The opinion of the court was delivered by: (judge Caputo)
Before the Court are Motions to Dismiss filed on behalf of defendants Romec, Inc., Delta Homes, Inc., Joseph DiGregorio, Rita Mecca, Anthony J. Mecca, Gerber Associates, and National City Mortgage Co. This suit arises out of plaintiffs ("Best") purchase of a home in Monroe County, Pennsylvania. Best essentially claims he was sold a bill of goods. He alleges defendants colluded to mislead him about every aspect of the purchase in violation of state and federal laws: from the lot the house was built on, to its design, financing, and value. The Court will address each motion in turn. The motions will be granted in part and denied in part for the reasons stated below.
Best's complaint alleges the following.
Julian Best and Patricia Creft live in Brooklyn, NY. Romec, Inc., is a Pennsylvania corporation owned and controlled by the Anthony and Rita Mecca. Delta Homes, Inc., is a Pennsylvania corporation owned and controlled by DiGregorio. Gerber Associates is a real estate company located in Clark Summit owned by W. Nevin Gerber and employing George Campbell. National City Mortgage Company is a subsidiary of National City Bank with its principal place of business in Miamisburg, Ohio.
On July 21, 2007, Best went to Delta about constructing a new home and was shown a corner lot in Cantebury Estates, Lot 12 by Delta employee Chuck Hess. That same day, Best purchased a lot from Romec, making a thirteen-thousand dollar ($13,000.00) down payment.
While Best was led to believe he was purchasing Lot 12, he actually bought Lot 13. Best then reviewed the styles and models of the homes Delta constructed. Unimpressed, Best submitted blueprints from a relative's home that DiGregorio told him would be the basis of the home Delta constructed. Specifically, DiGregorio would incorporate the submitted blueprints into the existing model, make changes, and submit the revised blueprints to Best. However, Best never saw the revisions. Delta and DiGregorio then forced Best to use National City and the Meccas to finance the construction of the home.
Before the closing, National City ordered two appraisals of the home. A.C. Read Appraisal appraised the property at four-hundred and thirty thousand dollars ($430,000.00). Gerber Associates appraised the property at four-hundred and seventy thousand dollars ($470,000.00). Gerber, Delta, Romec, and National City conspired with Gerber to inflate the appraisal beyond the actual market value of the property. Gerber agreed in order secure further business. National City then knowingly used Gerber's exaggerated appraisal as the basis of its underwriting of Best's mortgage to rack up higher financing charges. Best was initially told to bring a check for ten thousand dollars ($10,000) to the closing. After it was canceled, he was told to bring a check for forty-five thousand dollars ($45,000.00). At the closing, DiGregorio and a National City employee told him he needed an additional thirty-three thousand dollars ($33,000.00) in order to get a loan from National City. This forced him to sign a note with the Meccas for that amount. Shortly after the closing, Best went to see the construction and saw the foundation being poured at Lot 13, not Lot 12. He called Delta, but Delta told him that he had purchased Lot 13, not 12. Throughout the construction, Best complained to DiGregorio that he was not following the blueprints, but was ignored. Delta also charged him an additional forty thousand dollars ($40,000.00) to have the basement finished, a cost which should have been in the original purchase price.
In total, Best was charged over five-hundred and sixteen thousand, six-hundred and nine dollars ($516,609.00) for the completed home, far above even its inflated appraisal value. Additionally, DiGregorio and Delta made the following construction errors: the bedrooms and sunroom are smaller than the blueprints; there is no large window in the master bath; the inside steps and front porch were built incorrectly; and the kitchen overhangs the garage. Best hired an independent inspector to evaluate the construction. The inspector found, among other things, that the constructed rooms were smaller than those in the plans, resulting in a "house shrinkage" of approximately 26.54 square feet.
In his complaint, Best brings claims for: breach of contract (counts I and II); violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL") (count III); common law fraud (count IV); unjust enrichment (count V); and violation of the Real Estate Settlement and Procedures Act ("RESPA"). Delta, DiGregorio, Romec, the Meccas, Gerber, and National City then all moved to have the complaint dismissed. The motions have been briefed and are ripe for review.
Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint, in whole or in part, for failure to state a claim upon which relief can be granted. Dismissal is appropriate only if, accepting as true all the facts alleged in the complaint, a plaintiff has not pleaded "enough facts to state a claim to relief that is plausible on its face," Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007), meaning enough factual allegations "'to raise a reasonable expectation that discovery will reveal evidence of'" each necessary element, Phillips v. County of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (quoting Twombly, 550 U.S. at 556); see also Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir. 1993) (requiring a complaint to set forth information from which each element of a claim may be inferred). In light of Federal Rule of Civil Procedure 8(a)(2), the statement need only "'give the defendant fair notice of what the ... claim is and the grounds upon which it rests.'" Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam) (quoting Twombly, 550 U.S. at 555). "[T]he factual detail in a complaint [must not be] so undeveloped that it does not provide a defendant [with] the type of notice of claim which is contemplated by Rule 8." Phillips, 515 F.3d at 232; see also Airborne Beepers & Video, Inc. v. AT&T Mobility LLC, 499 F.3d 663, 667 (7th Cir. 2007).
In deciding a motion to dismiss, the Court should consider the allegations in the complaint, exhibits attached to the complaint, and matters of public record. See Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). The Court may also consider "undisputedly authentic" documents when the plaintiff's claims are based on the documents and the defendant has attached copies of the documents to the motion to dismiss. Id. The Court need not assume the plaintiff can prove facts that were not alleged in the complaint, see City of Pittsburgh v. W. Penn Power Co., 147 F.3d 256, 263 & n.13 (3d Cir. 1998), or credit a complaint's "'bald assertions'" or "'legal conclusions,'" Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997) (quoting In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1429-30 (3d Cir. 1997)). "While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009).
When considering a Rule 12(b)(6) motion, the Court's role is limited to determining if a plaintiff is entitled to offer evidence in support of her claims. See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). The Court does not consider whether a plaintiff will ultimately prevail. See id. A defendant bears the burden of establishing that a plaintiff's complaint fails to state a claim. See Gould Elecs. v. United States, 220 F.3d 169, 178 (3d Cir. 2000).
I. Motion to Dismiss of Delta Homes, DiGregorio, Romec, Anthony Mecca and Rita Mecca (Doc. 5)
The Court will grant this motion as to the breach of contract claim against Delta and
DiGregorio (count I). It will deny the rest of the motion.
In Count I, Best has sued Delta, DiGregorio, Romec, and the Meccas for breach of contract over the purchase of the lot. In Pennsylvania, a person who is not a party to a contract cannot be held liable for a breach by one of the parties to a contract. Fleetway Leasing Co. v. ...