Jacob McGreevey v. Phh Mortgage Corporation

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
JACOB MCGREEVEY, No. 16-36045
Plaintiff-Appellant,
D.C. No.
v. 3:16-cv-05339-
RJB
PHH MORTGAGE CORPORATION;
NORTHWEST TRUSTEE SERVICES,
INC., OPINION
Defendants-Appellees.
Appeal from the United States District Court
for the Western District of Washington
Robert J. Bryan, Senior District Judge, Presiding
Argued and Submitted June 5, 2018
Seattle, Washington
Filed July 26, 2018
Before: Jay S. Bybee and N. Randy Smith, Circuit Judges,
and John Antoon II, * District Judge.
Opinion by Judge Antoon
*
The Honorable John Antoon II, United States District Judge for the
Middle District of Florida, sitting by designation.
2 MCGREEVEY V. PHH MORTGAGE CORP.
SUMMARY **
Servicemembers Civil Relief Act
The panel affirmed the district court’s dismissal as time-
barred of a private suit alleging violations of § 303(c) of the
Servicemembers Civil Relief Act, which provides a limited
prohibition on foreclosure of the property of
servicemembers.
The panel held that the federal catchall statute of
limitations in 28 U.S.C. § 1658(a) applies to private suits
alleging violations of § 303(c) of the SCRA, an Act of
Congress enacted after 1990. Because § 1658(a), like the
state statute relied upon by the district court, specifies a four-
year limitations period, the panel affirmed.
COUNSEL
Sean J. Riddell (argued), Law Office of Sean J. Riddell,
Portland, Oregon, for Plaintiff-Appellant.
Matthew Sheldon (argued) and Jaime Ann Santos, Goodwin
Procter LLP, Washington, D.C.; John S. Devlin, III, Lane
Powell PC, Seattle, Washington; for Defendant-Appellee
PHH Mortgage Corporation.
Tovah Calderon and Christine A. Monta, Attorneys,
Appellate Section; T.E. Wheeler, II, Acting Assistant
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
MCGREEVEY V. PHH MORTGAGE CORP. 3
Attorney General; Civil Rights Division, United States
Department of Justice, Washington D.C.; for Amicus Curiae
United States of America.
Denise Gale Fjordbeck, Assistant Attorney General;
Benjamin Gutman, Solicitor General; Ellen F. Rosenblum,
Attorney General; Civil/Administrative Appeals, Oregon
Department of Justice, Salem, Oregon; for Amicus Curiae
State of Oregon.
OPINION
ANTOON, District Judge:
This appeal presents an issue of first impression—what
is the applicable statute of limitations for private suits
alleging violations of § 303(c) 1 of the Servicemembers Civil
Relief Act (SCRA)? 2 Section 303(c) provides a limited
prohibition on foreclosure of the property of
servicemembers, but the SCRA does not contain a statute of
limitations. The district court, applying the four-year
limitations period of what it determined to be the most
closely analogous state statute, found that Plaintiff Jacob
McGreevey’s § 303(c) claim was time-barred and dismissed
the case. McGreevey appeals. 3
1
50 U.S.C. § 3953(c).
2
50 U.S.C. §§ 3901–4043.
3
We have jurisdiction under 28 U.S.C. § 1291 and review de novo
the dismissal of McGreevey’s claim as time-barred. Cholla Ready Mix,
Inc. v. Civish, 382 F.3d 969, 973 (9th Cir. 2004). Because we are
reviewing the grant of a Rule 12(b)(6) motion to dismiss, we assume as
4 MCGREEVEY V. PHH MORTGAGE CORP.
After carefully considering the parties’ briefs, and with
the benefit of oral argument, we conclude that the federal
catchall statute of limitations in 28 U.S.C. § 1658(a) applies
to private suits alleging violations of § 303(c) of the SCRA.
Because that provision, like the state statute relied upon by
the district court, also specifies a four-year limitations
period, we affirm.
I
In 2006 McGreevey, a United States Marine, refinanced
the mortgage on his home in Vancouver, Washington, with
Defendant PHH Mortgage Corporation (PHH Mortgage).
By January 16, 2009, PHH Mortgage and Defendant
Northwest Trustee Services, Inc. (Northwest) 4 had initiated
foreclosure proceedings. Four months later, on May 18,
2009, the Marines recalled McGreevey to active service in
Iraq. On July 21, 2010, after McGreevey completed his
service in Iraq, the Marines released him from military duty.
