Middleton v. Pratt ( 2022 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
James B. Middleton, et al. :
:
Plaintiffs, : Civil Action No.: 21-cv-2301 (RC)
:
v. : Re Document Nos.: 3, 7, 11
:
Larry Pratt, et al. :
:
Defendants. :
MEMORANDUM OPINION
DENYING PLAINTIFFS’ MOTION TO REMAND AND GRANTING CERTAIN DEFENDANTS’
MOTIONS TO DISMISS
I. INTRODUCTION
James B. and Marvise Middleton (“Plaintiffs”), proceeding pro se, brought claims against
various defendants in connection with the impending foreclosure of their Washington, D.C.
property. Defendants removed the case from D.C. Superior Court and filed motions to dismiss.
Plaintiffs filed a motion to remand alleging procedural defects in the removal and challenging
this Court’s jurisdiction. Because the Court finds no procedural defect in the removal and is
persuaded that it has jurisdiction, the Court denies Plaintiffs’ Motion to Remand. In addition,
because the Court finds that Plaintiffs fail to state any claims against the Defendants who have
moved to dismiss,1 the Court grants those motions to dismiss.
1
As the Court will explain, Plaintiffs apparently have not served all of the Defendants,
and several Defendants have not appeared in the case. The Court will not here reach those
claims against Defendants who have yet to appear.
II. BACKGROUND2
The court gleans the following facts from the pleadings, motions, and associated filings.
On or around April 5, 2005, pro se Plaintiffs James B. and Marvise Middleton “issued a
Promissory Note (‘Note’) to facilitate a loan in the amount of $229,600.000 to” Defendant First
Savings Mortgage Corporation (“First Savings”) and pledged a Deed of Trust (“Deed”) on their
home in Washington, D.C. (the “Property”). See Superior Court Record (“Sup. Ct. R.”) at ECF
pp. 35, 42, ECF No. 4.
The Deed contains sections relevant to the instant decision. The Deed grants the Trustee
“power of sale” over the Property in the event Plaintiffs do not meet their obligations on the
Note. See Deed of Trust at ECF p. 4, ECF 3-3. The Deed also contains a Release clause, which
reads, “[u]pon payment of all sums secured by this Security Instrument, [First Savings] shall
request Trustee to release this Security Instrument and shall surrender all notes evidencing debt
secured by this Security Instrument to Trustee. Trustee shall release this Security Instrument.”
Id. at ECF p. 14.
The Deed names Defendant Mortgage Electronic Registration Systems, Inc. (“MERS”)
nominee-beneficiary for First Savings. Id. at ECF p. 3. On August 22, 2012, MERS, acting as
nominee for First Savings, transferred First Savings’ interest in the Deed to Defendant Bank of
New York Mellon Trust Company (“Mellon”).3 Exhibit C to Defs.’ Mot. to Dismiss Pls.’ Am.
Compl. (“Assignment of Deed”) at ECF p. 2, ECF No. 3-4.
2
“[A]t this stage of the litigation, the court must accept as true all material allegations of
the complaint, drawing all reasonable inferences from those allegations in [Plaintiffs’] favor.”
Zimmerman v. Al Jazeera Am., LLC, 246 F. Supp. 3d 257, 285 (D.D.C. 2017) (quoting LaRoque
v. Holder, 650 F.3d 777, 785 (D.C. Cir. 2011) (cleaned up and emphasis original)).
3
The court will also use “Mellon” to refer to both Residential Asset Mortgage Products,
Inc., for which Mellon is the Trustee, and to JP Morgan Chase Bank, whom Mellon succeeded.
See Not. of Removal at ECF p. 2.
2
On July 14, 2021, Plaintiffs filed their first complaint (“Complaint”) against Defendants
First Savings Mortgage Corporation; Residential Asset Mortgage Products, Inc.; JPMorgan
Chase Bank, NA; Residential Funding Corporation; MERS; and Does 1–100 asserting wrongful
foreclosure, breach of contract, quiet title, and slander of title claims in relation to the impending
foreclosure of the Property. Sup. Ct. R. at ECF pp. 34–49, ECF No. 4.4 Plaintiffs sought
injunctive, declaratory, and compensatory relief. Id. at ECF p. 36. Plaintiffs later filed their
Amended Complaint. Id. at ECF p. 26–31.
The Amended Complaint differs notably from the original Complaint in several ways.
Unlike the Complaint, Plaintiffs’ Amended Complaint appears to have been typed into a court-
provided form and does not assert any new claims, nor does it restate the claims from the
Complaint. See id. The Amended Complaint also does not name any of the original Defendants,
and under the pre-set heading “Additional Party Names and Addresses,” Plaintiffs list seven new
defendants: “Larry Pratt CEO for [First Savings],” “Glen Messina for Ocwen Financial
Corporation,” “Alvaro G[.] de Melina CEO for GMAC LLC Corporate Office,” “Bruce J.
Paradis CEO for Residential Funding LLC,” “B[aron] Silverstein CEO for [NewRez]-PHH
Mortgage Services,” “James Dimon CEO for JPMorgan Chase,” and “Thomas P. Gibbons for
The Bank of [New York] Mellon.”5 Compare id. at ECF p. 34 with id. at ECF pp. 26–28. It is
4
On the same day, Plaintiffs also filed for a Temporary Restraining Order on the
foreclosure of their property, Sup. Ct. R. at ECF pp. 81–87, ECF No. 4, which the Superior Court
denied, id. at ECF p. 3.
5
Because Plaintiffs list these seven entirely new defendants in their Amended Complaint,
the Court understands Plaintiffs to name these defendants in addition to the original five. See
Ferebee v. United Medical Ctr., 300 F. Supp. 3d 271, 275 (D.D.C. 2018) (“It is well established
that a court must ‘liberally construe’ the pleadings of pro se parties, and that a pro se complaint,
‘however inartfully pleaded, must be held to less stringent standards than formal pleadings
drafted by lawyers.’” (quoting Erickson v. Pardus, 551 U.S. 89, 94 (2007)) (cleaned up)). The
Court will use “Defendants” to refer to all 12 defendants whose names appear in the Complaint
and Amended Complaint.
3
unclear if Plaintiffs name these new Defendants as individual officers, the entities they represent,
or both. Id. at ECF pp. 26–28.6 Finally, Plaintiffs requested, in addition to their previous prayers
for relief, that their “credit be repaired.” Id. at ECF p. 30.
On August 30, 2021, Defendants Mellon, Ocwen, Messina, NewRez, and Silverstein (the
“moving Defendants”) removed this case from D.C. Superior Court. Not. of Removal, ECF No.
1. The moving Defendants allege that none of them were served with the original Complaint,
and that only Ocwen received the Amended Complaint. Id. at 3; see also Am. Not. of Removal
at 5. The Court’s examination of the record from the Superior Court reveals a number of
summonses for the Defendants, see Sup. Ct. R. at ECF pp. 68, 79–80, 103–108, but only Ocwen
appears to have received the pleadings by certified mail, id. at ECF p. 53.
