United States District Court, D. Massachusetts
THOMAS HARRY JR. and GRETCHEN C. HARRY, Plaintiffs,
COUNTRYWIDE HOME LOANS INC., et al. Defendants.
MEMORANDUM & ORDER
Nathaniel M. Gorton United States District Judge
case arises from a dispute concerning a mortgage on property
located at 89 Pimlico Pond in Mashpee, Massachusetts
(“the property”). A motion to dismiss filed by
defendants Ditech Financial, LLC, f/k/a Green Tree Servicing,
LLC (“Ditech”), Mortgage Electronic Registration
Systems, Inc. (“MERS”) and the Bank of New York
Mellon, f/k/a the Bank of New York as Trustee for the
Certificate Holders of CWABS, Inc. Asset-Backed Certificates,
Series 2005-17 (“BNY Mellon”) is pending before
the Court. For the reasons that follow, the motion will be
Harry, Jr. and Gretchen Harry (collectively,
“plaintiffs”) took title to the mortgaged
property in 2002. In November, 2005, plaintiffs refinanced
their property with a loan of approximately $245, 000 from
Countrywide Home Loans, Inc. (“Countrywide”) that
was secured by a mortgage in favor of MERS. Bank of America,
N.A. (“BANA”) was the original servicer of the
loan. In October, 2011, MERS assigned the mortgage to BNY
Mellon which then retained Ditech to service the loan.
plaintiffs' view, Countrywide engaged in “predatory
table funding lending” by using “bait [and]
switch” tactics. Plaintiffs claim that Countrywide
“induce[d] them into an alleged loan that they
couldn't afford”, charged “excessive”
fees and never notified them of their right to rescind. They
also allege that the “title documents” do not
match “what actually happened on Wall Street's
further assert that the mortgage is void because, while the
note and mortgage list the lender as “Countrywide Home
Loans, Inc.”, the United States Department of Housing
and Urban Development Settlement Statement (“HUD
Statement”) describes the lender as “Countrywide
Home Loans Corporation”. As does the mortgage, the HUD
Statement dates back to November, 2005 and is signed by
plaintiffs. They also contest the assignment of the mortgage
from MERS to BNY Mellon, contending that signatures by
“illegal robo-signer[s]” render it void.
admit that they made payments on the note only from January,
2006 through November, 2009.
August, 2011, plaintiffs received a letter from Harmon Law
Offices (“Harmon”) stating that Harmon had been
instructed to foreclose on their property on behalf of BNY
Mellon. In November, 2011 Harmon filed a complaint on behalf
of BNY Mellon in the Massachusetts Land Court Department of
the Trial Court. By December 23, 2011, plaintiffs had
retained counsel who disputed the foreclosure.
February, 2014, Ditech provided plaintiffs with a notice of
default and in March, 2015, Harmon again notified plaintiffs
that it was going to foreclose on the property on behalf of
BNY Mellon and Ditech. Plaintiffs responded by sending a
notice of rescission under the Truth in Lending Act, 15
U.S.C. § 1635 (“TILA”). Ditech, in turn,
sent plaintiffs copies of various mortgage-related documents,
including an unsigned loan application for $257, 000.
Plaintiffs assert that they did not complete that application
and that it was part of a scheme to defraud them.
in September, 2015, Harmon yet again served plaintiffs with a
notice of foreclosure, and in March, 2016, plaintiffs filed a
complaint in Massachusetts Superior Court seeking, inter
alia, quiet title, to have the note declared null and
void, to have the mortgage “released”, to have
their TILA rescission enforced and to recover damages. The
Massachusetts Superior Court allowed an ex parte motion for
the recording of a lis pendens that same month. In April,
2016 defendants BANA, Countrywide and Bank of America
Corporation removed the case to this Court on the basis of
federal question jurisdiction. In October, 2016, plaintiffs
moved to enjoin BNY Mellon and Ditech from foreclosing on the
property. After a hearing on that motion, this Court denied
Ditech, MERS and BNY Mellon (collectively,
“defendants”) have now moved to dismiss
plaintiffs' claims pursuant to Fed.R.Civ.P. 12(b)(6).
That motion is the subject of this memorandum and order.
Defedants Ditech, MERS and BNY Mellon's Motion to
survive a motion to dismiss for failure to state a claim
under Fed.R.Civ.P. 12(b)(6), a complaint must contain
“sufficient factual matter” to state a claim for
relief that is actionable as a matter of law and
“plausible on its face.” Ashcroft v.
Iqbal, 556 U.S. 662, 667 (2009) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is
facially plausible if, after accepting as true all
non-conclusory factual allegations, the court can draw the
reasonable inference that the defendant is liable for the
misconduct alleged. Ocasio-Hernandez v.
Fortuno-Burset, 640 F.3d 1, 12 (1st Cir. 2011). A court
may not disregard properly pled factual allegations even if
actual proof of those facts is improbable. Id.
Rather, the relevant inquiry focuses on the reasonableness of
the inference of liability that the plaintiff is asking the
court to draw. Id. at 13.
rendering that determination, a court may not look beyond the
facts alleged in the complaint, documents incorporated by
reference therein and facts susceptible to judicial notice.
Haley v. City of Boston, 657 F.3d 39, 46 (1st Cir.
their complaint, plaintiffs assert that their mortgage is
void, the unsigned loan application for $257, 000 proves that
defendants committed fraud and the assignment of their