RICARDO M. URBINA, District Judge.
The pro se plaintiff, Wanda Busby, has asserted a variety of statutory and common law claims against the defendants, Capital One, N.A. ("Capital One") and attorney David Prensky ("Prensky"), in connection with a promissory note and deed of trust executed by the plaintiff in 1996. Capital One has moved to dismiss all of the claims against it pursuant to Federal Rule of Civil Procedure 12(b)(6). Prensky has also filed a motion pursuant to Rule 12(b)(6) to dismiss all but two of the claims asserted against him. As discussed below, the plaintiff has failed to allege plausible claims for relief with respect to the claims addressed in the defendants' motions. The court therefore grants the defendants' motions.
In December 1996, the plaintiff purchased a property located in Northwest Washington, D.C. Am. Compl. ¶¶ 7, 19. To finance the purchase, the plaintiff obtained a $207,000 loan from the B.F. Saul Mortgage Company ("B.F. Saul"). Id. ¶ 19 & Ex. B. The loan was documented by a promissory note ("the Note"), id. ¶ 19; Capital One's Mot., Ex. A, and secured by a deed of trust ("the Deed of Trust"), Am. Compl., Ex. B. Both instruments were filed with the D.C. Recorder of Deeds on December 24, 1996. Am. Compl. ¶ 19. B.F. Saul subsequently assigned its rights under the Note to Chevy Chase Bank, F.S.B. ("Chevy Chase"). Capital One's Mot., Ex. A.
By early April 2010, the plaintiff had fallen three months behind on her loan payments. Am. Compl. ¶ 32. The plaintiff "contacted Capital One, the apparent loan servicer, in order to bring her payments up to date." Id. During a conversation with a Capital One representative, the plaintiff learned that there was, according to Capital One, "a sizable underpayment of her escrow account." Id. The plaintiff formally
On April 12, 2010, the defendants sent the plaintiff a notice of foreclosure sale ("the Notice"), advising her that she owed $168,842.38 on her note and that her property would be sold at a foreclosure sale on May 19, 2010. Am. Compl., Ex. C. The Notice identified the holder of the note as "Capital One NA." Id. The Notice further stated that in the event the plaintiff wished to stop the foreclosure sale, she should contact Prensky, id., who had purportedly been appointed to act as trustee pursuant to a deed of appointment of substitute trustee ("the Deed of Appointment") executed on December 1, 2009, Am. Compl., Ex. B. Both the Notice and the Deed of Appointment were filed with the D.C. Recorder of Deeds on April 14, 2010. Am. Compl. ¶ 47.
On May 18, 2010, the plaintiff commenced this action against the defendants in the Superior Court of the District of Columbia. See generally Compl. After being served with the complaint, Prensky informed the plaintiff that Capital One had agreed to cancel the foreclosure sale scheduled for May 19, 2010. Am. Compl. ¶¶ 93-94. Prensky, however, left open the possibility that the foreclosure sale would be rescheduled at a later date. Id. ¶¶ 95-96.
The plaintiff filed an amended complaint in the Superior Court on June 9, 2010. See generally id. In the amended complaint, the plaintiff alleges that the Notice was fraudulent and ineffective because it misrepresented Capital One as the holder of the note, when, in reality, Capital One was acting, at best, as the loan servicer. Id. ¶¶ 24, 40-45, 49-52, 98-102. The plaintiff contends that under both the terms of the Deed of Trust and as D.C. law, a loan servicer lacks the authority to commence foreclosure proceedings against a borrower like the plaintiff. Id. The plaintiff also alleges that in the Notice, the defendants misrepresented the amounts owed by the plaintiff. Id. ¶¶ 32-35; 123-24.
In addition, the plaintiff claims that the Deed of Appointment is fraudulent and ineffective. Id. ¶¶ 25, 47-48, 54-79. The plaintiff asserts that there are errors in the notarization on the form, id. ¶¶ 58-68, and that although the Deed of Appointment was executed by an individual on behalf of Chevy Chase on December 1, 2009, Chevy Chase had merged with Capital One four months earlier and therefore did not exist as of the date the Deed of Appointment was executed, id. ¶¶ 70-75.