Following his release, McGreevey promptly advised
Defendants of his military service and requested an
opportunity to refinance his mortgage. Defendants ignored
his request and proceeded with a foreclosure sale of
McGreevey’s home on August 20, 2010.
true the facts as alleged in McGreevey’s amended complaint. Brooks v.
Clark Cty., 828 F.3d 910, 914 n.1 (9th Cir. 2016).
4
Northwest, acting as trustee for PHH Mortgage, initiated and
conducted the foreclosure proceedings.
MCGREEVEY V. PHH MORTGAGE CORP. 5
Almost six years after the sale, McGreevey filed suit
against Defendants in district court. 5 He alleged that
Defendants had violated § 303(c) of the SCRA, which at that
time prohibited the “sale, foreclosure, or seizure of property”
for a breach of a mortgage obligation if “made during, or
within nine months after, the period of the servicemember’s
military service” unless such sale, foreclosure, or seizure
occurred by court order or under waiver by the
servicemember of his SCRA rights. 50 U.S.C. § 3953(c). 6
The amended complaint sought an award of money
damages, costs, and attorney’s fees.
Defendants moved to dismiss McGreevey’s complaint as
time-barred. Noting that the SCRA does not contain a
statute of limitations, Defendants urged the district court to
apply the limitations period of the closest state-law analogue
to the SCRA. Defendants advanced as analogous two
Washington statutes—the Consumer Protection Act (CPA),
Wash. Rev. Code ch. 19.86 (four-year limitations period),
and the Deeds of Trust Act, Wash. Rev. Code ch. 61.24
(two-year limitations period). Additionally, Defendants
5
McGreevey filed his initial complaint against PHH Mortgage on
May 6, 2016, and filed an amended complaint on September 23, 2016,
adding Northwest as a defendant.
6
While Congress included the prohibition on sale, foreclosure, or
seizure in every iteration of the SCRA and its predecessors, the length of
the protection varied. For instance, in 2008, Congress expanded the
period of protection from ninety days to nine months, and in 2012, to one
year. Soldiers’ and Sailors’ Civil Relief Act of 1940, Pub. L. No. 76-
861, § 302(3), 54 Stat. 1178, 1182–83 (1940); Housing and Economic
Recovery Act, Pub. L. No. 110-289, § 2203(a), 122 Stat. 2654, 2849
(2008) (amending § 303 of the SCRA); 50 U.S.C. § 3953(c) (2012).
Because the foreclosure on McGreevey’s home occurred in 2010, the
nine-month period of protection as enacted by Congress in 2008 applies
here.
6 MCGREEVEY V. PHH MORTGAGE CORP.
identified the Fair Debt Collection Practices Act, 15 U.S.C.
§§ 1692–1692p, as a federal statute with a one-year
limitations period that could apply. If the district court
applied the limitations period from any of these statutes,
dismissal would be required because—even after taking into
account that the period was tolled for 404 days for
McGreevey’s active duty service pursuant to 50 U.S.C.
§ 3936(a)—more than four years passed from the accrual of
McGreevey’s claim until the filing of McGreevey’s
complaint in May 2016.
In response to Defendants’ motion to dismiss,
McGreevey agreed that the district judge should adopt a
limitations period from the statute most analogous to the
SCRA, but he argued that other statutes were better
candidates. He contended that the district court need not
look to a state statute, asserting that the Uniformed Services
Employment and Reemployment Rights Act (USERRA),
38 U.S.C. ch. 43, was most analogous. If accepted, that
approach would have solved McGreevey’s untimeliness
problem because the Veterans’ Benefits Improvement Act 7
explicitly provided that “there shall be no limit on the period
for filing” a USERRA claim. 38 U.S.C. § 4327(b). As an
alternative, McGreevey suggested the court apply
Washington’s six-year statute of limitations for breach of
contract claims, Wash. Rev. Code § 4.16.040.
In their reply, Defendants argued that neither
Washington’s breach of contract law nor the USERRA was
analogous, noting that McGreevey was not suing for breach
of contract and that the USERRA was enacted for a purpose
entirely different from that of the SCRA. And as an
7
Pub. L. No. 110-389, 122 Stat. 4145 (2008) (codified in scattered
sections of 38 U.S.C.).