The moving Defendants allege that Plaintiffs are citizens of either Maryland or the
District and that no Defendant is a citizen of either. Not. of Removal ¶¶ 5–6; Am. Not. of
Removal at 4–8. Defendants do not support their allegations with affidavits or other forms of
evidence. Id. Defendants ultimately assert that each Defendant is diverse from Plaintiffs, that
the amount in controversy exceeds $75,000, and that therefore this Court has diversity
jurisdiction to hear the case. Am. Not. of Removal at 2.
On September 7, 2021, the moving Defendants filed a Motion to Dismiss. Defs.’ Mot. to
Dismiss Pls.’ Am. Compl. (“Mot. to Dismiss”), ECF No. 3. On September 28, 2021, the Court
ordered Plaintiffs to respond to the Motion to Dismiss by October 28, 2021. Order (“First
Fox/Neal Order”), ECF No. 5. Plaintiffs filed a Motion to Remand on October 27, 2021, but did
6
Defendants appear to share the Court’s confusion. For example, the Notice of Removal
was filed by, among others, both Glen Messina and Ocwen Financial Corporation (“Ocwen”)
and both Baron Silverstein and NewRez-PHH Mortgage Services (“NewRez”). Not. of Removal
at 2. The Notice of Removal also alleges the states of citizenship of both the officers whose
names appear on the Amended Complaint and the entities they allegedly represent. Id. at 4–7.
4
not address the substantive arguments made in the moving Defendants’ Motion to Dismiss. Pls.’
Mot. to Remand Defs. Notice of Removal and Mot. to Dismiss. (“Mot. to Remand.”), ECF No.
7. Plaintiffs allege “one of the Defendant(s)” is not diverse, but do not identify which defendant
is not diverse or explain why. Id. at 2.
On November 10, 2021, the moving Defendants filed their Opposition to Plaintiffs’
Motion to Remand and argued that their Motion to Dismiss should be granted as conceded.
Defs.’ Opp’n to Pls.’ Mot. to Remand Defs. Notice of Removal and Mot. to Dismiss, ECF No. 8.
Defendants again asserted that each Defendant is diverse, and identified the states in which they
are citizens. See Defs. Mem. Supp. Opp’n to Pls.’ Mot. to Remand (“Opp’n.”) at 5–7, ECF No.
8-1.
On January 6, 2022, Defendant Larry Pratt, individually, filed a Motion to Dismiss.7 Def.
Larry Pratt’s Mot. to Dismiss Pls.’ Am. Compl., or Alt., Mot. for Summ. J. (“Pratt Mot. to
Dismiss”), ECF No. 11. At this point, all Defendants had filed or joined in motions to dismiss
except Dimon, Gibbons, Paradis, and Molina, and the businesses for which they are officers (the
“non-moving Defendants”). Like the other motion to dismiss, Pratt’s motion did not cite any
affidavits or other evidence to establish that Pratt was diverse from Plaintiffs. See id. The same
day that Pratt filed his motion to dismiss, this Court ordered Plaintiffs to respond to it by
February 7, 2022. Order (“Second Fox/Neal Order”), ECF No. 12. On February 3, 2022,
Plaintiffs filed their Opposition to Pratt’s Motion to Dismiss. Mem. Opp’n to Defs.’ Mot. to
Dismiss (“Mem.”), ECF No. 13. Plaintiffs reasserted their jurisdictional challenge without
7
Because Pratt has filed a motion to dismiss, the Court will also refer to Pratt as a
“moving Defendant.”
5
specifying which Defendant is allegedly not diverse and without addressing any arguments
raised by the moving Defendants. Id. at 1.8
On April 8, 2022, the Court granted leave for the moving Defendants to cure defects in
their jurisdictional allegations, which had relied on the individual officer Defendants’ residencies
to plead diversity of citizenship. See Order, ECF No. 14. On April 15, 2022, the moving
Defendants filed their Amended Notice of Removal which alleged diversity of citizenship on the
basis of the individual officer’s domiciles. Am. Not. of Removal at 4–8, ECF No. 15.
III. ANALYSIS—MOTION FOR REMAND
Plaintiffs make two arguments for remand: 1) Defendants failed to “agree or give consent
to . . . removal,” and 2) this Court lacks subject matter jurisdiction because “all of the parties fall
under the diversity jurisdiction except for one of the Defendant(s).” Mot. to Remand at 1–2.
The moving Defendants respond that 1) Defendants were not required to give unanimous consent
because only Ocwen was served, see Opp’n. at 8–9, 2) Plaintiffs’ Motion to Remand should be
dismissed, in total, as untimely, id. at 3–4, and 3) this Court has subject matter jurisdiction
because all Defendants are diverse, id. at 4–5; Not. of Removal ¶¶. 21–22; Am. Not. of Removal
at 3. The Court finds it has jurisdiction over the claims against the moving Defendants and
denies Plaintiffs’ Motion to Remand.
A. Legal Standard
Generally, a defendant in a civil action brought in state court may remove the action to a
federal district court if the action is one over which the federal district courts have original
jurisdiction. See 28 U.S.C. § 1441(a). The Superior Court for the District of Columbia is
8
Plaintiffs’ Memorandum did not identify which Motion to Dismiss it addressed. The
Court find this of no consequence because, for reasons discussed below, the Court dismisses all
claims against the moving Defendants.
6
considered a state court for this purpose. See id. § 1451(1). The D.C. Circuit has explained,
“[w]hen it appears that a district court lacks subject matter jurisdiction over a case that has been
removed from a state court, the district court must remand the case.” Republic of Venez. v.
Philip Morris Inc., 287 F.3d 192, 196 (D.C. Cir. 2002) (citing 28 U.S.C. § 1447(c)). Because
removal implicates “federalism concerns,” the court “strictly construes the scope of its removal
jurisdiction.” Downey v. Ambassador Dev., LLC, 568 F. Supp. 2d 28, 30 (D.D.C.
2008) (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 107–09 (1941) (other citations
omitted)).
The general removal statute provides, “[a] motion to remand the case on the basis of any
defect other than lack of subject matter jurisdiction must be made within 30 days after the filing
of the notice of removal,” however, “[i]f at any time before final judgment it appears that the
district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. 1447(c)
(emphasis added). Thus, while “a motion to remand for defective procedure must be made
within 30 days after the filing” of the notice of removal, Williams v. Howard Univ., 984 F. Supp.
27, 30 (DDC 1997), there is no such time limit for challenges to the federal court’s subject-
matter jurisdiction, see 1368 H St., LLC v. Akers, No. 16-CV-02099, 2016 WL 10655557, *1
(D.D.C. Oct., 21, 2016); Busby v. Capital One, N.A., 841 F. Supp. 2d 49, 53 (D.D.C. 2012) (“In
the event that the federal court lacks subject-matter jurisdiction, remand is mandatory.” (citing
Republic of Venez., 287 F.3d at 196)).
