Gabriele v. American Home Mortgage Servicing, Inc.
503 F. App'x 89
2d Cir.2012Background
- Gabriele sued after a state foreclosure action in which Croog (Croog) and American served as attorney and loan servicer for Deutsche Bank; Croog and American were not party to the state foreclosure proceeding.
- Gabriele sought sanctions in state court for alleged misconduct by Deutsche Bank, which the state court denied.
- Following the state foreclosure judgment of strict foreclosure on Oct. 4, 2010, Gabriele filed a federal suit alleging FDCPA, CUTPA, and common-law misrepresentation against Croog and American.
- Gabriele alleged specific state-court filings were false, deceptive, unfair, or harassing (e.g., exhibits not served, untimely default motions, premature foreclosure motion, false affidavits).
- The district court dismissed for lack of subject-matter jurisdiction over Croog and for failure to state claims against Croog and American; this appeal followed.
- The court ultimately affirms the district court’s dismissal and holds the claims insufficient under the FDCPA and CUTPA, and that Rooker-Feldman does not bar relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Rooker-Feldman applicability to Croog claims | Gabriele argues the state-court judgment deprives federal review and divests jurisdiction | Croog contends Rooker-Feldman bars federal review of injuries from the state judgment | Rooker-Feldman does not bar these claims (injuries not caused by the state judgment) |
| FDCPA claim against Croog states a valid claim | Croog’s false filings and misrepresentations were actionable under FDCPA | Misstatements were mere procedural misconduct not material or deceptive to the least sophisticated debtor | FDCPA claim dismissed; conduct not sufficiently deceptive or material to violate §1692e/1692f |
| CUTPA claim against Croog states a valid claim | Croog’s actions as attorney constitute unfair or deceptive acts in trade/business | Lawyerly conduct in representation is typically immune from CUTPA liability | CUTPA claim dismissed; professional legal services immune under CUTPA unless outside the practice of law |
| Claims against American (FDCPA, misrepresentation, CUTPA) | American’s affidavits and guidance to apply for loss mitigation show misrepresentation | Allegations do not show FDCPA violation or fraudulent intent; affidavits may reflect honest mistake | No viable FDCPA or CUTPA claims against American; misrepresentation claim fails for lack of intent and plausibility |
| Leave to amend | Amendment could cure pleading deficiencies | Further amendment would be futile given previous amendments and merits | Denial of leave to amend affirmed; amendment would be futile |
Key Cases Cited
- McKithen v. Brown, 626 F.3d 143 (2d Cir. 2010) (Rooker-Feldman and preclusion principles clarified)
- Hoblock v. Albany Cnty. Bd. of Elections, 422 F.3d 77 (2d Cir. 2005) (Rooker-Feldman framework and applicability considerations)
- Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280 (S. Ct. 2005) (state-court judgment preclusion and federal-review limits)
- Easterling v. Collecto, Inc., 692 F.3d 229 (2d Cir. 2012) (FDCPA materiality and least sophisticated consumer standard)
- Donohue v. Quick Collect, Inc., 592 F.3d 1027 (9th Cir. 2010) (materiality and scope of FDCPA misrepresentations)