Richard Kreway v. Countrywide Bank, FSB
647 F. App'x 437
5th Cir.2016Background
- Richard Kreway sued multiple mortgage-related defendants (Countrywide entities, The Bank of New York Mellon as Trustee, Bank of America, MERS) alleging wrongful foreclosure-related claims including lack of standing, quiet title, declaratory relief, breach of contract, promissory estoppel, Texas Debt Collection Act violation, and common-law rescission.
- Central factual allegation: an assignment of Kreway’s mortgage by MERS to BAC Home Loans Servicing, LP (2011 assignment) was void because the signature of MERS Assistant Secretary Bud Kamyabi was forged.
- Kreway pleaded the forgery claim largely “upon information and belief” and attached a signature-comparison exhibit, but did not identify who forged the signature, when, where, or how the alleged forgery occurred.
- Defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6); the district court granted dismissal.
- On appeal, Kreway argued his complaint pleaded sufficient facts to make forgery facially plausible; the Fifth Circuit reviewed de novo whether the complaint met Twombly/Iqbal and Rule 9(b) standards.
- The Fifth Circuit affirmed, concluding the forgery allegation lacked the particularity required by Rule 9(b) and therefore all claims premised on the alleged forgery were properly dismissed; other errors were waived for failure to brief them.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the complaint plausibly pleads that the assignment was void due to forgery | Kreway: alleged the assignment bore a forged signature and attached signature comparisons; pleaded enough to make forgery plausible | Defendants: allegations are conclusory, lack specific facts about who, when, where, or how forgery occurred; fail Rule 9(b) | Complaint insufficient; forgery claim fails Rule 9(b) particularity and dismissal affirmed |
| Whether Rule 9(b) applies to the forgery-based claims | Kreway: forgery claim need not meet heightened particularity beyond plausible pleading | Defendants: Rule 9(b) applies to all averments of fraud or mistake | Court: Rule 9(b) applies; forgery allegations are subject to who/what/when/where/how requirement |
| Whether Twombly/Iqbal facial plausibility standard is met | Kreway: facts pleaded (including exhibit) satisfy plausibility standard | Defendants: pleadings are speculative and conclusory under Twombly/Iqbal | Court: Plaintiffs did not plead sufficient factual matter to make claim plausible |
| Whether appellate challenges beyond the pleaded forgery issue were preserved | Kreway: raised other points of error on appeal | Defendants: other points not properly briefed below or on appeal | Court: other points waived for failure to brief them properly |
Key Cases Cited
- In re Katrina Canal Breaches Litig., 495 F.3d 191 (5th Cir. 2007) (standard of review for Rule 12(b)(6) dismissal)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Benchmark Electronics, Inc. v. J.M. Huber Corp., 343 F.3d 719 (5th Cir. 2003) (Rule 9(b) requires who, what, when, where, and how for fraud allegations)
- Lone Star Ladies Inv. Club v. Schlotzsky’s Inc., 238 F.3d 363 (5th Cir. 2001) (Rule 9(b) applies to all averments of fraud, even when part of other claims)