Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

U.S. Bank National Association v. Viola

United States District Court, N.D. Ohio

June 13, 2017

U.S. BANK NATIONAL ASSOCIATION, Plaintiff,
v.
ANTHONY L. VIOLA, et al., Defendants.

          OPINION & ORDER [Resolving Docs. 32, 52, 58 & 61]

          JAMES S. GWIN, UNITED STATES DISTRICT JUDGE

         Plaintiff U.S. Bank National Association (“U.S. Bank”) brings a foreclosure action against Defendant Anthony L. Viola.[1] Defendant Viola brings fraud and unjust enrichment counterclaims against Plaintiff U.S. Bank.[2]

         Defendant Viola moves to dismiss the complaint, arguing that Plaintiff U.S. Bank lacks standing to enforce the note and mortgage in this case.[3]

         Plaintiff U.S. Bank moves for default judgment for failure to properly plead or otherwise defend.[4] U.S. Bank also moves to dismiss Defendant Viola's counterclaims for lack of subject matter jurisdiction and failure to state a claim.[5] Additionally, U.S. Bank moves for relief from the Court's previous order dismissing various defendants for want of prosecution.[6]

         For the reasons stated below, the Court DENIES Defendant Viola's motion to dismiss, DENIES Plaintiff U.S. Bank's motion for default judgment, and GRANTS Plaintiff U.S. Bank's motions to dismiss Viola's counterclaims and for relief from the Court's previous order.

         I. Background

         In this foreclosure action, Plaintiff U.S. Bank alleges that Defendant Anthony Viola defaulted on obligations under a Note and Mortgage assigned to and held by U.S. Bank. The parties bring several motions related to the viability of Plaintiff's Complaint and Defendant's Answer and Counterclaims.

         On December 23, 1993, Defendant Viola executed a promissory note for $126, 000 in favor of Union National Mortgage Co. (the “Note”).[7] Union National Mortgage Co. endorsed the Note to the Leader Mortgage Company.[8] To secure the Note, Viola executed a mortgage on 3048 Meadowbrook Boulevard, Cleveland Heights, Ohio in favor of Union National Mortgage Co. (the “Mortgage”).[9] On December 30, 1993, Union National Mortgage Co. conveyed the Mortgage to the Leader Mortgage Company.[10] Plaintiff U.S. Bank is a successor by merger to the Leader Mortgage Company, which merged into U.S. Bank in June 2004.[11]

         In 2012, Defendant Viola defaulted on the Note. Plaintiff U.S. Bank alleges that Viola currently owes the principal amount of $61, 435.62, plus interest on the outstanding principal, late charges, advances, and all costs and expenses incurred for the Note and Mortgage's enforcement.[12]

         Procedural History

         On February 24, 2016, Plaintiff U.S. Bank filed a complaint in the Cuyahoga County Court of Common Pleas for foreclosure, alleging a breach of Defendant Viola's Note and that U.S. Bank sought to foreclose the Mortgage.[13] The complaint named Anthony Viola; Joanne Viola; Cuyahoga Clerk of Courts; State of Ohio, Department of Taxation; Citibank (South Dakota); Chase Bank USA, N.A.; and Capital One Bank USA, N.A. as defendants.

         The complaint also named the United States as a defendant because the United States had filed a Notice of Lien for Fine and/or Restitution and a Notice of Federal Tax Lien that attached to Viola's Cleveland Heights Meadowbrook Boulevard property. On April 22, 2016, Defendant United States removed the case to this Court under 28 U.S.C. §§ 1442(a)(1) and 1444.[14]

         In his answer, Defendant Viola brought two counterclaims against Plaintiff U.S. Bank. First, Viola claims that U.S. Bank received unjust enrichment from its “double recovery” of both mortgage-backed security settlements and mortgage fraud restitution orders.[15] Second, Viola claims that U.S. Bank committed fraud when it failed to notify the Court of U.S. Bank's settlement with the Department of Justice for illegal mortgage origination and foreclosure practices.[16]

         On December 20, 2016, the Court filed an order noting that Plaintiff U.S. Bank had served copies of the complaint to Defendants Citibank (South Dakota); Chase Bank USA, N.A.; Capital One USA, N.A.; Joanne Viola; State of Ohio Department of Taxation; and Cuyahoga Clerk of Courts, but that those defendants had failed to file answers.[17] The Court instructed Plaintiff U.S. Bank to submit by January 6, 2017, a motion for default judgment or show cause why the Court should not dismiss those defendants for want of prosecution.[18] U.S. Bank failed to comply with the Court's order, and on January 13, 2017, the Court dismissed those defendants for want of prosecution.[19]

         Several motions are now before the Court.