B. Consent to Removal
“[A]ll defendants who have been properly joined and served must join in or consent to
the removal of the action.” See 28 U.S.C. 1446(b)(2). This requirement that all defendants
consent to removal has been termed the “rule of unanimity.” Hurt v. District of Columbia, 869
7
F. Supp. 2d 84, 86 (D.D.C. 2012) (collecting cases). One exception to the rule of unanimity is
“where one or more of the defendants has not yet been served with the initial pleading at the time
the removal petition was filed.” Id. at 87.
“The plaintiff bears the burden of establishing . . . proper service of process.” Klayman v.
Obama, 125 F. Supp. 3d 67, 77 (D.D.C. 2015) (citing Light v. Wolf, 816 F.2d 746, 751 (D.C. Cir.
1987). “Since this action was commenced in D.C. Superior Court, the sufficiency of process is
determined by District of Columbia law.” Magowan v. Lowery, 166 F. Supp. 3d 39, 65–66
(D.D.C. 2016) (“In determining the validity of service in the state court prior to removal, a
federal court must apply the law of the state under which the service was made.” (quoting 4A
Charles Alan Wright, Arthur R. Miller & Adam N. Steinman, Federal Practice and Procedure §
1082 (4th ed. 2015))); McMullen v. Synchrony Bank, 82 F. Supp. 3d 133, 142 (“[T]he Federal
Rules of Civil Procedure do not apply to a civil action until it is in federal court.” (citing Fed. R.
Civ. P. 81(c))). However, “[u]pon removal of the case, the plaintiff [has] an opportunity to cure
the insufficiency of [their] service of process by properly effectuating service under the Federal
Rules of Civil Procedure.” Magowan, 166 F. Supp. 3d at 66 (citing Wright, Miller & Steinman,
supra, § 1082). But see Rogers v. Amalgamated Transit Union Local 689, 98 F. Supp. 3d 1, 4–5
(D.D.C. 2015) (analyzing service of process prior to removal under federal rules).9
The moving Defendants argue that only Ocwen was properly served with the Amended
Complaint and that no moving Defendant was served with the original Complaint. See Not. of
Removal ¶ 2; Opp’n at 8–9; see Am. Not. of Removal at 5. Because Plaintiffs have not argued
or attempted to demonstrate that service was proper under either the D.C. or the federal rules, or
9
For the purposes of this decision, it is unnecessary to decide whether the D.C. Superior
Court Rules or the Federal Rules of Civil Procedure apply because Plaintiffs have not
demonstrated that service of process was proper under either.
8
that it has been perfected at any point since, Plaintiffs fail to meet their burden to establish proper
service of process. Consequently, the Court cannot conclude that all Defendants have been
properly served and therefore does not apply the rule of unanimity. See Hurt, 869 F. Supp. 2d at
87 (rule of unanimity does not apply “where one or more of the defendants [have] not yet been
served.”).
Even if the removal did suffer from procedural defects, the Court would find Plaintiffs’
procedural, consent-based challenge to the removal time-barred. Plaintiffs did not file their
Motion to Remand until nearly two-months after Defendants’ Notice of Removal. See Mot. to
Remand. This is beyond the 30-day time limit imposed by 28 U.S.C. 1447(c).
C. Subject Matter Jurisdiction
Federal courts may exercise diversity jurisdiction over civil cases where 1) the matter in
controversy exceeds $75,000 and 2) no defendant is a citizen of any state of which the plaintiff is
a citizen. 28 U.S.C. § 1332(a)(1), see Saadeh v. Farouki, 107 F.3d 52, 55 (D.C. Cir. 1997)
(“[F]ederal diversity jurisdiction is lacking if there are any litigants from the same state on
opposing sides.”) (citation omitted)). Therefore, removal based on diversity jurisdiction is
improper where the parties are not completely diverse. See Burton v. Coburn, No. 4-CV-965,
2005 WL 607912, at *2 (D.D.C. March 16, 2005) (citing Caterpillar, Inc. v. Lewis, 519 U.S. 61,
68 (1996)).
The method for determining a party’s citizenship depends on whether it is a natural
person or an entity, and, if the latter, on what kind of entity it is. “For purposes of diversity
jurisdiction, a person is a ‘citizen of the State’ in which he [or she] is domiciled.” Core VCT Plc
v. Hensley, 59 F. Supp. 3d 123, 125 (DDC 2014) (citing Prakash v. Am. Univ. 727 F.2d 1174,
1180 (D.C. Cir. 1984)); see also 28 U.S.C. 1332(e) (noting that the District of Columbia is
9
considered a “State” for purposes of diversity jurisdiction). “A person’s ‘[d]omicile is
determined by two factors: physical presence in a state, and intent to remain there for an
unspecified or indefinite period of time.’” Hensley, 59 F. Supp. 3d at 125 (quoting Prakash, 727
F.2d at 1180). Whereas individuals are residents of only one state, a corporation may be a
citizen of up to two states: 1) its state of incorporation and, 2) the state where its principal place
of business is located. 28 U.S.C. § 1332(c)(1). A corporation’s principal place of business is its
“nerve center,” “the place where a corporation’s officers direct, control, and coordinate the
corporation’s activities.” Hertz Corp. v. Friend, 559 U.S. 77, 92–93 (2010). “Unincorporated
associations, including LLCs, have the citizenship of each of their members.” CostCommand,
LLC v. WH Administrators, Inc., 820 F.3d 19, 21 (D.C. Cir. 2016) (citation omitted).
In general, a party seeking to remove to federal court based on diversity jurisdiction must
allege in its notice of removal facts demonstrating that the parties are of diverse citizenship. See
Elghannam v. Nat’l Assoc. of Bds. of Pharmacy, No. 15-cv-01554, 2015 WL 13158509, at *1
(D.D.C. Nov. 16, 2015) (corporate party seeking removal adequately alleged its states of
citizenship based on its state of incorporation and principle place of business and alleged that
plaintiff was a citizen of neither state); Lamm v. Bekins Van Lines Co., 139 F. Supp. 2d 1300,
1314 (M.D. Ala. 2001) (“To invoke removal jurisdiction on the basis of diversity, a notice of
removal must distinctly and affirmatively allege each party’s citizenship.” (citing McGovern v.
Am. Airlines, Inc., 511 F.2d 653, 654 (5th Cir. 1975) (per curiam))); cf. Momenian v. Davidson,
878 F.3d 381, 389 (D.C. Cir. 2017) (removal was improper where party seeking removal only
alleged parties’ residences); cf. Dart Cherokee Basin Operating Co., LLC v. Owens, 574 U.S. 81,
89 (2014) (“[A] defendant’s notice of removal need include only a plausible allegation that the
amount in controversy exceeds the jurisdictional threshold.”).
