MARTINO v. EVERHOME MORTGAGE No. 10-1247.
CARLOS and CAROL MARTINO, Individually and as a class representative on behalf of those similarly situated, Appellants, v. EVERHOME MORTGAGE; COOPER, PERSKIE, LEVENSON, APRIL, NIEDELMAN & WAGENHEIM, P.A.
United States Court of Appeals, Third Circuit.
Filed: December 23, 2010.
Before: BARRY, CHAGARES and VANASKIE, Circuit Judges.
OPINION OF THE COURT
VANASKIE, Circuit Judge.
Carlos and Carol Martino sued EverHome Mortgage ("EverHome") and its law firm, Cooper, Perskie, Levenson, April, Niedelman & Wagenheim, P.A. ("Cooper"), alleging that the Defendants unlawfully charged and collected various fees and costs. The District Court granted EverHome's and Cooper's motions to dismiss for failure to state a claim, and it subsequently denied the Martinos' motion to file an amended complaint. The Martinos appeal the denial of their motion to amend. For the reasons that follow, we will affirm the judgment of the District Court.
In August of 1996, EverHome
EverHome obtained a final judgment of foreclosure against the Martinos in June of 2001. The judgment awarded EverHome "the sum of $32,789.13 with interest at the contract rate of 15.50 percent on $30,217.91, being the principal sum in default (including advances, if any) from April 1, 2001 to 6/26/01, and lawful interest thereafter on the total sum due [EverHome] together with costs of this suit to be taxed, including a counsel fee of $477.89." (A. 227.) The judgment of foreclosure also authorized the sale of the Martinos' property "to raise and satisfy the several sums of money due in the first place to [EverHome] in the sum of $32,789.13 together with contract interest and lawful interest thereon as aforesaid, with [EverHome's] costs to be taxed, with lawful interest thereon." (
In December of 2004, Cooper, responding to the Martinos' request, indicated that the amount required to satisfy the mortgage totaled $46,678.27, consisting of the mortgage payoff balance, accrued interest, Sheriff's commission and costs, attorneys' fees, and other costs of suit. In January of 2005, Plaintiffs received a revised payoff amount of $34,471.95, consisting of $31,044.63 to EverHome and $3,427.32 to Cooper. On or about January 25, 2005, the Martinos paid the sum of $34,471.95 in satisfaction of their indebtedness to EverHome.
The Martinos filed a putative class action suit against EverHome and Cooper in January of 2009. The Martinos proposed a class consisting of people who had defaulted on mortgages serviced by EverHome and were overcharged attorneys' fees and other costs. The complaint asserted ten claims, all stemming from alleged overcharges by the Defendants. To support their claims, the Martinos pointed to discrepancies between amounts listed on three documents: (1) the 2001 foreclosure judgment, (2) the 2004 payoff statement prepared by Cooper, and (3) a Gloucester County Sheriff's Office Statement of Sale listing other charges that differed from the amounts on the 2004 payoff statement. The complaint, however, neglected to identify any of the Martinos' bankruptcy cases, and it omitted several years' worth of dealings between the Martinos and EverHome.
Cooper and EverHome moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). In deciding the motion, the District Court went to great lengths to piece together the factual background of the case and ultimately concluded that the complaint failed to state a claim upon which relief could be granted. After summarizing the alleged overcharges, the Court determined that Plaintiffs simply pled discrepancies between documents from different sources, and that "[t]he mere fact of a discrepancy is insufficient to support an inference of unlawful conduct by Defendants." Martino v. Everhome Mortg., 639 F.Supp.2d 484, 493 (D.N.J. 2009). Accordingly, the District Court granted the motions to dismiss. The Court did, however, grant the Martinos leave to file a motion to amend their complaint.
The Martinos then moved to file an amended class-action complaint. The proposed amended complaint dropped Cooper as a named defendant and contained only three counts against EverHome: breach of contract, violation of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2 et seq., and violation of New Jersey's Truth-in-Consumer Contract, Warranty and Notice Act, N.J.S.A. 56:12-14 et seq. Like the original complaint, the amended complaint relied on the premise that the Martinos had been overcharged various fees and costs. The amended complaint stated that the Martinos paid $64,232.46, which represented the sum of the $34,471.95 sought in the revised payoff statement from January of 2005, plus $14,376.32 toward the foreclosure judgment and mortgage, and $15,384.19 in payments to the Chapter 13 bankruptcy trustee between 2001 and 2004. The amended complaint further stated that the Martinos should have had to pay only $42,460.66, which represented their calculation of the foreclosure judgment, plus interest, taxes, and sheriff's fees and commission.
The amended complaint, however, suffered from the same deficiencies as the original complaint: it glossed over important dates, and it assumed wrongdoing by referencing different dollar amounts on unrelated documents. The District Court observed that
The District Court had jurisdiction pursuant to the Class Action Fairness Act of 2005, codified at 28 U.S.C. § 1332(d). We have jurisdiction pursuant to 28 U.S.C. § 1291.
We review the District Court's denial of the Martinos' motion to file an amended complaint for abuse of discretion.
Substantially for the reasons set forth in the District Court's opinion, we agree that the proposed amended complaint fails to state a claim upon which relief can be granted. All of the Martinos' claims rely on the notion that they should not have had to pay anything more than the foreclosure judgment, plus interest and some small additional costs. The Martinos' theory of the case overlooks the fact that they were involved in several years' worth of bankruptcy proceedings involving EverHome and Cooper. As the District Court observed, one would expect the bankruptcy proceedings to give rise to an obligation to make payments exceeding the amount of the foreclosure judgment plus Sheriff's fees. Therefore, we agree with the District Court that the amended complaint does not "plead factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged."
Much like the Martinos' arguments before the District Court, their arguments on appeal rely on disparities between cherry-picked numbers from disparate documents. For example, the Martinos assert that they were overcharged $450 for "sheriff's sale costs and commissions." (Appellants' Br. at 24.) This alleged overcharge appears to derive from an undated Cooper document entitled "Breakdown of Fees and Costs." (A. 245.) A handwritten note on the document says, "Cost Advance 450.00." (
We write further to address the Martinos' argument that our holding in
The Martinos' reliance on
Because we agree that the proposed amended complaint fails to state a claim upon which relief can be granted, we will affirm the judgment of the District Court.
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