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Novick v. Wells Fargo Bank, N.A.

United States District Court, S.D. Florida

June 7, 2017

JAMES NOVICK, Plaintiff,
WELLS FARGO BANK, N.A., Defendant.



         THIS CAUSE comes before the Court on Wells Fargo's Motion to Dismiss Plaintiff's Complaint [ECF No. 12]. The Court has reviewed the Motion and the record and is otherwise fully advised. For the reasons discussed below, the Motion is granted.

         I. BACKGROUND

         On January 28, 2011, Defendant Wells Fargo Bank, N.A. (“Wells Fargo”) commenced an action seeking to foreclose on a mortgage executed by Plaintiff James Novick (“Plaintiff') in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida (the “Foreclosure Action”). The Foreclosure Action was extended for five years, due in part to Plaintiff's repeated requests for continuances. On June 24, 2016, a Final Judgment of Foreclosure was entered in the Foreclosure Action. On July 8, 2016, Plaintiff appealed the final judgment to the Florida Fourth District Court of Appeal.[1] The only action remaining in the Foreclosure Action is conducting the sale and transferring title.

         Plaintiff initially filed his federal claims-along with seven other borrowers-in the case styled Guzman v. Wells Fargo Bank, N.A., No. 16-21423 (S.D. Fla. filed Feb. 18, 2016). On June 22, 2016, Judge Altonaga granted Wells Fargo's motion to sever, agreeing with Wells Fargo that the plaintiffs' claims did not arise out of a single transaction or series of transactions and did not present the same questions of law or facts, in violation of Federal Rule of Civil Procedure 20(a). See Order, Guzman, No. 16-21423 (S.D. Fla. June 22, 2016), ECF No. 26. She dismissed the plaintiffs' complaint and instructed them to file claims in separate actions nunc pro tunc to the filing date of that action.

         Plaintiff commenced this individual action on July 11, 2016, bringing claims against Wells Fargo for breach of contract; a violation of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2605; a violation of Article 5-102 of the Uniform Commercial Code; and a violation of 42 U.S.C. §3605(a), all arising from Wells Fargo's alleged failure to modify his loan. He also sought specific performance and judicial review of his applied-for loan modification.

         Wells Fargo moved to dismiss, arguing that Plaintiff's claims are barred by Florida's compulsory counterclaim rule and that, even if the claims are not barred, they fail to state a cause of action. The Court initially granted Wells Fargo's motion due to Plaintiff's failure to timely respond. Upon Plaintiff's motion for reconsideration and belated response, the Court now considers the merits of the motion to dismiss.


         “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, 129 S.Ct. 1937 (2009)(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955 (2007)). Although this pleading standard “does not require ‘detailed factual allegations, ' . . . it demands more than unadorned, the defendant-unlawfully-harmed-me accusations.” Id. (alteration added)(quoting Twombly, 550 U.S. at 555).

         Pleadings must contain “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (citation omitted). Indeed, “only a complaint that states a plausible claim for relief survives a motion to dismiss.” Iq-bal, 556 U.S. at 679 (citing Twombly, 550 U.S. at 556). To meet this “plausibility standard, ” a plaintiff must “plead[ ] factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. at 678 (alteration added)(citing Twombly, 550 U.S. at 556). When reviewing a motion to dismiss, a court must construe the complaint in the light most favorable to the plaintiff and take the factual allegations therein as true. See Brooks v. Blue Cross & Blue Shield of Fla. Inc., 116 F.3d 1364, 1369 (11th Cir. 1997).


         The Court finds that Plaintiff's claims are barred by the compulsory counterclaim rule.[2]The failure of a plaintiff to bring a compulsory counterclaim in a state court proceeding is a bar to a later suit in federal court on that claim. Montogomery Ward Dev. Corp. v. Juster, 932 F.2d 1378, 1380-82 (11th Cir. 1991). “The purpose of the compulsory counterclaim rule is to eliminate multiplicity of litigation.” Id. at 1381.

         The Court looks to state law to determine whether a particular claim is a compulsory counterclaim. Beepot v. J.P Morgan Chase, 57 F.Supp.3d 1358, 1370 (M.D. Fla. 2014). Florida Rule of Civil Procedure 1.170 provides:

[a] pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication the ...

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