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Mcmullen v. Ocwen Loan Servicing, LLC

United States District Court, D. New Jersey

February 23, 2017

BRIAN MCMULLEN and DEMETRIOS ZERIS, Plaintiffs,
v.
OCWEN LOAN SERVICING, LLC, Defendant.

          JEFFREY SCOTT SIMONS MINTZER SAROWITZ ZERIS LEDVA & MEYERS LLP On behalf of Plaintiffs.

          BRETT L. MESSINGER KASSIA FIALKOFF DUANE MORRIS, LLP On behalf of Defendant.

          OPINION

          NOEL L. HILLMAN, U.S.D.J.

         This case involves allegations of unreasonable mortgage closing costs. Presently before the Court are two motions: Defendant's motion to dismiss and Plaintiffs' motion to remand. For the reasons expressed below, Plaintiff's motion will be denied, and Defendant's motion will be granted.

         BACKGROUND

         The following allegations are contained in Plaintiffs' complaint and are assumed true for purposes of this motion.[1]Plaintiff, Brian McMullen, purchased the property located at 28 Patriot Court, Sicklerville, New Jersey on an unspecified date. At or around the time he purchased the property, McMullen took out a mortgage on the property. The mortgagee is not identified in the complaint. On or around October 7, 2010, Plaintiff, Demetrios Zeris, obtained a second mortgage on the property in the amount of $300, 000.[2] Zeris subsequently foreclosed on the property.

         On or about October 14, 2014, Zeris sold the property to unrelated buyers for $309, 000. At closing, Defendant, Ocwen Loan Servicing, LLC, purported to hold the first mortgage, taken out by plaintiff McMullen. According to the Complaint, Defendant has never provided any documentation proving that it is the rightful, legal holder of the first mortgage despite repeated requests for that information. At closing, Defendant presented a list of closing costs including, but not limited to, those pertaining to and entitled “Escrow Advance” in the amount of $95, 047.40, “Property Inspection Fee” in the amount of $301.25, “Property Maintenance Expense” in the amount of $2, 781.75, “Title Report Fee” in the amount of $1, 050.00, “Property Valuation Expense” in the amount of $1, 578.00, “FC Thru Title Searches” in the amount of $375.00, “FC Thru Complaint” in the amount of $1, 091.25, “FC Thru Judgment” in the amount of $1, 000.00, “Civil Litigation” in the amount of $600.00, and “Additional/Hourly/Court Appearance” in the amount of $1, 200.00. At the time of the closing on October 14, 2014, the title company, Connection Title Agency of NJ, LLC, paid the closing costs listed above so Zeris would not lose the sale.

         The Complaint alleges that the listed closing costs are unreasonable, unjustified and unlawful. At no time before, at, or after closing did Defendant provide any support, documentation, verification, or justification for the closing costs. Plaintiffs assert that they have repeatedly requested from Defendant any support, documentation, verification, or justification for the closing costs, but have been stonewalled by defendant at every turn.

         Plaintiffs alleges four causes of action: a) breach of contract (Count One); b) fraud (Count Two); c) breach of fiduciary duty (Count Three); and d) misallocation of funds (Court Four). Plaintiffs demand judgment against Defendant for compensatory damages, interest, fees, and costs of suit. (Docket No. 1-2 at 7-10.)

         The Defendant has moved to dismiss Plaintiffs' complaint, arguing that Plaintiffs have failed to state any cognizable claims. Plaintiffs have opposed Defendant's motion to dismiss, and filed a motion to remand their case to state court based on their stipulation that they will not seek damages in excess of $75, 000. Defendant has opposed Plaintiffs' motion to remand, arguing that Plaintiffs' post-removal stipulation of damages is inconsequential to this Court's exercise of subject matter jurisdiction.

         DISCUSSION

         A. Subject matter jurisdiction

         Defendant removed this action from New Jersey state court to this Court pursuant to 28 U.S.C. § 1441. This Court has jurisdiction over the matter pursuant to 28 U.S.C. § 1332 because there is complete diversity of citizenship between the parties and the amount in controversy exceeds $75, 000. The citizenship of the parties is as follows: Plaintiffs are citizens of New Jersey, and Defendant is a citizen of the U.S. Virgin Islands.[3]

         B. Standard for ...


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