         Defendant Viola moves to dismiss the Plaintiff's complaint on the ground that Plaintiff U.S. Bank lacks standing to sue.[20]

         Plaintiff U.S. Bank moves for default judgment against Defendant Viola, arguing that Viola has failed to properly plead or otherwise defend as required by Federal Rules of Civil Procedure Rule 12.[21] U.S. Bank also moves to dismiss Defendant Viola's counterclaims for lack of subject matter jurisdiction and failure to state a claim.[22]

         Finally, Plaintiff U.S. Bank moves for relief from the Court's order dismissing Defendants Citibank (South Dakota); Chase Bank USA, N.A.; Capital One USA, N.A.; Joanne Viola; State of Ohio Department of Taxation; and Cuyahoga Clerk of Courts.[23] U.S. Bank argues that its failure to properly respond to the Court's order was excusable neglect and that if the Court does not grant relief, U.S. Bank will have to dismiss and refile the action to add the dismissed defendants.[24]

         The Court addresses each motion in turn.

         II. Discussion

         A. Defendant Viola's Motion to Dismiss

         Defendant Viola moves to dismiss the Plaintiff's complaint on the ground that Plaintiff U.S. Bank lacks standing to sue.[25] Viola argues that there is no assignment of his mortgage from Leader Mortgage to U.S. Bank.[26] Plaintiff U.S. Bank counters that its complaint provided prima facie evidence of U.S. Bank's ownership of the Note and Mortgage.[27] Moreover, U.S. Bank argues that Defendant Viola lacks standing to challenge the assignment of his mortgage.[28]

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim for relief that is plausible on its face.'”[29] The plausibility requirement is not a “probability requirement, ” but requires “more than a sheer possibility that the defendant has acted unlawfully.”[30]

         Plaintiff U.S. Bank's complaint survives Defendant Viola's motion to dismiss. U.S. Bank supports its claims for money judgment and foreclosure with sufficient factual allegations. U.S. Bank alleges that it is the owner of Defendant Viola's Mortgage, that the Mortgage is in default, and that Viola's entire balance is due and payable. Moreover, U.S. Bank attached a copy of the Note, a copy of the Mortgage, an assignment of the Mortgage to the Leader Mortgage Company, and a document showing the merger of Leader Mortgage Company and Plaintiff U.S. Bank.[31]Plaintiff U.S. Bank's foreclosure claim is plausible on its face.

         Defendant Viola counters that there is no assignment of the Mortgage to U.S. Bank, and therefore U.S. Bank lacks standing to sue. This argument loses. It is Defendant Viola, in fact, who lacks standing to challenge the Mortgage's assignment. Viola was not a party to the Mortgage's assignment, nor has he suffered any new injury or faced any new obligation following the assignment.[32] Therefore, Viola lacks standing to challenge the Mortgage assignment. “[Viola] is in default on [his] loan and subject to foreclosure proceedings by the holder of the mortgage note . . . . Whether that holder is [Leader Mortgage Company] or [U.S. Bank] makes no difference with respect to the obligations owed by Plaintiff under the mortgage contract.”[33]

         Accordingly, the Court DENIES Defendant Viola's motion to dismiss.

         B. Plaintiff U.S. Bank's Motion for Default Judgment

         Plaintiff U.S. Bank moves for default judgment against Defendant Viola.[34] U.S. Bank argues that Viola has failed to properly plead or otherwise defend within the allotted answer period as required by Federal Rules of Civil Procedure Rule 12.[35] Defendant Viola counters that he has responded to the Complaint and all motions, and participated in the Court's pretrial conference.[36]

         Defendant Viola received the Summons on March 4, 2016. Therefore, under the federal rules, [37] he had until March 25, 2016 to file an answer. Viola's answer is dated March 24, 2016.[38]There is nothing on the docket supporting Plaintiff U.S. Bank's assertion that “Defendant failed to properly plead within the allotted answer period.”[39] The Court will not grant default judgment on U.S. Bank's mere words. The case will proceed on the merits.

         The Court DENIES Plaintiff U.S. Bank's motion for default judgment.

         C. Plaintiff U.S. Bank's Motion to Dismiss

         U.S. Bank also moves to dismiss Defendant Viola's fraud and unjust enrichment counterclaims.[40] U.S. Bank argues that the Court lacks supplemental jurisdiction over Viola's state law counterclaims.[41] Alternatively, U.S. Bank argues that the counterclaims fail to state plausible or viable claims under state law.[42] Viola responds that jurisdiction exists ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.