Suarez v. U.S. Bank, N.A., as Trustee

Western District of Texas, txwd-5:2019-cv-01339

Motion to Dismiss for Failure to State a Claim and Motion for Sanctions by U.S. Bank, N.A., as Trustee.

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0 IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION FELIX ROBERT SUAREZ, § § Plaintiff, § § v. § CIVIL ACTION NO. 5:19-cv-01339-XR § U.S. BANK, N.A., AS TRUSTEE § § Defendant. § DEFENDANT'S MOTION TO DISMISS AND MOTION FOR SANCTIONS TO THE HONORABLE JUDGE OF SAID COURT: Pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendant U.S. Bank National Association, as Trustee for ACE Securities Corp. Home Equity Loan Trust, Series 2001-AQ1, Asset-Backed Pass-Through Certificates,1 ("U.S. Bank" or "Defendant") files this Motion to Dismiss and requests that the Court dismiss Plaintiff's Original Petition, Application for Temporary Restraining Order, Temporary injunction, Permanent Injunction, and Request for Disclosures (the "Complaint") with prejudice. In support of its Motion, U.S. Bank respectfully shows the Court the following: I. INTRODUCTION Plaintiff Felix Robert Suarez ("Plaintiff") filed this lawsuit, his third since 2016,2 to prevent the foreclosure sale of real property located at 1246 Clower, San Antonio, Texas 78201 (the "Property"). See Compl. at ¶ 35. In the current lawsuit, Plaintiff alleges that U.S. Bank failed to communicate loss mitigation options to him and failed to properly review his loss mitigation 1 U.S. Bank was erroneously named as "U.S. Bank, N.A., as Trustee" herein by Plaintiff. 2 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of each of the following prior lawsuits filed by Plaintiff: Case No. 5:2016-CV-00040 and Case No. 5:2017-CV-00085. 1 0 application while proceeding with foreclosure. Id. ¶¶ 13, 16 – 17. Additionally, Plaintiff alleges that U.S. Bank failed to provide a notice of default allowing Plaintiff at least 20 days to cure and notice of the foreclosure sale. Id. ¶¶ 20 – 24. Finally, Plaintiff claims that U.S. Bank did not properly manage his Loan and escrow account. Id. ¶ 13. Plaintiff asserts claims for negligence, violation of the Texas Property Code, and breach of contract. See generally id. Based on these allegations, Plaintiff seeks temporary and permanent injunctive relief, actual damages and attorney's fees and costs. Id. Notably, Plaintiff's Complaint is devoid of specific factual allegations, instead asserting general, conclusory allegations and requesting relief based on insufficient facts and claims. For this reason, and for those further set forth below, Plaintiff's Complaint fails to state a claim. Because Plaintiff has failed to demonstrate "more than a sheer possibility that a defendant has acted unlawfully," this Court should be dismiss this lawsuit with prejudice. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). II. BACKGROUND Plaintiff asserts that on or about August 25, 2000, Plaintiff obtained a mortgage loan (the "Loan") in the original principal amount of $52,500 for the purchase of and secured by the Property. Compl. ¶ 9. Plaintiff does not deny that he is in default under the terms of the Loan. See generally id. The Property was scheduled for the November 5, 2019, foreclosure sale. Id. ¶ 7. Plaintiff filed suit in 407th District Court of Bexar County and obtained a temporary restraining order enjoining the sale. See Doc. 1-3. Defendant removed the case to this Court. This is Plaintiff's third lawsuit to preclude foreclosure of the Property since 2016. In his first suit, filed January 4, 2016 (the "First Lawsuit"), Plaintiff named Ocwen Loan Servicing, LLC, ("Ocwen"), the mortgage servicer for U.S. Bank, as a defendant (among others), and asserted claims for violation of the Texas Property Code Section 51.002 and promissory estoppel, asserting 2 0 nearly identical factual allegations as in the instant suit regarding notice and loss mitigation. See Ex. A.3 This Court dismissed all of Plaintiff's claims on March 11, 2016, based on Ocwen's motion to dismiss pursuant Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. See Exs. B, C.4 Plaintiff's second suit was filed less than a year later on December 30, 2016. See Ex. D.5 Plaintiff again named Ocwen as the defendant (among others) and asserted a violation of Texas Property Code Section 51.002, along with a breach of contract claim, and alleged identical facts as the First Lawsuit, and substantially similar claims as those in the current suit regarding notice and loss mitigation. See id. This Court granted Ocwen's motion for summary judgment, and dismissed all of Plaintiff's claims with prejudice on September 29, 2017. See Exs. E, F.6 Now, two years later, Plaintiff yet again brings virtually the same set of facts and causes of action in the instant suit. See generally Compl. This time, Plaintiff also claims that regulations of the Housing and Urban Development ("HUD") and the Real Estate Procedures Settlement Act ("RESPA") are incorporated into the contract and that by breaching these regulations Defendant breached the contract, in addition to his reiterated claims relating to notice and loss mitigation. Plaintiff's claims failed in each of his prior suits, and they fare no better in this iteration. Because Plaintiff fails to state a claim, the Court should dismiss this lawsuit with prejudice. 