2017 WL 2506144
D. Md.2017Background
- Plaintiffs Jowanda and James Strickland‑Lucas obtained a $161,000 mortgage loan in March 2007 secured by a Deed of Trust on property in Harford County, MD. The loan was originated by Quality Home Loans.
- The Deed of Trust was assigned to Citibank, N.A. as trustee for CWABS, Inc., Series 2007‑QH2 in 2011; Citibank was not the original lender.
- A state foreclosure action against the property was pending in Harford County (filed 2014) and an appeal from a denial of dismissal was pending in state appellate court.
- Plaintiffs filed this federal suit in March 2016 alleging TILA violations: (1) failure to provide required disclosures at origination, and (2) failure to recognize a purported notice of rescission sent in October 2015. Plaintiffs seek damages.
- Citibank moved to dismiss under Rule 12(b)(6) arguing Younger abstention and that both TILA claims are time‑barred. The court considered the parties’ filings and judicially‑noticed public records and granted Citibank’s motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal court should abstain under Younger because of ongoing state foreclosure | Younger abstention not addressed by plaintiffs in opposition | Younger requires dismissal or stay where parallel state proceeding implicates important state interests | Court declined to abstain under Younger given Sprint narrowing Younger’s scope; did not dismiss or stay on Younger grounds |
| Whether TILA damages claim for origination disclosures is timely | Equitable tolling applies due to alleged deceptive concealment by defendant | Claim is time‑barred: §1640(e) one‑year limit from occurrence (loan consummation) — filed ~9 years after origination | Dismissed as time‑barred; plaintiff failed to allege fraudulent concealment sufficient to toll the one‑year limit |
| Whether rescission claim under §1635(f) is timely | Notice of rescission was sent in Oct 2015; Jesinoski supports that written notice (not suit) suffices within three years | Rescission right expired under §1635(f) (three‑year statute of repose); plaintiffs’ notice was sent well after three years | Dismissed as time‑barred: §1635(f) is a statute of repose and not subject to equitable tolling |
| Whether Citibank (assignee/trustee) can be liable under TILA | Plaintiffs treat Citibank as creditor/assignee responsible for disclosures and rescission | Liability limited to original creditor and assignees under TILA; factual posture shows Citibank was assignee but not originator | Court treated assignment and considered TILA claims against assignee only for statute‑of‑limitations analysis; claims failed on timing grounds |
Key Cases Cited
- Younger v. Harris, 401 U.S. 37 (1971) (abstention doctrine requiring federal courts to avoid interfering with certain ongoing state proceedings)
- Sprint Communications, Inc. v. Jacobs, 134 S. Ct. 584 (2013) (narrowing Younger’s scope to certain exceptional categories)
- Jesinoski v. Countrywide Home Loans, 135 S. Ct. 790 (2015) (holding that written notice is the required 3‑year TILA rescission notice; filing suit is not required within three years)
- Beach v. Ocwen Fed. Bank, 523 U.S. 410 (1998) (interpreting §1635(f) as an absolute statute of repose precluding rescission after three years)