank"), erroneously sued as Impac Mortgage Corp. ("Impac"), as Trustee Under the Pooling and Servicing Agreement Relating to Impac Secured Assets Corp., in response to Plaintiff' First Amended Complaint ("FAC"). Defendants oppose the motion. Pursuant to Local Rule 7.1(d)(1), the court finds the matters presented appropriate for resolution without oral argument. For the reasons set forth below, the court denies the motion to strike.
On June 27, 2017, Plaintiffs filed the FAC, alleging four causes of action for: (1) violation of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §1681s-2(b); (2) violation of the California Consumer Credit Reporting Agencies Act ("CCCRA"), Cal. Div. Code §1785.25(a); (3) violation of the Rosenthal Fair Debt Collection Practices Act ("RFDCPA"); and (4) breach of contract. Plaintiffs' causes of action arise from the following generally described allegations.
In 2009, Plaintiffs allegedly obtained a "home mortgage loan" from Impac, who had retained Ocwen to act as the loan servicer. (FAC ¶¶17, 18). "At some point in 2012 or 2013, Plaintiffs began suffering financial difficulties in making their full monthly payments upon the loan." (FAC ¶23). In July 2013, Plaintiffs allegedly received a document from Impac entitled "Loan Modification Agreement," indicating that the monthly payments were being reduced to $310.09. (FAC ¶25). By letter dated October 16, 2013, Ocwen informed Plaintiffs that their loan modification had been approved, subject to submitting a notarized signed loan modification by October 26, 2013. (FAC ¶28). Plaintiffs complied with this requirement.
In December 2013, Plaintiffs began making the monthly $310.09 payment. However, Ocwen would not accept the payments, placed some of the payments in an escrow account, and rejected others. (FAC ¶¶ 32-36). Plaintiffs contacted Impac and were informed that the loan had, in fact, been modified. Impac also represented that Ocwen "was really bad about paperwork, and instructed Plaintiffs to continue to make their monthly payments." "At some point in 2014," Plaintiffs again contacted Ocwen to inquire as to why their payments were not being accepted and were allegedly informed that they were investigating the issue. (FAC ¶40).
Plaintiffs retained counsel in December 2014. Ocwen then allegedly represented that it would not honor "the October 2013 modification agreement because it was not a lucrative deal for Ocwen." (FAC ¶45). The parties attempted to resolve their dispute. The parties' informal settlement discussions continued until January 2017. At that time, Plaintiffs discovered that Ocwen had been furnishing new information each month to the credit reporting agencies indicating that Plaintiffs' account was over 180 days past due and the monthly shortfall in payments was $964. As of November 30, 2016, the account was allegedly past due by more than $40,663. Had Defendants honored the loan modification, allegedly, the account would be current.
In February 2017, Plaintiffs provided written dispute letters to all consumer credit reporting agencies (Experian, Equifax, and Trans Union) informing them about the allegedly false and misleading information being reported by Ocwen. (FAC ¶58). The credit reporting agencies contacted Ocwen about Plaintiffs' dispute letters. Ocwen responded to the inquiry and represented that the reported past due amounts were correct.
Plaintiffs allege that Ocwen failed "to conduct a reasonable re-investigation of the disputed information, and failed to update/modify/delete inaccurate information." (FAC ¶64). Since April 5, 2016, Plaintiffs allege that they have received multiple letters from Ocwen threatening to seek foreclosure upon the loan and take possession of the property. Ocwen has never initiated foreclosure proceedings.
On August 23, 2017, the court denied Defendants' motion to dismiss. Defendants answered on September 6, 2017, and Plaintiffs move to dismiss the affirmative defenses identified in the FAC.
Federal Rule of Civil Procedure 12(f) provides that the court "may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." "The function of a 12(f) motion to strike is to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial. . . ."
Plaintiff contends that the heightened pleading standards enunciated in
The parties agree that no circuit court has addressed whether a heightened pleading standard applies to affirmative defenses, and that district courts are split on the issue. In support of application of the heightened pleading standard to affirmative defenses, courts have reasoned that the "same logic holds true for pleading affirmative defenses [as for pleading a complaint] — without alleging facts as part of the affirmative defenses, [a] [p]laintiff cannot prepare adequately to respond to those defenses."
On the other hand, courts have held that heightened pleading is not required under Rule 8(c).
Although a close issue, the court concludes that affirmative defenses are not subject to a heightened pleading standard. In addition to the technical Rule 8 argument addressed in
In large part, Plaintiffs accurately represent that the affirmative defenses asserted by Defendants are, in essence, boilerplate in nature and not necessarily applicable under the particular circumstances of the case. At this early stage, nothing more is required. The affirmative defenses are plainly stated. As the case commences discovery, the court anticipates the parties will discover the contours of Plaintiffs' claims and Defendants' defenses, and bring timely and appropriate motions.
Finally, the court rejects Plaintiffs' argument that enumerated Rule 12(b) motions are not appropriately set forth as defenses in the answer. Rule 12(b) specifically provides that defenses "may" be set forth in the answer or, alternatively, be brought by separate motion. Fed.R.Civ.P. 12(b). Similarly, Rule 8(c) requires an answer to "state any avoidance or affirmative defense." By any measure, enumerated Rule 12(b) motions may be brought separately or, alternatively, included as an affirmative defense.
In sum, the motion to strike is denied.