10
In addition, the party seeking removal “bears the burden of proving that jurisdiction
exists in federal court.” Downey, 568 F. Supp. 2d at 30 (citing Mulcahey v. Columbia Organic
Chems. Co., 29 F.3d 148, 151 (4th Cir. 1994) (other citations omitted)); see also Reed v.
AlliedBarton Sec. Servs., LLC, 583 F. Supp. 2d 92, 93 (D.D.C. 2008); accord Hertz, 559 U.S. at
96 (“The burden of persuasion for establishing diversity, jurisdiction . . . remains on the party
asserting it.”) (citation omitted). “Because of the limited jurisdiction of federal courts, any
doubts as to whether such federal jurisdiction exists in any given case must be resolved in favor
of remand.” Stein v. Am. Exp. Travel Related Servs., 813 F. Supp. 2d 69, 71 (D.D.C. 2011)
(citation omitted).
But the proponents’ burden of proving that the federal court has jurisdiction is not
triggered unless jurisdiction is first challenged; in Hertz, the Supreme Court stated that the
parties must support their jurisdictional allegations by “competent proof” “[w]hen challenged on
allegations of jurisdictional facts.” 559 U.S. at 96–97 (emphasis added). The Supreme Court
relied on McNutt v. General Motors Acceptance Corp. of Indiana, which held that when a
proponent’s “allegations of jurisdictional facts are challenged by his adversary in any appropriate
manner, he must support them by competent proof.” 298 U.S. 178, 189 (1936). Courts in this
District have followed McNutt in suggesting that the competent proof requirement is not
triggered unless a party challenges jurisdictional facts in an “appropriate manner.” See Scott v.
Conley, 937 F. Supp. 2d 60, 66 (D.D.C. 2013) (“If [a party’s] allegations of jurisdictional facts
are challenged by his adversary in any appropriate manner, he must support them by competent
proof.” (quoting McNutt, 298 U.S. at 189)); James v. Lusby, 499 F.2d 488, 493 (“[W]here the
allegations as to the amount in controversy are challenged by the defendant in an appropriate
manner the plaintiff must support them by competent proof.”) (citation omitted); accord District
11
of Columbia ex rel. Am. Combustion, Inc. v. Transamerica Ins. Co., 797 F.2d 1041, 1044 (D.C.
Cir. 1986) (“If the amended allegations are not contested, and nothing appears to the appellate
court that would bar jurisdiction, jurisdiction is deemed proper, despite the [moving party]’s
usual burden of alleging and proving jurisdiction.”).
The requisite challenge requires more than a mere recitation; “the burden of presenting
such competent proof [of jurisdiction] is not necessarily triggered by an adversary’s ‘simply
argu[ing] [that the party seeking to establish jurisdiction has] not met [its] burden’ without
actually ‘factually contravening [that party’s] jurisdictional allegations or raising an issue of
fact.’” DC2NY, Inc. v. Acad. Bus, LLC, No. 18-2127, 2020 WL 1536219, at *7 (D.D.C. March
31, 2020) (quoting In re Lorazepam & Clorazepate Antitrust Litig., 900 F. Supp. 2d 8, 17
(D.D.C. 2012); In re Lorazepam, 900 F. Supp. 2d at 17 (“doubt[ing]” “whether simply uttering
‘challenge’ constitutes a challenge sufficient under McNutt to trigger [the party asserting
jurisdiction’s] burden”)). In other words, a party must raise an issue of fact to appropriately
challenge jurisdiction and trigger the burden of proving it.
Thus, the issue before this Court is whether Plaintiffs’ conclusory and unspecific
assertion that “one of the Defendant(s)” is not diverse, Mot. to Remand at 2, is an “appropriate”
challenge such that the Defendants must respond with proof of jurisdiction.10 Scott, 937 F. Supp.
2d at 66 (citation omitted). The Court finds that it is not.11
10
Plaintiffs repeated this assertion in a filing labeled “Summary Affirmance,” again
without specificity or support. ECF No. 16 at 1.
11
To be sure, the Court acknowledges that in the caption of the Amended Complaint,
Plaintiffs list the address of Defendant “Larry Pratt CEO for First Savings Mortgage
Corporation” as 6550 Rock Spring Dr. Ste 300, Bethesda, MD 20817. See Sup. Ct. R. at ECF p.
26. The Court hesitates to view an address listed in the caption as a factual challenge sufficient
to trigger Defendant’s burden of proving jurisdiction, particularly when there are no direct
challenges to jurisdiction in the body of either the complaint or the Amended Complaint, or in
Plaintiffs’ remand filings. Even so, out of an abundance of caution, the Court takes judicial
12
In DC2NY, defendant Academy Bus, LLC opposed plaintiff DC2NY’s proposed
amended complaint on the grounds that it would be futile, in part, because it did not sufficiently
plead diversity jurisdiction. 2020 WL 1536219, at *6. Without holding that jurisdiction was
proper, the Court rejected Academy Bus’s jurisdictional challenge, noting that although it
“point[ed] out . . . factual deficiencies with the amended pleading,” it did not identify or explain
how those factual deficiencies demonstrated that the Court lacked jurisdiction. Id. at *7.
Academy Bus did “not actually say at any point (a) that the parties [were] not diverse, (b) that
Academy Express LLC [was] a citizen of any state other than [that state DC2NY alleged], [or]
(c) that DC2NY, Inc. [was] a citizen of anywhere other than the District of Columbia [as it
alleged].” Id. The Court remarked, “if jurisdiction were, in fact, improper Academy most likely
would have made at least one of these arguments directly, rather than only insinuating
jurisdictional defects.” Id.
Here, Defendants have adequately alleged that all twelve possibly named defendants are
diverse from Plaintiffs. Not. of Removal at 4–7; Am. Not. of Removal at 4–8. Specifically,
Defendants allege their states of citizenship and that each are diverse from Plaintiffs’ two
potential domiciles, Maryland and the District of Columbia.12 Not. of Removal at 5–7; Am. Not.
notice of the fact, ascertained via internet search, that this address is a consumer-facing branch
location (not headquarters) of First Savings, and therefore could only feasibly be construed as an
allegation about First Savings’ citizenship, not Larry Pratt’s individual citizenship. See Canuto
v. Mattis, 273 F. Supp. 3d 127, 133 (D.D.C. 2017) (verifying via an internet search that the
plaintiff had written the wrong name for the defendant in her complaint, and instead intended to
sue the corporate entity at the address she had provided); see also Humphries v. Newman, 2022
WL 612657, at *6 (D.D.C. Mar. 2, 2022) (taking judicial notice of a hospital’s business address
for the purposes of determining diversity jurisdiction). As explained below, because the Court
concludes based on judicially noticeable facts that First Savings is a citizen only of Virginia, this
allegation in the caption of the amended complaint does not alter the outcome of the Court’s
jurisdictional analysis.
