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Thomas v. Ocwen Loan Servicing

United States District Court, W.D. Washington, Seattle

July 26, 2018

CECIL THOMAS and PAMELA THOMAS, Plaintiffs,
v.
OCWEN LOAN SERVICING, et al., Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION FOR JUDGMENT ON THE PLEADINGS

          RICARDO S. MARTINEZ CHIEF UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         This matter comes before the Court on Defendants Ocwen Loan Servicing, LLC's (“Ocwen”) and Deutsche National Trust Company's (“Deutsche”) Motion for Judgment on the Pleadings pursuant to Federal Rule of Civil Procedure 12(c).[1] Dkt. #25. These Defendants seek dismissal of all claims against them with respect to alleged violations of the Fair Debt Collection Practices Act (“FDCPA”), the Real Estate Settlement Procedures Act (“RESPA”), and Washington State's Consumer Protection Act (“CPA”). Id. Plaintiffs oppose the motion. Dkt. #26. Having reviewed the record before it, and finding oral argument on the motion to be unnecessary, the Court now GRANTS IN PART and DENIES IN PART Defendants' motion. The Court further grants Plaintiffs leave to amend as set forth below.

         II. BACKGROUND

         This matter was filed by Plaintiffs Cecil and Pamela Thomas on August 14, 2017. Dkt. #1. On August 21, 2017, Plaintiffs filed a Motion for Temporary Restraining Order (“TRO”). Dkt. #4. Plaintiffs allege that they are the owners of the home and land located at 15844 48th Ave NE, Woodinville, WA 98072. Id. Plaintiffs further allege that they completed a Chapter 12 bankruptcy plan that reorganized their mortgage loan, and that following completion of the bankruptcy plan Defendant Ocwen failed to account for payments, rejected payments, and commenced a foreclosure due to Ocwen's own errors. Id. Plaintiffs assert that despite the fact that they are current on their loan, Defendants scheduled a foreclosure on their home, which was originally to take place on August 25, 2017. Dkt. #6 at ¶ 12.

         On August 22, 2017, this Court issued a TRO, restraining Defendants, and anyone acting in concert with them, from foreclosing on Plaintiffs' real property. Dkt. #9. The Court then set a hearing for a preliminary injunction on September 8, 2017. Id. Soon thereafter, Defendants Ocwen and Deutsche appeared in this action. Dkts. #11-15. The parties then entered into a stipulated Preliminary Injunction Order which restrains Defendants from proceeding with a foreclosure on Plaintiffs' property until the merits of this case are resolved. Dkt. #22.

         In their Complaint, Plaintiffs allege the following factual background to their claims:

2. Plaintiffs are husband and wife and owners of the property commonly known as 15844 148th Ave. NE, Woodinville, Washington (“The Property”) with a legal description attached as Exhibit A which they occupy primarily as their family residence and which they also maintain as the location of their business.[2]
3. On September 20, 2010 plaintiffs filed Chapter 12 Bankruptcy to reorganize the home loan (“The Loan”) for which The Property was collateral.
4. At the time plaintiffs filed Chapter 12 The Loan was serviced by OneWest Bank, FSB.
5. The Chapter 12 plan as approved by the judge required plaintiffs to pay the bankruptcy trustee payments that she would then forward to the lender for 60 months and upon completion of the Chapter 12 plan plaintiffs were directed to pay The Loan each month directly to the servicer.
6. The Chapter 12 plan stipulated to a value of $375, 000 which became the balance of The Loan.
7. Plaintiffs have paid all amounts due under the Chapter 12 plan and have also sent the payments that were due to the lender on The Loan after the plan was complete.
8. On or about May 9, 2014 Ocwen Loan Servicing, LLC (“Ocwen”) began servicing The Loan.
9. Deutsch Bank National Trust Co. (“Deutsch Bank”) is the party that holds the promissory note signed by plaintiffs and has hired or consented to the hiring of Ocwen to service The Loan.
10. At the time Deutsh [sic] Bank employed Ocwen it had knowledge or it should have known that Ocwen had its banking charter revoked and that Ocwen used an accounting system that failed to accurately account for payments and charges to loans.
11. At the time Ocwen began servicing The Loan Ocwen alleged The Loan was in default.
12. Plaintiffs are not nor have been in default; rather Ocwen's accounting on The Loan is incorrect.
13. Plaintiffs have disputed the loan history with each of the defendants in this case.
14. Despite the dispute, the defendants have indicated that they intend to foreclose on The Property on August 9, 2017.
15. Plaintiffs have lived at The Property for 13 years and have no other place to live.
16. If The Property is foreclosed plaintiffs would lose their home and their fish hatchery business.
17. Plaintiffs have tendered all due payments to Ocwen; however, Ocwen rejected the payments and sent them back.
18. Ocwen has falsely reported to the credit reporting agencies that plaintiffs are delinquent on The Loan.
19. Ocwen knew that Ocwen's accounting system produced inaccurate information which was sent to the plaintiffs and the credit reporting agencies.
20. Despite knowing that Ocwen's accounting system produced inaccurate numbers, Ocwen persisted in mailing false statement to plaintiffs and furnishing false information about plaintiffs and to plaintiffs, the credit reporting agencies, the codefendants, and others.
21. Throughout 2017 plaintiffs have made written request to Ocwen which identified the loan, the property, the plaintiffs and indicated that the loan history was inaccurate and requested that Ocwen correct the accounting on the loan.
22. The plaintiffs written demands to Ocwen constitute Qualified Written Requests under the Real Estate ...

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