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Norton v. Wells Fargo Bank, N.A.

United States District Court, N.D. Texas, Fort Worth Division

August 2, 2019

AALEN NORTON, Plaintiff,



         Before the Court is the Motion for Judgment on the Pleadings and Brief in Support (ECF No. 15) and Appendix in Support (ECF No. 16) filed by Defendant Wells Fargo Bank, N.A. (“Wells Fargo”) on February 21, 2019; “Objection to Wells Fargo's Motion for Summary Judgment” (ECF No. 22) filed by Plaintiff Aalen Norton (“Norton”) on April 1, 2019; and Wells Fargo's Response to Norton's Objection to its Motion for Judgment on the Pleadings (ECF No. 23) filed on April 3, 2019, which the undersigned construes as a reply.

         After reviewing the pleadings and applicable legal authorities, the undersigned RECOMMENDS that United States District Judge Reed O'Connor GRANT Wells Fargo's Motion for Judgment on the Pleadings (ECF No. 15); DISMISS WITH PREJUDICE Norton's claim to quiet title and for violations of the Federal Trade Commission Act of 1914 (“the FTCA”), and the Real Estate Settlement Procedures Act of 1974 (“RESPA”); and DISMISS WITHOUT PREJUDICE Norton's remaining claims and give him an opportunity to file a second amended complaint within the fourteen days allotted for objections to this recommendation. If, however, Norton files a second amended complaint within the prescribed time period, the Motion should be DENIED as MOOT as to the claims not dismissed with prejudice, and the action should be allowed to proceed on the amended complaint.


         Norton filed this foreclosure-related case on December 27, 2018 in the 352nd Judicial District Court of Tarrant County, Texas regarding property located at 8107 Guadalupe Road, Arlington, Texas 76002 (“the Property”). (ECF No. 1-3). Wells Fargo removed the case to this Court on January 2, 2019. (ECF No. 1). The undersigned required the parties to replead. (ECF No. 9). Norton filed his First Amended Original Petition (“FAC”) on February 11, 2019. (ECF No. 14). He asserts the following claims against Wells Fargo: (1) suit to quiet title; (2) violations of the FTCA; (3) violations of the Fair Debt Collection Practices Act (“FDCPA”); (4) violations of the Fair Credit Reporting Act of 1970 (“the FCRA”); and (5) violations of the RESPA. (See generally id.). Although not listed in a separate count, he also asserts that Wells Fargo does not have authority to foreclose because it has not produced the original note and deed of trust. (Id. at 13). Norton seeks statutory civil penalties; attorneys' fees; declaratory, injunctive, and equitable relief; economic, exemplary, and punitive damages; and costs of court. (Id. at 22-25).

         Thereafter, Wells Fargo filed its Motion for Judgment on the Pleadings. Wells Fargo argues that Norton's claims fail as a matter of law and that because he has no viable underlying claims, his requests for declaratory and injunctive relief also fail. (See generally ECF No. 15). Norton replies and argues that Wells Fargo violated the Texas Finance Code and Texas Debt Collection Act (“the TDCA”). (ECF No. 22 at 4). Norton reasserts his request for declaratory relief. (Id.). Having fully brief the Motion for Judgment on the Pleadings, it is now ripe for a decision.


         The standard for dismissal under Rule 12(c) is the same standard for dismissal for failure to state a claim under Rule 12(b)(6). Chauvin v. State Farm Fire & Cas. Co., 495 F.3d 232, 237 (5th Cir. 2007). The Rules require that each complaint contain “a short and plain statement of the claim showing that the pleader is entitled to relief . . . .” Fed.R.Civ.P. 8(a). A complaint must include sufficient factual allegations “to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In considering a Rule 12(b)(6) motion, courts “take all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff . . . and ask whether the pleadings contain ‘enough facts to state a claim to relief that is plausible on its face.'” Yumilicious Franchise, L.L.C. v. Barrie, 819 F.3d 170, 174 (5th Cir. 2016) (citing Twombly, 550 U.S. at 547). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. (citing Twombly, 550 U.S. at 555).

         A plaintiff's complaint should “contain either direct allegations on every material point necessary to sustain a recovery . . . or contain allegations from which an inference may fairly be drawn that evidence on these material points will be introduced at trial.” Campbell v. City of San Antonio, 43 F.3d 973, 975 (5th Cir. 1995). The complaint must contain facts that support the claim for relief. The court cannot “accept as true conclusory allegations or unwarranted deductions of fact.” Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000) (quotation omitted). A complaint, therefore, is not sufficient if it merely contains “naked assertions” devoid of factual enhancement. Iqbal, 556 U.S. at 678.

         In ruling on a motion to dismiss, a court may consider documents outside the complaint when they are: (1) attached to the motion to dismiss; (2) referenced in the complaint; and (3) central to the plaintiff's claims. In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007). Additionally, a court may take judicial notice of matters of public record without converting a motion to dismiss into a motion for summary judgment. See Randall D. Wolcott, M.D., P.A. v. Sebelius, 635 F.3d 757, 763 (5th Cir. 2011) (“Generally, a court ruling on a 12(b)(6) motion may rely on the complaint, its proper attachments, documents incorporated into the complaint by reference, and matters of which a court may take judicial notice.”) (citation and quotation marks omitted).

         There exists a “well-established policy that the plaintiff be given every opportunity to state a claim.” Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001) (citing Hitt v. City of Pasadena, 561 F.2d 606, 608 (5th Cir. 1977)). It is federal policy to decide cases on the merits rather than technicalities, and thus when possible the Fifth Circuit has recommended that suits be dismissed without prejudice on Rule 12 motions. Great Plains Tr. Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 329 (5th Cir. 2002); Hines v. Wainwright, 539 F.2d 433, 434 (5th Cir. 1976) (vacating and remanding a Rule 12(c) dismissal with instructions to the district court to dismiss without, instead of with, prejudice). As a result, courts generally allow plaintiffs at least one opportunity to amend following a Rule 12 dismissal on the pleadings. Great Plains Tr. Co., 313 F.3d at 329; see In re Online Travel Co. (OTC) Hotel Booking Antitrust Litig., 997 F.Supp.2d 526, 548-49 (N.D. Tex. 2014) (Boyle, J.) (dismissing for failure to state a claim without prejudice, as dismissing with prejudice would be “too harsh a sanction”). Nonetheless, courts may appropriately dismiss an action with prejudice if a court finds that the plaintiff has alleged its best case. Jones v. Greninger, 188 F.3d 322, 327 (5th Cir. 1999).

         III. ANALYSIS

         A. Norton's Quiet Title Claim Fails as a Matter of Law.

         Wells Fargo argues that Norton's claim to quiet title fails because it had authority, as a mortgagee to whom the security instrument was assigned, to initiate foreclosure proceedings on the Property. (ECF No. 15 at 11-12). Norton responds that Wells Fargo must produce the note to prove it has authority to foreclose. (ECF No. 22 at 4). Norton further asserts that Wells Fargo violated various sections of the TDCA. (Id.). The undersigned notes that Norton's TDCA claim was not part of his FAC. (See generally ECF No. 14). As a result, he has not properly pleaded a claim under the TDCA. St. Claire v. EnsureLink, No. CIV.A. 3:01CV1548-G, 2002 WL 663570, at *1 n.2 ...

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