Opinion
Civil Action No. 04-0946, Section "T" (1).
July 20, 2004
Before this Court is a Motion to Dismiss filed by the Defendants, Lawrence Genin and American Title Agency, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. The Court, having studied the legal memoranda and exhibits submitted by the parties, the record, and the applicable law, is fully advised on the premises and ready to rule.
ORDER AND REASONS
I. BACKGROUNDThe Plaintiff, Connie Norris, is attempting to accuse many individuals and companies of wrongs against her arising out of the sale of property she owns. Lawrence Genin and American Title Agency are named as a defendants in the "Parties" section of the complaint.
Norris owned a piece of property at 3321 Bacchus Street, in New Orleans. Dryades filed two suits against her, based on a loan obligation and an overdraft, in the First City Court for the City of New Orleans and obtained two judgments by default against her. The two judgments, both dated January 13, 2000 were in the amounts of $16,463.87 and $453.39 and they were both recorded in the mortgage record of the Parish of Orleans on January 31, 2000.
Norris then moved to Memphis, TN where she filed for relief under Chapter 7 of Title 11, U.S.C. in the United States Bankruptcy Court for the Western District of Tennessee on August 1, 2002. Dryades was listed in the debtor's schedules and received notice of the bankruptcy. This was a no-asset case, the debtor's trustee filed a no asset report, the debtor received her discharge and the case was closed.
On April 16, 2003 Norris, domiciled in TN, sold her New Orleans property to Edward Eulice Turner and Diana Taylor-Turner for $61,500.00. The act of sale passed before Mr. Genin as notary, was recorded in the conveyance records of Orleans Parish on April 23, 2003, at CIN 25163.
Before the sale was consummated, Dryades' attorney, Robert Wakefield, was contacted by Lawrence Genin. He said that he was preparing the plaintiffs property for sale and inquired about the status of the recorded Dryades judgments and one other judgment for which Mr. Wakefield was the counsel of record. Negotiations began and were taken over by Joseph E. Fick, Jr. It was agreed that Dryades and the other judgment creditor would grant partial release of their judgments in exchange for Dryades receiving payment in the amount of $4,800.00. This was paid by Mr. Genin and Dryades and the other judgment creditor granted a partial release of the judgments, insofar as they affect the property.
Norris believes that her bankruptcy discharge should have prevented Dryades from receiving any money out of the sale of her property. Norris claims that Genin acted without her authority to enter into negotiations with Dryades and struck a deal which required her to make payments to Dryades that were unauthorized and which she should not have to make, because of her bankruptcy discharge.
In the present case, the Defendants, Lawrence Genin and American Title Agency move to dismiss Norris' claims that the Defendants violated the following laws: (1) 15 U.S.C. § 45(a), 45(m)(1)(A), and 53(b); (2) 15 U.S.C. § 1692 and 15 U.S.C. § 1681; (3) 12 U.S.C. § 2605 and 24 C.F.R. § 3500.21 and La R.S. 9:5166; (5) 42 U.S.C.A. § 1983; and (6) 42 U.S.C.A. § 1985. Because Norris did not specify which allegations are against which of the named Defendants, all allegations are addressed. Genin and American Title Agency base their motion to dismiss on the grounds that Norris does not state a claim against them because personal discharge of judgments in personal bankruptcy does not affect the real estate which is at the center of this controversy. Also, Mr. Genin, as the closing attorney, must honor the judgments against the property in order to establish a clear title. Furthermore, Defendants claim that Norris' complaint is insufficient because it fails to provide factual allegations supporting a finding of the proposed violations.
II. LAW AND ANALYSIS
A. Law on Motions to Dismiss:
A motion to dismiss for failure to state a claim upon which relief can be granted under FRCP 12(b)(6) "is viewed with disfavor and is rarely granted." Lowery v. Texas AM University System, 117 F.3d 242, 247 (5th Cir. 1997); Kaiser Aluminum Chem. Sales v. Avondale Shipyards, 677 F.2d 1045, 1050 (5th Cir. 1982). The complaint must be liberally construed in favor of the plaintiff, and all facts pleaded in the original complaint must be taken as true. Campbell v. Wells Fargo Bank, 781 F.2d 440, 442 (5th Cir. 1980). A district court may not dismiss a complaint under FRCP 12(b)(6) "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957); Blackburn v. Marshall, 42 F.3d 925, 931 (5th Cir. 1995). The Fifth Circuit defines this strict standard as, "whether in the light most favorable to the plaintiff and with every doubt resolved in his behalf, the complaint states any valid claim for relief." Lowrey, 117 F.3d at 247 (citing 5 Charles A. Wright Arthur R. Miller, FEDERAL PRACTICE AND PROCEDURE § 1357, at S601 (1969)).
B. Analysis of the Court
1. Federal Trade Commission Act; Fair Debt Collection Act; Fair Credit Reporting Act
Plaintiff alleges several violations of the Federal Trade Commission Act, specifically 15 U.S.C. § 45(a), 45(m)(1)(A) and 53(b). Section 45(a) prohibits unfair and deceptive acts or practices in or affecting commerce. 15 U.S.C. § 45(a) (2000). Plaintiff fails to provide any specific facts showing how Lawrence Genin or American Title Agency violated this law. Norris claims that in November 2002 Genin commenced to negotiate on her behalf without consent and that she had to make unauthorized payments to American Title Agency. These facts, as stated in her pleading, fail to claim that either Genin or American Title Agency acted in an unfair or deceptive manner in or affecting commerce.
