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Modica v. U.S. Bank, N.A.

United States District Court, D. Massachusetts

August 29, 2017




         Plaintiff Janice Modica, the mortgagor, brought this action in state court against U.S. Bank, N.A. (“U.S. Bank”), as Trustee for Citigroup Mortgage Loan Trust 2006-WFHE2 Asset-Backed Pass-Through Certificates, Series 2006 WFHE2 (the “Trust”) and Wells Fargo Bank, N.A (collectively “defendants”). On December 21, 2016, defendants removed the action to this court based on diversity jurisdiction. Docket # 1.

         Plaintiff seeks a declaratory judgment that U.S. Bank, as trustee, did not have the authority to exercise the statutory power of sale under Massachusetts General Law chapter 244, section 14 to foreclose on plaintiff's property (Count I). She also asserts that Wells Fargo violated Massachusetts regulations, 209 C.M.R. 18.21A(2) and 209 C.M.R. 18.22 (Count II), and that U.S. Bank, as trustee, slandered the title of her property (Count III). Docket # 1-1. Defendants have moved to dismiss the verified complaint asserting that plaintiff lacks standing to challenge the validity of the mortgage assignment and that the verified complaint fails to state a claim upon which relief can be granted. Docket # 8.

         I. Factual Background

         The following facts come directly from plaintiff's verified complaint as well as documents, including official public records, referenced in, attached to, and central to the complaint, which were provided by both parties. See Watterson v. Page, 987 F.2d 1, 4 (1st Cir. 1993).

         1. Mortgage, Note, and Assignments

         On May 24, 2006, plaintiff executed an adjustable rate promissory note and mortgage in favor of Wells Fargo in the amount of $360, 000 for a property located at 98-100 Lancaster Avenue, Revere, MA 02151 (the “Property”). On April 19, 2010, Wells Fargo assigned the mortgage and note to U.S. Bank, as Trustee for Citigroup Mortgage Loan Trust 2006-WFHE2, and on April 20, 2010, the assignment was recorded in Suffolk County Registry of Deeds. Docket # 1-4, at 50. Wells Fargo filed a corrective assignment on July 27, 2012, “to fix the scriveners error in the previously recorded Assignment of Mortgage . . . as it relates to the assignee.” Docket # 1-4, at 44. The corrective assignment identified the assignee as U.S. Bank, N.A., as Trustee for Citigroup Mortgage Loan Trust 2006-WFHE2, Asset-Backed Pass-Through Certificates, Series 2006-WFHE2. Id. (emphasis added).

         2. Pooling Service Agreement

         The Trust is governed by its Pooling and Servicing Agreement (“PSA”), dated August 1, 2006, executed among the depositor (Citigroup Mortgage Loan Trust Inc), the servicer (Wells Fargo), the trust administrator (CitiBank, N.A.), and the trustee (U.S. Bank). Docket # 1-3. The PSA authorizes the depositor (Citigroup Mortgage Loan Trust Inc.) to transfer its mortgage loans to the trustee (U.S. Bank), on or before the closing date of August 1, 2006, or within two years thereafter. Docket # 1-1, at ¶¶ 43-45.

         3. Foreclosure

         Plaintiff defaulted on her loan beginning in May 2007, but for reasons that were unexplained in the verified complaint, foreclosure proceedings did not begin until 2016. See Docket # 1-4, at 2-5 (loan information report stating that foreclosure was referred on May 17, 2007, and account had been past due for 3, 189 days). On November 9, 2016, Wells Fargo's counsel sent a notice letter to plaintiff, enclosing the Notice of Mortgagee's Sale of Real Estate and informing her that the Property was scheduled to be sold at a public auction on December 14, 2016. Docket # 1-2, at 2-3. The letter also included a “Certification Pursuant to Massachusetts 209 C.M.R. 18.21A(2)(c), ” which recited that the loan on the Property was in default. Id. at 4. The Certification further identified the chain of title of the mortgage, reflecting the two mortgage assignments, and identified U.S. Bank, as trustee for the Trust, as the current owner of the note and assignee of the mortgage. Id. at 4-5.

         About one month later, in December 2016, plaintiff filed a verified complaint in the superior court against defendants asserting three counts related to U.S. Bank's foreclosure on the Property. Defendants removed the matter to federal court and now seek to dismiss the verified complaint.

         II. Standard of review

         “To 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, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. For purposes of a motion to dismiss, the court accepts all well-pleaded factual ...

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