Opinion
3:02-CV-2455-AH
December 9, 2003
MEMORANDUM OPINION AND ORDER
Pursuant to the written consents of the parties and the District Court's order reassigning the above styled and numbered action in accordance with the provisions of 28 U.S.C. § 636(c) came on to be considered Defendant Fairbanks Capital Corporation's ("Fairbanks") Motion for Judgment on the Pleadings or, In the Alternative, To Dismiss for Failure to State a Claim, filed on December 18, 2002; Plaintiff s Memorandum in Opposition thereto, filed on January 21, 2003; Fairbanks's Reply, filed on January 31, 2003; Defendant WMC Mortgage Corporation's ("WMC") Rule 12(b)(6) Motion to Dismiss for Failure to State a Claim Upon Which Relief Can Be Granted, filed on December 23, 2002; Plaintiff's, Memorandum in Opposition thereto, filed on January 21, 2003; and WMC's Reply, filed on February 5, 2003.
On January 15, 2003, Fairbanks also filed a Motion to Abate or Stay this litigation as to it, asserting that it did not receive pre-suit written notice of Plaintiff's specific complaint and alleged damages as a result of her failure to comply with section 17.505(a) of the Texas Business and Commerce Code, which requires that such notice be provided sixty days before the filing of a suit related thereto. (Fairbanks's Br. In Support of the Motion to Abate or Stay at pp. 1-2). However, it is unnecessary for the court to consider Fairbank's motion, as the same has been rendered moot because of the court's dismissal of Plaintiff's claims against both Defendants WMC and Fairbanks. See p. 16, infra.
I. Factual Background
On August 18, 1998, Plaintiff Virgie L. Grant-Brooks (hereinafter referred to as "Plaintiff") received a facsimile-transmitted offer to refinance her home mortgage note from a representative of Mortgage Consultants, Inc. ("MCI"). (App. 1 attach, to Pl.'s First Am. Compl Application for Injunctive Relief) (hereinafter "Pl.'s Compl."). The next day, August 19, 1998, Plaintiff received a "Fax Cover Sheet" from the same MCI representative, which detailed the following terms for a home equity loan: a new loan amount of $180,000, consisting of the balance of Plaintiff's original mortgage — $153,000 — plus $22,000 cash out and closing costs, financed at 9.9% interest (fixed) for thirty (30) years, with a monthly payment of $1578.21. ( Id.). The fax transmission further provided that if Plaintiff were to maintain her monthly payments, her loan would be refinanced at a 6.5% fixed interest rate.
On November 9, 1998, a "Settlement Statement" memorializing the terms of the new loan was completed. (App. B attach, to Pl.'s Compl.). According to the statement, Defendant WMC Mortgage Corporation ("WMC") had agreed to lend Plaintiff and her husband, Ronnie J. Brooks, $180,800, of which $159,242.43 was payable to the holder of the original mortgage note, GE Capital Mortgage, and $12,849.63 comprised of various settlement charges, including, inter alia, underwriting fees and premium yield fees in the amounts of $450 and $5,242, respectively to MCI, and school district fees in the amounts of $589 and $2,608.03 to Dallas County ISD and Duncanville ISD, respectively ( Id.). After the pay-off of Plaintiff's original mortgage balance as well as the payment of the various settlement charges, a balance of $8,707.94 remained, which Plaintiff and her husband received as "cash-out" in the form of a cashier's check drawn on the Swiss Avenue State Bank. ( Id.; see also App. C attach, to Pl.'s Compl).
On that same day, Plaintiff and her husband, Ronnie J. Brooks, executed waivers of their right to receive this statement at settlement. (App. D attach, to Pl.'s Compl.).
According to Plaintiff, the terms of WMC's loan varied substantially from the terms she had been provided by, and agreed to with, MCI. For example, instead of a home equity loan of $22,000 financed at 9.9%, she received a refinance of her original mortgage in conjunction with the amount she sought to borrow from her home's equity, all of which was then financed at 11%.
