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Head v. Ocwen Loan Servicing, LLC

United States District Court, D. Kansas

July 14, 2015

NANCY HEAD, Plaintiff,


ERIC F. MELGREN, District Judge.

Plaintiff Nancy Head brought this lawsuit against Ocwen Loan Servicing, LLC ("Ocwen"), alleging that Ocwen committed several statutory violations while servicing her note and mortgage. Ocwen has moved to dismiss Head's Fair Debt Collections Practices Act ("FDCPA") count under Federal Rules of Civil Procedure 12(b)(6) for failure to state a claim. For the reasons stated below, the Court grants in part and denies in part Defendant's Motion to Dismiss Count II of Plaintiff's Complaint (Doc. 4).

I. Factual and Procedural Background

Head sets out the following facts and allegations in her complaint. On March 13, 2003, Head executed a note that was secured by a mortgage on certain real property. Initially, Option One Mortgage serviced the note and mortgage. Sometime thereafter, Homeward Residential, Inc. ("Homeward") took over servicing of the note and mortgage. On January 17, 2013, Homeward sent Head a letter advising her she was in default under the security agreement's terms. Homeward then transferred servicing to Ocwen on January 28, 2013.

Less than two months later, Head received the first of a series of letters requesting a set amount of money that she labels as either a "past due notice" or "notice of default." Ocwen sent Head these letters on or about March 22, 2013; May 4, 2013; November 2, 2013; and December 4, 2013. During this period of time, Head continued to make her normal monthly payments.

On June 6, 2013, Head sent a letter to Ocwen, asking for information about the missed payments and stating that she never missed a payment since 2003. Head alleges the June 6, 2013 letter can be treated as a "request for verification of the debt as well as a qualified written request."[1] On July 3, 2013, Ocwen acknowledged that it received Head's letter and advised that it would respond under the Real Estate Settlement Procedures Act.[2] However, Ocwen never responded to Head's request.

Head alleges that Ocwen repeatedly has misrepresented the amount due under her mortgage and "repeatedly [has] contacted [her] in an attempt to collect the debt."[3] Head further alleges that Ocwen's continued contact with her without verification of the debt violates the FDCPA. Head also alleges that Ocwen has threatened foreclosure in order to collect the debt "when foreclosure is not justified."[4] Head claims that she "has suffered damages due to the worry and emotional distress" resulting from Ocwen's alleged actions.[5]

II. Legal Standard

Under Rule 12(b)(6), a defendant may move for dismissal of any claim for which the plaintiff has failed to state a claim upon which relief can be granted.[6] Upon such motion, the court must decide "whether the complaint contains enough facts to state a claim to relief that is plausible on its face.'"[7] A claim is facially plausible if the plaintiff pleads facts sufficient for the court reasonably to infer that the defendant is liable for the alleged misconduct.[8] The plausibility standard reflects the requirement in Rule 8 that pleadings provide defendants with fair notice of the nature of claims as well the grounds on which each claim rests.[9] Under 12(b)(6), the court must accept as true all factual allegations in the complaint, but need not afford such a presumption to legal conclusions.[10] Viewing the complaint in this manner, the court must decide whether the plaintiff's allegations give rise to more than speculative possibilities.[11] If the allegations in the complaint are "so general that they encompass a wide swath of conduct, much of it innocent, then the plaintiffs have not nudged their claims across the line from conceivable to plausible.'"[12]

III. Analysis

The FDCPA was enacted to eliminate abusive debt collection practices.[13] To eliminate abusive debt collection practices, the FDCPA regulates interactions between consumer debtors and "debt collectors."[14] The FDCPA does not "prohibit a debt collector from merely attempting to collect on a debt. Nor are threats to take legal action or to report a debtor to credit agencies actionable, unless the action threatened cannot legally be taken, is not intended to be taken, or involves the communication of false information."[15] Head alleges such violations. Ocwen contends that Head's allegations are time-barred, that Ocwen is not a "debt collector" under the FDCPA, and that Head does not plead sufficient facts to state a plausible claim for relief.[16] Head responds that the November 2, 2013 and December 4, 2013 letters from Ocwen are not time-barred, that Ocwen is a "debt collector" under the FDCPA, and that there are sufficient facts that would allow a plausible claim for relief under ยงยง 1692e and 1692g.

A. Head Sufficiently Pleads Discrete Acts Within the Statute of Limitations Period

Although the statute of limitations is an affirmative defense, it properly may be resolved on a motion to dismiss "when the dates given in the complaint make clear that the right sued upon has been extinguished."[17] "An action to enforce any liability created by [the FDCPA] may be brought... within one year from the date on which the violation occurs.'"[18] Due to the comprehensive scheme of the FDCPA that makes many debt collection maneuvers actionable, separate debt collection communications concerning a single debt can create separate violations supporting a cause of action.[19] Therefore, for statute of limitations purposes, discrete violations of the FDCPA are analyzed individually.[20] The improper communication must occur within the limitation period to be actionable.[21] A later effect of an earlier time-barred violation is not actionable.[22] If a defendant engages in a series of prohibited acts, a fresh violation occurs at the moment of each act.[23]

Here, Head filed her complaint on November 3, 2014. Head concedes that Ocwen's November 2, 2013 and December 4, 2013 letters are the only communications arguably occurring within the one year preceding the filing of her complaint. Head also believes discovery will reveal additional violations beyond Ocwen's letters. While the Court agrees that Ocwen's November 2, 2013 and December 4, 2013 letters are within the one-year FDCPA limitations period, [24] the Court considers Head's speculation of additional, discoverable violations irrelevant to this motion to dismiss.[25] As each letter is a discrete act that independently could constitute a violation of the FDCPA, not requiring ...

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