Appellate Circuit

Former Texas Lawyer Scott Scher May Have An Ally In Mind Once He Reads This

As the Scher family face foreclosure, could Isaac Nesser, the Quinn Emanuel partner who prevailed in 100 toxic loan cases, aid his appeal?

Scher v. Deutsche Bank Trust Company Americas

(4:21-cv-00048)
District Court, E.D. Texas

JUL 12, 2021 | REPUBLISHED BY LIT: JUL 29, 2021

Scott Scher with Rhonda and daughter (2018)

Does Tom the lawyer for former Texas lawyer Scott Scher know about Isaac and Ally/GMAC/Rescap settlements? Probably not. He will shortly when he reads this article.

DEFENDANTS’ SECOND AMENDED ANSWER AND COUNTERCLAIM

JUL 12, 2021 | REPUBLISHED BY LIT: JUL 29, 2021

Defendants, Deutsche Bank Trust Company Americas, as Trustee for Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates Series 2006-QS14 (incorrectly named Deutsche Bank Trust Company Americas, as Trustee for Residential Accredit Loans, Inc.), (“Deutsche Bank”) and PHH Mortgage Corporation (“PHH”), (together, “Defendants”), files this Second Amended Answer and Counterclaim, and respectfully show the Court as follows:

ANSWER

No answer is required with respect to the first introductory paragraph in Plaintiff’s First Amended Original Petition and Verified Request for Temporary Restraining Order (the “Complaint”) which begins with the phrase “Comes Now.”

PARTIES

Defendants admit the allegations in the first sentence under the paragraph heading “Parties” in the Complaint.

Defendants deny the allegations in the second sentence under this paragraph heading because Deutsche Bank has been improperly named. The correct name is Deutsche Bank Trust Company Americas, as Trustee for Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates Series 2006-QS14 and it may be served through its agent for service of process. All other allegations are denied.

Defendants deny the allegations in the third sentence under this paragraph heading. PHH has been improperly described. PHH is a corporation and it may be served through its agent for service of process. All other allegations are denied.

JURISDICTION AND VENUE

Defendants deny the allegations under the paragraph heading “Jurisdiction and Venue” in the Complaint. This matter has been properly removed to this federal Court, where Defendants agree jurisdiction and venue are proper.

DISCOVERY LEVEL 2

Defendants deny the allegations under the paragraph heading “Discovery Level 2” in the Complaint. This matter has been properly removed to this federal Court, where the discovery levels of the Texas Rules of Civil Procedure are no longer applicable.

MATERIAL PREDICATE FACTS

In answer to the allegations in the first sentence under the paragraph heading “Material Predicate Facts” in the Complaint, Defendants state that they lack knowledge or information sufficient to form a belief as to the truth of the allegations and therefore deny them.

Defendants admit the allegations in the second sentence under this paragraph heading.

CAUSE OF ACTION – BREACH OF CONTRACT

No answer is required with respect to the first sentence under the paragraph heading “Cause of Action – Breach of Contract” in the Complaint because the allegations constitute legal conclusions. To the extent an answer is required, Defendants admit only that the law and contract referenced speak for themselves.

Defendants deny the allegations in the second and third sentences under this paragraph heading.

No answer is required with respect to the fourth sentence under this heading, including the citations to regulations, because the allegations constitute legal conclusions. To the extent an answer is required, Defendants admit only that the laws referenced speak for themselves. Defendants deny the allegations in the fifth sentence under this paragraph heading.

CAUSE OF ACTION – NEGLIGENCE

No answer is required with respect to the first sentence under the paragraph heading “Cause of Action – Negligence” in the Complaint because the allegations constitute legal conclusions. To the extent an answer is required, Defendants deny the allegations. Defendants deny the remaining allegations under this paragraph heading.

REQUEST FOR TEMPORARY RESTRAINING ORDER

In answer to the allegations in the first sentence under the paragraph heading “Request for Temporary Restraining Order” in the Complaint, Defendants admit only that Plaintiff Scott Scher (“Plaintiff”) makes the request noted therein. Defendants deny that Plaintiff is entitled to any such relief and deny all liability.