12
In the initial Notice of Removal, the removing defendants stated that Larry Pratt is a
resident of Virginia. See Not. of Removal ¶ 17. In the Amendment to the Notice of Removal,
13
of Removal at 4–8; see Elghannam, 2015 WL 13158509, at *1. Like the defendant who
challenged jurisdiction in DC2NY, Plaintiffs have not directly argued that either they or any
Defendant is a citizen of a different state than Defendants have alleged. All they have said is that
“all of the parties fall under the diversity . . . jurisdiction except for one of the Defendant(s),”
without specifying which one. Mot. to Remand at 2 (emphasis added). To treat this as an
appropriate challenge would put Defendants in the untenable position of having to provide
competent proof without fair notice of what sort of proof to offer or on behalf of which
defendants to offer it. The Court declines to do so. In short, whatever the precise requirement
for an “appropriate challenge,” in a multi-defendant case such as this, Plaintiffs’ cursory
assertion does not meet it.
Putting aside Plaintiffs’ defective challenge, this Court must still assure itself it has
jurisdiction. See, e.g., Amer. Library Ass’n v. F.C.C., 401 F.3d 489, 492 (D.C. Cir. 2005). For
several reasons, the Court is satisfied that it does.
First, the Court’s own review of the filings reveals no obvious infirmity in Defendants’
jurisdictional allegations. Defendants allege that Plaintiffs are domiciled in either Washington,
D.C. or Maryland. Not. of Removal ¶ 5. They further allege in their original Notice of Removal
they instead state that Larry Pratt is a resident of Florida and is domiciled in Florida. See Am.
Not. of Removal at 5. Pratt himself, who appeared after the initial Notice of Removal and
moved to dismiss for failure to state a claim, has not presented any allegations of his own
regarding his citizenship. The Court observes the discrepancy between the removing defendants’
initial and amended allegations regarding Pratt’s citizenship but concludes that it does not matter
for the instant analysis. The removing defendants have alleged that Pratt is a citizen of either
Virginia or Florida, which makes him diverse from Plaintiffs, who are only citizens of D.C. or
Maryland. As the Court explained in footnote 11, Plaintiffs have not made any allegation that
Larry Pratt, the individual, is a citizen of D.C. or Maryland. Indeed, they have not said anything
about Pratt’s citizenship at all. Therefore, they have not presented any challenge to the removing
defendants’ allegations that Pratt is not a citizen of either D.C. or Maryland, much less done so in
an “appropriate manner” sufficient to trigger the removing defendants’ burden of proving
jurisdiction. Scott, 937 F. Supp. 2d at 66 (quoting McNutt, 298 U.S. at 189).
14
and Amended Notice of Removal that no Defendant is a citizen of either D.C. or Maryland. Id. ¶
6; Am. Not. of Removal at 4–8. Plaintiffs have nowhere persuasively controverted these facts.
See District of Columbia ex rel. Am. Combustion, 797 F.2d at 1045 (“[U]nless Transamerica
denied ACI’s allegations of diversity, triggering the requirement that ACI affirmatively prove the
facts necessary to support a finding of diversity, the amended allegations here support a finding
of diversity jurisdiction.”); cf. Novak v. Capital Management and Development Corp., 452 F.3d
902, 906 (D.C. Cir. 2006) (noting defendants failed to allege their states of citizenship and only
alleged plaintiffs’ residency). Thus, nothing in the record gives the Court pause.
Second, out of an abundance of caution, the Court has reviewed the annual reports filed
with the SEC by the publicly traded corporate defendants potentially named in this suit, and they
each square with the states of incorporation and principal places of business13 alleged in the
Notice of Removal, none of which is Maryland or D.C. See DiLorenzo v. Norton, No. 07-cv-
144, 2009 WL 2381327, at *2 n.7 (D.D.C. July 31, 2009) (“Because SEC filings are matters of
public record, they are properly the subject of judicial notice, and therefore the Court may, and
will, consider them on review of defendant’s motion to dismiss.” (citing Marshall Cnty. Health
Care Auth. V. Shalala, 988 F.2d 1221, 1226 n.6 (D.C. Cir. 1993)). To confirm the citizenship of
First Savings, a private company, the Court has reviewed the Virginia State Corporation
Commission (“SCC”) filings to confirm that First Savings’ place of incorporation is Virginia, as
alleged in the Notice of Removal. See Robo-Team NA, Inc. v. Endeavor Robotics, 313 F. Supp.
13The Court views the annual reports’ designated “principal executive office[s]” as
sufficient proxies for the Defendants’ principal places of business. See Hertz, 559 U.S. at 93(noting that a corporations’ principal place of business will “in practice . . . normally be the place
where the corporation maintains its headquarters.”). To the extent the officer Defendants are the
intended Defendants in this suit, judicially noticeable documents cannot verify their alleged
domiciles.
15
3d 19, 23 n.1 (D.D.C. 2018) (“Courts may take judicial notice of public records of corporate
filings maintained online by state Secretaries of State to determine a company’s place of
incorporation.” (citing In re Lorazepam & Clorazepate Antitrust Litig., 900 F. Supp. 2d 8, 18
(D.D.C. 2012)). The Virginia SCC filings also list First Savings’ principal office in Virginia,
consistent with the allegation in the Notice of Removal. Plaintiffs list a Maryland address for
First Savings in the Amended Complaint, but as the Court has explained, this address is not the
“nerve center” of First Savings—it is a consumer-facing branch location with no bearing on
diversity jurisdiction. See Hertz, 559 U.S. at 92–93. Because there appear to be no “litigants
from the same state on opposing sides,” Saadeh, 107 F.3d at 55, Defendants have sufficiently
alleged diversity jurisdiction.
For the reasons set forth above, this Court has jurisdiction and will rule on the moving
Defendants’ motions to dismiss for failure to state a claim.
IV. ANALYSIS—MOTIONS TO DISMISS14
A. Standard of Review
The Federal Rules of Civil Procedure require that a complaint contain “a short and plain
statement of the claim” in order to give the defendant fair notice of the claim and the grounds
upon which it rests. Fed. R. Civ. P. 8(a)(2); accord Erickson v. Pardus, 551 U.S. 89, 93 (2007)
(per curiam). A motion to dismiss under Rule 12(b)(6) does not test a plaintiff’s ultimate
14
At this stage, the Court only resolves claims against the moving Defendants because
the non-moving Defendants have neither filed nor joined in any of the motions to dismiss. In
addition, while it appears none of the Defendants were properly served with the Complaint, the
moving Defendants have moved to dismiss for failure to state a claim, not for insufficient
service, and therefore the Court finds the moving Defendants have waived the defense of
insufficient service. See Raynor v. District of Columbia, 296 F. Supp. 3d 66, 71 (D.D.C. 2017)
(“Rule 12(h)(1) of the Federal Rules of Civil Procedure states that the defense for insufficient
service of process shall be deemed waived if it is not included in a motion under Rule 12.”).