3 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of the Notice of Removal filed in Case No. 5:16-CV-00040-DAE in the Western District of Texas, San Antonio Division, a true and correct copy of which is attached hereto as Exhibit A. 4 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of the Order Granting Motion to Dismiss and Judgment in a Civil Action signed and entered in Case No. 5:16-CV-00040-DAE in the Western District of Texas, San Antonio Division, a true and correct copy of each is attached hereto as Exhibits B and C, respectively. 5 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of the Notice of Removal filed in Case No. 5:17-CV-00085-FB in the Western District of Texas, San Antonio Division, a true and correct copy of which is attached hereto as Exhibit D. 6 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of the Order Granting Motion for Summary Judgment and Judgment signed and entered in Case No. 5:17-CV-00085-FB in the Western District of Texas, San Antonio Division, a true and correct copy of each is attached hereto as Exhibits E and F, respectively. 3 0 III. ARGUMENT AND AUTHORITIES To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead "enough facts to state a claim to relief that is plausible on its face." In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007). "Factual allegations must. . . raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). While the allegations need not be overly detailed, a plaintiff's pleadings must still provide the grounds of his entitlement to relief, which "requires more than labels and conclusions," and "a formulaic recitation of the elements of a cause of action will not do." Id.; see also Iqbal, 556 U.S. at 678 ("'naked assertions' devoid of 'further factual enhancement,'" along with "legal conclusions" and "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements," are not entitled to the presumption of truth). "[C]onclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss." Blackburn v. City of Marshall, 42 F.3d 925, 931 (5th Cir. 1995). Demonstrating the facial plausibility of a claim requires a plaintiff to establish "more than a sheer possibility that a defendant has acted unlawfully." Iqbal, 556 U.S. at 678. It is not enough that a plaintiff allege the mere possibility of misconduct; it is incumbent to "show that the [plaintiff] is entitled to relief." FED. R. CIV. P. 8(a)(2); Iqbal, 556 U.S. at 679. The court may dismiss a complaint under Rule 12(b)(6) if either the complaint fails to assert a cognizable legal theory or the facts asserted are insufficient to support relief under a cognizable legal theory. Stewart Glass & Mirror, Inc. v. U.S.A. Glass, Inc., 940 F. Supp. 1026, 1030 (E.D. Tex. 1996). A. Res Judicata Bars all of Plaintiff's claims. "[R]es judicata is the venerable legal canon that insures the finality of judgments and thereby conserves judicial resources and protects litigants from multiple lawsuits." Palmer v. 4 0 Federal Home Loan Mortg. Corp., No. 4:13–CV–430–A, 2013 WL 2367794, at * 2 (N.D. Tex. May 30, 2013) (quoting Procter & Gamble Co. v. Amway Corp., 376 F.3d 496, 499 (5th Cir. 2004)). "The doctrine precludes the relitigation of claims which have been fully adjudicated or arise from the same subject matter, and that could have been litigated in the prior action." Id. (citing Nilsen v. City of Moss Point, 701 F.2d 556, 561 (5th Cir. 1983)). "Under res judicata, a prior judgment bars a subsequent judgment when (1) the parties are identical or in privity; (2) the judgment in the prior action was rendered by a court of competent jurisdiction; (3) the prior action was concluded by a final judgment on the merits; and (4) the same claim or cause of action was involved in both actions." Id. (citing Test Masters Educ. Servs., Inc. v. Singh, 428 F.3d 559, 571 (5th Cir. 2005)); see also Petro-Hunt LLC v. United States, 365 F.3d 385, 395 (5th Cir. 2004). 1. The Parties are Identical or in Privity. Plaintiff in the instant lawsuit is the plaintiff in both the First Lawsuit and Second Lawsuit. See Exs. A, D. Ocwen, the mortgage servicer for mortgagee U.S. Bank, is named as the defendant in First Lawsuit and Second Lawsuit. See id. Plaintiff admits in both suits however that U.S. Bank is the mortgagee for whom Ocwen is acting as mortgage servicer. See id. Thus, Ocwen and U.S. Bank are in privity. Privity exists: (1) where the non-party is the successor in interest to a party's interest in property; (2) where the non-party controlled the prior litigation; and (3) where the non- party's interests were adequately represented by a party to the original suit. Wicker v. Seterus, Inc., No. EP-15-CV-331-KC, 2016 WL 2622017, at *5 (W.D. Tex. May 5, 2016). Specifically, "privity exists between preceding and succeeding owners of property," and "assignees and servicing agents of a loan are in privity with an original mortgage company." See Ernest v. CitiMortgage, Inc., No. SA:13-CV-802-DAE, 2014 WL 294544, at *4 (W.D. Tex. Jan. 22, 2014). U.S. Bank as the mortgagee is in privity with Ocwen, its servicing agent. See Ernest, 2014 WL 294544, at *4. Thus, the first element of res judicata is satisfied. 