Defendants deny the allegations in the second through the eighth sentences under this paragraph heading.

In answer to the allegations in the ninth sentence under this paragraph heading, Defendants admit only that Plaintiff makes the request noted therein. Defendants deny that Plaintiff is entitled to any such relief and deny all liability.

Defendants deny the allegations in the tenth sentence under this paragraph heading.

In answer to the allegations in the eleventh sentence under this paragraph heading, Defendants admit only that Plaintiff makes the request noted therein. Defendants deny that Plaintiff is entitled to any such relief and deny all liability.

Defendants lack knowledge or information sufficient to admit or deny the allegations in the twelfth sentence under this paragraph heading, and therefore deny those allegations.

REQUEST FOR RULE 194 DISCLOSURE

In answer to the allegations under the paragraph heading “Request for Rule 194 Disclosure” in the Complaint, Defendants admit only that Plaintiff makes the request noted therein. Defendants deny that Plaintiff is entitled to such disclosure and deny all liability.

PRAYER

No answer is required with respect to the allegations under the paragraph heading “Prayer” in the Complaint. To the extent an answer is required, Defendants admit only that Plaintiff seeks the relief stated therein. Defendants, however, deny that Plaintiff is entitled to any such relief and deny all liability.

Except as admitted, qualified, or otherwise stated herein, Defendants deny all allegations contained in the Complaint.

AFFIRMATIVE AND OTHER DEFENSES

Defendants assert the following affirmative and other defenses:

1. Plaintiff’s claims are barred, in whole or in part, by reason of Defendants’ compliance with applicable contracts and agreements.

2. Plaintiff’s claims are barred by the statute of limitations.

3. Plaintiff’s claims are barred by res judicata and collateral estoppel, including issue and claim preclusion.

4. Plaintiff’s claims are barred by set-off and/or off-set.

5. Plaintiff’s claims are barred in whole or in part by the doctrines of unclean hands, laches, waiver, and/or estoppel (in all its forms).

6. Plaintiff’s claims are barred in whole or in part by his failure to mitigate his damages, if any.

7. Plaintiff’s claims are barred in whole or in part by the statute of frauds, parol evidence rule, merger, and economic loss doctrines.

Plaintiff’s claims may also be barred by additional defenses that may arise during the course of this litigation, which defenses Defendants reserve the right to assert.

COUNTERCLAIM

Deutsche Bank Trust Company Americas, as Trustee for Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates Series 2006-QS14 (“Deutsche Bank”) and PHH Mortgage Corporation (“PHH”) plead the following counterclaims against Plaintiff and his spouse, Rhonda Sexton, (hereinafter “Borrowers”) in accordance with the Federal Rules of Civil Procedure, and would respectfully show the Court as follows:

PARTIES

1. Borrowers are individuals who are domiciled in the State of Texas. Plaintiff has appeared and may be served through is counsel appearing in this action. Rhonda Sexton may be served at 981 Woodview Drive, Prosper, Texas 75078, or wherever she may be found.

2. Deutsche Bank is a New York chartered banking institution, which has appeared in this lawsuit and may be served through its undersigned counsel.

3. PHH is a New Jersey corporation, which has appeared in this lawsuit and may be served through its undersigned counsel.

JURISDICTION AND VENUE

4. This Court has jurisdiction over this counterclaim under 28 U.S.C. § 1332(a)(1) because Deutsche Bank and PHH are each citizens of a different states than Borrowers, and the amount in controversy exceeds $75,000 excluding interest and costs.

5. Venue is proper in this district under 28 U.S.C. § 1391(b)(2) because a substantial party of the events or omissions giving rise to the claims asserted herein occurred in this district and the property at issue is situated in this district.

FACTS

6. Borrowers own property located at 981 Woodview Drive, Prosper, Texas 75078 (the “Property”). On July 13, 2006, Rhonda Sexton financed the purchase of the Property with a loan in the original principal amount of $650,000.00 from Secure Mortgage Company (the “Loan”).

The Loan was memorialized by the execution of, among other things, the following instruments by Borrowers: (1) Note (the “Note”), (2) a deed of trust (the “Deed of Trust”).

