Ayers v. AURORA LOAN SERVICES, LLC
787 F. Supp. 2d 451
E.D. Tex.2011Background
- Ayers purchased a house and land in Smith County, Texas, in January 2007, financed by two Lehman Brothers Bank, FSB mortgages.
- An Aurora agent allegedly suggested rolling the two mortgages into a single fixed-rate loan if Ayers would allow past-due status, enabling a modification.
- Ayers withheld payments to trigger the modification and submitted paperwork over two years, claiming Aurora lost or ignored it.
- Ayers alleges Aurora repeatedly promised forbearance and threatened foreclosure while reporting false credit information.
- Aurora set a foreclosure sale for November 2, 2010, Ayers attempted to dispute the debt, and Aurora did not respond; Ayers filed state court suit which Aurora removed to federal court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Property Code claim viability | Ayers argues Section 51.002/12.001 were violated | Aurora says no foreclosure occurred; claim ripe only if sale happened | Dismissed for lack of an actual sale; no wrongful foreclosure claim recognized |
| DPTA consumer standing | Ayers is a consumer via modification-related purchase of loan terms | Modification is refinancing, not a good/service under DPTA | Dismissed; Ayers not a consumer for DTPA purposes |
| FDCPA debt-collector status | Aurora acted as a debt collector | Mortgage servicer not a debt collector if debt not in default when assigned | Dismissed; Aurora not a debt collector because debt was not in default when assigned |
| Negligent misrepresentation | Aurora misrepresented future loan modification terms | Misrepresentation must concern existing facts, not promises of future conduct | Dismissed; future promises cannot support negligent misrepresentation |
| Texas Debt Collection Act vs. preemption | Aurora violated TDCA; claim linked to DTPA | Alleges credit reporting injury preempted by FCRA; TDCA claim is vague/conclusory | Dismissed as preempted by the FCRA; state-law TDCA claim barred |
Key Cases Cited
- Lormand v. U.S. Unwired, Inc., 565 F.3d 228 (5th Cir. 2009) (two-step approach to evaluating complaints under Rule 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (S. Ct. 2009) (plausibility pleading standard for surviving Rule 12(b)(6))
- In re Katrina Canal Breaches Litig., 495 F.3d 191 (5th Cir. 2007) (pleading must state plausible claims; court accepts factual allegations as true)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (S. Ct. 2007) (requires plausible facts to support a claim beyond mere speculation)
- Port City State Bank v. Leyco Constr. Co., 561 S.W.2d 546 (Tex. Civ. App. 1977) (no right to relief absent foreclosure sale; wrongful foreclosure claim requires sale)