MCGREEVEY V. PHH MORTGAGE CORP. 7
alternative argument, Defendants for the first time raised
28 U.S.C. § 1658(a) in support of their motion. By enacting
§ 1658(a), Congress established a four-year limitations
period for claims arising from any federal statute enacted
after December 1, 1990, that fails to delineate a limitations
period.
The district court granted Defendants’ motion to dismiss,
rejecting McGreevey’s arguments and applying the four-
year statute of limitations contained in the Washington CPA.
In doing so, the district court did not comment on the
applicability of 28 U.S.C. § 1658(a). On appeal, McGreevey
maintains that the district court erred in applying the four-
year limitations period of the Washington CPA instead of
USERRA or Washington’s limitations period for breach of
contract claims. Defendants’ primary argument on appeal is
that McGreevey’s SCRA claim is time-barred under the
catchall four-year limitations period of 28 U.S.C. § 1658(a).
II
Traditionally, when a federal statute creating a right of
action did not include a limitations period, courts would
apply the limitations period of the “closest state analogue.”
Jones v. R.R. Donnelley & Sons Co., 541 U.S. 369, 378
(2004). The district court sought such an analogue here and
ultimately applied the four-year limitations period of the
Washington CPA. As evidenced by the district court’s
attempt to sort through statutes covering everything from
deeds to consumer protection to employment, the task of
determining which statute was most analogous “spawned a
vast amount of litigation.” Id. at 377.
But in 1990, Congress established—in 28 U.S.C.
§ 1658(a)—a uniform, catchall limitations period for actions
arising under federal statutes enacted after December 1,
8 MCGREEVEY V. PHH MORTGAGE CORP.
1990. This provision states that “[e]xcept as otherwise
provided by law, a civil action arising under an Act of
Congress enacted after [December 1, 1990] may not be
commenced later than 4 years after the cause of action
accrues.” 28 U.S.C. § 1658(a). If § 1658(a) applies, there is
no need for a court to seek a state law analogue when
analyzing a statute-of-limitations argument.
A cause of action “aris[es] under an Act of Congress
enacted after” 1990 within the meaning of § 1658(a) if the
“plaintiff’s claim against the defendant was made possible
by a post-1990 enactment.” Jones, 541 U.S. at 382. Such
enactments include amendments to preexisting statutes that
create “new rights of action and corresponding liabilities.”
Id. at 381.
Defendants contend that no private right of action for
§ 303(c) violations existed until 2010, when an amendment
to the SCRA added an express private right of action.
Defendants thus argue that 28 U.S.C. § 1658(a) applies here.
The applicability of § 1658(a) turns on whether the 2010
amendment to the SCRA created a “new right[] of action and
corresponding liabilities” that were not available to
servicemembers before 1990. We conclude that it did and
that 28 U.S.C. § 1658(a) accordingly controls.
III
The SCRA’s predecessor—the Soldiers’ and Sailors’
Civil Relief Act (SSCRA)—was originally enacted in 1918,
during World War I. SSCRA of 1918, Pub. L. No. 65-103,
40 Stat. 440 (1918); Gordon v. Pete’s Auto Serv. of Denbigh,
Inc., 637 F.3d 454, 457 (4th Cir. 2011). The Act expired
after the war, but Congress reenacted the SSCRA in 1940
and amended it several times from 1942 to 2003. SSCRA of
1940, Pub. L. No. 76-861, 54 Stat. 1178 (1940); Gordon,
MCGREEVEY V. PHH MORTGAGE CORP. 9
637 F.3d at 458. In the 2003 amendments, Congress
renamed the statute the Servicemembers Civil Relief Act and
sought to modernize and “strengthen many of [the
SSCRA’s] protections,” H.R. Rep. No. 108-81, at 35 (2003),
and “to enable [servicemembers] to devote their entire
energy to the defense needs of the Nation,” Brewster v. Sun
Tr. Mortg., Inc., 742 F.3d 876, 878 (9th Cir. 2014) (alteration
in original) (quoting 50 U.S.C. app. § 502(1)). See SCRA of
2003, Pub. L. No. 108-189, 117 Stat. 2835 (2003).
The SCRA accomplishes Congress’s purposes “by
imposing limitations on judicial proceedings that could take
place while a member of the armed forces is on active duty,
including insurance, taxation, loans, contract enforcement,
and other civil actions.” Brewster, 742 F.3d at 878. Section
303 of the SCRA, which is at issue in this case, pertains to
foreclosure of mortgages. We have recognized that this
provision constitutes “a serious prohibition aimed at keeping
members of the armed forces free of foreclosures which
would be distractions and unfair while they serve their
country.” Id.