In her ten-count amended complaint, the plaintiff asserts a variety of statutory and common law
The defendants removed this action to this court on June 17, 2010. See generally Notice of Removal. On July 16, 2010, Capital One and Prensky separately filed motions to dismiss the amended complaint pursuant to Rule 12(b)(6). See generally Capital One's Mot.; Prensky's Mot. Capital One seeks the dismissal of all the claims asserted against it. See generally Capital One's Mot. Prensky has moved to dismiss all of the claims against him except the breach of fiduciary duty and negligence claims. See generally Prensky's Mot. The plaintiff filed an omnibus opposition to both motions on February 14, 2011,
A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of a complaint. Browning v. Clinton, 292 F.3d 235, 242 (D.C.Cir.2002). The complaint need only set forth a short and plain statement of the claim, giving the defendant fair notice of the claim and the grounds upon which it rests. Kingman Park Civic Ass'n v. Williams, 348 F.3d 1033, 1040 (D.C.Cir. 2003) (citing FED. R. CIV. P. 8(a)(2) and Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). "Such simplified notice pleading is made possible by the liberal opportunity for discovery and the other pretrial procedures established by the Rules to disclose more precisely the basis of both claim and defense to define more narrowly the disputed facts and issues." Conley, 355 U.S. at 47-48, 78 S.Ct. 99 (internal quotation marks omitted). It is not necessary for the plaintiff to plead all elements of his prima facie case in the complaint, Swierkiewicz v. Sorema N.A., 534 U.S. 506, 511-14, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002), or "plead law or match facts to every element of a legal theory," Krieger v. Fadely, 211 F.3d 134, 136 (D.C.Cir.2000) (internal quotation marks and citation omitted).
Yet, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, ___ U.S. ____, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (internal quotation marks omitted); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 562, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (abrogating the oft-quoted language from Conley, 355 U.S. at 45-46, 78 S.Ct. 99, instructing courts not to dismiss for failure to state a claim unless it appears beyond doubt that "no set of facts in support of his claim [] would entitle him to relief"). A claim is facially plausible when the pleaded factual content "allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949 (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). "The plausibility standard is not akin to a `probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955).
In resolving a Rule 12(b)(6) motion, the court must treat the complaint's factual allegations—including mixed questions of law and fact—as true and draw all reasonable inferences therefrom in the
The plaintiff appears to base her fraud claims on Capital One's alleged misrepresentation that it was the holder of the note and that it had the authority to institute foreclosure proceedings against the plaintiff, Capital One's alleged misrepresentations regarding the amounts owed by the plaintiff and the alleged misrepresentations by Capital One and Prensky that Prensky was authorized to act as trustee on behalf of the note holder in foreclosure proceedings. See Am. Compl. ¶¶ 24-25, 40-79, 98-102, 123-24. According to the plaintiff, these misrepresentations appear in the Notice and the Deed of Appointment. See id.
Both Capital One and Prensky contend that the plaintiff has failed to state a viable claim for fraud because she has not alleged that she relied on these allegedly fraudulent representations to her detriment, as required to state a claim for fraud under D.C. law.
Under D.C. law, "[t]he essential elements of common law fraud are: (1) a false representation (2) in reference to material fact, (3) made with knowledge of its falsity, (4) with the intent to deceive, and (5) action is taken in reliance upon the representation." Fort Lincoln Civic Ass'n, Inc. v. Fort Lincoln New Town Corp., 944 A.2d 1055, 1074 n. 22 (D.C.2008) (quoting Bennett v. Kiggins, 377 A.2d 57, 59-60 (D.C.1977)). To prevail on such a claim, "the plaintiff must also have suffered some injury as a consequence of his reliance on the misrepresentation." Chedick v. Nash, 151 F.3d 1077, 1081 (D.C.Cir.1998) (citing Dresser v. Sunderland Apartments Tenants Ass'n, Inc., 465 A.2d 835, 839 (D.C. 1983)).
