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Pennington v. Wells Fargo Bank, N.A.

United States District Court, Third Circuit

May 30, 2013

NIKKI PENNINGTON, Plaintiff/Counter Defendant,
v.
WELLS FARGO BANK, N.A. SUCCESSOR TO WELLS FARGO HOME MORTGAGE Defendant/Counterclaimant,
v.
JEFFREY PENNINGTON, Counter Defendant.

MEMORANDUM

WILLIAM H. YOHN, District Judge.

In this action, Wells Fargo Bank, N.A. ("Wells Fargo") brings counterclaims for breach of contract against Nikki Pennington, and in rem mortgage foreclosure against both Nikki and Jeffrey Pennington. The Penningtons then filed counterclaims to Wells Fargo's counterclaims. Currently before me is Wells Fargo's motion to strike, or in the alternative, dismiss the Penningtons' counterclaims pursuant to Rules 12(f) and 12(b) of the Federal Rules of Civil Procedure. For the reasons stated below, I will grant Wells Fargo's motion to dismiss.

I. FACTS AND PROCEDURAL BACKGROUND

The factual background of the underlying action is well known to the parties and has been exhaustively explained in previous memoranda; I need not recite the facts again here. Of more importance for the current motion is the procedural posture of the case.

On April 29, 2011, Wells Fargo removed this case from the Philadelphia County Court of Common Pleas. On May 16, 2012, this case was reassigned to me from the docket of the late Honorable Louis H. Pollak. I held a hearing on October 17, 2012, with respect to Wells Fargo's motion to dismiss the Penningtons' complaint. Following the hearing, I issued an order (the "October 17 order") that dismissed several of the Penningtons' claims with prejudice, including their claim for rescission of the mortgage and any claim premised on the argument that Wells Fargo was not the original holder of the note. Additionally, I dismissed with prejudice from the case the 10, 000 John Doe (investors) and Jeffrey Pennington.

On October 19, 2012, in a separate memorandum and order, I dismissed the remainder of Nikki Pennington's claims, save her claim for quiet title. Thereafter, both parties filed motions for reconsideration of the October 19, 2012 order (the "October 19 order"). In addition, the Penningtons filed a motion for leave to amend their complaint. On January 15, 2013, I denied both parties' motions for reconsideration. I also denied the Penningtons' motion for leave to file an amended complaint with prejudice, as I had previously concluded in the October 17 and October 19 orders that amendment of their claims would have been frivolous and futile.

Wells Fargo filed an answer to Nikki Pennington's complaint on January 29, 2013. Included in its answer were two counterclaims against Nikki Pennington: breach of contract and in rem mortgage foreclosure. On January 31, Wells Fargo filed a joinder complaint against Jeffrey Pennington, asserting a claim against him for in rem mortgage foreclosure, given his purported interest in the property at issue via quitclaim deed. Thus, Jeffrey Pennington was brought back into these proceedings.

On March 25, 2013, the Penningtons filed a reply to Wells Fargo's counterclaims. In their reply, the Penningtons assert counterclaims to Wells Fargo's counterclaims. Specifically, they allege the following: setoff, breach of contract, violations of the Uniform Commercial Code, lack of full disclosure, and recoupment. Wells Fargo now moves to strike the Penningtons' counterclaims, or in the alternative, have them dismissed.

II. LEGAL STANDARD

Under Rule 12(f) of the Federal Rules of Civil Procedure, a "court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed.R.Civ.P. 12(f). Motions to strike are "not favored and usually will be denied unless the allegations have no possible relation to the controversy and may cause prejudice to one of the parties, or if the allegations confuse the issues." N. Penn. Transfer, Inc. v. Victaulic Co. of Am., 859 F.Supp. 154, 158 (E.D. Pa. 1994) (quoting River Road Devel. Co. v. Carlson Corp., No. 89-7037, 1990 WL 69085, at *2 (E.D. Pa. May 23, 1990)) (internal quotation marks omitted). "Indeed, striking a pleading is a drastic remedy to be resorted to only when required for the purposes of justice' and should be used sparingly.'" DeLa Cruz v. Piccari Press, 521 F.Supp.2d 424, 428 (E.D. Pa. 2007) (quoting N. Penn. Transfer, 859 F.Supp. at 158). "To prevail, the moving party must demonstrate that the allegations have no possible relation to the controversy and may cause prejudice to one of the parties, or [that] the allegations confuse the issues.'" Id. (quoting River Road Devel. Co., 1990 WL 69085, at *3)

When deciding a motion to dismiss under Rule 12(b)(6), courts must "accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. Cnty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (internal quotation marks and citation omitted). The pleading standard of Rule 8 "demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements" will not suffice. Id. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). The complaint must contain sufficient factual matter to be plausible on its face. See id. "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"; a sheer possibility that a defendant acted unlawfully is not sufficient. Id. Therefore, to survive a motion to dismiss, a plaintiff must allege facts sufficient to "nudge[] [his or her] claims across the line from conceivable to plausible." Twombly, 550 U.S. at 570.

III. DISCUSSION

A. Motion to Strike

Wells Fargo argues that the court should strike the Penningtons' counterclaims because it appears that the counterclaims were authored by Jeffrey Pennington, who continues to assert that the court lacks jurisdiction over him. Thus, in the vein of judicial estoppel, Wells Fargo argues that Jeffrey Pennington cannot shield himself from suit by claiming that the court lacks personal jurisdiction, while at the same time continue to assert claims against Wells Fargo.[1] Wells Fargo also generally asserts that the Penningtons' counterclaims should be stricken because they are redundant. Finally, it argues that a ...


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