5 0 2. The First Lawsuit and Second Lawsuit were Each Concluded by a Final Judgment on the Merits Rendered by a Court of Competent Jurisdiction. On March 11, 2016, the Court in the First Lawsuit, a court of competent jurisdiction, entered an Order granting U.S. Bank's motion to dismiss, thereby dismissing Plaintiff's claims in the First Lawsuit. See Exs. B, C. On September 29, 2017, the Court in the Second Lawsuit, a court of competent jurisdiction, entered an order granting U.S. Bank's motion for summary judgment, thereby dismissing Plaintiff's claims in the Second Lawsuit with prejudice. See Exs. E, F. Because the First Lawsuit and Second Lawsuit were each concluded by a final judgment on the merits rendered by a court of competent jurisdiction, the second and third elements of res judicata are satisfied. 3. The First Lawsuit, Second Lawsuit, and the Instant Lawsuit are Based on the Same Nucleus of Operative Facts. Under the Fifth Circuit's "transactional test," a "prior judgment's preclusive effect extends to all rights of the plaintiff with respect to all or any part of the transaction, or series of connected transactions, out of which the original action arose." Test Masters Educ. Servs., Inc. v. Singh, 428 F.3d 559, 571 (5th Cir. 2005). "The critical issue is whether the two actions are based on the same nucleus of operative facts." Id. To determine whether the same claims or causes of action are brought, the transactional test is applied, in which "all claims arising from a common nucleus of operative facts and could have been brought in the first lawsuit, are barred by res judicata." Id. (citing Procter & Gamble, 376 F.3d at 499). "It is black-letter law that res judicata, by contrast to narrower doctrines of issue preclusion, bars all claims that were or could have been advanced in support of the cause of action on the occasion of its former adjudication ... not merely those that were adjudicated." Id. (quoting Nilson, 701 F.2d at 560) (emphasis in original); see also Matter of Howe, 913 F.2d 1138, 1144 (5th Cir. 1990) ("[T]he critical issue is not the relief requested or the theory asserted but whether plaintiff bases the two actions on the same nucleus of operative 6 0 facts."); Petro–Hunt, 365 F.3d at 395–96 (prior judgment's preclusive effect extends to all rights of plaintiff "with respect to all or any part of the transaction, or series of transactions, out of which the [original] action arose"). In the First Lawsuit, Plaintiff sought injunctive relief to preclude the foreclosure sale of the Property based on claims relating to the servicing of the mortgage, particularly in regard to the foreclosure notice requirements and loss mitigation. See Ex. A. Plaintiff's complaint in the Second Lawsuit is an exact duplicate of his complaint in the First Lawsuit, again asserting claims relating to the foreclosure notices and loss mitigation deficiencies allegedly perpetuated by Ocwen as mortgage servicer for U.S. Bank. See Ex. D. Plaintiff's claims in the instant lawsuit arise from the same common nucleus of operative facts as those facts alleged in the First Lawsuit and Second Lawsuit. See Compl. Indeed, in the instant lawsuit, Plaintiff again seeks injunctive relief to preclude the foreclosure sale of the Property, along with damages and attorney's fees, based on his allegations that he did not receive foreclosure notices, and that U.S. Bank did not properly process his loss mitigation application. See Compl. ¶ 13. While Plaintiff also now claims the Loan and escrow accounts were not properly managed and that he did not receive notice of the transfer of the Loan, because of each of these arise from a common nucleus of operative facts and could have been brought in the First Lawsuit and/or the Second Lawsuit, and Plaintiff failed to do so, each of Plaintiff's claims are barred by res judicata.7 7 Collateral estoppel also bars Plaintiff's claims because it "precludes the relitigation of identical issues of facts or law that were actually litigated and essential to the judgment in a prior suit." Van Dyke v. Boswell, O'Toole, Davis & Pickering, 697 S.W.2d 381, 384 (Tex. 1985). Three elements are necessary to establish issue preclusion: (1) the issue of fact or law sought to be litigated in the second action was fully and fairly litigated in the prior action; (2) the issue of fact or law was essential to the judgment in the first action; and (3) the parties were cast as adversaries in the first action. Bonniwell v. Beech Aircraft Corp., 663 S.W.2d 816, 818 (Tex. 1984). All three of the collateral estoppel elements are satisfied based on the Prior Lawsuit. 7 0 B. Plaintiff's Negligence-Based Claims Fail Because there is no Duty, the Claims are Barred by the Economic Loss Rule, and any Alleged Misrepresentations were not made for the Purpose of Plaintiff's Business. Plaintiff generally asserts that Defendant was negligent in allegedly failing to comply with the notice provisions of the Deed of Trust and in reviewing and communicating with Plaintiff regarding loss mitigation. Compl. ¶¶ 13 – 19. However, Plaintiff's factual allegations relating to his negligence-based claims are devoid of any non-conclusory statements and are insufficient to support the claim. Additionally, the negligence-based claims further fail for the additional reasons set forth below. To establish a claim for negligence, a plaintiff must prove (1) the existence of a legal duty, (2) a breach of that duty, and (3) damages proximately caused by that breach. Kroger Co. v. Elwood, 197 S.W.3d 793, 794 (Tex. 2006). Here, Defendant does not owe a duty to Plaintiff in tort. Duty is the threshold inquiry in a negligence claim. Centeq Realty, Inc. v. Siegler, 899 S.W.2d 195, 197 (Tex. 1995); RT Realty, L.P. v. Tex. Utilities Elec. Co., 181 S.W.3d 905, 914 (Tex. App.