United States District Court, E.D. Pennsylvania
ARNOLD MACHLES, AS EXECUTOR OF THE ESTATE OF CHARLES H. KOONS, Plaintiff,
MCCABE, WEISBERG & CONWAY, P.C., d/b/a MCCABE, WEISBERG & CONWAY, LLC, AND CIT BANK, N.A., d/b/a FINANCIAL FREEDOM, Defendants.
case arises out of a foreclosure action involving a reverse
mortgage on a property in Clifton Heights, Pennsylvania
(“the Property”) that became due on the death of
the borrower. Plaintiff, who is the executor of the
borrower's estate, claims that the Defendants, the bank
that purports to hold the note and mortgage as well as the
law firm hired by the bank to pursue the foreclosure action
in state court, made false or misleading misrepresentations
and used unfair practices. Both Defendants have filed a
motion to dismiss. For the reasons outlined herein, CIT Bank
N.A.'s (“CIT”) motion will be granted in its
entirety, and McCabe, Weisberg & Conway, P.C.'s
motion will be denied.
FACTUAL AND PROCEDURAL BACKGROUND
November 30, 2015, Financial Freedom, a division of CIT, sent
Plaintiff a notice of intent to foreclose on the Property.
The notice refers to a mortgage on the Property “held
by CIT Bank, N.A. and serviced by Financial Freedom”
and states that due to the death of the borrower, the
mortgage was in in default in the amount of $161, 545.23. The
default, according to the notice, could not be cured
“however, foreclosure can be avoided by repaying the
loan balance or selling the property for at least 95% of the
appraised value.” The notice represented that the
property had an appraised value of $170, 000.
to Plaintiff, CIT was not the successor in interest to the
note and was, thus, not entitled to foreclose on it.
Furthermore, the appraised value of the Property at the time
the notice was sent was $67, 000, not $170, 000.
misrepresentations, claims Plaintiff, were compounded in
filings made on behalf of CIT's attorneys - Defendant
McCabe, Weisberg & Conway, P.C. (“McCabe”) -
in the mortgage foreclosure action they filed in the court of
Common Pleas of Delaware County. Specifically, the pleadings
include statements that CIT was the assignee of the mortgage
and note - which Plaintiff contends it was not - as well as
an assertion that CIT had “complied with all notice
requirements as prescribed by 41 P.S. § 101, et
seq. (“Act 6”) . . .” which Plaintiff
says it had not. Plaintiff also contends that a denial that
CIT had violated the National Housing Act was also a
claims are that these representations - in the notice and in
the state court pleadings - were made in violation of the
Fair Debt Collection Practices Act (“FDCPA”), 15
U.S.C. §§ 1692e-1692f, the Pennsylvania Fair Credit
Extension Uniformity Act (“FCEUA”), 73 P.S.
§§ 2270.4(a)-(b), 2270.5, and the Pennsylvania
Unfair Trade Practices and Consumer Protection Law
(“UTPCPL”), 73 P.S. § 201-3.
move to dismiss Plaintiff's claims under Federal Rules of
Civil Procedure Rule 12(b)(6) for failure to state a claim.
“To survive a motion to dismiss, a complaint must
contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its
face.'” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). “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.” Id.
“Threadbare” recitations of the elements of a
claim supported only by “conclusory statements”
will not suffice. Id. at 683. Rather, a plaintiff
must allege some facts to raise the allegation above the
level of mere speculation. Great Western Mining &
Mineral Co. v. Fox Rothschild LLP, 615 F.3d 159, 176 (3d
Cir. 2010) (citing Twombly, 550 U.S. at 555).
analyzing a motion to dismiss legal conclusions are
disregarded, well-pleaded factual allegations are taken as
true, and a determination is made whether those facts state a
“plausible claim for relief.” Fowler v. UPMC
Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009).
Generally that determination is made upon a review of the
allegations contained in the complaint, exhibits attached
appropriately to the complaint and matters of public record.
Pension Benefit Guar. Corp. v. White Consol. Indus.,
Inc. 998 F.2d 1192, 1996 (3d Cir. 1993). Here, where
Defendants have attached to their motion to dismiss various
pleadings in the state court proceedings, those may properly
be considered as well. See S. Cross Overseas Agencies,
Inc. v. Wah Kwong Shipping Ground Ltd., 181 F.3d 410,
426 (3d Cir. 1999). Furthermore, a court may grant a motion to
dismiss under Rule 12(b)(6) if there is a dispositive issue
of law. Neitzke v. Williams, 490 U.S. 319, 326-27
alleges that the Defendants made false or misleading
representations “in connection with the collection of
[a] debt.” 15 U.S.C. § 1692e. More specifically,
he contends that the Defendants violated multiple provisions
of the FDCPA regarding the prohibition from “falsely
represent[ing] the character and/or legal status of a debt, .
. . represent[ing] and/or impl[ying] that nonpayment of a
debt would result in the seizure, garnishment, attachment, or
sale of property, when such action was unlawful, . . . [or]
us[ing] a false representation or deceptive means to attempt
to collect a debt.” 15 U.S.C. §§ 1692e(2),
1692e(4), 1692e(10). Given that the FDCPA is designed
“to eliminate abusive debt collection practices by debt
collectors, ” its language is construed broadly to give
full effect to those purposes. See 15 U.S.C. §
1692(e); Caprio v. Healthcare Revenue Recovery Grp.,
LLC, 709 F.3d 142, 148 (3d Cir. 2013); Piper v.
Portnoff Law Assocs., Ltd., 396 F.3d 227, 232 (3d Cir.
state a FDCPA claim, a plaintiff must allege that: (1) he is
a consumer; (2) the defendant is a debt collector; (3) the
challenged practice involves an attempt to collect a
“debt” as the FDCPA defines it; and (4) the
defendant has violated a provision of the FDCPA in attempting
to collect a debt. Douglass v. Convergent
Outsourcing, 765 F.3d 299, 303 (3d Cir. 2014).
case, Defendants do not challenge Plaintiff's status as a
consumer or that the notice and the lawsuit were attempts to
collect a debt. Neither does McCabe contest that it is a
“debt collector” within the meaning of the FDCPA.
However CIT does seek to refute that label and both CIT and
McCabe argue that neither of them has violated a provision of
Any Alleged Misrepresentations Made Before March 7, 2016 are