Plaintiff does not have a claim against Genin or American Title Agency under 15 U.S.C. § 45(m)(1)(A) because it empowers the Federal Trade Commission to commence an action for knowing violations of rules and cease and desist orders respecting unfair or deceptive acts or practices. 15 U.S.C. § 45(m)(1)(A) (2000). This law does not give private citizens the right to assert these claims, therefore Norris does not have a claim under 15 U.S.C. § 45(m)(1)(A).
Furthermore, Norris does not have a claim under 15 U.S.C. § 53(b) which permit the issuance of a preliminary injunction against any person or entity in violation of any of the provisions of the Federal Trade Commission Act. 15 U.S.C. § 53(b) (2000). She is not seeking an injunction. She is seeking relief for an action that has already occurred, therefore this section is inapplicable to her suit.
Next Plaintiff alleges violations of the Fair Debt Collection Act and the Fair Credit Reporting Act under 15 U.S.C. § 1692 and 1681, respectively. Section 1692 pertains to debt collectors. 15 U.S.C. § 1692 (2000). Genin was the closing attorney on the real estate transaction that gave rise to this suit and American Title Agency is a title company. Neither of these Defendants is a debt collection agency, therefore 15 U.S.C. § 1692 is inapplicable to them. Furthermore, 15 U.S.C. § 1681 applies to consumer credit reporting agencies. 15 U.S.C. § 1681 (2000). Consumer credit reporting agencies are persons or entities who regularly engage in the practice of assembling or evaluating consumer credit information for the purpose of furnishing the consumer's credit report to a third person. 15 U.S.C.A. § 1681(a)(f) (West 2004). An attorney and a title agency clearly do not fit this description and Norris does not allege that they do anywhere in her complaint, therefore she does not have a claim under 15 U.S.C. § 1681.
2. Real Estate Settlement Procedures Act; Department of Housing and Urban Development Regulations
Plaintiff alleges violations of the Real Estate Settlement Procedures Act under 12 U.S.C.A. § 2605 and the Department of Housing and Urban Development Regulations under 24 C.F.R. § 3500.21.
The Real Estate Settlement Procedures Act is intended to protect the buyer in real estate transactions. The seller is not the intended beneficiary of the act. 12 U.S.C.A. § 2605. Furthermore 24 C.F.R. § 3500.21 concerns mortgage servicing transfers and pertains only to buyers and lenders. 24 C.F.R. § 3500.21 (2004). Norris is the seller in the real estate transaction involved in this suit. Thus neither 12 U.S.C.A. § 2605 nor 24 C.F.R. § 3500.21 provides her with a claim against Genin or American Title Agency under 12 U.S.C.A. § 2605.
3. Bankruptcy Code Title 11; La.R.S. 9:5166
Next Plaintiff asserts that this is an action under Section 541(5) of the Bankruptcy Code. This section defines the property of an estate to include property that would have been property of the estate if such interest had been an interest of the debtor on the date of the filing of the bankruptcy proceeding. 11 U.S.C.A. § 541(a)(5) (West 1984). A discharge in bankruptcy does not affect any mortgages against the debtor's real estate. Tucker v. Louisiana Dept. Of Revenue Taxation, 96-2740, (La.App. 1 Cir. 2/20/98), 708 So.2d 782. Also, La.R.S. 9:5166 provides that a canceled judgment only relieves the debtor of personal liability.Losavio v. Gauthir, 412 So.2d 1306 (La. 1982).
Norris's discharge in personal bankruptcy does not affect the mortgage on her property. This claim is not applicable to Genin or American Title because a motion filed under La.R.S. § 9:5166 must be brought against the debtor's judgment-creditor, not the closing attorney or title agency. La. Stat. Ann. § 9:5166 (2004).
4. 42 U.S.C.A. § 1983 and 42 U.S.C.A. § 1985
Norris's final allegations are violations of 42 U.S.C.A. § 1983 and 42 U.S.C.A. § 1985. Section 1983 provides a cause of action against any person who, "under the color of" any statute, ordinance or regulation subjects or causes another person a deprivation of rights, privileges or immunities secured by the Constitution and laws. 42 U.S.C.A. § 1983 (West 2004). In order to state a claim under Section 1983 against a private defendant, the plaintiff must allege that the individual conspired with a state actor to violate the plaintiff's constitutional rights.Brummett v. Camble, 946 F.2d 1178, 1185 (5th Cir. 1991). Norris fails to allege any facts supporting a finding that Genin or American Title Agency conspired with any state actors to violate her rights. She only claims that Genin engaged in non-consensual negotiations with Dryades on her behalf. This is not a conspiracy with a state actor, therefore she does not have a claim against them under 42 U.S.C.A. § 1983.
Section 1985 concerns conspiracies to interfere with a person's civil rights. This statute applies when an officer is prevented from performing duties, justice is obstructed in court or there is a conspiracy to deprive a person of rights and privileges. 42 U.S.C.A. § 1985 (2004). Norris does not supply facts which would support a finding that Genin or American Title Agency violated this statute, therefore she does not have a cause of action against these defendants under 42 U.S.C.A. § 1985.
III. Conclusion
For the reasons set forth above, the Court finds that Norris has failed to state a valid claim for relief against the Defendants, Lawrence Genin and American Title Agency.
IT IS ORDERED that Defendants' Motion to Dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure be, and the same hereby is, GRANTED.