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Omotosho v. Freeman Investment & Loan

United States District Court, D. Connecticut

March 9, 2016


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          Joel Omotosho, Plaintiff, Pro se, Bridgeport, CT.

         For Mortgage Electronic Registration Systems, Inc., (MERS), CitiMortgage, Inc, and its Agents, Defendants: Donald E. Frechette, Tara Lynn Trifon, Locke Lord LLP - CT, Hartford, CT.

         For Hunt Leibert Jacobson, P.C., Defendant: Geoffrey K. Milne, Hunt Leibert Chester & Jacobson, Hartford, CT.

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         Alvin W. Thompson, United States District Judge.

         The pro se plaintiff brings this action seeking damages and seeking to void, vacate, and set aside a foreclosure judgment rendered in Connecticut Superior Court and to be granted free and clear title to the property that was the subject of the foreclosure proceeding.

         Defendants CitiMortgage, Inc. (" CitiMortgage" ), Mortgage Electronic Registration Systems, Inc. (" MERS" ), and Hunt Leibert Jacobson, P.C. (" Hunt Leibert" ) have moved to dismiss the complaint in its entirety pursuant to Fed.R.Civ.P. Rules 12(b)(1) and 12(b)(6), and the plaintiff has moved for leave to amend the complaint. The motions to dismiss are being granted, and the motion for leave to amend the complaint is being denied.[1]


         On August 14, 2007 the plaintiff executed an Open-End Mortgage in favor of

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Intercontinental. MERS was named as nominee for Intercontinental, and its successors and assigns. On February 19, 2010 MERS assigned the mortgage to CitiMortgage.

         On February 9, 2010, CitiMortgage initiated foreclosure proceedings. Hunt Leibert represented CitiMortgage. On November 24, 2014, the Connecticut Superior Court entered a final judgment of foreclosure. On January 20, 2015, the Connecticut Superior Court denied the plaintiff's motion to open the judgment. The plaintiff's law day ran on April 21, 2015.

         During the course of the foreclosure proceedings, on April 22, 2014, the plaintiff declared bankruptcy under Chapter 13 of the Bankruptcy Code. See In re Omotosho, 14-bk-50590, Doc. No. 1 (Bank. D. Conn). His Schedule B listing of personal property did not contain any reference to the claims pled in the instant lawsuit. On August 21, 2014, the plaintiff's bankruptcy case was converted to a Chapter 7 " no asset" case. On January 22, 2015, the plaintiff was granted a discharge under section 727 of the Bankruptcy Code, 11 U.S.C. § 727.

         The plaintiff filed the this action on April 28, 2015. In Count I, the plaintiff alleges that the defendants, acting " under Color of Law[,]" deprived him of his " Bundle of Rights" for his property by " unjustly" foreclosing on his house. (Verified Complaint (" Complaint" ) at ¶ ¶ 53, 54.) In Count II, the plaintiff alleges that the defendants " conspired to intercept, co-opt or invalidate the integrity and solvency of Plaintiff's Mortgage (Title) and Promissory Note at the inception of the purchasing agreement through fraudulent conversion of said security instruments without lawful justification." (Id. at ¶ 55.) He alleges that Freemont " unconscionably bifurcated Plaintiff's Mortgage from the Promissory Note by assigning MERS as 'nominee' to be the Mortgage of his Security Agreement with [Freemont]," (Id. at ¶ 10), and that Freemont, " and its Agents and Assignees intended to securitize his security instruments on Wall Street in Mortgage Backed Securities schemes to profit off his debt obligations." (Id. at ¶ 33.) Thus, he alleges, the assignment of the Mortgage was " unconscionable" and a " conspiratorial act perpetrated by the Defendant(s) for the illicit purpose of unjustly enriching their investment interests at Plaintiff's expense." (Id. at ¶ 57.) In Count III, the plaintiff alleges that the defendants had a duty to " prevent the violation of Plaintiff's Rights" and that Hunt Leibert was " bound" to " prevent the injury or violation of Plaintiff's constitutionally protected Rights in the interest of justice and the implied covenant of Good Faith and Fair Dealing." (Id. at ¶ ¶ 60, 61.) In Count IV, the plaintiff alleges that Hunt Leibert " knew or should have reasonably known that the foreclosure action initiated by them against Plaintiff was a misuse or misapplication of process" and that the defendants " abused the foreclosure process . . . because they had an ulterior motive to benefit from a fraudulent financial obligation of which they never intended or expected Plaintiff to achieve." (Id. at ¶ ¶ 64, 65). In Count V, the plaintiff alleges that " failing to disclose the true nature of the Mortgage Loan Agreement, the separation of the Note from the Mortgage at its inception, and avoiding or omitting evidence from the Court in the foreclosure action, is in effect an obstruction of justice and denial of due process." (Id. at ¶ 66.) In Count VI, the plaintiff alleges that the defendants " conspired to deprive Plaintiff of constitutionally protected Rights under Color of Law through the initiation and implementation of a fraudulent foreclosure proceeding." (Id. at ¶ 71.) In Count VII, the plaintiff alleges that " [Freemont] and MERS committed fraud in the factum in the Mortgage Agreement and purchase transaction of the Mortgage Agreement