—Dallas 2006, no pet.) ("The threshold inquiry regarding a gross negligence claim is whether a legal duty existed.). If there is no legal duty, liability for negligence cannot exist. See Thapar v. Zezulka, 994 S.W.2d 635, 637 (Tex. 1999) (dismissing negligence claim where the defendant did not owe the plaintiff a duty in tort). "In the mortgage context, there is no special relationship between a mortgagor and a mortgagee, or between a servicer and a borrower, that would impose an independent common law duty. . . ." Miller v. CitiMortgage, Inc., 970 F. Supp. 2d 568, 585 (N.D. Tex. 2013); see also Milton v. U.S. Bank Nat. Ass'n, 508 F. App'x 326, 329 (5th Cir. 2013) (negligence and gross negligence claims failed because "under Texas law, there is 'no special relationship between a mortgagor and mortgagee' that would give rise to a stand-alone duty"); Flowers v. Am. Nat'l Bank, N.A., No. 05- 95-00761-CV, 1996 WL 743761, at *4 (Tex. App.—Dallas 1996, no pet.) (stating that a debtor- 8 0 creditor relationship imposes no duties on the lender under a negligence cause of action). Plaintiff admits that he is the mortgagor and that U.S. Bank is the mortgagee. See Compl. ¶ 9. It is therefore clear that there is no special relationship and that U.S. Bank owes no duty in tort to Plaintiff. Further, Plaintiff's negligence-based claims also fail because they are barred by the economic loss rule. The economic loss rule precludes recovery in tort when the loss complained of is the subject matter of a contract between the parties. Sw. Bell Tele. Co. v. DeLanney, 809 S.W.2d 493, 494 (Tex. 1991); see also Daryani, 2012 WL 3527924, at *3-4 ("Here, any complaints by Plaintiffs about Defendant's misrepresentations, or their failure to provide information relating to the loan or alleged modification agreement, relate to the parties' contractual relationship, and cannot, as a matter of law, form the basis of a fraud claim."); Medistar, CIV.A. H-09-3828, 2010 WL 1996596, at *7 (recognizing the economic loss rule as a bar to fraud claims); Heil Co., 191 S.W.3d at 817 (holding that the economic loss rule barred fraud claim). The economic loss rule applies to claims for negligence that arise from a contract. See Essex Ins. Co. v. Blount, Inc., 72 F. Supp. 2d 722, 724. (E.D. Tex. 1999) (dismissing negligence claim under economic loss doctrine). Plaintiff has not alleged any facts supporting injury independent of the purported economic losses caused by the alleged failure to perform contractual obligations. Here, Plaintiff's negligence-based claims center on the alleged duties in the Deed of Trust, a contract. See Compl. ¶¶ 13 – 19. Thus, any complaints by Plaintiff about Defendant's allegedly negligent conduct thereunder cannot, as a matter of law, form the basis of a negligence claim. See Daryani, 2012 WL 3527924, at *3-4. Plaintiff has not asserted any facts sufficient to support any claim for damages, let alone any injury independent of the purported economic losses caused by the alleged failure to perform contractual obligations. See Clark v. Bank of Am., No. 3:12-CV- 1277-N-BK, 2012 WL 4793465, at *5 (N.D. Tex. Aug. 1, 2012); DeLanney, 809 S.W.2d at 494; Jim Walter Homes, Inc., 711 S.W.2d at 618; McCartney v. CitiFinancial Auto Credit, Inc., No. 9 0 4:10–CV–424, 2010 WL 5834802, at *5 (E.D. Tex. Dec. 14, 2010), rec. adopted, 2011 WL 675386 (E.D. Tex. Feb. 16, 2011). Each of Plaintiff's complaints about U.S. Bank's alleged misrepresentations relate to the parties' contractual relationship, and as such, cannot form the basis of a negligent misrepresentation claim. See Daryani, 2012 WL 3527924, at *3-4. Finally, to the extent that Plaintiff is asserting a negligent misrepresentation claim, under Texas law Plaintiff must prove that: (1) a representation made by the defendant in the course of its business or in a transaction in which it has a pecuniary interest; (2) the defendant supplies false information for the guidance of others in their business; (3) the defendant did not exercise reasonable care or competence in obtaining or communicating the information; (4) the plaintiff suffers pecuniary loss by justifiably relying on the representation. In re Absolute Res. Corp., 76 F. Supp. 2d 723, 732 (N.D. Tex. 1999). The negligent misrepresentation claim fails because the alleged misrepresentations related to the foreclosure notices, loss mitigation and/or account charges do not constitute a representation made for the guidance of Plaintiff in his business. A claim for negligent misrepresentation requires that the defendant supply false information for the guidance of others in their "business." Gen. Elec. Capital Corp. v. Posey, 415 F.3d 391, 395-96 (5th Cir. 2005); see also Douglas v. Wells Fargo Bank, N.A., 3:17-CV-02588-B, 2018 WL 2064388, at *3 (N.D. Tex. May 2, 2018); Hutton v. Nationstar Mortg. LLC, No. 3:16-CV-0266- B, 2018 WL 3392028, at *3 (N.D. Tex. July 10, 2018). "[N]egligent misrepresentation is a commercial tort; plaintiffs must show that the defendant negligently made a false representation 'in the course of his business. . . for the guidance of others in their business.'" Douglas, 2018 WL 2064388, at *3 (citing Posey, 415 F.3d at 395).8 The Court should dismiss the negligent 8 See also Weakly v. East, 900 S.W.2d 755, 759 (Tex. App.