7. The Note and Deed of Trust require Borrowers to make monthly payments of principal and interest. The Deed of Trust provides Secure Mortgage Company and its successors and assigns with a power of sale if Borrowers default on the payment obligations. The power of sale may be exercised by a court order.

8. Mortgage Electronic Registration Systems, Inc., acting solely as nominee for Secure Mortgage Company, executed an assignment of the Deed of Trust, together with the indebtedness or obligation described in the Deed of Trust and the monies due and to grow due thereon with interest, to Deutsche Bank on or about January 22, 2011.

PHH is the current servicer of the Loan.

9. Borrowers defaulted on the Loan. Borrowers’ Loan is currently due for the July 1, 2016 payment. Because of Borrowers’ default, Borrowers were sent a notice of default and notice of intent to accelerate. The notice was sent to Borrowers’ last known address by certified mail.

Because Borrowers failed to cure their default within thirty days, Borrowers were sent a notice advising Borrowers that the indebtedness owed on the Loan had been accelerated. The acceleration letter was sent to Borrowers at Borrowers’ last known address by certified mail.

10. Plaintiff filed this lawsuit in an attempt to prohibit the mortgagee and mortgage servicer from proceeding with the nonjudicial foreclosure sale that was scheduled for January 5, 2021.

11. Borrowers have enjoyed continuous and uninterrupted use of the Property for more than four years without making a single payment on the Loan.

COUNT 1—JUDICIAL FORECLOSURE

12. Deutsche Bank and PHH incorporate for all purposes the allegations set forth in each paragraph above.

13. Deutsche Bank and PHH have satisfied all conditions precedent.

14. Deutsche Bank and PHH seek entry of an order and judgment against Borrowers under Texas Rule of Civil Procedure 309 (1) providing for the judicial foreclosure of the lien encumbering the Property; (2) awarding Deutsche Bank and PHH their debt, damages, and costs; and (3) further providing that the Property shall be sold at public auction in accordance with the requirements of chapter 51 of the Texas Property Code in satisfaction of such judgment.

COUNT 2—WRIT OF POSSESSION

15. Deutsche Bank and PHH incorporates for all purposes the allegations set forth in each paragraph above.

16. Upon the Court’s issuance of a judgment for foreclosure, Deutsche Bank and PHH are further entitled to a writ of possession pursuant to Texas Rule of Civil Procedure 310.

COUNT 3—IN THE ALTERNATIVE DECLARATORY JUDGMENT FOR NONJUDICIAL FORECLOSURE

17. Deutsche Bank and PHH incorporate for all purposes the allegations set forth in each of the paragraphs stated above.

18. In the alternative, Deutsche Bank and PHH seek declaratory relief, setting forth the respective rights, duties, and obligations of Deutsche Bank and PHH and Borrower under the Note and Deed of Trust.
Specifically, Deutsche Bank and PHH seek declarations that:

(1) Borrowers are indebted to Deutsche Bank and PHH under the Note;

(2) Deutsche Bank is the mortgagee and PHH is the mortgage servicer of the Loan and are authorized to enforce the terms of the Note and Deed of Trust, including through foreclosure;

(3) Borrowers are in default of their Loan obligations;

(4) Deutsche Bank and PHH, or its predecessors-in-interest and/or their agents, provided Borrowers with all of the notices required to conduct a foreclosure sale under the terms of the Note and Deed of Trust, and applicable law;

and

(5) that Deutsche Bank as mortgagee and PHH as mortgage servicer and attorney-in-fact for Deutsche Bank is entitled to conduct a nonjudicial foreclosure sale by providing Borrowers with only a notice of trustee’s sale.

19. Any conditions precedent to the relief sought have occurred or have been performed, tendered, or waived.

COUNT 4—ATTORNEYS’ FEES

20. Deutsche Bank and PHH incorporate for all purposes the allegations set forth in each paragraph above.

21. The Deed of Trust expressly provides that any amounts paid by Lender— including PHH as servicer of the Loan—to protect Lender’s interest in the Property and/or rights under the Deed of Trust, including for reasonable attorneys’ fees, become additional debt secured by the Deed of Trust.