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respectively" and that they " did not disclose or get consent from Plaintiff in the securitization of his Note and Mortgage." (Id. at ¶ ¶ 73, 75.) The plaintiff also alleges that Intercontinental and Hunt Leibert " committed fraud by initiating the foreclosure action." (Id. at ¶ 77.) In Count VIII, the plaintiff alleges that Intercontinental and Hunt Leibert also perpetrated fraud upon the court by initiating the alleged " fraudulent foreclosure action." (Id. at ¶ 78.) Finally, in Count IX, the plaintiff alleges that Intercontinental and Hunt Leibert committed mail fraud by " using the mail to instigate their intention to defraud Plaintiff out of his property interests under Color of Law." (Id. at ¶ 83.)


         " [T]he standards for reviewing dismissals granted under 12(b)(1) and 12(b)(6) are identical." Moore v. PaineWebber Inc., 189 F.3d 165, 169 n.3 (2d Cir. 1999). When deciding a motion to dismiss under Fed.R.Civ.P. Rule 12(b)(6), the court must accept as true all factual allegations in the complaint and must draw inferences in a light most favorable to the plaintiff. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974). Although a complaint " does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986)(on a motion to dismiss, courts " are not bound to accept as true a legal conclusion couched as a factual allegation" )). " Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement. Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009)(quoting Twombly, 550 U.S. at 557). " Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all allegations in the complaint are true (even if doubtful in fact)." Id. (citations omitted). However, the plaintiff must plead " only enough facts to state a claim to relief that is plausible on its face." Id. at 1974. " The function of a motion to dismiss is 'merely to assess the legal feasibility of the complaint, not to assay the weight of the evidence which might be offered in support thereof.'" Mytych v. May Dep't Stores Co., 34 F.Supp.2d 130, 131 (D. Conn. 1999) (quoting Ryder Energy Distribution v. Merrill Lynch Commodities, Inc., 748 F.2d 774, 779 (2d Cir. 1984)). " The issue on a motion to dismiss is not whether the plaintiff will prevail, but whether the plaintiff is entitled to offer evidence to support his claims." United States v. Yale New Haven Hosp., 727 F.Supp. 784, 786 (D. Conn. 1990) (citing Scheuer, 416 U.S. at 232).

         When considering a motion to dismiss, the district court may only consider " the facts alleged in the pleadings, documents attached as exhibits or incorporated by reference in the pleadings and matters of which judicial notice may be taken." Samuels v. Air Transport Local 504, 992 F.2d 12, 15 (2d Cir. 1993). The court may take judicial notice of public records. Taylor v. Vermont Dept. of Educ., 313 F.3d 768, 776 (2d Cir. 2002). " [D]ocket sheets are public records of which the court [may] take judicial notice." Mangiafico v. Blumenthal, 471 F.3d 391, 398 (2d Cir. 2006).


         A. Jurisdictional Issues

         1. Claims Owned by Bankruptcy Estate

         Defendants CitiMortgage and MERS argue that Counts II, IV, V, VII,

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and VIII are owned by the plaintiff's bankruptcy estate and, therefore, the plaintiff lacks standing to bring them.[2] Commencement of a bankruptcy proceeding creates an estate comprised of " all legal or equitable interests of the debtor in property as of the commencement of the case." 11 U.S.C. § 541(a)(1). The debtor must file a schedule of assets and liabilities with the Bankruptcy Court. See 11 U.S.C. § 521(a)(1)(B)(i). The debtor's equitable interests " include causes of action possessed by the debtor at the time of filing." In re Jackson, 593 F.3d 171, 176 (2d Cir. 2010). " [B]ecause an unscheduled claim remains the property of the bankruptcy estate, the debtor lacks standing to pursue the claim after emerging from bankruptcy." Rosenshein v. Kleban, 918 F.Supp. 98, 103 (S.D.N.Y. 1996).

In order to determine whether a debtor had a property interest in a cause of action at the time he filed for bankruptcy, we look to state law. In Connecticut, a cause of action accrues when a plaintiff suffers actionable harm. The fact that this accrual date may be different than the date on which the statute of limitations begins to run is irrelevant.

Calabrese v. McHugh, 170 F.Supp.2d 243, 257 (D. Conn. 2001) (citations omitted).

         The defendants argue that the claims in Counts II, IV, V, VII, and VIII accrued prior to the bankruptcy filing and were not scheduled and, they are, therefore, assets of the plaintiff's bankruptcy estate and may not be asserted by the plaintiff. The plaintiff filed for bankruptcy on April 22, 2014. Thus, all unscheduled claims in the Complaint that accrued prior to April 22, 2014 are part of the bankruptcy estate and may not be asserted by the plaintiff. The court concludes that Counts II, IV, and VII are owned by the bankruptcy estate, so the plaintiff lacks standing to bring these claims.

         Coun ...

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