16
likelihood of success on the merits; rather, it tests whether a plaintiff has properly stated a claim.
See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). A court considering such a motion presumes
that the complaint’s factual allegations are true and construes them liberally in the plaintiff’s
favor. See, e.g., United States v. Philip Morris, Inc., 116 F.Supp.2d 131, 135 (D.D.C.2000).
Nevertheless, “[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, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). This means that a plaintiff’s factual allegations “must be enough to raise a right to relief
above the speculative level, on the assumption that all the allegations in the complaint are true
(even if doubtful in fact).” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555–56 (2007) (citation
omitted). “Threadbare recitals of the elements of a cause of action, supported by mere
conclusory statements,” are therefore insufficient to withstand a motion to dismiss. Iqbal, 556
U.S. at 678. A court need not accept a plaintiff’s legal conclusions as true, see id., nor must a
court presume the veracity of the legal conclusions that are couched as factual allegations, see
Twombly, 550 U.S. at 555.
B. Choice of Law
The parties have not briefed the choice of law issues presented in this case. “‘[F]ederal
courts are to apply state substantive law and federal procedural law’ when sitting pursuant to
their diversity jurisdiction.” Burke v. Air. Serv. Int’l, Inc., 685 F.3d 1102, 1107 (D.C. Cir. 2012)
(quoting Hanna v. Plumer, 380 U.S. 460, 465 (1965) (other citations omitted)). It follows that
“[a] federal court sitting in diversity must apply the choice-of-law rules of the forum state—here,
the District of Columbia.” Beach TV Properties, Inc. v. Solomon, 306 F. Supp. 3d 70, 92
(D.D.C. 2018) (quoting In re APA Assessment Fee Litig., 766 F.3d 39, 51 (D.C. Cir. 2014). “The
17
District of Columbia ‘employ[s] a modified governmental interests analysis which seeks to
identify the jurisdiction with the most significant relationship to the dispute.’” Id. (quoting
Washkoviak v. Student Loan Mktg. Ass’n, 900 A.2d 168, 180 (D.C. 2006) (brackets original).
In tort cases,
[u]nder the governmental interest test, a court must consider “the governmental
policies underlying the applicable law and determine[] which jurisdiction’s policy
would be the most advanced by the application of its law to the facts of the case,
taking into consideration (1) the place where the injury occurred; (2) the place
where the conduct causing the injury occurred; (3) the domicile, residence,
nationality, place of incorporation and place of business of the parties; and (4) the
place where the relationship is centered.
LoPiccolo v. American University, 840 F. Supp. 2d 71, 75–76 (D.D.C. 2012) (citation omitted).
“Where each state would have an interest in the application of its own law to the facts, the law of
the jurisdiction with the stronger interest will apply,” but “[i]f the interests of the jurisdictions in
the application of their law are equally weighty, the law of the forum will be applied.” Williams
v. First Gov’t Mortg. and Invs. Corp., 176 F.3d 497, 499 (D.C. Cir. 1999) (cleaned up).
On the other hand, in contract cases in which the contract contains an “express
contractual choice-of-law provision[],” District of Columbia courts will enforce such provisions
“so long as there is some reasonable relationship with the state specified.” Sickle v. Torres
Advanced Enterprise Solutions, LLC, No. 11-cv-2224, 2020 WL 5530357, at *7 (D.D.C. Sep. 14,
2020) (quoting Ekstrom v. Value Health, Inc., 68 F.3d 1391, 1394 (D.C. Cir. 1995); accord B&S
Glass, Inc. v. Del Metro, No. 20-cv-2769, 2021 WL 3268360, at *5 (D.D.C. July 30, 2021). As
explained below, the Court finds it proper to apply the District’s substantive law to all issues.
18
C. Plaintiffs’ Claims15
Plaintiffs assert wrongful foreclosure, breach of contract, quiet title, and slander of title
claims in relation to the impending foreclosure of the Property. Sup. Ct. R. at ECF pp. 34–49.
The moving Defendants contend that all claims should be dismissed under Fed. R. Civ. P
12(b)(6). Mot. to Dismiss at 6, 8.
1. Lack of Standing/Wrongful Disclosure16
The Court understands Plaintiffs to assert that Defendants lack standing to foreclose on
two grounds: 1) Defendants “failed to perfect any security interest in the” Property or “cannot
prove to the court that they have a valid interest . . . [in the] Deed of Trust”; and 2) the
Defendants engaged in fraud “in the processing, handling and attempted foreclosure” of the
property. Sup. Ct. R. at ECF p. 43. The moving Defendants claim that the Deed’s “power of
sale” provision authorizes foreclosure, Mot. to Dismiss at 8; Pratt Mot. to Dismiss at 8, and that
Plaintiffs fail to adequately plead fraud, Pratt Mot. to Dismiss at 7–8.
The Court will apply D.C. substantive law to all of Plaintiffs’ wrongful foreclosure
claims because the Deed is governed by D.C. law, and all of Plaintiffs’ claims under this heading
15
This Court has on two occasions instructed Plaintiffs to respond to the moving
Defendants’ motions to dismiss. Plaintiffs have filed motions in response, but none of these
motions address the arguments raised in the moving Defendants’ motions. See First Fox/Neal
Order; Second Fox/Neal Order. However, given Plaintiffs’ pro se status, and because the Court
is confident that no further briefing would change the outcome of this case, the Court declines to
treat Defendants’ motions to dismiss as conceded and instead reaches the merits.
Furthermore, for purposes its motion-to-dismiss analysis, this Court will treat Plaintiffs’
Amended Complaint as supplementing rather than superseding their original Complaint. See
Hunter, 485 F. Supp. 3d at 73 (“[W]here a pro se party has filed multiple submissions, the
district court must generally consider those filings together and as a whole.”) (citing Richardson
v. United States, 193 F.3d 545, 548 (D.C. Cir. 1999).
16
The Court does not address Plaintiffs’ related claims against MERS, as MERS has not
made an appearance in this case.
19
arise out of Defendants’ alleged lack of interest in the Deed. First, the Deed’s choice of law
provision clearly intends for District of Columbia law to apply. The clause states that the Deed
“shall be governed by . . . the law of the jurisdiction in which the Property is located.” Deed of
Trust at ECF p.12.17 There is no dispute that the Property is located in Washington, D.C., see
Sup. Ct. R. at ECF p. 35, and therefore the parties to the Deed anticipated the application of D.C.
law. Second, because the Property subject to the Deed is located in the District, the Deed itself
necessarily bears a “reasonable relationship” with the District of Columbia. Sickle, 2020 WL
5530357, at *7 (quoting Ekstrom, 68 F.3d at 1394); see also Williams v. First Gov’t. Mortg. and
Inv. Corp., 176 F.3d 497, 499 (D.C. Cir. 1999) (applying District of Columbia law in suit
seeking to enjoin foreclosure of property located in D.C.). Therefore, the Deed’s choice-of-law
provision controls.
