United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION AND ORDER
BARBARA M. G. LYNN JUDGE
the Court is a Motion for Summary Judgment [ECF No. 54] filed
by Defendants U.S. Bank National Association, as Trustee for
Morgan Stanley Mortgage Loan Trust 2006-7, Mortgage
Pass-Through Certificates, Series 2006-7 (“U.S.
Bank”), and Ocwen Loan Servicing, LLC
“Defendants”). For the following reasons,
Defendants' Motion for Summary Judgment is GRANTED.
civil action arises out of foreclosure proceedings initiated
against real property located at 15531 Bay Point Drive,
Dallas, Texas 75248 (the “Property”).
See 4th Am. Compl. 2 [ECF No. 48]. Plaintiff Michael
Germain filed an original petition in the 193rd
Judicial District Court in Dallas, Texas on May 1, 2015
seeking to prevent a May 5, 2015 foreclosure on the Property.
See Case Summary [ECF No. 1-3 at 2]; Original Pet.
[ECF No. 1-4 at 1 & 9]. On May 4, 2015, the state court
issued a Temporary Restraining Order and set a May 15, 2015
hearing on Plaintiff's Application for Temporary
Injunction. See Order [ECF No. 1-5 at 2-3].
Defendants removed the case to the federal district court the
day before the hearing on May 14, 2015. See Notice
of Removal [ECF No. 1].
operative Fourth Amended Complaint alleges the following
claims: (1) violations of the Real Estate Settlement
Procedure Act (“RESPA”) pursuant to Title 12,
Code of Federal Regulations, Section 1024.41 (“Section
1024.41”) against Ocwen; (2) violations of the Texas
Debt Collection Act (“TDCA”), pursuant to Texas
Finance Code (“TFC”), Sections 392.301(a)(8),
392.304(a)(14), and 392.304(a)(19) against U.S. Bank and
Ocwen; (3) promissory estoppel under Texas law against U.S.
Bank and Ocwen; (4) violation of Section 83.001 of the Texas
Government Code against dismissed defendant Power Default
Services, Inc.; and (5) violation of the federal Declaratory
Judgment Act under Title 12, United States Code, Section
2605(f) against all of the defendants. See 4th Am.
Compl. 8-21 [ECF No. 48]. Plaintiff also alleges that
Defendants are vicariously liable for the conduct of their
employees, agents, attorneys, affiliated entities, vice
principals, and representatives of their affiliated entities.
See 4th Am. Compl. 7. Plaintiff seeks actual,
statutory, and exemplary damages, and attorneys' fees.
See 4th Am. Compl. 22. Plaintiff further asks the
Court to “enjoin Defendants from selling the Property
at a foreclosure sale un[less] the Defendants” comply
with RESPA. See 4th Am. Compl. 22.
filed their Motion for Summary Judgment on August 25, 2017.
On September 15, 2017, Plaintiff filed his response [ECF No.
57]. Defendants filed their reply [ECF No. 60] on October 13,
2017. This matter has been fully briefed and is now ripe for
judgment is proper when “there is no genuine dispute as
to any material fact and the movant is entitled to judgment
as a matter of law.” Fed.R.Civ.P. 56(a). A party
seeking summary judgment bears the initial burden of showing
the absence of a genuine issue for trial. See Duffy v.
Leading Edge Prods., Inc., 44 F.3d 308, 312 (5th Cir.
1995). The movant's burden can be satisfied by
demonstrating that there is an absence of evidence which
supports the nonmoving party's case for which that party
would have the burden of proof at trial. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Once the movant meets
its initial burden, the non-movant must show that summary
judgment is not proper. See Duckett v. City of Cedar
Park, 950 F.2d 272, 276 (5th Cir. 1992). The parties may
satisfy their respective burdens “by tendering
depositions, affidavits, and other competent
evidence[.]” See Topalian v. Ehrman, 954 F.2d
1125, 1131 (5th Cir. 1992). All evidence must be viewed in
the light most favorable to the party opposing the summary
judgment motion. See Rosado v. Deters, 5 F.3d 119,
123 (5th Cir. 1993). However, “the court is under no
duty to sift through the record to find evidence that
supports a nonmovant's opposition to a motion for summary
judgment.” Esquivel v. McCarthy, 2016 WL
6093327, at *2 (N.D. Tex. Oct. 18, 2016) (citing Ragas v.
Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir.
December 15, 2005, Plaintiff executed a Deed of Trust in
favor of Morgan Stanley Credit Corporation (“Morgan
Stanley”) that secured repayment on a Note for $144,
000 (the “Loan”) to refinance the Property.
See Defs.' Exs. A [ECF No. 56 at 6], A-1 [ECF
No. 56 at 14-26], A-2 [ECF No. 56 at 29-35]. In addition,
Plaintiff signed a Loan Agreement Rider in connection with
the Loan, which states, in pertinent part, that “[t]he
Loan Agreements may not be varied by any oral agreements or
discussions that occur before, contemporaneously with, or
subsequent to the execution of the Loan Agreements” and
that “[t]here are no unwritten oral agreements between
the parties.” See Defs.' Ex. A-3 [ECF No.