The determinative question here is whether a private
right of action for § 303(c) violations existed before 1990.
Although federal law has provided servicemembers
protection against property foreclosure since the SSCRA, it
is undisputed that neither the SCRA nor its predecessors
contained an express private right of action until Congress,
in the Veterans’ Benefits Act of 2010, added a section to the
SCRA providing that a servicemember whose SCRA rights
are violated may “obtain any appropriate equitable or
declaratory relief . . . [and] recover all other appropriate
relief, including monetary damages.” 50 U.S.C. § 4042(a)
(2018); Veterans Benefits’ Act of 2010, Pub. L. 111-275,
10 MCGREEVEY V. PHH MORTGAGE CORP.
§ 801, 124 Stat. 2864, 2877 (2010); H.R. Rep. No. 111-324,
at 7 (2009).
McGreevey argues that despite the lack of an express
right of action prior to 2010, servicemembers had an implied
private right of action under the SSCRA before 1990. But
this argument is tenuous. No federal appeals court,
including this Court, has ever held that these acts created a
private right of action before 2010, 8 and the several district
courts in this circuit and elsewhere that addressed this
question have come to different conclusions about various
sections of the SCRA. 9 At oral argument, McGreevey was
8
The state of Oregon, as amicus curiae in this case, argues that the
Fourth Circuit, in Gordon, addressed whether private rights of action
under SCRA existed before the 2010 amendment. 637 F.3d 454 (4th Cir.
2011). The Fourth Circuit found that the express private cause of action
retroactively applied in that case. Id. at 461. But the Fourth Circuit
explicitly declined to decide whether there was a pre-existing implied
federal right of action, instead “assum[ing] for the sake of argument that
there was not.” Id. at 459 n.1.
9
Compare Frazier v. HSBC Mortg. Servs., Inc., No. 8:08-cv-02396-
T-24 TGW, 2009 WL 4015574, at *5 (M.D. Fla. Nov. 19, 2009)
(concluding that SCRA’s interest rate provision implicitly provided a
private cause of action), Hurley v. Deutsche Bank Tr. Co. Americas, No.
1:08-CV-361, 2009 WL 701006, at *4 (W.D. Mich. Mar. 13, 2009)
(finding that the SCRA’s foreclosure protections provided an implied
private cause of action), and Linscott v. Vector Aerospace, No. CV-05-
682-HU, 2006 WL 240529, at *5–7 (D. Or. Jan. 31, 2006) (concluding
that the SCRA contained a private right of action to enforce the mortgage
foreclosure provision), with Giri v. HSBC Bank USA, 98 F. Supp. 3d
1147, 1151–52 (D. Nev. 2015) (concluding that the pre-2010 SCRA did
not imply a private right of action to enforce the mortgage foreclosure
provision, as it “provided only for criminal liability, not for any civil
liability”), Williams v. U.S. Bank Nat’l Ass’n, No. ED CV 12-00748-
JLQ, 2013 WL 571844, at *4 (C.D. Cal. Feb. 13, 2013) (concluding that
plaintiff “had no right to civil relief” under the SCRA prior to the 2010
Act), and McMurtry v. City of Largo, 837 F. Supp. 1155, 1157–58 (M.D.
MCGREEVEY V. PHH MORTGAGE CORP. 11
unable to supply the Court with any authority establishing a
pre-2010 private right of action to pursue damages for a
wrongful foreclosure under the SCRA or its predecessors.
And to the extent McGreevey asks this Court to assess
whether an implied private right of action existed under the
pre-December 1, 1990 SSCRA, we discern no such implied
right in the statute. 10 In Cort v. Ash, 422 U.S. 66 (1975), and
Alexander v. Sandoval, 532 U.S. 275 (2001), the Supreme
Court provided guidance in analyzing whether a statute
creates an implied private right of action. Cort prescribes
considering the following factors:
First, is the plaintiff ‘one of the class for
whose especial benefit the statute was
enacted,’—that is, does the statute create a
federal right in favor of the plaintiff? Second,
is there any indication of legislative intent,
explicit or implicit, either to create such a
remedy or to deny one? Third, is it consistent
with the underlying purposes of the
legislative scheme to imply such a remedy for
the plaintiff? And finally, is the cause of
action one traditionally relegated to state law,
in an area basically the concern of the States,
Fla. 1993) (holding the SSCRA did not provide a private cause of
action).