Furthermore, Federal Rule of Civil Procedure 9(b) requires that a claimant state with particularity the circumstances constituting fraud. FED.R.CIV.P. 9(b). The claimant must plead with particularity matters such as the time, place and content of the false misrepresentations, the misrepresented fact and what the opponent retained or the claimant lost as a
The plaintiff first suggests that the reliance element needed to establish her fraud claim is satisfied by her allegation that the D.C. Recorder of Deeds and other third parties relied on the misrepresentations made in the Notice and Deed of Appointment. Pl.'s Opp'n at 17. Yet under D.C. law, "[a] plaintiff may recover for a defendant's fraudulent statement only if the plaintiff took some action in reliance on that statement." Aktieselskabet AF 21. Nov. 2001 v. Fame Jeans Inc., 525 F.3d 8, 22-23 (D.C.Cir.2008) (affirming the dismissal of the plaintiff's fraud claim because rather than suggesting its own reliance, the plaintiff alleged only that the United States Patent and Trademark office relied on the defendant's alleged misrepresentation (citing Va. Acad. of Clinical Psychologists v. Grp. Hospitalization & Med. Servs., Inc., 878 A.2d 1226, 1237-38 (D.C. 2005) (emphasis added))). Thus, the plaintiff's allegations concerning actions taken by the D.C. Recorder of Deeds or any other third parties cannot, standing alone, satisfy the detrimental reliance element required for fraud claims under D.C. law.
The plaintiff also contends that she relied to her detriment on the defendants' fraudulent statements by consulting legal counsel. Pl.'s Opp'n at 17. This allegation, however, does not appear in the amended complaint. See generally Am. Compl.; see also Middlebrooks v. Godwin Corp., 722 F.Supp.2d 82, 87 n. 4 (D.D.C. 2010) (observing that a plaintiff "may not amend her complaint by the briefs in opposition to a motion to dismiss" (citing Calvetti v. Antcliff, 346 F.Supp.2d 92, 107 (D.D.C.2004))). Furthermore, even if this allegation were considered part of the plaintiff's pleadings, it has not been pled with the requisite specificity, as the plaintiff has offered no indication of what steps she took to consult with legal counsel or what costs she incurred as a result. See Pl.'s Opp'n at 17. Finally, even if the plaintiff had alleged that she had offered some factual allegation to substantiate her claim of loss, it is far from clear that the cost of legal services can constitute detrimental reliance for purposes of fraud, given the American Rule against fee shifting. See Oliver T. Carr Co. v. United Tech. Commc'ns Co., 604 A.2d 881, 883 (D.C. 1992) ("[T]his jurisdiction follows `the American Rule under which . . . every party to a case shoulders its own attorneys' fees, and recovers from other litigants only in the presence of statutory authority, a contractual arrangement, or certain narrowly-defined common law exceptions' such as the conventional `bad faith' exception." (internal quotation marks omitted) (quoting Dalo v. Kivitz, 596 A.2d 35, 37, 39 (D.C.1991))); see also Sloan v. Urban Title Servs., Inc., 689 F.Supp.2d 94, 121 (D.D.C. 2010) (holding that a party asserting fraud "must provide legal authority in support of his apparent claim that he is entitled to attorney's fees and costs"). Accordingly, the plaintiff's assertion in her opposition that she consulted legal counsel as a result of the defendants' fraudulent representations does not satisfy the detrimental reliance requirement.