—Corpus Christi 1995, writ denied) (describing negligent misrepresentation as a "commercial tort"); Ayres v. Parker, No. SA-12-CV-621, 2013 WL 3929711, at *14 (W.D. Tex. Jul. 29, 2013) (rejecting negligent misrepresentation claim because plaintiffs failed to show representations were made for guidance in their business); Steele v. Green Tree Servicing, LLC, No. 3:09-CV-0603-D, 2010 WL 3565415, at *7-8 (N.D. Tex. Sept. 7, 2010) (disposing of a negligent misrepresentation claim sua sponte because, among other 10 0 misrepresentation claim because Plaintiff wholly fails to allege that the purported misrepresentation that forms the basis of the claim was made for the guidance of Plaintiff in his business. See generally Compl. For these reasons, Plaintiff's negligence-based claims further fail. C. Plaintiff's Claim for Violation of the Texas Property Code Section 51.002 Fails Because it does not Provide for a Private Right of Action and no Foreclosure has Occurred. Plaintiff generally claims that he did not receive notice of the default or notice of the foreclosure sale. Compl. ¶¶ 20 – 24. Plaintiff asserts that the notice was required under both the Texas Property Code and the Deed of Trust. Id. However, Plaintiff's claim for an alleged violation of the Texas Property Code Section 51.002 fails because there is no private right of action under Section 51.002. Texas Property Code Section 51.002 does not provide a private right of action. See also Nelson v. Wells Fargo Bank, N.A., No. 4:17-cv-298-A, 2017 WL 3405525, at *2 (N.D. Tex. Aug. 7, 2017); see also Palomino v. Wells Fargo Bank, N.A., No. 615CV00375RWSKNM, 2017 WL 989300, at *3 (E.D. Tex. Feb. 17, 2017) ("As Defendants correctly point out, Section 51.002 of the Texas Property Code, however, does not provide Plaintiffs with a private right of action.") (internal quotation omitted), report and recommendation adopted, No. 2017 WL 978930 (E.D. Tex. Mar. 14, 2017); Carey v. Wells Fargo, No. CV H-15-1666, 2016 WL 4246997, at *2-3 (S.D. Tex. Aug. 11, 2016) ("Section 51.002 of the Texas Property Code, however, does not provide Plaintiffs with a private right of action."); England v. JPMorgan Chase Bank, N.A., No. 4:14-CV- 183-Y, 2014 WL 12588508, at *1 (N.D. Tex. June 19, 2014) ("Plaintiff asserts a claim under Texas Property Code section 51.002, but there is no private right of action under that provision.. .."); reasons, there was no evidence that "the information supplied was for the guidance of others in their business"); FloTrend Sys., Inc. v. Allwaste, Inc., 948 S.W.2d 4, 8 (Tex. App.—Houston [14 Dist.] 1997, no writ) (describing negligent misrepresentation as a "commercial tort"). 11 0 Ashton v. BAC Home Loan Servicing, L.P., No. 4:13-cv-810, 2013 WL 3807756, at *2 (S.D. Tex. Jul. 19, 2013) ("This Court has not found any cases that interpret section 51.002 to establish an independent right of action for damages. The section also does not contain its own enforcement mechanism."). Consequently, courts have construed claims for violation of Section 51.002 as claims for wrongful foreclosure. See Nelson, 2017 WL 3405525, at *2, Palomino, 2017 WL 989300, at *3; Carey, 2016 WL 4246997, at *3; England, 2014 WL 12588508, at *1; Anderson v. National City Mortg., No. 3:11-CV-1687-N, 2012 WL 612562, at *6 (N.D. Tex. Jan. 17, 2012); Johnson v. Vericrest Financial, Inc., No. 3:09-CV-1260-M, 2010 WL 3464971, at *4 (N.D. Tex. Aug. 27, 2010); Ashton, 2013 WL 3807756, at *2. However, any wrongful foreclosure claim made by Plaintiff here also fails as a matter of law. To state a wrongful foreclosure claim under Texas law, Plaintiffs must plead: (1) a defect in the foreclosure sale proceedings; (2) a grossly inadequate selling price; and (3) a causal connection between the defect and the grossly inadequate selling price. See Martins v. BAC Home Loans Servicing, L.P., 722 F.3d 249, 253-56 (5th Cir. 2013); Barcenas v. Fed. Home Loan Mortg. Corp., No. H-12-2466, 2013 WL 286250, at *5 (S.D. Tex. Jan. 24, 2013). There must be evidence of an irregularity that "must have caused or contributed to cause the property to be sold for a grossly inadequate price." Barcenas, 2013 WL 286250, at *5. Texas law, however, does not recognize a cause of action for an attempted wrongful foreclosure. See Iroh v. Bank of Am., N A, No. 4:15-CV-1601, 2015 WL 9243826, at *4 (S.D. Tex. Dec. 17, 2015) ("Claims for attempted wrongful foreclosure, however, are simply not cognizable under Texas law.") (emphasis in original); Jolem, LLC v. Select Portfolio Servicing, Inc., No. H-14-3301, 2015 WL 3823642, at *8 (S.D. Tex. June 18, 2015) ("an attempted wrongful foreclosure claim is not recognized under Texas law"); Motten v. Chase Home Fin., 831 F. Supp. 12 0 2d 988, 1007 (S.D. Tex. 2011). In this case, Plaintiff obtained an ex parte temporary restraining order precluding the foreclosure sale of the Property. See Doc. No. 1-3 at 4 – 5. Nor does Plaintiff allege that the sale took place. See generally Compl. Because the foreclosure sale did not occur, Plaintiff cannot state a wrongful foreclosure claim as a matter of law. Regardless, Plaintiff cannot allege sufficient facts necessary to establish each element of a wrongful foreclosure claim. Therefore, Plaintiff has failed to state a claim for violation of the Texas Property Code and wrongful foreclosure. D. Plaintiff's Breach of Contract Claim Fails Because HUD and RESPA regulations were not Incorporated into the Contract, Plaintiff has not identified a breach, and Plaintiff has not Identified Damages. Plaintiff