Failure to Perfect. Plaintiffs do not specify in what way Defendants have failed to
perfect their security interest. The Court understands Plaintiffs to mean 1) the Note was not
“transfer[ed] in [the] ordinary course of business,” Sup. Ct. R. at ECF p. 39, and 2) that the Note
and Deed were not “contemporaneous[ly] assign[ed]” and are therefore “irreparably separated,”
id. at ECF p. 42. At bottom, Plaintiffs appear to challenge the assignment of the security interest
in the Deed, which contains the “power of sale” clause.
In general, a borrower lacks standing to challenge the assignment of a note. See Bank of
New York Mellon Trust Co. N.A. v. Henderson, 107 F. Supp. 3d 41, 45 (D.D.C. 2015) (“Because
defendant has not alleged that he is either a party to, or an intended beneficiary of, the
17
This Court will consider the Deed without converting Defendants’ motions into
motions for summary judgement because the Deed is referenced in Plaintiffs’ Complaint. See,
e.g., Sup. Ct. R. at ECF p. 36, ¶ 13; Malek v. Flagstar Bank, 70 F. Supp. 3d 23, 29 n.4
(considering deed of trust referenced in complaint and attached to motion to dismiss).
20
assignment of the Note and Deed of Trust, he does not have standing to attack the assignment.”);
Jessup v. Progressive Funding, 35 F. Supp. 3d 25, 35 (D.D.C. 2014) (“Jessup has not pled facts
showing that she is either a party to, or an intended beneficiary of, the assignment agreement.
Accordingly, Jessup has not established that she has standing to challenge the validity of any
assignment of the Note and Deed.”); Rivera v. Rosenberg & Associates, LLC, 142 F. Supp. 3d
149, 156 (D.D.C. 2015) (same). The Henderson court explained why this rule “makes good
sense”:
[T]he assignment does not affect [the borrower’s] rights or obligations at all.
Regardless of whether the Note and Deed of Trust were properly assigned, [the
borrower is] still required to make timely payments on his mortgage and, by the
plain terms of the Note and Deed of Trust, he [or she] is subject to foreclosure upon
default.
107 F. Supp. 3d at 45. Because Plaintiffs are not beneficiaries of the assignment of the Note,
they fail to state a claim on this ground.
The allegation that the Note and Deed were not contemporaneously assigned does not
change the Court’s conclusion. “When a contract incorporates another writing, the two must be
read together as the contract between the parties.” W. Surety Co. v. U.S. Eng’g Co., 211 F. Supp.
3d 302, 308 (D.D.C. 2016) (quoting Sheriff v. Medel Elec. Co., 412 A.2d 38, 41 (D.C. Ct. App.
1980)). See also Horvath v. Bank of New York, NA, 641 F.3d 617, 624 (4th Cir. 2011) (“[N]otes
and contemporaneous written agreements executed as part of the same transaction will be
construed together as forming one contract.”). Here, the Deed’s Release clause references the
Note as “sums secured by this Security Instrument.” Deed of Trust at ECF p. 14; see Note ¶ 11,
ECF No. 3-2 (“In addition to the protections given to the Note Holder under this Note, a . . .
Deed of Trust . . . (the ‘Security Instrument’) dated the same date as this Note, protects the Note
Holder.”). Thus, the Deed incorporates Plaintiffs’ obligations under the Note, and the transfer of
the interest in the Note in no way abrogates said obligations. As the Fourth Circuit explained in
21
Horvath, “there would be little reason for notes to exist” without “the[ir] defining feature of . . .
transferability.” 641 F.3d at 624. Therefore, Plaintiffs fail to state a claim on this ground.
Fraud. Pratt argues that Plaintiffs have not adequately plead fraud. Pratt Mot. to Dismiss
at 7–8. Federal Rule of Civil Procedure 9(b) requires that a party “alleging fraud or mistake . . .
must state with particularity the circumstances constituting fraud or mistake.” Fed. R. Civ. P.
9(b). “The rule serves to discourage the initiation of suits brought solely for their nuisance value,
and safeguards potential defendants from frivolous accusations of moral turpitude . . . . And
because ‘fraud’ encompasses a wide variety of activities, the requirements of Rule 9(b) guarantee
all defendants sufficient information to allow for preparation of a response.” United States ex
rel. Joseph v. Cannon, 642 F.2d 1373, 1385 (D.C. Cir. 1981). “Rule 9(b) applies with equal
strength to defendants sued by a pro se litigant . . . [and] requires that the pleader provide the
who, what, when, where, and how with respect to the circumstances of that fraud.” Tefera v.
OneWest Bank, FSB, 19 F. Supp. 3d 215, 223 (D.D.C. 2014) (quotation omitted).
Plaintiffs fall short of Rule 9(b)’s heightened pleading standard. The Complaint states
neither the time, place, nor content of the alleged misrepresentation. Even construing the claim
liberally, the Court cannot identify the substance of the allegedly fraudulent statements.
Therefore, Plaintiffs fail to state a claim on this ground as well.
Power of Sale. The moving Defendants argue that the Deed’s power of sale clause
authorizes them to foreclose on the Property. Mot. to Dismiss at 8; Pratt Mot. to Dismiss at 8.
“Power of sale foreclosures are referred to as non-judicial foreclosure and are initiated privately
by the mortgagor/lender.” Rogers v. Advance Bank, 111 A.3d 25, 29 (D.C. Ct. App. 2015)
(citation omitted); Leake v. Prensky, 798 F. Supp. 2d 254, 256 (D.D.C. 2011) (“The District of
Columbia is a non-judicial foreclosure jurisdiction, which allows foreclosure pursuant to a
22
‘power of sale provision contained in any deed of trust.’”) (quoting D.C. Code § 42-815)). “In
short, non-judicial foreclosures are private debt collection procedures conducted without
participation by the court.” Rogers, 111 A.3d 29. (citing Pappas v. E. Sav. Bank, FSB, 911 A.2d
1230, 1237 (D.C. 2006)). The Deed at issue here provides for the “power of sale.” Deed of
Trust at ECF p. 4. Because, as described above, Plaintiffs have not adequately pled fraud, the
Court finds that the Deed’s power of sale provision controls.
In summary, Plaintiffs fail to state a claim that the Defendants lack standing to foreclose
on any of their asserted grounds. The Court therefore dismisses this claim.
2. Breach of Contract
Plaintiffs allege that the Release clause in the Deed obligates Defendant First Savings to
release the Deed because First Savings was “paid in full” by transferring its interest therein.18
Sup. Ct. R. at ECF p. 46. The Court understands Plaintiffs’ allegation to assert that, because
First Savings was paid by a third-party to the Deed for First Savings’ interest in the same,
Plaintiffs were released from their obligation to pay the Note. District of Columbia law governs
Plaintiffs’ breach of contract claim for the same reasons it governs the wrongful foreclosure
claims. Applying District of Columbia law, the Court finds that Plaintiff fails to state a claim for
breach of contract.