56 at 38].
began servicing the Loan on April 2, 2012, and the Loan was
assigned to U.S. Bank on August 19, 2014. See
Defs.' Exs. A [ECF No. 56 at 6-7], A-4 [ECF No. 56 at
41]. At the time Ocwen began servicing the Loan, Plaintiff
was in default and received a notice of default. See
Defs.' Exs. A [ECF No. 56 at 7], A-6 [ECF No. 56 at
53-55]. Plaintiff has been in and out of default since 2009.
See Defs.' Ex. B [ECF No. 56 at 147].
Plaintiff's last loan payment was in December 2013, and
this payment was applied to the payment owed for May 2013.
See Defs.' Ex. A. The balance remaining on the
Loan as of August 24, 2017 is $87, 573.51. See
Defs.' Ex. A [ECF No. 56 at 11].
admits that he was in default on February 2, 2012.
See Defs.' Exs. A-6 [ECF No. 56 at 53], Ex. B
[ECF No. 56 at 176]. On July 7, 2012, Ocwen sent Plaintiff a
letter with mortgage assistance options that were available
to Plaintiff at that time such as a loan modification, a
repayment plan, a short sale, and a deed in lieu of
foreclosure. See Defs.' Exs. A-7 [ECF No. 56 at
57], A [ECF No. 56 at 7]. Plaintiff admits that he received
the July 7, 2012 letter and several others. Defs.' Ex. B
[ECF No. 56 at 177]. Because Ocwen did not receive a response
to the July 7, 2012 letter, Ocwen scheduled the Property for
foreclosure. See Defs.' Exs. A-8 [ECF No. 56 at
61], A [ECF No. 56 at 7].
August 24, 2012, Plaintiff submitted his first loss
mitigation application. See Defs.' Ex. A-9 [ECF
No. 56 at 69-81]. Plaintiff stated that he was experiencing
financial difficulties in 2012 and “did not have the
money to pay.” See Defs.' Ex. B [ECF No.
56 at 179]. Plaintiff stated that he understood that if he
filled out the Loss Mitigation Application, he could be
eligible for several options that may help with his
delinquent loan. See Defs.' Ex. B [ECF No. 56 at
180]. Plaintiff also admitted that his delinquent loan in
2012 was caused by his financial problems and that it was not
caused by “anything that Ocwen did.” See
Defs.' Ex. B [ECF No. 56 at 182]. On August 28, 2012,
Ocwen denied the loan modification request and explained that
the owner of Plaintiff's loan did not allow the
modification. See Defs.' Ex. A-10 [ECF No. 56 at
83]. Plaintiff admitted that he received the August 28, 2012
denial and that he received “one or two” of these
letters. See Defs.' Ex. B [ECF No. 56 at 181].
On August 29, 2012, Plaintiff made a significant payment to
bring the loan current, and Ocwen ceased further review of
Plaintiff's Loan for mitigation options. See
Defs.' Exs. A [ECF No. 56 at 8], B [ECF No. 56 at 183].
loan was again in default in June of 2013. See
Defs.' Exs. A [ECF No. 56 at 8], B [ECF No. 56 at 184].
Plaintiff admitted that he failed to make one or more monthly
payments of the principal and interest on the Loan in 2013.
See Defs.' Ex. E [ECF No. 56 at 230]. Plaintiff
also admitted that his financial difficulty was not due to
the conduct of Ocwen. See Defs.' Ex. B [ECF No.
56 at 183]. On July 20, 2013, Ocwen sent Plaintiff another
letter with the options of a loan modification, listing the
Property for sale, and a deed in lieu as alternatives to
foreclosure. See Defs.' Ex. A-11 [ECF No. 56 at
85]. On August 1, 2013, Ocwen sent a letter to Plaintiff
following up, because it had not heard from Plaintiff.
See Defs.' Exs. A [ECF No. 56 at 8], A-12 [ECF
No. 56 at 88]. Plaintiff acknowledged receipt of the August
1, 2013 letter. See Defs.' Ex. B [ECF No. 56 at
August 11, 2013, Plaintiff sent another loss mitigation
application to Ocwen. See Defs.' Ex. A-13 [ECF
No. 56 at 91-96]. On August 15, 2013, Ocwen sent a denial
letter that was substantially similar to the letter sent in
response to Plaintiff's August 24, 2012 application, and
explained listing the Property for sale and a deed in lieu as
alternatives to foreclosure. See Defs.' Ex. A-14
[ECF No. 56 at 99-101]. This letter also identified Morgan
Stanley as the owner of Plaintiff's Loan. See
Defs.' Ex. A-14 [ECF No. 56 at 99]. Plaintiff
acknowledged that Morgan Stanley was identified as the owner
of his Loan. See Defs.' Ex. B [ECF No. 56 at
186]. Plaintiff also acknowledged that Ocwen promptly
responded to Plaintiff's applications and that the letter
outlined the reason why a loan modification was rejected,
namely, the owner of the Loan, Morgan Stanley, did not permit
the modification. See Defs.' Ex. B [ECF No. 56
September 23, 2013, Plaintiff and Ocwen discussed additional
loss mitigation options other than a loan modification.