Plaintiff contends that the loan origination fees she paid were substantially higher than they would have been for a $22,000 home equity loan because the same were based on the total loan amount of $180,800. (Pl.'s First Am. Compl. Application for Injunctive Relief at ¶ 8). She also contends that this disparity caused her "cash-out" amount to be significantly lower than the $22,000 she had been offered. ( Id.).
On April 13, 2000, WMC assigned Plaintiffs refinanced mortgage note to NationsCredit Home Equity Services ("NationsCredit"). (Pl.'s Compl. at ¶ 9). Thereafter, in July of 2000, Plaintiff filed for Bankruptcy protection. ( Id. at ¶ 10; App. E. attach, to Pl.'s Compl.). On August 2, 2000, Plaintiff and her husband received a letter from a NationsCredit representative, which informed that their account was "seriously deliquent"; that foreclosure proceedings had been initiated; and that, if they were then experiencing "financial hardship," alternatives to foreclosure could be explored. (App. F. attach, to Pl.'s Compl.).
On or about September 11, 2000, Plaintiff received a letter addressed to her from the law firm of Brown Shapiro, L.L.P. ("Brown Shapiro"), which informed her that it had been retained by NationsCredit Financial Services Corporation, the owner and holder of Plaintiff s mortgage note, to initiate foreclosure proceedings on her home. (App. G. attach, to Pl.'s Compl.). The letter, which purported to be in compliance with the Federal Fair Debt Collection Act, also informed that she had an outstanding debt of $194,178.65 owed to NationsCredit. (Id.).
On September 17, 2000, Plaintiff sent a letter via certified mail to Mr. Charles A. Brown of Brown Shapiro, wherein she informed Mr. Brown that she had filed a Chapter 13 bankruptcy petition, and that she had been in contact with a representative of NationsCredit regarding her request to have her loan restructured and that she had been informed that her request had been forwarded to NationsCredit's department which handled bankruptcies. (App. H attach, to Pl.'s Compl.). In her letter, Plaintiff also informed Mr. Brown that she and her husband were "separated." ( Id.).
On or about May 7, 2001, Plaintiff received another letter from a NationsCredit representative addressed to her and her husband, which informed them that their account was "seriously delinquent" and reiterated that foreclosure proceedings had been initiated against them. (App. J attach, to Pl.'s Compl.). The letter further informed that, as an alternative to foreclosure, the two of them could apply for an extension of their payments; provide a deed in lieu of foreclosure; or provide a suitable applicant to assume their loan. ( Id.).
On May 20, 2001, Plaintiff sent a letter via certified mail to Kevin Page at NationsCredit, wherein she reiterated the fact that she had filed a bankruptcy petition and that she had been waiting to hear from the company's bankruptcy department regarding alternate payment arrangements on her account. (App. K attach, to Pl.'s Compl.).
On or about August 31, 2001, Plaintiff received a demand letter addressed to her husband from Brown Shapiro, which informed that he had defaulted on the mortgage loan note and that the holder of the note, NationsCredit, demanded payment of all monies owed to it within thirty (30) days of the date of the letter. (App. attach, to Pl.'s Compl.). The letter further advised that in the event that such payment was not timely made, the maturity of the loan note would be accelerated, rendering the entire unpaid principal balance as well as accrued interest immediately due and payable. ( Id.).
On or about November 5, 2001, Plaintiff received two letters addressed to her husband from Brown Shapiro, one of which detailed amounts payable for the reinstatement of the mortgage loan and the other of which detailed mortgage payoff figures. (App. L attach. to Pl.'s Compl.). Each letter concluded with the statement "We are not attempting to collect money from anyone who has discharged the debt under the Bankruptcy laws of the United States." ( Id.).