is alleging a breach of contract due to Defendant's alleged violation of the Deed of Trust and the HUD and/or RESPA regulations purportedly contained therein. Compl. ¶¶ 25 – 30. Plaintiff's breach of contract claim fails because Plaintiff has suffered no damages due to the alleged violation and the claim is insufficiently plead. Further, Plaintiff provides no support to show that the HUD and/or RESPA regulations are incorporated into the deed of trust, or that even if they are, he has the right to bring a private suit to enforce such as a breach of contract. Thus, Plaintiff's breach of contract claim must fail. To prevail on a breach of contract claim under Texas law, a plaintiff must show "(1) the existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3) breach of contract by the defendant; and (4) damages sustained by the plaintiff as a result of the breach." Sport Supply Group, Inc. v. Columbia Cas. Co., 335 F.3d 453, 465 (5th Cir. 2003); Steele v. Green Tree Servicing, LLC, No. 3:09-CV-0603-D, 2010 WL 3565415, at *4 (N.D. Tex. Sept. 7, 2010) (citations omitted); Hackberry Creek Country Club, Inc. v. Hackberry Creek Home Owners Ass'n, 205 S.W.3d 46, 55 (Tex. App.—Dallas 2006, pet. denied). 13 0 As an initial matter, Plaintiff does not provide any factual allegations or specificity in regard to his breach of contract claim. Mere conclusions and general claims are insufficient to state any claim or raise a right to relief against U.S. Bank above the speculative level. Twombly, 550 U.S. at 555. Thus, Plaintiff fails to plead facts sufficient to support a breach of contract claim. Further, Plaintiff provides no authority for his claim that the HUD and/or RESPA9 regulations are incorporated into the Deed of Trust. See generally Compl. Specifically as to the HUD regulations, the Deed of Trust makes no reference to HUD or its regulations, and certainly does not expressly incorporate them therein. See Exhibit C. Thus Plaintiff's claim that the HUD regulations are "incorporated with the Deed of Trust" are simply incorrect. Compl. ¶ 14. While RESPA is indeed referenced in the Deed of Trust as to the escrow account limitations, there is no express incorporation of the regulations. See Ex. G10 Because the deed of trust does not expressly incorporate RESPA, violations of RESPA "cannot serve as the basis for a breach of contract claim." Motton v. Chase Home Fin., No. H-10-4994, 2012 WL 2886718, at *4 (S.D. Tex. Jul. 13, 2012); see also Smith v. JPMorgan Chase Bank, N.A., 519 Fed. App'x 861, 864 (5th Cir. 2013) (dismissing breach of contract claim where RESPA's provisions were not expressly incorporated 9 To the extent Plaintiff is asserting U.S. Bank violated RESPA, that claim would fail. While Plaintiff fails to allege a specific section of RESPA that U.S. Bank purportedly violated, generally in the Fifth Circuit, Plaintiff must plead that he submitted a single complete loss mitigation application to Defendant and that the single complete loss mitigation application was sent to Defendant more than 37 days before a scheduled foreclosure sale, and he fails to do so here. See 12 C.F.R. § 1024.41(g); Gresham v. Wells Fargo Bank, N.A., 642 F. App'x 355, 359 (5th Cir. 2016) (holding that "Section 1024.41(g) only applies where a servicer receives a complete loss mitigation application more than 37 days before a foreclosure sale" and affirming dismissal of RESPA claim where the plaintiff failed to plead that he submitted a complete loss mitigation application more than 37 days before the foreclosure sale date). Further, Plaintiff fails to plead any actual damages sustained as a result of the alleged RESPA violations, which is required to state a RESPA claim. See 12 U.S.C. § 2605(f)(1); Smith v. JPMorgan Chase Bank, N.A., 519 Fed. Appx. 861, 864 (5th Cir. 2013) (requiring a showing of "particular damages as a result" of the alleged RESPA violation); Kareem v. Am. Home Mortg. Servicing, Inc., 479 F. Appx. 619, 620 (5th Cir. 2012) (holding that plaintiff could not recover on his RESPA claim because he did not allege what actual damages he suffered); Armendariz v. Bank of Am., N.A., No. EP-15-CV-00020-DCG, 2015 WL 3504961, at *5 (W.D. Tex. May 21, 2015) ("[E]ven assuming that Plaintiff did not receive the required notification under RESPA, Plaintiff's claim still fails because the Complaint contains no facts explaining how this alleged violation impeded Plaintiff's ability to pay the mortgage, or otherwise caused Plaintiff to incur actual damages."). 10 Pursuant to Federal Rule of Evidence 201, U.S. Bank requests that the Court take judicial notice of the Deed of Trust, recorded in the Real Property Records of Bexar County at Instrument No. 2000-0164370, a true and correct copy of which is attached hereto as Exhibit G. 14 0 into mortgage agreement). Further, even assuming arguendo that the regulations are incorporated into the Deed of Trust, Plaintiff provides no authority that he could bring a private suit against a lender for violation of such. See generally id. Moreover, "it is not enough to generally allege the existence of a contract and generally allege that a contract has been breached. Instead, to state a plausible breach of contract claim a plaintiff must allege which provision of an identified contract has been breached." Caine v. Wells Fargo Bank, N.A., No. H17-2046, Doc. No. 60 at 5 (S.D. Tex. Jun. 8, 2018). Thus, to survive a motion to dismiss, Plaintiff