“To prevail on a breach of contract [claim] pursuant to District of Columbia law, a party
must establish (1) a valid contract between the parties; (2) an obligation or duty arising out of the
contract; (3) a breach of that duty; and (4) damages caused by the breach.” Dean v. Walker, 876
F. Supp. 2d 10, 13 (D.D.C. 2012) (citing Tsintolas Realty Co. v. Mendez, 984 A.2d 181, 187
18
Plaintiffs may instead be referring to the transfer of the Deed to the Trust. Sup. Ct. R.
at ECF p. 46. This would not change the Court’s analysis, because that arrangement is exactly
what a Deed of Trust requires. See, e.g., D.C. Code § 42-601.
23
(D.C. 2009). Plaintiffs’ reading of the Release clause as obligating First Savings to release
Plaintiffs from their obligations under the Note is unsupported by the clause’s plain language.
See Intelsat USA Sales Corp. v. Juch-Tech, Inc., 935 F. Supp. 2d 101, 108 (D.D.C. 2013) (“[A]
court ‘may dismiss a complaint based on a contract if the contract unambiguously shows that the
plaintiff is not entitled to the requested relief.’”) (quoting DynCorp v. GTW Corp., 215 F. Supp.
2d 308, 315 (S.D.N.Y. 20020)). The Release clause states, “Upon payment of all sums secured
by this Security Instrument, Lender shall request Trustee to release this Security Instrument.”
Deed of Trust at ECF p. 14. (emphasis added). As described above, the secured sums are
Plaintiffs’ obligations under the Note. See Note ¶ 11, ECF No. 3-2. Plaintiffs do not allege that
they have paid off the Note. Thus, even reading the allegations in the light most favorable to
Plaintiffs, the Release clause could not have been triggered. The Court therefore dismisses this
claim.
3. Quiet Title
Plaintiffs’ assert their quiet title claim on the ground that Defendants lack an interest in
the Property. See Sup. Ct. R. at ECF pp. 46–47. The moving Defendants argue that Plaintiffs
cannot establish they have superior title because “their Loan [the Note] has [not] been paid off or
otherwise forgiven.” Mot. to Dismiss at 7. The Property is located in D.C., so D.C. law governs
this claim. See, e.g., Jessup v, 35 F. Supp. 3d at 34 (D.D.C. 2014); Diaby v. Bierman, 795 F.
Supp. 2d 108, 111–113 (D.D.C. 2011); see Sup. Ct. R. at ECF p. 35. “Successful quiet title
actions require a plaintiff to establish that [he or] she has superior title to the property.” Jessup,
35 F. Supp. 3d at 36 (“The plaintiff has the burden of showing a title or right superior to that of
the defendant as a prima facie case, which means that the plaintiff must at least prove a title
24
better than that of the defendant, which, if not overcome by the defendant, is sufficient.” (citing
74 C.J.S. Quieting Title § 77 (2014)) (cleaned up)).
In Jessup, the court dismissed a quiet title claim when the plaintiff alleged that she had
conveyed a Deed of Trust with power of sale, but did not allege that she had paid off the Note.
Id. Plaintiffs’ complaint suffers from the same deficiency. Sup. Ct. R. at ECF pp. 46–47.
Therefore, even construing the facts most favorable to Plaintiffs, it appears the property is still
encumbered by a loan. While Plaintiffs’ assert in conclusory fashion that they are superior title
holders, absent an allegation that they have satisfied their obligations under the Note, they cannot
so prove. Therefore, the Court dismisses Plaintiffs’ quiet title claim.
4. Slander of Title
Plaintiffs allege two facts in support of their slander of title claim: 1) Defendants failed to
publicly record certain interests in the property; and 2) Defendants did record the assignment of
the Deed to Mellon in 2012. Sup. Ct. R. at ECF p. 47. The Court finds that neither of these
grounds state a claim.
In determining which law governs a tort case, D.C. courts determine the respective states’
“governmental interest” in the suit by “taking into consideration (1) the place where the injury
occurred; (2) the place where the conduct causing the injury occurred; (3) the domicile,
residence, nationality, place of incorporation and place of business of the parties; and (4) the
place where the relationship is centered.” LoPiccolo, 840 F. Supp. 2d at 75–76 (citation
omitted).
The Court finds that D.C. law governs Plaintiffs’ slander of title claims. As for the first
factor, the injury occurred in D.C. where the allegedly-slandered Property is located. As for the
second, the Assignment of the Deed was notarized in Minnesota, see Assignment of Deed of
25
Trust at ECF p. 2, ECF No. 3-4, a state only one party appears to have any connection with. As
for the third, based on Defendants’ unrefuted allegations, the Plaintiffs are citizens of D.C. or
Maryland, and Defendants are citizens of at least as many different states as Florida,
Connecticut, New York, Delaware, Michigan, Minnesota, Virginia. Not. of Removal at 4–7; see
Am. Not. of Removal at 6–7 (alleging certain officer Defendants are not citizens of Maryland or
the District without identifying which state they are citizens of). As for the fourth, the
relationship between the parties appears to center around location of the Property in the District.
Because two of the factors clearly favor applying D.C. law, and because the District
unquestionably has an interest in the application of D.C. law to suits involving property in the
District, the Court applies D.C. law. See Pace v. Wells Fargo Bank, N.A., No. 16-cv-1706, 2020
WL 1667658 at *9 (D.D.C. April 3, 2020) (applying District of Columbia law in slander of title
claim based on assignment of deed of trust).
“To establish a claim for slander of title, the plaintiff must prove: (1) a communication
relating to the title of property was false and malicious; (2) damages resulted from the
publication of the statement; and (3) if special damages are sought, the underlying damages must
be pled with specificity.” Bloom v. Beam, 99 A.3d 263, 266 (D.C. Ct. App. 2014) (citing
Psaromatis v. English Holdings, 944 A.2d 472, 488 n. 20 (D.C.2008)). The Court finds that
Plaintiffs’ first alleged ground for a slander of title action does not state a claim. Defendants’
alleged failure to record their interests is not a “communication” or a “publication of [a]
statement.” Id. In fact, a failure to record it is exactly the opposite.
Plaintiffs’ second alleged ground likewise does not state a claim. Although the recording
of the transfer of the interest in the property to Mellon was a communication, Plaintiffs’ have not
demonstrated that the recording was false or malicious in anyway. See Assignment of Deed of
26
Trust at ECF p. 2, ECF No. 3-4. Because Plaintiffs do not state a claim for slander of title, the
Court dismisses the claim.
V. CONCLUSION
For the foregoing reasons, Plaintiffs’ Motion to Remand is DENIED, and the moving
Defendants’ Motions to Dismiss are GRANTED. An order consistent with this Memorandum
Opinion is separately and contemporaneously issued.
Dated: 08/31/2022 RUDOLPH CONTRERAS
United States District Judge
27