22. Because of Borrowers’ default and because of the referenced litigation, Deutsche Bank and PHH have incurred and paid, and will continue throughout the pending litigation to incur and pay, attorneys’ fees and expenses.

Deutsche Bank and PHH are therefore entitled to an award for all of the reasonable attorneys’ fees they have paid or will pay in connection with protecting their interest in the Property and/or their rights under the Deed of Trust.

PRAYER

WHEREFORE, Deutsche Bank and PHH pray that, upon final hearing hereof, judgment be rendered against Plaintiff, that Plaintiff take nothing by his claims and that Deutsche Bank and PHH be awarded a judgment against Borrowers consistent with the relief pleaded herein, including:

(a) an order awarding debt, damages, attorneys’ fees, costs, and interest thereon;

(b) an order foreclosing the lien evidenced by the Deed of Trust and ordering the sale of the Property and a writ of possession in satisfaction or partial satisfaction of such judgment;

(c) in the alternative, a declaratory judgment providing for a nonjudicial foreclosure of the Property;

and
(d) all other and further relief to which Deutsche Bank and PHH may be entitled.

Respectfully submitted,

/s/ Elizabeth K. Duffy

Robert T. Mowrey
Texas Bar No. 14607500
rmowrey@lockelord.com

Arthur E. Anthony
Texas Bar No. 24001661
aanthony@lockelord.com
Elizabeth K. Duffy
Texas Bar No. 24050535
eduffy@lockelord.com

LOCKE LORD LLP
2200 Ross Avenue, Suite 2800
Dallas, Texas 75201-6776
(214) 740-8000 (Telephone)
(214) 740-8800 (Facsimile)

ATTORNEYS FOR DEFENDANTS/COUNTER- PLAINTIFFS

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing was served on this 12th day of July 2021 via e-filing on:

Thomas C. Barron
Law Offices of Thomas C. Barron
P.O. Box 141323 Dallas, Texas 75214
tbarron@barronlawfirm.com
Attorneys for Plaintiff/Counter-Defendant

/s/ Elizabeth K. Duffy
Attorney for Defendants/Counter-Plaintiffs

When is Mandamus Granted by the Court of Appeals for the Fifth Circuit?

This court is constrained to issue writs of mandamus only in situations that amount to a clear abuse of judicial power or usurpation.

Judge Alfred H. Bennett, S.D. Tex., Reversed for Abuse of Discretion by Fifth Circuit

Abuse of Discretion: The scope of the district court’s discretion is narrower when the Rule 41(b) dismissal is with prejudice says 5th Cir.

A Fifth Circuit Clerk Corruptly Impersonating Appellants Induces Finality of Appeal

Fifth Circuit Clerk Gardner, with knowledge and in bad faith, entered her own fraudulent Motion upon which the 5th Cir. entered its judgment.

U.S. District Court
Eastern District of TEXAS [LIVE] (Sherman)
CIVIL DOCKET FOR CASE #: 4:21-cv-00048-ALM

Scher v. Deutsche Bank Trust Company Americas et al
Assigned to: District Judge Amos L. Mazzant, III
Cause: 28:1332 Diversity-Petition for Removal
Date Filed: 01/18/2021
Jury Demand: None
Nature of Suit: 290 Real Property: Other
Jurisdiction: Diversity
Plaintiff
Scott Scher represented by Thomas C Barron
Law Offices of Thomas C. Barron
P. O. Box 14123
Dallas, TX 75214
214/855-6631
Fax: 214-855-6633
Email: tbarron@barronlawfirm.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
V.
Defendant
Deutsche Bank Trust Company Americas
as Trustee for Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates Series 2006-QS14
represented by Arthur Elex Anthony
Locke Lord LLP – Dallas
2200 Ross Ave, Suite 2800
Dallas, TX 75201-6776
214/740-8000
Fax: 214-740-8800
Email: aanthony@lockelord.com
ATTORNEY TO BE NOTICEDRobert T Mowrey
Locke Lord LLP – Dallas
2200 Ross Ave, Suite 2800
Dallas, TX 75201-6776
214/740-8000
Fax: 214/740-8800
Email: rmowrey@lockelord.com
ATTORNEY TO BE NOTICEDElizabeth Kristin Duffy
Locke Lord LLP – Dallas
2200 Ross Ave, Suite 2800
Dallas, TX 75201-6776
214-740-8673
Fax: 214-756-8673
Email: eduffy@lockelord.com
ATTORNEY TO BE NOTICED
Defendant
PHH Mortgage Corporation represented by Arthur Elex Anthony
(See above for address)
ATTORNEY TO BE NOTICEDRobert T Mowrey
(See above for address)
ATTORNEY TO BE NOTICEDElizabeth Kristin Duffy
(See above for address)
ATTORNEY TO BE NOTICED