must identify the specific provisions of the contract that he alleges were breached, which he does not. See Williams v. Wells Fargo Bank, N.A., 560 F. App'x 233, 238 (5th Cir. 2014) ("It has been held that a claim for breach of contract of a note and deed of trust must identify the specific provisions in the contract that was breached."); Guajardo v. JP Morgan Chase Bank, N.A., 605 F. App'x 240, 244 (5th Cir. 2015) (affirming dismissal of breach of contract claim where plaintiff did not specify which provision in the deed of trust was breached). Plaintiff has not alleged any specific provision of a contract between the parties that was allegedly breached. See generally Compl. Plaintiff fails to provide a single non-conclusory allegation in support of a breach of contract claim. Id. Finally, Plaintiff has not properly pled recoverability of damages for the alleged breach of contract. No foreclosure sale has occurred, and the damages Plaintiff pleads are speculative at best. See CQ, Inc. v. TXU Min. Co., L.P., 565 F.3d 268, 278 (5th Cir. 2009) ("[a] party may not recover damages for breach of contract if those damages are remote, contingent, speculative, or conjectural") (citations omitted); Maldonado v. Bank of Am., SA-12-CA-442-FB, 2013 WL 12108679, at *3 (W.D. Tex. June 14, 2013) (citing Peoples v. BAC Home Loans Serv., LP, No. 4:10-CV-489-A, 2011 WL 1107211, at *4 (N.D. Tex. Mar. 25, 2011) (holding mortgagor failed to establish she actually sustained damages for breach of contract claim where mortgagor admitted 15 0 no foreclosure had occurred, she remained in continuous possession and occupation of the residence, and title remained in her name). Plaintiff merely alleges that "if Defendant is allowed to proceed with the finalization of the foreclosure proceedings of Plaintiff's property, Plaintiff will suffer immediate and irreparable harm" and "Plaintiff has suffered harm as he has incurred additional charges to his loan balance and escrow account" Compl. ¶¶ 23, 30. Plaintiff provides no further factual enhancement as to what these charges are or how they stem from U.S. Bank's alleged breach of contract. See generally id. This is simply insufficient to support a breach of contract claim and such claim should be dismissed. For these reasons, the breach of contract claim further fails and should be dismissed. E. The Requests for Injunctive Relief and Attorney's Fees Should Be Dismissed Because the Underlying Claims Fail. Plaintiff seeks attorney's fees and injunctive relief precluding foreclosure of the lien. See Doc. 1-3 at 12 – 13. Because Plaintiff's claims fail for the reasons discussed above, and because Plaintiff has otherwise failed to plead any cognizable claim against Defendant, this Court should decline to consider Plaintiff's request for injunctive relief. See Cook v. Wells Fargo Bank, N.A., No. 3:10-CV-592-D, 2010 WL 2772445, at *4 (N.D. Tex. July 12, 2010). Likewise, Plaintiff's request for attorney's fees is also barred, because Plaintiff has not plead any viable causes of action that would allow for recovery of attorney's fees. E.g., Green Int'l, Inc. v. Solis, 951 S.W.2d 384, 390 (Tex. 1997). F. Dismissal with Prejudice Is Appropriate Although "a court should freely give [a party] leave" to amend pleadings "when justice so requires," Fed. R. Civ. P. 15(a), a court should deny leave to amend when the amendment, if granted, will be futile. Martin's Herend Imports, Inc. v. Diamond & Gem Trading U.S. Am. Co., 195 F.3d 765, 771 (5th Cir. 1999); Leffall v. Dallas Indep. Sch. Dist., 28 F.3d 521, 524 (5th Cir. 16 0 1994). To determine futility, the Fifth Circuit considers whether an amendment could survive a motion to dismiss under Federal Rule 12(b)(6); if an amendment would fail to state a claim upon which relief could be granted, the court may deny leave to amend. See Briggs v. Mississippi, 331 F.3d 499, 508 (5th Cir. 2003) (stating "because. . . the proposed amended complaint could not survive a Fed. R. Civ. P. 12(b)(6) motion" allowing plaintiff "to amend the complaint would be futile"). As demonstrated herein, Plaintiff's claims fail as a matter of law. No ethical amendment could cure the deficiencies in Plaintiff's claims, and as a result, giving Plaintiff an opportunity to amend his pleading would be futile. Further, it is clear from Plaintiff's generalized and vague allegations contained in his third complaint to preclude foreclosure, this is simply yet another stalling tactic to prevent foreclosure. Therefore, the Court should dismiss the claims as detailed above with prejudice. IV. MOTION FOR SANCTIONS As forth herein, the instant suit, like Plaintiff's prior two suits, is groundless and filed for purposes of harassment and delay. The current suit recycles the allegations plead in the recently- dismissed Second Lawsuit which was a word-for-word recitation of his claims in the First Lawsuit. See Exs. A, D. The Court should impose sanctions on Plaintiff and/or his attorney under Texas Rule Civil Procedure 13, Chapter 10 of the Texas Civil Practices & Remedies Code, and 28 U.S.C. § 1927, and the Court's inherent power. Following removal, a federal district court is authorized to issue sanctions under Texas Rule of Civil Procedure 13 and Chapter 10 of the Texas Civil Practices & Remedies Code.11 11 The Court can also issue sanctions under 28 U.S.C. § 1927, though sanctions under that provision are generally limited to excessive costs due to persistent prosecution of a meritless claim. Browning v. Kramer, 931 F.2d 340, 344 (5th Cir. 1991). However, when the entire proceeding has been unwarranted, unreasonable, and vexatious and should therefore not have been initiated or pursued—which is clearly the case here—it is appropriate to shift the entire financial burden of the action's defense to the sanctioned party. Meadowbriar Home for Children, Inc. v. Gunn, 81 F.3d 521, 535 (5th Cir. 1996). 