The plaintiff's failure to plead that she took any steps in reasonable reliance on the defendants' fraudulent statements warrants dismissal of her fraud claim. See Aktieselskabet AF 21. Nov. 2001, 525 F.3d at 22-23. Nonetheless, the plaintiff asserts that such a finding does not preclude her from proceeding with a claim of conspiracy to commit fraud. Pl.'s Opp'n at 13-14; see also Am. Compl. ¶ 114. As a threshold matter, however, it is hardly clear that a plaintiff can proceed with a claim for conspiracy to commit fraud in the absence of a viable underlying fraud claim. See Hill v. Medlantic Health Care Grp., 933 A.2d 314, 334 (D.C.2007) (observing that civil conspiracy "is not an independent tort but only a means for establishing vicarious liability for an underlying tort" (quoting Paul v. Howard Univ., 754 A.2d 297, 310 (D.C.2000))); Ali v. Mid-Atlantic Settlement Servs., Inc., 640 F.Supp.2d 1, 9 (D.D.C.2009) (holding that the entry of summary judgment for the defendant on the plaintiff's fraud claim required dismissal of the plaintiff's conspiracy to commit fraud claim because "civil conspiracy depends on performance of some underlying tortious act" (quoting Exec. Sandwich Shoppe, Inc. v. Carr Realty Corp., 749 A.2d 724, 738 (D.C.2000))); but see Wiggins v. Dist. Cablevision, Inc., 853 F.Supp. 484, 498 n. 27 (D.D.C.1994) ("Often when a claim for fraud fails for lack of the requisite elements, courts will search to find evidence of a conspiracy to defraud." (citing
At any rate, in order to state a civil conspiracy claim under D.C. law, the plaintiff must allege "(1) an agreement between two or more persons (2) to participate in an unlawful act, and (3) injury caused by an unlawful overt act performed by one of parties to the agreement, and in furtherance of the common scheme." Hill, 933 A.2d at 334. Here, the plaintiff has offered no factual allegations whatsoever indicating the existence of an agreement between Capital One and Prensky. See generally Am. Compl. Rather, the plaintiff's conspiracy claim is grounded on the bare, conclusory assertion that the defendants "conspired to commit, and did commit fraud, on which Plaintiff relied to her detriment." Id. ¶ 114. Such an allegation, unadorned by any substantiating factual allegations, is insufficient to state a viable conspiracy claim. See Kissi v. Panzer, 664 F.Supp.2d 120, 126 (D.D.C.2009) (holding that the plaintiff's allegation that the defendants "conspired to rip off him and his spouse" were insufficient to state a claim for conspiracy to commit fraud); Brady v. Livingood, 360 F.Supp.2d 94, 104 (D.D.C. 2004) (concluding that the plaintiff's allegation that the defendants "agreed among themselves" to engage in tortious conduct was insufficient to state a viable civil conspiracy claim).
Accordingly, the plaintiff has failed to state a cognizable claim for conspiracy to commit fraud, just as she failed to state a cognizable claim for fraud. The court therefore grants the defendants' motions to dismiss these claims.
The plaintiff alleges that Capital One violated the D.C. Usury Statute "by both misrepresenting material facts and failing to state material facts." Am. Compl. ¶ 122. Although the plaintiff does not specify the misrepresentations and omissions on which she bases this claim, see id., it appears that the plaintiff rests her D.C. Usury Statute claim on the same allegedly fraudulent statements underlying her fraud claim, see id. ¶¶ 24-25, 40-79, 98-102, 120-29.
Capital One contends that the plaintiff has failed to state a claim under the D.C. Usury Statute because the statute applies only to "lenders" and not loan servicers. Capital One's Mot. at 12-13. Capital One further contends that to the extent the plaintiff premises this claim on allegedly unwarranted escrow fees and other charges demanded by Capital One, the plaintiff has offered no explanation for why these fees were unauthorized, overstated or otherwise improper. Id. at 13. The plaintiff responds that Capital One constitutes a "lender" for purposes of the D.C. Usury Statute and that Capital One violated the statute by making material misrepresentations to the plaintiff. Pl.'s Opp'n at 23-24.
The D.C. Usury Statute provides that "[i]t shall be a violation of this chapter for any lender to" engage in certain specified conduct, including "misrepresent[ing] as to a material fact" and "fail[ing] to state a material fact." D.C.CODE § 28-3312. By its terms, the statute applies only to "lenders." See id.; see also Young v. 1st Am. Fin. Servs., 992 F.Supp. 440, 444 & n. 7 (D.D.C.1998) (dismissing the plaintiffs' claim under the D.C. Usury Statute because the statute applies only to lenders and not brokers like the defendant, notwithstanding the plaintiffs' allegation that the defendant fraudulently led them to believe that it was acting as the lender rather than the broker).
In the amended complaint, the plaintiff repeatedly asserts that Capital One was
The plaintiff alleges that the defendants violated the CPPA by misrepresenting material facts in connection with the plaintiff's loan obligations. Am. Compl. ¶¶ 121, 123. Again, this claim appears to be based on the same alleged misrepresentations underlying the plaintiff's fraud claim. See id. ¶¶ 24-25, 40-79, 98-102, 120-29.