 

Date Filed # Docket Text
01/18/2021 1 NOTICE OF REMOVAL by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation (Filing fee $ 402 receipt number 0540-8202144), filed by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation. (Attachments: # 1 Exhibit A – Index, # 2 Exhibit B – State Court Docket Sheet, # 3 Exhibit C – State Court Action Pleadings, # 4 Exhibit D – List of All Parties, # 5 Exhibit E – List of All Attorneys, # 6 Exhibit F – Collin Co. Appraisal District Property Detail, # 7 Exhibit G – Disclosure Statement, # 8 Civil Cover Sheet)(Duffy, Elizabeth) (Entered: 01/18/2021)
01/18/2021 2 CORPORATE DISCLOSURE STATEMENT filed by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation identifying Other Affiliate Deutsche Bank Trust Company Americas for PHH Mortgage Corporation. (Duffy, Elizabeth) (Entered: 01/18/2021)
01/19/2021 3 ***ORIGINALLY FILED IN STATE COURT*** COMPLAINT against Deutsche Bank Trust Company Americas, PHH Mortgage Corporation, filed by Scott Scher.(rpc, ) (Entered: 01/19/2021)
01/19/2021 4 ***ORIGINALLY FILED IN STATE COURT*** ANSWER to 3 Complaint by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation.(rpc, ) (Entered: 01/19/2021)
01/19/2021 5 ORDER AND ADVISORY. Signed by District Judge Amos L. Mazzant, III on 1/19/2021. (rpc, ) (Entered: 01/19/2021)
02/11/2021 6 ORDER governing proceedings. Rule 26(f) attorney conference must occur by March 3, 2021. Joint written report filed by March 17, 2021. Rule 16 Management/Scheduling Conference set for 4/5/2021 02:30 PM in Ctrm 208 (Sherman) before District Judge Amos L. Mazzant III. Signed by District Judge Amos L. Mazzant, III on 2/11/2021. (bjc, ) (Entered: 02/11/2021)
03/10/2021 7 AMENDED ANSWER to Plaintiff’s First Amended Original Petition and Verified Request for Temporary Restraining Order by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation. (Duffy, Elizabeth) (Entered: 03/10/2021)
03/17/2021 8 REPORT of Rule 26(f) Planning Meeting – Joint Report of Rule 26(f) Conference (Duffy, Elizabeth) Modified on 3/18/2021 (rpc, ). (Additional attachment(s) added on 3/18/2021: # 1 Proposed Scheduling Order) (rpc, ). (Entered: 03/17/2021)
04/16/2021 9 SCHEDULING ORDER: Final Pretrial Conference set for 2/28/2022 at 09:00 AM in Ctrm 208 (Sherman) before District Judge Amos L. Mazzant III. Amended Pleadings due by 6/28/2021. Discovery due by 9/20/2021. Joinder of Parties due by 5/17/2021. Mediation Completion due by 11/12/2021. Designation of Mediator due by 7/9/2021, Motions due by 10/1/2021. Proposed Findings of Fact due by 2/14/2022. Proposed Pretrial Order due by 1/28/2022. Signed by District Judge Amos L. Mazzant, III on 4/16/2021. (rpc, ) (Entered: 04/16/2021)
07/09/2021 10 NOTICE of Designation of Mediator, Jay C. Zeleskey, filed by Deutsche Bank Trust Company Americas. re 9 Scheduling Order,, (Duffy, Elizabeth) (Entered: 07/09/2021)
07/12/2021 11 Unopposed MOTION for Leave to File Second Amended Answer and Counterclaim by Deutsche Bank Trust Company Americas. (Attachments: # 1 Exhibit 1, # 2 Text of Proposed Order)(Duffy, Elizabeth) (Entered: 07/12/2021)
07/12/2021 12 SECOND AMENDED ANSWER AND COUNTERCLAIM to 3 Complaint by Deutsche Bank Trust Company Americas, PHH Mortgage Corporation. (baf, ) (Entered: 07/13/2021)
07/13/2021 13 ORDER. It is therefore ORDERED that Defendants’ Unopposed Motion for Leave to File Second Amended Answer and Counterclaim (Dkt. 11 ) is GRANTED, and Defendants’ Second Amended Answer and Counterclaim (Dkt. 12 ) is deemed filed. Signed by District Judge Amos L. Mazzant, III on 7/13/2021. (baf, ) (Entered: 07/13/2021)