On or about May 13, 2002, Plaintiff received a letter addressed to her and her husband from Defendant Wilshire Credit Corporation ("Wilshire"), which informed them that on May 1, 2002, it had become the servicing agent for their loan after the same was transferred to it by Defendant Fairbanks Capital Corporation ("Fairbanks"). (App. M attach, to Pl's Compl.). The letter further informed Plaintiff that the loan balance was $268,837.94. ( Id.).
It is not altogether clear exactly when Fairbanks became the servicing agent for Plaintiff's loan. However, it is clear that at some time between November of 2001 and May 1, 2002, Fairbanks serviced Plaintiffs loan. Fairbanks alleges that it only serviced Plaintiffs loan for one (1) month. (Fairbank's Br. In Support of Its Motion for Judgment on the Pleadings or, In the Alternative, To Dismiss for Failure to State a Claim at p. 4).
On or about October 15, 2002, Plaintiff received a "Notice of Acceleration" of her loan note from Brown Shapiro. (App. N attach, to Pl's Compl.).
On November 8, 2002, Plaintiff filed the present action against WMC, Wilshire, Fairbanks, and various "successors-in-interest" of WMC on the basis of diversity jurisdiction. ( See generally Pl.'s Original Compl. Application for Injunctive Relief). On December 12, 2002, Plaintiff filed her First Amended Complaint ("Pl.'s Compl."). Therein, Plaintiff alleged the following causes of action against WMC, Wilshire, Fairbanks, and various unnamed successors-in-interest of WMC (collectively referred to as "Defendants"): common law fraud and misrepresentation; statutory fraud in violation of Texas Business and Commerce Code § 27.01; violations of the Texas Deceptive Trade Practices and Consumer Protection Act; and violations of the Texas Debt Collections Practices Act. ( Id. at pp. 5-11).
However, to the extent that neither Defendants Wilshire nor the unnamed successors-in-interest of WMC have joined either WMC or Fairbanks in their respective motions to dismiss or filed such a motion on its own, any reference to "Defendants" shall not include either Wilshire or the unnamed Defendants.
II. Analysis
A. Standard of Review-Motion to Dismiss
Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)") allows for dismissal of a complaint if the plaintiff fails "to state a claim upon which relief may be granted." Dismissal is appropriate only when "it appears beyond doubt that the plaintiff can prove no set of facts in support of [her] claim which would entitle [her] to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99 (1957); Holmes v. Texas A M Univ., 145 F.3d 681, 683 (5th Cir. 1998) (citations omitted).
In deciding whether dismissal is warranted, the court accepts as true the nonconclusory allegations in a plaintiffs complaint. Jones v. Greninger, 188 F.3d 322, 324 (5th Cir. 1999). A motion to dismiss for failure to plead fraud with the particularity required by Federal Rule of Civil Procedure 9(b) ("Rule 9(b)") is treated as a motion to dismiss for failure to state a claim under Rule 12(b)(6). United States ex rel. Thompson v. Columbia/HCA Healthcare Corp., 125 F.3d 899, 901 (5th Cir. 1997). As a general principle dismissals based upon Rule 9(b) deficiencies should be without prejudice to a plaintiffs right to file an amended complaint which corrects the deficiencies, subject only to the requirements of Rule 11, Federal Rules of Civil Procedure. See Hart v. Bayer Corp., 199 F.3d 239, 248 n. 6 (5th Cir. 2000). However, for the reasons discussed below, any attempt on the part of Plaintiff to correct Rule 9(b) deficiencies would be futile.
Federal Rule of Civil Procedure 9(b) provides that "[i]n all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge, and other condition of mind of a person may be averred generally." Accordingly, Rule 9(b) requires the Plaintiff to plead all of the elements of common law fraud with particularity, with one exception. The text of Rule 9(b) explicitly states that intent to defraud "may be averred generally." FED. R. CIV. P. 9(b).
B. Applicable law
1. Fraud
Plaintiff asserts in her First Amended Complaint and Application for Injunctive Relief ("Pl.'s Compl."), that "Defendant" knowingly made false representations as to various material facts-i.e., the actual interest rate offered and the amount of "cash out"-of the home equity loan agreement which she was offered with the intent to induce her to finance her loan with WMC, that she relied on such representations, and that she sustained financial damages thereby. ( Id. at ¶¶ 16-19).