Both Capital One and Prensky contend that the plaintiff's CPPA claim fails because the plaintiff was not a "consumer" of goods or services provided by either defendant.
The CPPA prohibits a wide variety of deceptive trade practices perpetrated against consumers. D.C.CODE § 28-3904. The practices prohibited by the statute include misrepresenting the existence of a sponsorship or affiliation, misrepresenting a material fact which has the tendency to mislead and failing to state a material fact which has the tendency to mislead. Id. § 28-3904(b), (e), (f). "The purpose of the CPPA is to protect consumers from a broad spectrum of unscrupulous practices by merchants, therefore the statute should be read broadly to assure that the purposes are carried out." Modern Mgmt. Co. v. Wilson, 997 A.2d 37, 62 (D.C.2010).
Despite its broad reach, the CPPA applies only to consumer-merchant relationships. Snowder v. Dist. of Columbia, 949 A.2d 590, 599 (D.C.2008) (observing that the CPPA "was designed to police trade practices arising only out of consumer-merchant relationships" (quoting Howard v. Riggs Nat'l Bank, 432 A.2d 701, 709 (D.C.1981))). The statute defines a "consumer" as "a person who does or would purchase, lease (from), or receive consumer goods or services . . . or a person who does or would provide the economic demand for a trade practice." Id. § 28-3901(a)(2). A "merchant" is defined as "a person who does or would sell, lease (to), or transfer, either directly or indirectly, consumer goods or services, or a person who does or would supply the goods or services which are or would be the subject matter of a trade practice." Id. § 28-3901(a)(3).
Here, the amended complaint contains no factual allegations whatsoever indicating the existence of a consumer-merchant
The plaintiff alleges that the defendants "engaged in conversion by asserting ownership over the Note and [Deed of Trust], including, but not limited to, the power of sale provisions within the [Deed of Trust]."
Under D.C. law, the elements of conversion are "(1) an unlawful exercise, (2) of ownership, dominion, or control, (3) of the personal property of another, (4) in denial or repudiation of that person's rights thereto.'" O'Callaghan v. Dist. of Columbia, 741 F.Supp. 273, 279 (D.D.C. 1990) (citing Duggan v. Keto, 554 A.2d 1126, 1137 (D.C.1989)). According to the plaintiff, her conversion claim is grounded on the defendants' misappropriation of her "beneficial interest in both the Property and the Deed of Trust." Pl.'s Opp'n at 30; see also Am. Compl. ¶¶ 131-33. The plaintiff is mistaken. The Deed of Trust is a security instrument given by the plaintiff for the benefit of the lender. See generally Am. Compl., Ex. B. The authorities relied on by the plaintiff stand only for the proposition that the mortgagor has a beneficial interest in the underlying property securing the transaction, not in the deed of trust itself. See, e.g., Democratic Cent. Comm. of Dist. of Columbia v. Wash. Metro. Area Transit Comm'n, 21 F.3d 1145, 1153 (D.C.Cir.1994) (observing that legal title of property held under a deed of trust lies with the trustee, while equitable title rests with the debtor).
The plaintiff also attempts to base her conversion claim on the defendants' alleged interference with her right to have
Lastly, the court notes that "an action for conversion is recognized only when a defendant has unlawfully exercised `ownership, dominion or control over the personal property of another in denial or repudiation of his rights thereto.'" Kaempe v. Myers, 367 F.3d 958, 964 (D.C.Cir.2004) (quoting Shea v. Fridley, 123 A.2d 358, 361 (D.C.1956)). "When there has been no dispossession of property rights, there can be no action for conversion." Id. Here, the amended complaint contains no allegations indicating that the actions taken by the defendants have dispossessed the plaintiff of any right she currently possesses in the property or the Deed of Trust. See generally Am. Compl. Accordingly, the plaintiff's conversion claim is deficient in this respect as well, and the court grants the defendants' motion to dismiss this claim.