About Thomas Barron

My primary focus is upon a general trial practice, having tried over sixty matters to verdict in both state and federal courts. The practice encompasses the representation of multi-national corporations in complex commercial litigation to the representation of individuals in all manner of disputes. I have significant jury trial experience representing both plaintiffs and defendants in fraud cases, deceptive trade practice actions, general contract litigation, trade secret matters, real estate disputes, legal malpractice claims, and collection suits as well as will contests and construction cases. My firm also prosecutes and defends special proceedings, such as temporary restraining orders, temporary injunctions, pre-judgment garnishments, sequestrations, and all other forms of extraordinary relief. Representaion of clients also includes mediations and binding arbitrations before state and national alternative dispute resolution tribunals.

Specialties: Fraud and deceptive trade practice defense. Landlord- tenant disputes. Legal malpractice and grievance defense.

Scher v. Deutsche Bank Trust Co., 634 F. App’x 435 (5th Cir. 2015)

DEC 22, 2015 | REPUBLISHED BY LIT: JUL 29, 2021

In 2006, Scott Scher and Rhonda Sexton bought a home in Prosper, Texas. To purchase their home, Appellants borrowed $650,000 from Secure Mortgage Company, a lender, via a promissory note.

In November 2006, Appellants were notified that GMAC, a predecessor entity to Ally Financial, was designated as the servicer for their loan.

In the middle of 2010, Scher experienced significant health issues and they fell behind on their house payments. A few months later, MERS, acting as Secure Mortgage’s nominee, assigned the Appellants’ Deed of Trust to Deutsche Bank. Ally moved to foreclose in April 2011.

No. 15-40570

12-22-2015

SCOTT A. SCHER; RHONDA SEXTON, Plaintiffs – Appellants v. DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee for Rali 2006QS14; ALLY FINANCIAL, INCORPORATED, formerly known as GMAC Mortgage, L.L.C.; MORTGAGE ELECTRONIC REGISTRATION SERVICES, INCORPORATED; OCWEN FINANCIAL CORPORATION, Defendants – Appellees

STEPHEN A. HIGGINSON, Circuit Judge

Summary Calendar Appeal from the United States District Court for the Eastern District of Texas
USDC No. 4:13-CV-203 Before WIENER, HIGGINSON, and COSTA, Circuit Judges. STEPHEN A. HIGGINSON, Circuit Judge:

Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. ——–

Scott Scher and Rhonda Sexton borrowed money to purchase a home. Scher became seriously ill and the couple was unable to make their mortgage payments. Deutsche Bank foreclosed on the property, and Scher and Sexton, Appellants herein, sued. The district court granted the Defendants-Appellees’ several motions to dismiss. We AFFIRM.

BACKGROUND

We take the allegations in Appellants’ complaint as true. See Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010). We also consider the documents that Appellants attached to their complaint and the documents that Appellees attached to their responsive pleadings that were both central to and mentioned by the complaint. See id. These documents include: a Deed of Trust, an Assignment of Deed of Trust, an Appointment of Substitute Trustee, a Substitute Trustee’s Deed, and a Notice of Substitute Trustee’s Sale. To the extent that the documents conflict with Appellants’ allegations, the documents control. See Bosarge v. Mississippi Bureau of Narcotics, 796 F.3d 435, 440-41 (5th Cir. 2015).

