Grevious v. Flagstar Bank, FSB, 4:11-cv-00246

Grevious refinanced his home in 2008 with Texas Lending/ Aspire Financial; closing allegedly involved an inflated appraised value ($132,000) vs. loan amount ($112,048).
Plaintiff claims lender's representatives pressured a late payment to induce a loan modification and that documents at closing were fraudulent or misleading.
Plaintiff incurred approximately $11,706.27 in closing fees and alleges value inflation and improper fee construction to benefit the lender’s interests.
After closing, Plaintiff sought a loan modification in 2010; he alleges he was told a modification would be available if delinquent, and later received a deed-of-trust signing demand (which he did not sign).
Plaintiff filed suit December 30, 2010; district court removed to federal court and later granted in part the Defendant’s summary judgment motion, leaving a fraud claim as the sole surviving claim until amendments were sought.
The court later granted in part and denied in part Plaintiff’s motion to amend, granting negligent misrepresentation, breach of contract, and quiet title claims, but denying defamation; and granted Defendant’s summary judgment on the fraud claim.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Plaintiff may amend to add new claims.	Plaintiff seeks leave to amend to add negligence, breach of contract, defamation, and quiet title.	Defendant did not oppose amendment but argued upon motion; court should consider futility and prejudice.	GRANTED IN PART; some new claims allowed (negligence, breach of contract, quiet title), others denied (defamation).
Whether negligent misrepresentation is cognizable against Defendant.	Plaintiff pleads misrepresentation in conversations during loan process.	Insufficient evidence of misrepresentation or reliance.	GRANTED; negligent misrepresentation allowed.
Whether breach of contract (oral loan modification) can be pleaded and proven.	Oral agreement to modify loan existed based on conversations in 2010.	No enforceable contract or breach shown.	GRANTED; breach of an oral loan modification claim allowed.
Whether defamation claim may be amended/recognized.	Defendant harmed Plaintiff’s credit reputation through false statements.	No publication or defaming statement shown.	DENIED; defamation claim cannot be maintained.
Whether Plaintiff may amend to quiet title based on foreclosure cloud.	Foreclosure creates cloud on title.	No title cloud established beyond foreclosure.	GRANTED; quiet title claim allowed.

Fed. Land Bank Ass’n of Tyler v. Sloane, 825 S.W.2d 439 (Tex. 1991) (elements of negligent misrepresentation and reliance standard)
Coburn Supply Co. v. Kohler Co., 342 F.3d 372 (5th Cir. 2003) (Texas law negligent misrepresentation standard adopted)
Coffel v. Stryker Corp., 284 F.3d 625 (5th Cir. 2002) (fraud elements under Texas law)
Rio Grande Royalty Co., Inc. v. Energy Transfer Partners, L.P., 620 F.3d 465 (5th Cir. 2010) (fraud elements and reliance considerations)
Ernst & Young, L.L.P. v. Pac. Mut. Life Ins. Co., 51 S.W.3d 573 (Tex. 2001) (Texas fraud standards; reliance and scienter considerations)
Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment burden-shifting and evidence standard)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (material facts must be genuinely in dispute)