Counts V, VI and VII of the amended complaint set forth alternative civil RICO claims. See Am. Compl. ¶¶ 136-210. The thrust of these claims is that the defendants engaged in a fraudulent scheme, involving mail fraud, wire fraud and witness tampering, to misappropriate the plaintiff's interest in the Deed of Trust and unjustifiably force the foreclosure sale of her property. See id. Both Capital One and Prensky contend that the plaintiff has not stated a viable RICO claim because she has not pled the existence of a pattern of racketeering activity.
To establish a RICO violation, the plaintiff must show "(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity." W. Assocs. Ltd. P'ship v. Market Square Assocs., 235 F.3d 629, 633 (D.C.Cir.2001) (citing 18 U.S.C. § 1961(1)(B)). The RICO statute defines the term "pattern of racketeering activity" as requiring the commission of at least two predicate racketeering offenses over a ten year period. 18 U.S.C. § 1961(5). Predicate offenses satisfying the statute include acts punishable under certain state and federal criminal laws, such as mail and wire fraud. Id. § 1961(1)(B). To satisfy the "pattern of racketeering activity" requirement,
It is well established that a "single scheme ... designed to frustrate one transaction and inflict[] a single, discrete injury on a small number of victims ... fails to meet RICO's requirement of a `pattern of racketeering activity.'" Edmondson & Gallagher v. Alban Towers Tenants Ass'n, 48 F.3d 1260, 1263 (D.C.Cir.1995) (holding that the plaintiff's allegation that a tenant's association engaged in a scheme to unlawfully block the sale of a residential building complex failed to state a RICO claim because "the scheme entail[ed] but a single discrete injury, the loss of the sale ... suffered by a small number of victims" and that "the combination of these factors (single scheme, single injury, and few victims) makes it virtually impossible for plaintiffs to state a RICO claim"); see also W. Assocs. Ltd. P'ship, 235 F.3d at 633 (affirming the dismissal of the plaintiff's RICO claims because the defendant's alleged misconduct, which included "concealing cost overruns or shifting the burden of financing them," was "more accurately characterized as a single effort to diminish the value of [the plaintiff's] partnership interest"); Zernik v. United States, 630 F.Supp.2d 24, 27 (D.D.C.2009) (dismissing the plaintiff's civil RICO claim for failure to plead a "pattern of racketeering activity" because the plaintiff's allegations amounted to a single scheme to defraud). The plaintiff in Zernik alleged that the defendants violated RICO by engaging in various acts of mail and wire fraud in connection with the forced sale of the plaintiff's home at foreclosure. Zernik, 630 F.Supp.2d at 26. The court dismissed the RICO claim pursuant to Rule 12(b)(6):
Id. at 27 (citing W. Assocs. Ltd. P'ship, 235 F.3d at 634).
In this case, the plaintiff has provided no factual allegations indicating the existence of an ongoing, widespread scheme on the part of the defendants to unlawfully compel the sale of homeowners in the District of Columbia. See generally Am. Compl. To the contrary, the plaintiff's RICO claims focus exclusively on the actions taken by the defendants to foreclose on the plaintiff's property. See id. ¶¶ 136-210. Although the plaintiff states in a conclusory fashion that other D.C. homeowners have been similarly victimized by the defendants, the plaintiff has identified no similar actions taken by the defendants against any other homeowners. See generally id.; cf. Corley v. Rosewood Care Ctr., Inc., 142 F.3d 1041, 1051 (7th Cir.1998) (concluding that the plaintiff had adequately pled the existence of a pattern of racketeering activity "by referencing his own experiences with Rosewood in contracting for the care of his mother and alleging in some detail that other residents and their relatives also were victimized by the identical scheme"). Accordingly, the plaintiff has not alleged the existence of a "pattern of racketeering activity" as required for a viable RICO claim.
The plaintiff alleges that the defendants negligently misrepresented themselves in the Notice and the Deed of Appointment as the lender and trustee, respectively. Am. Compl. ¶¶ 211-17. The plaintiff states that she "reasonably and justifiably relied on Defendant[s'] misrepresentations and omissions to [her] detriment and paid [more] that amounts due and owing." Id. ¶ 218. The plaintiff further alleges that Capital One is liable for negligent supervision because it "failed to train or monitor its employees properly about the amounts due and owing for escrow payments under security instruments, and about the requirements that they adhere to the terms of those security instruments, thereby negligently allow[ing] the collection of improper and illegal insurance premiums from Plaintiff." Id. ¶ 221.
