Terrance Moore v. Wells Fargo Bank, N.A.
908 F.3d 1050
7th Cir.2018Background
- Terrence Moore took out a mortgage (serviced by Wells Fargo, owned by Deutsche Bank); Dixie Moore was not on title, mortgage, or note. 2012 state-court judgment of foreclosure entered against Terrence; he did not appeal.
- After multiple modification attempts and bankruptcy filings, Terrence sent Wells Fargo a "qualified written request" (QWR) on Aug. 15, 2016 with 22 broad questions about ownership, payment application, escrow, and modification history.
- Wells Fargo treated the letter as a QWR, promised a response, and mailed a three-page letter with 58 pages of attachments on Sept. 30, 2016; it answered many questions but declined to answer several requests it deemed "too broad," inviting clarification.
- The Moores filed suit in state and federal court on Sept. 28, 2016 alleging violations of RESPA §2605 and Wis. Stat. §224.77 for Wells Fargo’s alleged failure to respond fully; the state court declined to reopen the foreclosure and the sheriff’s sale proceeded.
- District court granted summary judgment for Wells Fargo; on appeal the Seventh Circuit affirmed: Terrence’s claims fail on the merits for lack of actual damages; Dixie lacks standing as she has no legal interest in the loan/property.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing of Dixie Moore | Dixie was harmed by lack of responses because she would lose the home; she is a “person aggrieved” under Wis. Stat. §224.77 | Dixie is not a titleholder, borrower, or party to the loan or bankruptcies and thus has no legally cognizable interest | No standing — Dixie lacks a legal interest in the mortgage or note, so §224.77 claim fails |
| Standing of Terrence Moore | Terrence as borrower suffered injury (emotional distress, inability to litigate state case) traceable to Wells Fargo’s conduct | Wells Fargo disputes causation and sufficiency of alleged injury | Terrence has Article III standing (alleged concrete injury suffices at pleading/standing stage) |
| RESPA §2605(f) — Actual damages (out-of-pocket) | Attorney review fees ($900) and bankruptcy-related costs are damages caused by incomplete QWR response | Fees are not "actual damages" caused by the violation; attorney fees are addressed separately in §2605(f)(3) and filing suit isn’t an injury | Summary judgment for Wells Fargo — claimed out-of-pocket attorney fee is not compensable actual damage under RESPA |
| RESPA §2605(f) — Emotional distress causation | Emotional distress from fear of losing home was caused by missing QWR information that hindered state-court strategy | Distress stems from long-standing default, foreclosure judgment, and bankruptcy timings, not Wells Fargo’s QWR reply; causal link too attenuated | Summary judgment for Wells Fargo — emotional distress not shown to be caused by any RESPA violation |
| Wisconsin §224.77 & Rooker–Feldman | §224.77 claim seeks damages for servicer misconduct independent of foreclosure judgment | Federal action would effectively undermine or require nullifying the state foreclosure judgment; claim barred | Summary judgment for Wells Fargo — Rooker–Feldman (and state law preclusion) bars claims that would contradict the state-court foreclosure; alternatively §224.77 claims fail on damages causation |
Key Cases Cited
- Catalan v. GMAC Mortg. Corp., 629 F.3d 676 (7th Cir. 2011) (defines QWR scope and recognizes emotional-distress damages under RESPA when caused by servicer violations)
- Diedrich v. Ocwen Loan Servicing, LLC, 839 F.3d 583 (7th Cir. 2016) (RESPA and Wis. Stat. §224.77 claims require showing actual damages causally linked to servicer’s failure)
- Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (Article III standing requires a concrete, particularized injury)
- Steel Co. v. Citizens for a Better Env't, 523 U.S. 83 (1998) (standing is a threshold jurisdictional requirement)
- Perron on behalf of Jackson v. J.P. Morgan Chase Bank, N.A., 845 F.3d 852 (7th Cir. 2017) (injury from RESPA violation must not be too attenuated from the violation)
- Mains v. Citibank, N.A., 852 F.3d 669 (7th Cir. 2017) (Rooker–Feldman bars federal review of state-court judgments and related claims)
- TRW Inc. v. Andrews, 534 U.S. 19 (2001) (principle against rendering statutory language superfluous in statutory construction)