In the summer of 2006, Appellants Scott Scher and Rhonda Sexton bought a home in Prosper, Texas. To purchase their home, Appellants borrowed $650,000 from Secure Mortgage Company, a lender, via a promissory note. The note was secured by a Deed of Trust. The Deed of Trust names Secure Mortgage as the lender and the Mortgage Electric Registration System (“MERS”) as the beneficiary in the capacity as nominee for Secure Mortgage and its assignees. The Deed of Trust was filed in the Collin County land records. In November 2006, Appellants were notified that GMAC, a predecessor entity to Ally Financial, was designated as the servicer for their loan. In the middle of 2010, Scher experienced significant health issues and they fell behind on their house payments. A few months later, MERS, acting as Secure Mortgage’s nominee, assigned the Appellants’ Deed of Trust to Deutsche Bank. Ally moved to foreclose in April 2011. Due to alleged defects in the notice requirements, however, the sale did not happen when initially scheduled. On April 5, the Appellants’ property was again posted for foreclosure, this time on May 3, with Deutsche Bank conducting the sale. Appellants had notice of this sale. Deutsche Bank, through a substitute trustee, foreclosed on the property, purchasing it on May 16, 2011.

After foreclosing, Deutsche Bank sought to evict the Appellants, who responded by filing suit against Deutsche Bank, MERS, and others in Texas state court. Ten months later, Appellants filed a nonsuit. Appellants filed their original complaint—a class action—in federal court in April 2013, and their first amended complaint (also a class action) in July 2013. The amended complaint alleges six causes of action against Deutsche Bank; Ally Financial; Ocwen Financial; MERS; the law firm Bradley, Arant, Boult, Cummings, LLP; and an individual attorney, Preston Neel: (1) suit to quiet title; (2) fraudulent filings; (3) fraud; (4) wrongful foreclosure; (5) breach of contract; and (6) declaratory relief. The Appellees moved to dismiss and the magistrate judge recommended that their motions be granted. Over Appellants’ objections, the district court adopted the magistrate’s findings and conclusions, dismissing all of Appellants’ claims. Appellants moved the court to reconsider, or in the alternative, to allow them to amend their complaint. The district court denied the motion for reconsideration, and this appeal followed.

DISCUSSION

Appellants challenge the district court’s dismissal of claims pertaining to Deutsche Bank and MERS only. We review de novo a district court’s decision to grant a motion to dismiss. See Reece v. U.S. Bank Nat. Ass’n, 762 F.3d 422, 424 (5th Cir. 2014). Appellants assert six claims of reversible error on appeal: (1) wrongful foreclosure and quiet title; (2) declaratory relief; (3) fraudulent filings; (4) fraud; (5) the district court’s denial of the motion for reconsideration; and (6) the district court’s denial of the motion to amend their complaint. Having reviewed the briefs and the record, we AFFIRM.

A. Wrongful Foreclosure and Quiet Title

Appellants first argue that Deutsche Bank lacked the capacity to foreclose on their property; thus, they contend that they are entitled to quiet title. This argument is based on the premise that “at the time of foreclosure, Deutsche was neither the holder of the note, the holder of the deed of trust, nor the beneficiary of the deed of trust.” To the contrary—documents in evidence establish Deutsche Bank’s authority to enforce the Deed of Trust:

• The Deed of Trust names MERS as beneficiary in the capacity as nominee for Secure Mortgage and its assignees.

• The Deed of Trust was filed in the Collin County land records in July 2006.

• On January 22, 2011, MERS assigned the Deed of Trust to Deutsche Bank.

• This assignment was recorded in Collin County on February 8, 2011.

• The Deed of Trust grants MERS and its assigns the right “to foreclose and sell the Property.”

The district court held that Appellants’ “challenges to the assignment of the Deed of Trust are not enough to state a claim,” citing Wiley v. Deutsche Bank Nat. Trust Co., 2013 WL 4779686, *2-3 (5th Cir. 2013). We agree.