Capital One contends
As a general matter, a claim for negligence in the District of Columbia has four elements: (1) the defendant owed a duty to the plaintiff, (2) the defendant breached its duty, (3) and that breach was the proximate cause of (4) damages sustained by the plaintiff. Powell v. Dist. of Columbia, 634 A.2d 403, 406 (D.C.1993). The plaintiff's negligent misrepresentation claim suffers from a similar to defect to the one that afflicted her fraud claim. See supra Part III.B.1. Namely, the plaintiff has failed to plausibly allege that the defendants' misrepresentations proximately caused any injury to her. See Am. Compl. ¶¶ 211-18. The plaintiff claims that the defendants negligently misrepresented themselves as the note holder and trustee in the Notice and Deed of Appointment, id. ¶ 215, and that as a result, the plaintiff paid amounts in excess of what she owed, id. ¶ 218. Yet, as previously discussed, the amended complaint indicates that the plaintiff made no additional payments to Capital One after the defendants commenced foreclosure proceedings by filing the Notice and Deed of Appointment containing the allegedly fraudulent statements at issue. See id. ¶¶ 32-35. Accordingly, the plaintiff has failed to adequately plead that the defendants' misrepresentations proximately resulted in her alleged injury.
In Count IX of the amended complaint, which the plaintiff titles "unconscionability, bad faith, [and] unfair dealing," the plaintiff alleges that the defendants "used both their superior positions as a financial institution and foreclosure attorney, respectively, to take oppressive and unfair advantage of Plaintiff by filing the Forged Deed [of Appointment] and Fraudulent Notice of Sale." Am. Compl. ¶¶ 226. In so doing, the plaintiff alleges that the defendants "acted in bad faith." Id. ¶ 227.
The defendants contend that this claim must be dismissed because claims of unconscionability, bad faith and unfair dealing require the existence of a contractual relationship between the plaintiff and the defendant, which is absent here. Capital One's Mot. at 26-27; Prensky's Mot. at 9-10. The plaintiff responds by asserting that the defendants' conduct was outrageous and amounts to unconscionable behavior. Pl.'s Opp'n at 43-44.
"Liability for common law unconscionability requires two findings: `an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party.'" Williams v. First Gov. Mortg. & Investors Corp., 225 F.3d 738, 748 (D.C.Cir.2000) (quoting Williams v. Walker-Thomas Furniture Co., 350 F.2d 445, 449 (D.C.Cir.1965)) (emphasis added). Thus, the claim for unconscionability requires the existence of a contract between the plaintiff and the defendant. See id.
Likewise, a claim for breach of the implied covenant of good faith and fair dealing cannot exist in the absence of a contractual relationship. See Kerrigan v. Britches of Georgetowne, Inc., 705 A.2d 624, 627 (D.C.1997) (concluding that because the plaintiff, "as an employee at will, not under any contract," had no basis for claiming that the defendant breached the implied covenant of good faith and fair dealing); Brown v. Countrywide Home Loans, Inc., 319 B.R. 278, 290 (D.D.C.2004) (granting summary judgment to the defendant on the plaintiff's claim that the defendant breached the implied covenant of good faith and fair dealing because "no reasonable fact-finder could determine that a contract existed between [the parties]"); see also Choharis v. State Farm Fire & Casualty Co., 961 A.2d 1080, 1089 (D.C.2008) (concluding that D.C. law does not recognize an independent tort of bad faith).
The amended complaint is devoid of any allegation indicating a contractual relationship
The plaintiff has asserted a claim of "emotional distress," through which she appears to be asserting a claim of intentional infliction of emotional distress ("IIED"). See Am. Compl. ¶¶ 229-34. The defendants contend that this claim should be dismissed because the amended complaint is devoid of any factual allegations suggesting a plausible claim of intentional infliction of emotional distress. Capital One's Mot. at 27-29; Prensky's Reply at 12 n. 5. Relying on case law preceding the Supreme Court's decisions in Iqbal and Twombly, the plaintiff maintains that dismissal of this claim is unwarranted because the defendants have not established that the plaintiff "can prove no set of facts in support of [her] claim which would entitle her to relief." Pl.'s Opp'n at 43 (quoting Fed. Information Systems, Corp. v. Boyd, 753 F.Supp. 971, 974 (D.D.C.1990)).