10
McGreevey’s argument principally relies on Moll v. Ford
Consumer Finance Company, Inc., No. 97 C 5044, 1998 WL 142411(N.D. Ill. Mar. 23, 1998). That case assessed whether the SSCRA’s
separate limitation on the amount of interest recoverable by a creditor
under § 526 implied a private cause of action after 1990, and we find it
distinguishable and otherwise unpersuasive.
12 MCGREEVEY V. PHH MORTGAGE CORP.
so that it would be inappropriate to infer a
cause of action based solely on federal law?
422 U.S. at 78 (citations omitted). While the Cort factors
remain relevant, the focus now is on whether Congress
“displays [through the statute] an intent to create not just a
private right but also a private remedy.” Alexander, 532 U.S.
at 286. “Statutory intent [to create not just a private right but
also a private remedy] is determinative[;]” without
Congress’s intent to create a remedy, no right of action can
be implied. Id. at 286–87.
After “search[ing] for Congress’s intent with[in] the text
and structure” of the statute pursuant to Cort and Alexander,
we find no implied private right of action for damages,
attorney’s fees, and costs within the pre-1990 SSCRA’s
foreclosure protections. Id. at 288. The methods Congress
provided to enforce violations of the SSCRA “preclude[] a
finding of congressional intent to create a private right of
action, even though other aspects of the statute (such as
language making [McGreevey] ‘a member of the class for
whose benefit the statute was enacted’) suggest the
contrary.” Id. at 290 (quoting Mass. Mut. Life Ins. Co. v.
Russell, 473 U.S. 134, 145 (1985)).
Prior to 2010, only equitable relief and criminal
sanctions for a violation existed. 11 50 U.S.C. app. § 532(2)–
11
In 1990, a servicemember could have petitioned the court during
a foreclosure proceeding initiated by the mortgagor, to stay the
proceeding or to “make such other disposition of the case as may be
equitable to conserve the interests of all parties.” 50 U.S.C. app.
§ 532(2)(a)–(b) (1990). Or the government could bring criminal charges
against a violator, who could be found guilty of a misdemeanor and
punished by imprisonment for knowingly selling or foreclosing on a
servicemember’s property. Id. § 532(4).
MCGREEVEY V. PHH MORTGAGE CORP. 13
(4) (1990). The 2010 amendment enlarged the category of
relief available under the SCRA, and McGreevey’s claim for
damages “necessarily depend[ed] on” remedy-creating
language of the amendment. Jones, 541 U.S. at 384. Thus,
we conclude that the 2010 amendment to the SCRA created
“a new right to maintain an action” to enforce
servicemembers’ rights against wrongful foreclosure, id. at
382, and thus 28 U.S.C. § 1658(a)’s catchall limitations
period applies and bars McGreevey’s claims.
The conclusion that no implied right existed prior to the
2010 amendment also fits with the underlying purpose of the
legislative scheme, which was “made to suspend
enforcement of civil liabilities, . . . in order to enable such
persons to devote their entire energy to the defense needs of
the Nation, [and] . . . for the temporary suspension of legal
proceedings, and transactions which may prejudice the civil
rights of persons in such service.” 50 U.S.C. app. § 510
(1990) (current version at 50 U.S.C. § 3902 (2012)). This
focus is on delaying proceedings rather than compensating
servicemembers for any violations. As such, we find no
basis to now imply a private right of action for damages,
attorney’s fees, and costs based on the statutory intent and
purpose of the SSCRA.
Because we conclude that 28 U.S.C. § 1658(a) applies,
we need not address which Washington law is the “most
closely analogous statute” to the SCRA. For the same
reason, we need not reach McGreevey’s argument regarding
whether the “narrow exception” to the “presumption that
state law will be the source of a missing federal limitations
period” warrants the application of USERRA’s express
prohibition on any limitations period to SCRA cases. N. Star
Steel Co. v. Thomas, 515 U.S. 29, 34–36 (1995). We hold
that McGreevey’s complaint arises under an Act of Congress
14 MCGREEVEY V. PHH MORTGAGE CORP.
enacted after 1990 and is thus governed—and barred—by
the four-year limitations period in 28 U.S.C. § 1658(a).
IV
For the reasons stated herein, we affirm the judgment of
the district court.
AFFIRMED.