980 F. Supp. 2d 892
S.D. Ohio2013Background
- In 1983 Bihn took a mortgage from Citizens Federal. Fifth Third entities later claimed ownership via a 2009 assignment and foreclosed; a foreclosure judgment was entered in 2011 and later reversed by the Ohio Supreme Court after Schwartzwald.
- The 2009 assignment was signed by Brad Griffith, identified as a Citizens Federal AVP, but he was then an AVP of Fifth Third Bank — raising questions about validity of the assignment and FTMC’s standing.
- After litigation and appeal, the Ohio Supreme Court held post-filing assignments cannot cure lack of standing (Fed. Home Loan Mortg. Corp. v. Schwartzwald); the Bihn foreclosure judgment was reversed and remanded and the state action was later dismissed.
- Bihn brought a putative class action in federal court asserting: (1) FDCPA claims (15 U.S.C. §1692e/f), (2) OCSPA claims (Ohio Rev. Code §1345.01), (3) unjust enrichment, and (4) breach of contract against Fifth Third Mortgage Company (FTMC) and Maguire & Schneider.
- FTMC moved to dismiss under Fed. R. Civ. P. 12(b)(6). The district court dismissed all claims against FTMC without prejudice for failure to plead sufficient facts (legal conclusions and threadbare allegations). Claims against Maguire were not addressed here.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FDCPA applicability (whether FTMC is a “debt collector”) | FTMC engaged in false, deceptive collection statements and sought improper fees; FTMC is a debt collector subject to FDCPA. | FTMC says it is exempt from the "debt collector" definition because it is a subsidiary/related to Fifth Third Bank and/or obtained the debt before default (exemptions §1692a(6)(B),(F)). | Dismissed: complaint fails to plead factual allegations showing FTMC is a debt collector; plaintiff relied on legal conclusions. Court declined to resolve subsidiary/assignment factual disputes at 12(b)(6). |
| OCSPA applicability | FTMC committed unfair/deceptive acts by improperly prosecuting foreclosure and seeking prohibited fees. | FTMC argues OCSPA doesn’t apply to financial institutions/subsidiaries and Anderson precludes OCSPA claims for loan servicing/foreclosure activities. | Dismissed: plaintiff failed to allege facts showing OCSPA applies and failed to plead specific deceptive acts; resolution depends on facts outside the pleadings so cannot survive 12(b)(6). |
| Unjust enrichment (benefit conferred element) | FTMC was compensated for improper fees and should disgorge profits — unjust enrichment in the alternative. | FTMC contends contract governs and plaintiff didn’t plead she conferred a benefit or dispute contract enforceability. | Dismissed: plaintiff failed to plead she conferred a benefit (no allegation she paid the fees) and did not sufficiently plead an alternative to an existing contract. |
| Breach of contract (elements and damages) | FTMC charged fees not permitted by loan agreements, breaching contract. | FTMC argues complaint lacks contract specifics, performance, breach details, and damages. | Dismissed: complaint contains only conclusory allegations without facts identifying the contract terms, plaintiff’s performance, the breach, or damages. |
Key Cases Cited
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (plausibility pleading standard governs Rule 12(b)(6) motions)
- Ashcroft v. Iqbal, 556 U.S. 662 (courts need not accept legal conclusions as true for pleading purposes)
- Fed. Home Loan Mortg. Corp. v. Schwartzwald, 134 Ohio St.3d 13, 979 N.E.2d 1214 (Ohio Supreme Court: post-filing assignment does not cure lack of standing)
- Fifth Third Mortg. Co. v. Bihn, 134 Ohio St.3d 367, 982 N.E.2d 698 (Ohio Supreme Court order reversing the court of appeals and remanding consistent with Schwartzwald)
- Anderson v. Barclay's Capital Real Estate, Inc., 136 Ohio St.3d 31, 989 N.E.2d 997 (servicing a residential mortgage and related foreclosure activities are not a "consumer transaction" under OCSPA)