WMC, relying on Rule 9(b) as well as on Williams v. WMX Techs., Inc., 112 F.3d 175, 177-78 (5th Cir. 1997) and Tuchman v. DSC Communications Corp., 14 F.3d 1061 (5th Cir. 1994), argues that Plaintiff has wholly failed to allege, with sufficient factual specificity, the nature of her fraud claim. Specifically, WMC asserts that Plaintiff has simply made "conclusory" allegations against it without producing any evidence that it made any false or misleading statements to her regarding the loan agreement she ultimately entered into.
On the other hand, WMC asserts that Plaintiff has only proffered "unauthenticated" documentary evidence in the form of a fax cover sheet and a letter, both of which are from a company called Mortgage Consultants, Inc. ("MCI"), which is not named as a defendant in the present suit. As such, WMC urges the court to dismiss Plaintiff's complaint against it under Rule 12(b)(6) or, alternatively, under Rule 9(b). For its part, Fairbanks asserts that Plaintiff has failed to allege that it was even a party to the loan agreement she entered into, let alone that it made any false representations related thereto which she relied upon.
To recover under a cause of action for fraud the Plaintiff must show the following: (1) a material misrepresentation was made; (2) the misrepresentation was made recklessly or with knowledge of its falsity; (3) the misrepresentation was made in anticipation of reliance upon it; and (4) actual reliance occurred which resulted in damages to the plaintiff. Michael v. Dyke, 41 S.W.3d 746, 752-53 (Tex.App. Corpus Christi 2001, no pet.) (citing Trenholm v. Ratcliff, 646 S.W.2d 927, 930 (Tex. 1983)).
2. Rule 9(b)
While the exact pleading requirements of Rule 9(b) are case-specific, there are some essential core requirements that can be distilled from Fifth Circuit precedent. See Guidry v. Bank of LaPlace, 954 F.2d 278, 288 (5th Cir. 1992). In every case based on fraud, Rule 9(b) requires the plaintiff to allege as to each individual defendant "the nature of the fraud, some details, a brief sketch of how the fraudulent scheme operated, when and where it occurred, and the participants." Askanase v. Fatjo, 148 F.R.D. 570, 574 (S.D.Tex. 1993); see also Zuckerman v. Foxmeyer Health Corp., 4 F. Supp.2d 618, 622 (N.D.Tex. 1998) (citations omitted)("[T]he plaintiff is obligated to distinguish among those [she] sue[s] and enlighten each defendant as to his or her part in the alleged fraud"); In re Urcarco Secs. Litigation, 148 F.R.D. 561, 569 (N.D.Tex. 1993).
Rule 9(b)'s heightened pleading requirement must be interpreted in conjunction with the Federal Rules of Civil Procedure's general emphasis on notice pleading. "In applying Rule 9(b), the Fifth Circuit has noted that the particularity standard of Rule 9(b) must be interpreted in conjunction with Rule 8's requirement that the pleading contain a short and plain statement of the claims . . . Thus, although Rule 9(b) calls for fraud to be pleaded with particularity, the allegations still must be as short, plain, simple, direct, and concise as is reasonable under the circumstances." See Corwin v. Marney, Orton Investments, 788 F.2d 1063, 1068 n. 4 (5th Cir. 1986) (quoting 5 C. Wright A. Miller, FEDERAL PRACTICE AND PROCEDURE § 1291 at 389 (1969)).
However, "[p]leading fraud with particularity in this circuit requires `time, place, and contents of the false representations, as well as the identity of the person making the misrepresentation and what [that person] obtained thereby.'" Williams v. WMX Techs., Inc., 112 F.3d 175, 178 (5th Cir. 1997). Furthermore, "articulating the elements of fraud with particularity requires a plaintiff to . . . explain why the statements [that were allegedly made] were fraudulent." Id. (citing Mills v. Polar Molecular Corp., 12 F.3d 1170, 1175 (2nd Cir. 1993)).
