BELFI v. USAA FEDERAL SAVINGS BANK
2:22-cv-02083
| E.D. Pa. | Sep 7, 2022Background
- Plaintiff Alex Belfi took a VA-backed mortgage from USAA in June 2016 for property at 1502 E. Moyamensing Ave., Philadelphia and defaulted; USAA sent a foreclosure notice in Aug. 2018 and filed foreclosure in Jan. 2019 in Philadelphia Court of Common Pleas.
- Belfi alleges his mortgage was recorded/assigned via MERS without his consent and that a November 2018 assignment (signed by one "Omar Basped," whom he contends is fictitious) was fraudulent; he ties these allegations to claims about securitization and VA guaranty "double-dipping."
- In May–June 2022 Belfi filed a pro se federal amended complaint asserting FDCPA, FCRA, RICO, and Lanham Act claims, plus state-law claims (quiet title, fraud, UDAP, breach, etc.).
- Defendants moved to dismiss. The state foreclosure remained pending in the Philadelphia Court of Common Pleas; Belfi previously removed related litigation and participated in bankruptcy proceedings.
- The District Court dismissed all federal claims with prejudice (statute of limitations or lack of standing/requisite pleading), declined supplemental jurisdiction over state claims and dismissed those without prejudice, and denied Belfi’s request for appointed counsel.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FDCPA — applicability (debt collector vs. creditor) and timeliness | Belfi alleges defendants failed to provide an Act 6 foreclosure notice; contends defendants are debt collectors or otherwise liable | Defendants assert they are creditors/servicers (not FDCPA debt collectors) and FDCPA claims are time-barred | Court: Belfi failed to plead any defendant is a debt collector; FDCPA claim also untimely — dismissed (FDCPA dismissed with prejudice) |
| FCRA — furnisher liability and timeliness | Belfi alleges credit reporting disputes and that assignment shortened credit history, harming creditworthiness | Defendants say Belfi failed to allege defendant was a furnisher who failed to investigate and that claim is time-barred | Court: Failed to plead required furnisher-investigation facts; FCRA untimely — dismissed with prejudice |
| RICO — standing and predicate acts (mail/wire fraud) | Belfi alleges a broad securities/assignment scheme (MERS, securitization, VA reimbursements, fraudulent assignments, mail/wire fraud) injured him | Defendants argue Belfi lacks RICO standing and fails to plead particularized predicate acts under Rule 9(b) | Court: No RICO standing (no cognizable RICO injury) and insufficiently pleaded predicate acts — RICO dismissed with prejudice |
| Lanham Act — standing to sue for trademark use | Belfi claims MERS trademark participation fraudulently concealed facts that affected consumer choice | Defendants note only trademark owner/commercial plaintiff may sue under Lanham Act | Court: Belfi lacks commercial interest/reputation injury and thus Lanham Act standing — dismissed with prejudice |
| State-law quiet-title and related tort/consumer claims | Belfi seeks declaration of exclusive title and damages under state statutes and tort law | Defendants note parallel state foreclosure and argue federal court should not exercise supplemental jurisdiction | Court: Prior exclusive jurisdiction (Princess Lida) bars federal adjudication of property claims while state foreclosure pending; state claims dismissed without prejudice for lack of jurisdiction |
| Motion to appoint counsel | Belfi requests counsel due to case complexity and pro se status | Defendants oppose; appointed counsel appropriate only if claim has arguable merit | Court: Claims lack arguable merit; request denied |
Key Cases Cited
- Obduskey v. McCarthy & Holthus LLP, 139 S. Ct. 1029 (2019) (FDCPA does not broadly reach ordinary enforcement of security interests)
- Henson v. Santander Consumer USA Inc., 137 S. Ct. 1718 (2017) (FDCPA "default" test for assignees is not dispositive)
- Rotkiske v. Klemm, 140 S. Ct. 355 (2019) (limitations period for FDCPA begins on date violation occurs)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard for pleadings)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state plausible claim)
- Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479 (1985) (civil RICO standing requires injury to business or property)
- Lexmark Int'l, Inc. v. Static Control Components, Inc., 572 U.S. 118 (2014) (Lanham Act standing requires commercial injury to reputation or sales)
- Anza v. Ideal Steel Supply Corp., 547 U.S. 451 (2006) (mail/wire fraud can be RICO predicate acts)
- Grayson v. Mayview State Hosp., 293 F.3d 103 (3d Cir. 2002) (pro se plaintiffs generally should be granted leave to amend unless futile)
- Menominee Indian Tribe of Wis. v. United States, 136 S. Ct. 750 (2016) (elements for equitable tolling)