Whitley v. Flagstar Bank, FSB
4:17-cv-02075
E.D. Mo.Jan 17, 2018Background
- Whitely executed a deed of trust on November 24, 2010 securing a mortgage on real property in St. Louis County; loan recorded December 9, 2010.
- Whitely defaulted; Flagstar sued for foreclosure on August 6, 2014; summary judgment entered for Flagstar and affirmed on appeal.
- A trustee’s sale was noticed for June 23, 2017; the sale occurred and Flagstar purchased the property for $217,300; deed recorded June 29, 2017.
- Whitely filed a four-count petition in state court on June 20, 2017 seeking to enjoin the sale (TILA/rescission, FDCPA references, preliminary and permanent injunctions, and quiet title); sale later occurred.
- Defendants Millsap & Singer, PC and Flagstar moved to dismiss under Fed. R. Civ. P. 12(b)(6); Whitely did not substantively oppose; the court evaluated claims for TILA, FDCPA, and quiet title and found injunction claims moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| TILA violations / rescission | Whitely alleges improper disclosures and seeks rescission under TILA | Defendants argue plaintiff fails to plead requisite facts: no timely rescission (statute expired) and defendants not shown to be creditors | Dismissed — TILA claim fails (statute of limitations for rescission expired; insufficient factual allegations that defendants regularly extended credit) |
| FDCPA liability | Whitely references FDCPA violations in Count I | Defendants assert they are not debt collectors and plaintiff pleads no facts showing collection activity | Dismissed — plaintiff failed to allege defendants were debt collectors or that they collected debts |
| Quiet title / declaratory relief | Whitely seeks quiet title asserting superior title or defect in defendants’ title | Defendants point to the completed foreclosure sale and recorded successor trustee’s deed; plaintiff fails to plead superior title or facts creating a justiciable controversy | Dismissed — insufficient factual allegations to show superior title or ripe controversy |
| Preliminary and permanent injunctions | Whitely sought injunctions to halt foreclosure sale | Defendants note sale already occurred | Moot — injunction claims dismissed as moot |
Key Cases Cited
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must state a plausible claim)
- Ashcroft v. Iqbal, 556 U.S. 662 (conclusions unsupported by facts not entitled to assumption of truth)
- Koons Buick Pontiac GMC, Inc. v. Nigh, 543 U.S. 50 (purpose and scope of TILA disclosures)
- Neitzke v. Williams, 490 U.S. 319 (purpose of Rule 12(b)(6) to test legal sufficiency)
- Young v. City of St. Charles, 244 F.3d 623 (dismissal standard discussion)
- Bennett v. Berg, 685 F.2d 1053 (plaintiff entitled to present evidence; dismissal when insuperable bar appears)