Plaintiffs pleadings fail to allege with sufficient specificity any material misrepresentation made by either WMC or Fairbanks or that any misrepresentation was made recklessly or with knowledge of its falsity. Further, the court finds that Plaintiff has wholly failed to identify which "Defendant" perpetrated a fraud against her with respect to the loan agreement she entered into. Although WMC's name appears as a "lender" on the "Settlement Statement" provided to Plaintiff, its name does not appear on the faxed cover sheet she received from MCI, which detailed the proposed terms of the home equity loan she was offered. Plaintiff has also wholly failed to allege any relationship, legal or otherwise, between WMC and MCI. Further, Plaintiff cannot establish that Fairbanks made any representations, material or otherwise, to her in connection with her entry into the loan agreement at issue; the attachments to Plaintiffs amended complaint indicate that Fairbanks was nothing more than a servicing agent of the loan note, after the same came into existence.
WMC also asserts that Plaintiffs fraud claim is barred by the statute of frauds pursuant to Texas Business and Commerce Code § 26.02-which provides that a loan agreement involving an amount greater than $50,000 is only enforceable where the same is in writing and signed by the party to be bound. It further asserts that Plaintiff is time barred from pursuing her claim because she filed suit on the same outside of the four (4) year limitations period for such causes of action pursuant to Texas Civil Practices Remedies Code § 16.004 — her cause of action accrued in August 1998, but she did not file her suit thereon until November 8, 2002. Plaintiff has not shown otherwise. Therefore, Defendants are entitled to an order dismissing Plaintiffs common law fraud claim.
3. Statutory Fraud-Violation of Section 27.01 of the Texas Business and Commerce Code
Plaintiff also asserts that because the statements discussed above, which she attributes to an unnamed "Defendant," were made in connection with the application for a home equity loan secured by real estate, the same constitute a violation of Section 27.01 of the Texas Business and Commerce Code. In response, WMC asserts that the home equity loan it made to Plaintiff did not involve either the actual conveyance of real estate or the sale of land, and, as such, the transaction between the parties falls outside the purview of Section 27.01.
Section 27.01(a) and (b) sets up a statutory cause of action for "fraud in a transaction involving real estate . . .," when a false representation or a false promise induces the defrauded party to enter into a contract. Texas Commerce Bank Reagan v. Lebco Constrs., Inc., 865 S.W.2d 68, 82 (Tex.App. — Corpus Christi 1993, writ denied). However, Texas courts have not interpreted section 27.01 as broadly as Plaintiff would like this court to do. Id.
Section 27.01(a) provides, in pertinent part, that: (a) Fraud in a transaction involving real estate . . . consists of a
(1) false representation of a past or existing material fact, when the false representation is
(A) made to a person for the purpose of inducing that person to enter into a contract; and
(B) relied on by that person in entering into that contract; or
(2) false promise to do an act, when the false promise is
(A) material;
(B) made with the intention of not fulfilling it;
(C) made to a person for the purpose of inducing that person to enter into a contract; and
(D) relied on by that person in entering into that contract.
( Id.) (emphasis added).
In Texas Commerce Bank, the Corpus Christi Court of Appeals, noting that in Nolan v. Bettis, 577 S.W.2d 551, 556 (Tex.Civ.App.-Austin 1979, writ refd n.r.e.) the Austin Court of Appeals stated that "[a]n examination of § 27.01 shows that it is concerned with misrepresentation of material fact made to induce another to enter into a contract for the sale of land . . .," held that section 27.01 is only applicable to fraudulent misrepresentations made in real estate transactions and is inapplicable when there is no contract or sale of land between the parties. Texas Commerce Bank, 865 S.W.2d at 82 (citations omitted); see also Life Ins. Co. Of Va. v. Murray Inv. Co., 646 F.2d 224, 227 n. 2 (5th Cir. Unit A May 1981) (noting that section 27.01 "only reaches those transactions involving the actual or potential sale or purchase of real estate."). The Texas Commerce Bank court further held that section 27.01 does not apply to a party who merely loaned money for the purchase of real estate. Id. (citing Greenway Bank Trust v. Smith, 679 S.W.2d 592, 596 (Tex.App.-Houston [1st Dist.] 1984, writ refd n.r.e.)).