Appellants also argue that there are three defects in the notice requirements that support their claim to quiet title: (1) a failure to send Appellants a notice of default and opportunity to cure; (2) a failure to send Appellants a notice of acceleration; and (3) a failure to include the substitute trustee’s address in the notice of sale. These arguments are not persuasive. The first two arguments pertain to the planned April foreclosure—but that sale was postponed until May, and Appellants had notice of the May sale. The third argument is contradicted by the plain terms of the Notice of Substitute Trustee’s Sale, which lists the names of the Substitute Trustees and a “Return to” address.

B. Declaratory Relief

Appellants argue that Deutsche Bank could not foreclose under the “split-the-note” theory. Our court has repeatedly rejected this argument. See Martins v. BAC Home Loans Servicing, L.P., 722 F.3d 249, 253-56 (5th Cir. 2013). Here, the Deed of Trust was assigned to MERS, and then by MERS to Deutsche Bank. It granted MERS and its assigns (Deutsche Bank) the right “to foreclose and sell the Property.” Thus, MERS and Deutsche Bank did not need to possess the note to foreclose. Id. at 255. Appellants’ reliance on state court cases that our court in Martins recognized as the minority—and non-prevailing—view is not persuasive.

C. Fraudulent Filings

Appellants also argue that the district court erred in dismissing their fraudulent filings claim under Chapter 12 of the Texas Civil Practice & Remedies Code. The court held, in part, that “no facts [were] stated . . . that would sufficiently state, with the specificity required under the Federal Rules of Civil Procedure, any fraudulent filing,” and thus “[t]he claim should be dismissed.” Appellants do not challenge that holding. Instead, they direct all of their arguments toward an alternative ground the district court gave for its dismissal of the fraudulent filings claims: that, under Fifth Circuit law, borrowers cannot make challenges to the type of assignments at issue here. Because they have not addressed the district court’s alternative and sufficient ground for dismissal—failure to plead fraud with specificity—Appellants’ waive their right to appeal the dismissal of their fraudulent filings claim. See Capital Concepts Properties 85-1 v. Mut. First, Inc., 35 F.3d 170, 176 (5th Cir. 1994) (“issues not raised on appeal in the brief of the appellant may be considered waived, and thus cannot be noticed or entertained by the Court of Appeals” (citing Matter of Texas Mortgage Servs. Corp., 761 F.2d 1068, 1073 (5th Cir. 1985))).

D. Fraud

Appellants next argue that the Appellees’ conduct, acts, and omissions constituted fraud. The district court dismissed this claim against the remaining Appellees for several reasons, including a failure to allege the damages necessary to satisfy the economic loss doctrine. The court stated that “[b]ecause no extracontractual damages have been stated – indeed, [Appellants] have not addressed the economic loss doctrine whatsoever in their response to the motion to dismiss – [Appellants’] fraud claims should be dismissed.” The Appellants failed to address this holding in their briefing to this court, and therefore waive the issue. See Capital Concepts Properties, 35 F.3d at 176.

E. Denial of a Motion for Reconsideration

Appellants argue that the district court committed reversible error by denying their motion for reconsideration, but fail to brief this claim. We review for abuse of discretion a district court’s decision to deny reconsideration. See LeClerc v. Webb, 419 F.3d 405, 412 n.13 (5th Cir. 2005). In denying the motion for reconsideration, the district court concluded that the Appellants did not put forth any new evidence or show a change in the law. We agree.

F. Denial of a Request to Amend

Finally, Appellants argue that the district court erred by denying their request to amend their pleadings. Appellants filed an amended complaint after several Appellees moved to dismiss the original complaint. Thus, Appellants challenge the denial of their second amended complaint. We review this denial for an abuse of discretion. See Goldstein v. MCI WorldCom, 340 F.3d 238, 255 (5th Cir. 2003). The district court found that the Appellants did not put forth any new information or show a change in the law. On appeal, the Appellants do not indicate what additional information they would plead “to provide sufficient detail in the Court’s eyes.” The district court did not abuse its discretion by denying Appellants a second opportunity to amend.

CONCLUSION

For the foregoing reasons, we AFFIRM.

*Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. ——–

Former Texas Lawyer Scott Scher May Have An Ally In Mind Once He Reads This
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