169 F. Supp. 3d 766
N.D. Ill.2015Background
- Plaintiff borrowed $420,000 in 2005; loan secured by mortgage with MERS as nominee and later serviced by Countrywide, BAC and Bank of America (BofA).
- Beginning in 2009 plaintiff sought loan modification; alleges multiple Trial Period Plans (TPPs) were offered and she completed the October 2012 TPP.
- October 2012 TPP promised a permanent modification upon timely completion of trial payments but stated final terms would be determined after the trial period and did not reference HAMP.
- After completing trial payments, BofA offered a January 2013 permanent modification with deferred principal, extended amortization (balloon at maturity), and tiered reduced interest rates; plaintiff contends the terms differed from promises and that BofA should have provided a HAMP modification.
- Plaintiff also alleges defendants failed to timely/adequately respond to Qualified Written Requests under RESPA about loan ownership/servicing; she asserts causes of action for breach of contract, promissory estoppel, fraud/concealment, ICFA, RESPA, and requests declaratory relief, accounting and injunctive relief.
- District court considered motions to dismiss by several defendants, granted dismissal as to the first group (including BofA) and denied other motion as moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of contract / Promissory estoppel | BofA promised a permanent HAMP modification if plaintiff complied with TPP; reliance on that promise | TPP did not promise HAMP; final modification was offered and performed; no clear definite promise to support estoppel | Dismissed — TPP language and prior denials show no promise of HAMP; BofA performed by offering January 2013 modification |
| Fraudulent misrepresentation / concealment and ICFA | BofA misrepresented that compliance with TPP would yield a modification and waive past late charges; concealed intent not to offer HAMP | No false statement in TPP; plaintiff received a permanent modification; TPP expressly described terms including handling of late fees; no plausible concealment | Dismissed — plaintiff failed to plead a false, material representation or plausible concealment; ICFA claim likewise fails for lack of deception/unfairness pleaded |
| RESPA (§ 2605) | Defendants failed to timely/adequately respond to QWRs about loan ownership/servicing | Responses were adequate or plaintiff suffered no actual damages from any RESPA violation | Dismissed — plaintiff did not plead actual, pecuniary damages attributable to RESPA violations, a required element |
| Declaratory judgment, accounting, injunctive relief | Plaintiff seeks declaration of ownership/servicing rights, accounting, and to enjoin foreclosure based on alleged defects | Defendants argue claims are unsupported by pleaded facts and moot given dismissal of substantive claims | Dismissed — plaintiff failed to respond to defendants’ arguments and did not plausibly plead entitlement to relief |
Key Cases Cited
- Gibson v. City of Chicago, 910 F.2d 1510 (7th Cir.) (motion to dismiss tests complaint sufficiency)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading must state plausible claim)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleadings)
- DiLeo v. Ernst & Young, 901 F.2d 624 (7th Cir.) (fraud pleading requires who, what, when, where, how)
- Centers v. Centennial Mortg., Inc., 398 F.3d 930 (7th Cir.) (contract controls when attached to complaint)
- Soo Line R. Co. v. St. Louis Southwestern Ry. Co., 125 F.3d 481 (7th Cir.) (party can plead itself out of court)
- Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547 (7th Cir.) (no private right of action under HAMP; HAMP compliance actionable only via state law claims)
- All-Tech Telecom, Inc. v. Amway Corp., 174 F.3d 862 (7th Cir.) (promissory estoppel requires clear, definite promise)
- Tamayo v. Blagojevich, 526 F.3d 1074 (7th Cir.) (plausibility and factual specificity in pleading)
- Catalan v. GMAC Mortg. Corp., 629 F.3d 676 (7th Cir.) (actual damages required for RESPA claims)
- Kirksey v. R.J. Reynolds Tobacco Co., 168 F.3d 1039 (7th Cir.) (failure to respond to dismissal arguments forfeits claim)