Based on the foregoing authorities, it is clear that section 27.01 only applies to transactions involving the sale or transfer of real estate from one party to another, such as when a contract to purchase real estate or other indica of ownership transfer is entered into between a buyer and a seller, and not to the act of loaning money for such a purchase, such as a loan agreement entered into between a mortgagor and mortgagee. As such, the court finds that, to the extent that section 27.01 does not apply to the loan agreement entered into between Plaintiff and WMC, the latter could not have violated the same and, therefore, Plaintiff has failed to state an actionable claim of statutory fraud against WMC. Fairbanks also asserts that Plaintiff has failed to state an actionable claim of statutory fraud against it. However, its assertion is based on the reasons discussed, in detail, at pp. 9-10, supra, and not on the inapplicability of section 27.10 to the present action. Regardless of the different approaches to Plaintiffs statutory fraud claim undertaken by WMC and Fairbanks, the court, for the reasons stated more fully above, dismisses with prejudice Plaintiffs claim of statutory fraud against both WMC and Fairbanks.
4. DTPA Claim
Plaintiff also asserts that "Defendant ['s]" representations made in connection to the home equity loan she accepted-discussed more fully at p. 7, supra — violated the Texas Deceptive Trade Practices — Consumer Protection Act ("DTPA"), in that such representations were "target[ed] [at] . . . [a] homeowner . . . burdened by substantial debt and promot[ed] . . . based on the misrepresentation and material omissions with the goal of inducing [the] consumer to pay high fees and interest costs." (Pl.'s Compl. at pp. 8-9). Plaintiff further asserts that "Defendant" "[f]ail[ed] to provide good faith estimates of the costs of their loan transactions[,] requir[ed] waivers for the review of . . . settlement statements . . ., and [e]ngaged in deceptive underwriting practices." ( Id. at 9). Specifically, Plaintiff alleges that "Defendant" acted unconscionably by falsifying closing documents and requiring her to waive her right to review settlement/closing statements, thereby taking advantage of her "lack of capacity" to a grossly unfair degree. ( Id.).
From the content in which this assertion is made, it appears that Plaintiff implies that she was taken advantage of due to a "lack of sophistication" rather than claiming that she was under some disability or limitation which affected her ability to enter into a contract.
In response, WMC asserts that Plaintiffs DTPA claim is time-barred because the same was brought outside the two (2) year limitations period for such claims pursuant to section 17.565 of the Texas Business and Commerce Code. Specifically, WMC asserts that Plaintiffs suit, which was filed on November 9, 1998, was filed more than four (4) years after the alleged misrepresentations occurred-August 1998-and more than two (2) years after it sold the rights to Plaintiffs loan-April 2000.
In light of the foregoing, the court finds that Plaintiff is time-barred from bringing her cause of action under the DTPA. Accordingly, the same is dismissed with prejudice as to WMC.
Further, the court notes that WMC, relying on Clardy Mfg. Co. v. Marine Midland Bus. Loans, Inc., 88 F.3d 347, 356 (5th Cir. 1996) and on Riverside Nat'l Bank v. Lewis, 603 S.W.2d 169, 174 (Tex. 1980), asserts, alternatively, that Plaintiff is not a "consumer" within the meaning of the DTPA because the loan at issue does not constitute seeking or acquiring either a "good" or a "service." Fairbanks, relying on Riverside Nat'l Bank as well, also asserts that Plaintiff is not entitled to seek redress under the DTPA because she is not a "consumer."
