United States District Court, M.D. Florida, Tampa Division
D. MERRYDAY, UNITED STATES DISTRICT JUDGE
decade ago, the Treasury Department introduced the Home
Affordable Modification Program, which allegedly requires a
participating bank to use “reasonable efforts” to
modify the mortgage of a person in default or reasonably
likely to default. After an eligible mortgagor applies for a
modification, the program requires several “trial
payments” before the bank approves the modification.
October 2016, Edelso Carmenates and several dozen others sued
Bank of America in a single action in the Circuit Court for
Hillsborough County, and the bank invoked diversity
jurisdiction and removed the action. No.
8:16-cv-3384-SCB (M.D. Fla. Dec. 12, 2016). The 103-page
complaint, which copied swaths from a qui tam
complaint in the Eastern District of New York,  alleged that Bank
of America defrauded each plaintiff between 2009 and 2011 by,
among other things, misleading each plaintiff about the
eligibility requirement for a modification. For example, Bank
of America allegedly told Carmenates “to refrain from
making [his] regular mortgage payments because the only way
to get a loan modification was if the loan was in default or
had a past due balance.” (Doc. 2 at ¶ 248 in No.
8:16-cv-3384) Moving to dismiss the action, Bank of America
argued misjoinder of the plaintiffs' claims, failure to
plead fraud with particularity, failure to state a claim,
expiration of the four-year limitation, and the absence of a
private right to sue a bank for violating the requirements of
the Home Affordable Modification Program.
Carmenates and the other plaintiffs failed to respond timely
to the motion to dismiss, the presiding judge ordered the
plaintiffs to show good cause for the failure to respond. The
plaintiffs argued that their counsel never received the
motion to dismiss because of an “Electronic Service
Error.” (Doc. 15 in No. 8:16-cv-3384) Before the
presiding judge resolved the motion to dismiss, Carmenates
and the other plaintiffs voluntarily dismissed the action.
2017, Carmenates and 118 other plaintiffs again sued Bank of
America in a single action. No. 8:17-cv-1534-RAL
(M.D. Fla. June 27, 2017). The 292-page “shotgun”
complaint alleges fraud and the violation of Florida's
Deceptive and Unfair Trade Practices Act. In the part of the
complaint specific to him, Carmenates alleged that in June
2009 a Bank of America employee, “Christine, ”
told Carmenates that a modification requires a default. (Doc.
1 at ¶ 1188 in No. 17-cv-1534) Bank of America allegedly
omitted to mention that a reasonably foreseeable likelihood
of default might qualify a mortgagor for a modification.
Moving to dismiss the complaint, Bank of America repeated the
arguments from the first motion to dismiss.
resolving the motion to dismiss, the presiding judge observed
that the complaint, which alleged neither each
plaintiff's citizenship nor the amount in controversy
between each plaintiff and Bank of America, failed to invoke
diversity jurisdiction. (Doc. 15 in No. 17-cv-1534) Ordered
to amend the complaint to invoke diversity jurisdiction,
Carmenates and the other plaintiffs submitted a 403-page
complaint. (Doc. 16 in No. 17-cv-1534) For the third time,
Bank of America moved to dismiss the complaint and repeated
the arguments from the earlier motions. The presiding judge
in that action found misjoinder, severed the plaintiffs'
claims, and ordered the plaintiffs to sue separately.
plaintiffs heeded the presiding judge's command. Between
October 30, 2017, and November 3, 2017, more than a hundred
plaintiffs sued Bank of America in the Middle District of
Florida in eighty actions and alleged fraud under Florida
common law. Excepting names, dates, addresses, and the like,
the complaints are identical. The actions are distributed
among eight district judges in the Middle District of
Florida. In two actions, the presiding judges found the
claims barred by the four-year limitation.
Carmenates' fourth complaint (but the first complaint in
this case), Carmenates alleges (Doc. 1) four
misrepresentations by Bank of America. First, Bank of America
allegedly failed to mention that a reasonably foreseeable
danger of default might qualify a mortgagor for a
modification; second, Bank of America stated that the
mortgagor failed to provide Bank of America with the
documents necessary to complete the modification; third, Bank
of America orally notified the mortgagor that the bank
approved the requested modification; and fourth, Bank of
America charged a “fraudulent” inspection fee.
For the fourth time, Bank of America moved (Doc. 9) to
dismiss the complaint. Carmenates has not - in any motion,
pleading, or other paper - moved at any moment in this action
for leave to amend the complaint.
February 1, 2018 order (Doc. 12) dismisses each fraud claim
except the claim that Bank of America omitted to mention that
a reasonably foreseeable likelihood of default might qualify
a mortgagor for a modification. In this claim, Carmenates
alleges that Bank of America instructed him on June 3, 2009,
to “refrain from making [his] regular mortgage
payments” in order to qualify for a modification. (Doc.
1 at ¶ 37) Bank of America allegedly omitted to mention
that a reasonably foreseeable likelihood of default can
qualify a mortgagor for a modification. (Doc. 1 at ¶ 37)
Confusingly, Carmenates alleges elsewhere in the complaint
that a modification requires not a reasonably foreseeable
likelihood of default but rather an “eminent [sic]
default.” (Doc. 1 at ¶ 38) In either event,
unaware of his option not to default, Carmenates allegedly
“refrained from” paying his mortgage and, as a
result, “fell into default status.” (Doc. 1 at
¶ 39) As a “direct result” of Bank of
America's alleged omission, Carmenates allegedly suffered
the loss of both his home and the equity in his home. (Doc. 1
at ¶ 39)
(Doc. 23) for summary judgment, Bank of America observes that
Carmenates defaulted in April 2009, two months before Bank of
America's alleged omission. In an affidavit that
accompanies his response, Carmenates affirms that he
defaulted on the mortgage “due in part to the state of
the economy and my own personal financial obligations.”
(Doc. 28 at 7) Two paragraphs later, Carmenates swears that,
when he called Bank of America on June 3, 2009, he “was
capable of and intended to start making my mortgage
payments.” (Doc. 28 at 7) Carmenates affirms that Bank
of America advised him not to cure the default and that he
suffered a foreclosure after relying on Bank of America's
advice. (Doc. 28 at 8) Objecting to Carmenates'
maintaining two putatively irreconcilable sets of factual
assertions (that is, “I was not in default” and
“I was in default”), Bank of America replies
(Doc. 33) that Carmenates cannot in effect amend his
complaint by responding to a motion for summary judgment with
facts that conflict with the allegations in the complaint.
Bank of America argues that the record reveals no genuine
dispute of material fact about the fraud claim alleged in the
of America correctly observes, the fraud claim in the
complaint appears to conflict irreconcilably with the
argument in the response to Bank of America's motion for
summary judgment. In the complaint, Carmenates alleges:
Relying on the false statement and omission, [Carmenates]
refrained from making [his] regular mortgage payment and fell
into default status.
(Doc. 1 at ¶ 39) In the response to Bank of
America's motion for summary judgment, Carmenates argues:
The fact that [Carmenates] was in default at the time of the
phone call is irrelevant because it was [Bank of
America's] statements that stopped ...