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Baylon v. Wells Fargo Bank, N.A.

United States District Court, D. New Mexico

March 29, 2018




         THIS MATTER comes before the Court on McCarthy & Holthus's Motion to Dismiss Plaintiffs' Claims Pursuant to Federal Rule of Civil Procedure 12(b)(6) and the Applicable Statutes of Limitation [Doc. 7], Wells Fargo Bank, N.A.'s Motion to Dismiss [Doc. 8], and Motion to Strike Plaintiffs' Notice of Supplemental Authorities [Doc. 25]. The Court, having considered the motions, briefs, and relevant law, and being otherwise fully informed, finds that the motions are not well-taken and will be denied.


         On or about May 30, 2007, Plaintiff Cruz Baylon signed a promissory note (the “Note”) with a principal amount of $132, 300, due to Accredited Home Lenders, Inc., for a home located at 202 Yucca Drive NW, Albuquerque, New Mexico. See Baylon v. Wells Fargo Bank, N.A., et al., U.S.D.C., No. 12-cv-52 (KG/KK) (“2012 Action”), Doc. 120, Ex. A. On the same day, Cruz and Maria Carmen Baylon secured the Note by executing a mortgage encumbering the home. Id., Doc. 120, Ex. B. The Note and mortgage were later assigned to Wells Fargo on September 10, 2007. Id., Doc. 120, Ex. G. Beginning in May 2009, Plaintiffs stopped making payments on their mortgage. Id., Doc. 120, Ex. C. On January 25, 2010, Plaintiffs received a Chapter 7 bankruptcy discharge. Id., Doc. 120, Ex. D.

         On August 24, 2011, Wells Fargo, through its foreclosure counsel McCarthy & Holthus, LLP (“McCarthy”), filed a foreclosure complaint against Plaintiffs in New Mexico state court. Id., Doc. 120, Ex. E. On March 22, 2012, Plaintiffs and Wells Fargo agreed to a stipulated judgment as to the foreclosure complaint, which was entered on April 3, 2012. Id., Doc. 120, Ex. C.

         On January 18, 2012, Plaintiffs commenced an action against Wells Fargo and McCarthy in this Court (“2012 Action”), alleging violations of the Federal Debt Collection Practices Act (“FDCPA”) and the New Mexico Unfair Practices Act (“UPA”), and claims for tortious debt collection. Id., Doc. 1. On October 30, 2015, the Court entered a Memorandum Opinion and Order and a Final Judgment. Id., Docs. 259, 260. The Court dismissed with prejudice Plaintiffs' FDCPA claim and, declining to exercise supplemental jurisdiction, dismissed Plaintiffs' state law claims without prejudice. Id.

         On November 8, 2016, Plaintiffs commenced the instant action against Wells Fargo and McCarthy in the Second Judicial District Court of New Mexico, County of Bernalillo. Doc. 1-1. On December 19, 2016, Wells Fargo removed the action to this Court on the basis of diversity jurisdiction. Doc. 1. In the Complaint, Plaintiffs allege, as they did in the 2012 Action, that Wells Fargo and McCarthy violated the UPA and engaged in tortious debt collection. Doc. 1-1. Plaintiffs' allegations that Defendants attempted to collect on their debt, despite the fact that Plaintiffs' debt was previously discharged in bankruptcy, form the basis of their claims for relief. Id. Specifically, Plaintiffs allege that Wells Fargo placed illegal collection calls to them between September 2010 and May 2011, and engaged in other illegal collection activity through August 2011, culminating in the commencement of the foreclosure action on August 24, 2011. Id. Plaintiffs further allege that McCarthy misrepresented the character of Plaintiffs' mortgage debt in a reinstatement letter sent on May 14, 2011, and in the foreclosure complaint filed on August 24, 2011. Id.

         Wells Fargo and McCarthy each filed a motion to dismiss this action for failure to state a claim upon which relief can be granted, similarly arguing that the applicable statutes of limitations bar Plaintiffs' suit. Plaintiff filed a response in opposition to each motion. Thereafter, Plaintiff filed a Notice of Supplemental Authorities, which McCarthy has moved to strike.


         Under Rule 12(b)(6), a Court may dismiss a complaint for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). “Although the statute of limitations is an affirmative defense, it may be resolved on a Rule 12(b)(6) motion to dismiss when the dates given in the complaint make clear that the right sued upon has been extinguished.” Cosgrove v. Kan. Dep't of Soc. & Rehab. Servs., 332 F. App'x 463 (10th Cir. 2009) (citation omitted).

         “The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations within the four corners of the complaint.” Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir. 1994). When considering a Rule 12(b)(6) motion, the Court must accept as true all well-pleaded factual allegations in the complaint, view those allegations in the light most favorable to the non-moving party, and draw all reasonable inferences in the plaintiff's favor. Smith v. United States, 561 F.3d 1090, 1097 (10th Cir. 2009), cert. denied, 130 S.Ct. 1142 (2010).

         “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) (citations omitted). “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. “Where a complaint pleads facts that are ‘merely consistent with' a defendant's liability, it ‘stops short of the line between possibility and plausibility of entitlement to relief.'” Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007)).

         The Court in Iqbal identified “two working principles” in the context of a motion to dismiss. Id. First, “the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. Accordingly, Rule 8 “does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.” Id. at 678-79. “Second, only a complaint that states a plausible claim for relief survives a motion to dismiss.” Id. at 679; see Twombly, 550 U.S. at 570 (holding that a plaintiff must “nudge” her claims “across the line from conceivable to plausible”). Accordingly, “where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not shown - that the pleader is entitled to relief.” Id. (citation omitted).

In keeping with these two principles, the Court explained, a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. When there are well-pleaded factual allegations, a court should assume their veracity and ...

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