As a threshold matter, the court reiterates that the "no set of facts" standard on which the plaintiff relies has been abrogated by the Supreme Court's rulings in Twombly and Iqbal. See supra Part III.A; Twombly, 550 U.S. at 562, 127 S.Ct. 1955 (abrogating Conley, 355 U.S. at 45-46, 78 S.Ct. 99). As previously noted, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Iqbal, 129 S.Ct. at 1949. It is, therefore, not enough for the plaintiff to assert that there could be a set of facts consistent with her pleadings that would entitle her to relief. See Pl.'s Opp'n at 43. Rather, the plaintiff must plead sufficient factual content to allow "the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949.
To succeed on her IIED claim, the plaintiff must show "(1) extreme and outrageous conduct on the part of the defendant[s] which (2) intentionally or recklessly (3) cause[d] the plaintiff severe emotional distress." Khan v. Parsons Global Servs. Ltd., 521 F.3d 421, 428 (D.C.Cir.2008) (citing Darrow v. Dillingham & Murphy, LLP, 902 A.2d 135, 139 (D.C.2006)). Conduct is "extreme and outrageous" when it is "so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community." Homan v. Goyal, 711 A.2d 812, 818 (D.C.1998) (quoting Drejza v. Vaccaro, 650 A.2d 1308, 1312 n. 10 (D.C.1994)). As a general matter, a case of IIED is made out only if "the recitation of the facts to an average member of the community would arouse his resentment against the actor, and lead him to exclaim, `Outrageous!'" RESTATEMENT (SECOND) OF TORTS § 46 cmt. d.
Although the amended complaint does not specify the precise conduct on which the plaintiff grounds her IIED claim, the court presumes that she bases the claim on all of the allegations of misconduct set forth in the amended complaint: Capital One's misrepresentation that it was the holder of the note rather than the loan servicer, Capital One's improper assessment of escrow charges and other penalties and Prensky's holding himself out as the trustee under the Deed of Appointment. See generally Compl. This
Furthermore, the amended complaint contains no factual allegations indicating that the defendants acted "intentionally or recklessly" or that the plaintiff suffered "severe emotional distress" as a result of the defendants' behavior. See Khan, 521 F.3d at 428. The plaintiff has alleged no facts suggesting that the defendants intended to cause her emotional distress or acted recklessly in initiating foreclosure proceedings against her. See generally Am. Compl. Rather, the plaintiff acknowledges that she had fallen three months behind on her mortgage payments at the time the defendants initiated foreclosure proceedings and the defendants halted the foreclosure proceedings once the plaintiff commenced this action. Id. ¶¶ 32, 94. Likewise, although the plaintiff alleges that the defendants' conduct "inflicted severe mental anguish and emotional distress," id. ¶ 231, these conclusory allegations are unsupported by any factual content established that the plaintiff suffered "emotional upset `of so acute a nature that harmful physical consequences might be not unlikely to result,'" Sere v. Grp. Hospitalization, Inc., 443 A.2d 33, 37 (D.C.1982) (quoting Clark v. Associated Retail Credit Men of D.C., 105 F.2d 62, 65 (D.C.Cir.1939)).
For all these reasons, the plaintiff has failed to state a plausible IIED claim under D.C. law. The court therefore grants the defendants' motions to dismiss this claim.
As described above, nearly all of the plaintiff's claims, as set forth in the amended complaint, are seriously flawed and insufficient to withstand the defendants' motions to dismiss. See supra Part III.B. As a result, the only claim to survive the defendants' rulings is the plaintiff's breach of fiduciary duty claim against Prensky, which Prensky did not move to dismiss. See id.; see generally Am. Compl.
Although the aforementioned claims are woefully inadequate and must be dismissed,
For the foregoing reasons, the court grants Capital One's motion to dismiss and Prensky's motion for partial dismissal. An Order consistent with this Memorandum Opinion is separately and contemporaneously issued this 28th day of March, 2011.
