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Moore v. Ditech Financial, LLC

United States District Court, D. Nevada

June 7, 2017

ROBERT MOORE, Plaintiff,
DITECH FINANCIAL, LLC et al., Defendants.



         Robert Moore obtained a $1 million mortgage to purchase a home in 2005. He defaulted on his mortgage in 2009, and when his lenders tried to foreclose, he filed a federal lawsuit arguing that there was a defect in the property's chain of title. After having all of his claims dismissed, Moore now files a new case against other parties involved in his mortgage. He does not dispute that he is still in default on his mortgage; instead, he claims that he can rescind his mortgage because the defendants violated the Truth in Lending Act (“TILA”). Alternatively, he again argues that he should be given title to the property because there is a defect in the chain of title.

         Moore's claims have as little merit now as they did before. His TILA claims fail both because he did not file within the applicable limitation period and because the provision he sued under does not apply to his mortgage. His claims related to the chain of title fail because he has not cured his default, he has not plausibly alleged that he has any interest in the property, and he has not offered any specific facts suggesting that there is actually a problem with the title. I therefore dismiss Moore's claims.

         I. BACKGROUND

         In 2005, Moore purchased his home with a $1 million mortgage from Silver State Financial Services.[1] Moore then borrowed almost half of a million dollars in a home equity line of credit, executing a second Deed of Trust with Silver State as the lender and MERS as the beneficiary.[2] MERS later assigned the Deed of Trust to the Bank of New York Mellon.[3]

         By 2009, Moore had defaulted on his mortgage and a notice of trustee sale was recorded. Over the following several years, a number of notices of sale were recorded-but Moore does not allege that the home has ever been foreclosed on.

         In 2011, Moore filed a federal lawsuit against MERS (who was then the beneficiary of Moore's Deed of Trust) and ReconTrust Company (who was then the trustee on the deed) for various claims related to the securitization of his mortgage.[4] In 2013, Judge Pro either dismissed or granted summary judgment in favor of the defendants on all of Moore's claims.[5]

         Moore now brings this lawsuit against new banks and services that were involved with his mortgage. He asserts claims for wrongful disclosure, quiet title, and a declaration about who owns the property. Moore also filed a Notice of Lis Pendens Affecting Real Property that apparently was recorded in the Official Records of Clark County.[6]

         II. ANALYSIS

         A. Motions to Dismiss

         A properly pleaded complaint must provide “a short and plain statement of the claim showing that the pleader is entitled to relief.”[7] While Rule 8 does not require detailed factual allegations, it demands “more than labels and conclusions” or a “formulaic recitation of the elements of a cause of action.”[8] “Factual allegations must be enough to rise above the speculative level.”[9] Thus, to survive a motion to dismiss, a complaint must contain sufficient factual matter to “state a claim to relief that is plausible on its face.”[10]

         B. Moore fails to allege a plausible claim for wrongful foreclosure.

         To allege a plausible wrongful foreclosure claim, Moore must offer specific facts showing that he was not in default at the time of the foreclosure sale.[11] But Moore has failed to allege he was not in default, and more importantly, he has not even alleged that the sale occurred.

         Moore offers a number of reasons for why his wrongful foreclosure claim should be permitted to survive, but none of them addresses the issue that he cannot sue for wrongful foreclosure when no one has, in fact, foreclosed on his home.[12] Nor has Moore offered any allegations or authority to dispute that Nevada law requires that he plausibly allege that he is not in default on his mortgage, which he did not do. I therefore dismiss this claim. Because Moore does not dispute that he remains in default on his mortgage, and thus that he cannot add new facts to cure this defect, I do not grant him leave to amend this claim.

         C. Moore fails to allege a plausible claim for quiet title or declaratory relief.

         Aside from Moore's wrongful foreclosure claim, the balance of his complaint requests a declaration that he owns the property and that title to the property should be quieted in his name. Moore offers two theories to support these requests: (1) the defendants violated the Truth in Lending Act (“TILA”), which means Moore can rescind his mortgage (so that he is now free from his debt on the property), and (2) there is a defect in the defendants' chain of title so that they are not entitled to foreclose on the home. Each of these theories fails for multiple reasons.

         TILA requires creditors to clearly disclose key terms and costs in credit transactions.[13] If a creditor fails to make these disclosures, in some circumstances the borrower can rescind his mortgage. One of these required disclosures is a ...

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