17 0 DTND Sierra Invs., LLC v. CitiMortgage, Inc., 624 F. App'x 846, 848-49 (5th Cir. 2015); Thompson v. Cyr, 202 F.3d 770, 787 (5th Cir. 2000).  Texas Rule of Civil Procedure 13 authorizes the court to impose sanctions against an attorney, a represented party, or both, who file a groundless pleading brought in bad faith or brought for the purpose of harassment, or who make. TEX. R. CIV. P. 13. Rule 13 also authorizes sanctions for Rule 13 defines groundless as having "no basis in law or fact and not warranted by good faith argument for the extension, modification, or reversal of existing law." Id.  Chapter 10 of the Texas Civil Practice and Remedies Code permits sanctions for signing frivolous pleadings or motions without reasonable inquiry into their propriety. TEX. CIV. PRAC. & REM. CODE §§ 10.001. Specifically, sanctions may be imposed under Chapter 10 if a party presents a pleading "for any improper purpose, including to harass or cause unnecessary delay or needless increase in the cost of litigation." Id. §§ 10.001-10.002.  Federal courts also have the inherent authority to manage their own affairs so as to achieve the orderly and expeditious disposition of cases. Chambers v. NASCO, Inc., 501 U.S. 32, 43-45 (1991). To preserve that authority, federal courts are empowered to sanction bad faith conduct occurring during the litigation. Elliott v. Tilton, 64 F.3d 213, 216 (5th Cir. 1995). Here, Plaintiff's current lawsuit is clearly groundless and filed for purposes of harassment and delay. Plaintiff has now twice had nearly identical claims summarily dismissed by this Court. Son, 2019 WL 317251 at *3; see also Exs. B – C, E – F. Plaintiff brazenly re-filed a pleading with nearly identical allegations, recycling the claims from the First Lawsuit and Second Lawsuit. Compare Compl. with Exs. A, D. Plaintiff's claims in the Current Lawsuit are clearly barred by res judicata, which Plaintiff's attorney was aware of, or should have been aware of, when he filed the Current Lawsuit. Plaintiff's true purpose—to delay the inevitable foreclosure of the Property—is unmistakable. Plaintiff's primary complaint in both the First Lawsuit and Second Lawsuit is of failure to receive foreclosure notices and inaccurate Loan calculations which, as set forth above, are the same issues reiterated herein, albeit with an attempt at a new yet meritless twist on the claims. See Exs. A, D. And Plaintiff's recycled pleading in the Current Lawsuit demonstrates that 18 0 Plaintiff is not interested in a ruling on the merits—he has received two in the last three years dismissing the same claims. See Son, 2019 WL 317251 at *3; see also Exs. B – C, E – F. Plaintiff's true aim is to delay foreclosure and prolong his rent-free possession of the Property. Under these circumstances, sanctions in the form of attorneys' fees and a pre-filing injunction are appropriate to deter Plaintiff from continuing to file meritless lawsuits. See DTND Sierra Invs., 624 F. App'x at 848-50 (affirming $20,000 sanction issued to prevent plaintiff and its counsel "from continuing to file groundless, harassing lawsuits"); Thanedar v. Time Warner, Inc., 352 F. App'x 891, 900 (5th Cir. 2009) ("There is no constitutional right to prosecute frivolous actions, and preclusion orders are appropriate tools for deterring vexatious filings."). Therefore, U.S. Bank requests that it be awarded $2,500 for expenses and reasonable attorneys' fees incurred in defending this lawsuit. Additionally, U.S. Bank requests that the Court enter a pre-filing injunction against Plaintiff specifying that Plaintiff will not be permitted to file any new civil action against U.S. Bank unless he first files a motion requesting leave of court to do so and attaches thereto a copy of its proposed complaint and a copy of this Court's order imposing the injunction. V. CONCLUSION Plaintiff fails to state a claim upon which relief can be granted. Accordingly, U.S. Bank respectfully requests that the Court grant this Motion, and pursuant to Federal Rule of Civil Procedure 12(b)(6), enter an order dismissing this lawsuit in its entirety with prejudice. U.S. Bank further requests all relief, at law or in equity, to which it is justly entitled. 19 0 Respectfully submitted, LOCKE LORD LLP /s/ Elizabeth Hayes B. David L. Foster Texas Bar No. 24031555 dfoster@lockelord.com 600 Congress Ave., Suite 2200 Austin, Texas 78701 (512) 305-4700 (512) 305-4800 (Facsimile) Robert T. Mowrey State Bar No. 14607500 rmowrey@lockelord.com Elizabeth Hayes Texas Bar No. 24069001 elizabeth.hayes@lockelord.com 2200 Ross Avenue, Suite 2800 Dallas, Texas 75201-6776 (214) 740-8000 (214) 740-8800 (facsimile) ATTORNEYS FOR U.S. BANK CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing was served as indicated on this 2nd day of December, 2019, to the following: VIA ECF Robert C. Newark, III 1341 W. Mockingbird Lane, Suite 600W Dallas, Texas 75247 Attorney for Plaintiff /s/ Elizabeth Hayes Elizabeth Hayes 20