See Defs.' Ex. A [ECF No. 56 at 8]. Plaintiff
indicated that he was looking into filing for bankruptcy, and
Ocwen advised him of the option of a deed in lieu, which
Plaintiff declined. See Defs.' Ex. A [ECF No. 56
at 8]. On September 30, 2013, Plaintiff filed for bankruptcy.
See Defs.' Ex. D [ECF No. 56 at 213]. Plaintiff
stated that he filed for bankruptcy because he “wanted
to avoid foreclosure.” See Defs.' Ex. B
[ECF No. 56 at 188]. Due to Plaintiff's bankruptcy
filing, Plaintiff was put on a repayment plan, and Ocwen
ceased review of his loss mitigation application.
See Defs.' Ex. A [ECF No. 56 at 9]. Plaintiff
stated that his bankruptcy was dismissed, because he failed
to file required documents. See Defs.' Ex. B
[ECF No. 56 at 188].
admitted that he did not make one or more payments of
principal and interest on his Loan in 2014. See
Defs.' Ex. E [ECF No. 56 at 230]. On February 19, 2014,
Plaintiff sent another loss mitigation application to Ocwen.
See Defs.' Exs. A-15 [ECF No. 56 at 103-120], B
[ECF No. 56 at 180-90]. On February 26, 2014, Ocwen sent its
denial of loan modification explaining that Morgan Stanley
did not allow a loan modification, but that Ocwen
conditionally approved for Plaintiff a short sale.
See Defs.' Ex. A-17 [ECF No. 56 at 132].
Plaintiff acknowledged that this letter explained that Ocwen
reviewed Plaintiff's application for all available loan
modification options, denied his request for a loan
modification, and approved for him a short sale. See
Defs.' Ex. B [ECF No. 56 at 191].
evaluated Plaintiff for a forbearance plan under his February
2014 application, and Plaintiff was approved for a loan
forbearance plan. See Defs.' Ex. A [ECF No. 56
at 10], C [ECF No. 56 at 210]. On July 30, 2014, Ocwen sent a
Forbearance Stipulation Agreement that required Plaintiff to
send a $13, 000 down payment. See Defs.' Ex.
A-18 [ECF No. 56 at 136]. Plaintiff acknowledged receiving
this agreement, but stated that he was not able to agree to
its terms. See Defs.' Ex. B [ECF No. 56 at 194].
Plaintiff stated in his complaint that the $13, 000 was
“too high for Plaintiff to make work.”
See 4th Am. Compl. 4.
March 30, 2015, Plaintiff's Loan was accelerated pursuant
to a Notice of Acceleration that referred back to a June 8,
2013 Notice of Default. See Defs.' Ex. A-21 [ECF
No. 56 at 161-62]. Plaintiff admitted that he failed to make
one or more monthly payments of principal and interest on his
Loan in 2015 and 2016. See Defs.' Ex. E [ECF No.
56 at 230]. On May 1, 2015, Plaintiff filed his lawsuit in
state court seeking to prevent foreclosure on his Property.
See Case Summary [ECF No. 1-3 at 2]; Original Pet.
[ECF No. 1-4 at 1 & 9]. Plaintiff testified at his May
31, 2017 deposition that he was still living in the Property
as of that date. Defs.' Ex. B [ECF No. 56 at 166 &
contends that Ocwen violated Section
1024.41(c)(1) by failing to evaluate him for all loss
mitigation options and by failing to provide proper notice.
4th Am. Compl. 8-9. Plaintiff contends that Ocwen also
violated Section 1024.41(d) by failing to provide the
specific investor information that resulted in the denial of
Plaintiff's most recent loss mitigation application in
December 2015, as well as potentially earlier applications.
4th Am. Compl. 9.
argue that they are entitled to summary judgment with respect
to Plaintiff's RESPA claims because: (1) RESPA's
requirements apply to only one completed loss mitigation
application; (2) Ocwen evaluated Plaintiff for all of the
available loss mitigation options; (3) Ocwen provided notice
and specific reasons for its determinations; (4) Ocwen
specifically indicated why Plaintiff was denied a loan
modification; (5) Ocwen identified Plaintiff's loan
investor in response to Plaintiff's 2013 Loss Mitigation
Application; and (6) Plaintiff has no evidence of actual or
statutory damages. See Defs.' Br. 15-21 [ECF No.
1024.41 of the Code of Federal Regulations provides
instructions on loss mitigation procedures.” Obazee
v. Bank of New York Mellon, 2015 WL 4602971, at *2 (N.D.
Tex. Jul. 31, 2015) (citing 12 C.F.R. § 1024.41).
“This section does not require that the servicer
provide the borrower any specific loss mitigation
options.” Id. (citing 12 C.F.R. §
1024.41(a)). Rather, “it specifies procedures and
timing for reviewing loss mitigation applications, including
requiring the servicer to notify the borrower in writing,
within 30 days of receipt of a complete loss mitigation
application, which loss mitigation ...