In order to have standing to bring an action under the DTPA a plaintiff must be a consumer. Mendoza v. American Nat'l Ins. Co., 932 S.W.2d 605, 608 (Tex.App.-San Antonio 1996, no writ). The issue of consumer status under the DTP A is question of law for the court to decide. Lukasik v. San Antonio Blue Haven Pools, Inc., 21 S.W.3d 394, 401 (Tex.App.-San Antonio 2000, no pet.).
To qualify as a consumer, a plaintiff must meet two requirements: (1) the person must seek or acquire goods or services by purchase or lease, and (2) the goods or services purchased or leased must form the basis of the complaint. See TEX. Bus. COM. CODE ANN. § 17.45(4) (Vernon 2001). With respect to the first element, in the Riverside Nat'l Bank v. Lewis, 603 S.W.2d 169, 174 (Tex. 1980), the Texas Supreme Court held that the borrowing of money from a lender, without more, does not constitute a "service" as defined by the DTPA.
In the instant case, Plaintiffs suit is predicated primarily on allegedly fraudulent conduct to which she was subjected in the course of obtaining a home equity loan from WMC. As such, because her loan is not a "service" under the DTPA, she cannot satisfy the threshold requirement that she be a consumer-i.e., that she sought or acquired any goods or services by either lease or purchase. Therefore, Plaintiffs cause of action under the DTPA is dismissed with prejudice as to both WMC and Fairbanks.
5. Texas Debt Collections Practices Act
Plaintiff asserts that the multiple "Notices of Intent to Accelerate" she received on behalf of an entity which she identifies only by the generic term "Defendant" violated various provisions of the Texas Debt Collections Practices Act. Specifically, she claims that the notice dated November 5, 2001, only provided her with five (5) days to cure the default as opposed to the twenty (20) days she was statutorily entitled to, and that the notice dated October 15, 2002, failed to include either the total amount defaulted or the outstanding loan balance, both of which were statutorily required. Based upon the alleged deficiencies in the notices Plaintiff seeks injunctive relief enjoining any foreclosure on the real property which is subject to the outstanding mortgage loan balance owing.
On September 24, 2003, Plaintiff filed her motion to sever in this action contending that the injunctive relief sought was subject to the jurisdiction of the bankruptcy court in which her individual bankruptcy petition is pending. On November 26, 2003, Defendants filed their joint memorandum in opposition to Plaintiffs motion to sever, arguing that this aspect of Plaintiff's Amended Complaint is moot. In the alternative, Wilshire Credit Corp. in its separately filed memorandum argues that any request for injunctive relief is premature. See Wilshire's memorandum filed on November 26, 2003, at pages 2-4. Specifically Wilshire notes that no foreclosure proceeding has been initiated at this time. Under such circumstances, Plaintiff cannot show a colorable basis for seeking injunctive relief under the Texas Debt Collections Practices Act. See also the discussion set out in the District Court's order filed on November 15, 2002.
Since the conduct alleged in Plaintiffs complaint pre-dated the filing of her bankruptcy petition on November 2, 2002, this court has serious reservations as to whether Ms. Grant-Brooks has standing to bring this action in her own behalf. E.g. see Wieburg v. GTE Southwest, Inc., 272 F.3d 302, 306 (5th Cir. 2001). Although Wilshire Credit Corp. filed a suggestion of bankruptcy in this action on December 18, 2002, and this court filed a show cause order on October 8, 2003, granting permission to the bankruptcy trustee to address the issue of standing, neither the trustee nor the defendants in this action have addressed this issue.
For the foregoing reasons, it is ORDERED that Defendants Fairbanks Capital Corp.'s and WMC Mortgage Corp.'s motions to dismiss are GRANTED and that all claims asserted against the said Defendants in Plaintiffs First Amended Complaint are dismissed with prejudice.
A copy of this opinion and order shall be transmitted to Plaintiff and counsel for Defendants.
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