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Rivera v. Select Portfolio Servicing, Inc.

United States District Court, D. New Jersey

December 5, 2017

ANGEL RIVERA et al., Plaintiffs,
v.
SELECT PORTFOLIO SERVICING, INC. et al., Defendants.

          MEMORANDUM AND ORDER

          PETER G. SHERIDAN, U.S.D.J.

         This matter is before the Court on Defendant's motion for reconsideration. (ECF No. 50). Defendant seeks for the Court to address Defendant's remaining arguments in their Motion to Dismiss: (1) that Plaintiff failed to provide pre-suit notice of their dispute; and (2) that Plaintiff failed to state a cognizable claim for relief. For the reasons set forth below, Defendant's motion for reconsideration is denied.

         Background

         Plaintiffs Angel and Angela Rivera filed this Second Amended Complaint (SAC), individually and on behalf of a putative class of people, alleging Defendant Select Portfolio Servicing, Inc. (SPS) violated the Fair Debt Collections Practices Act, 15 U.S.C. § 1692, et seq. (FDCPA). (SAC at ¶¶ 18-19). SPS is a Utah-based a mortgage servicer that "specializes in handling delinquent and defaulted mortgage loans." (Id. at ¶¶ 6-8). Specifically, Plaintiffs maintain that SPS is a "special servicer" and "debt collector, " as defined by 15 U.S.C. § l692a(6). (Id. at ¶¶ 7.13)..

         In July 2004, Plaintiffs obtained a $328, 000 mortgage loan from Countrywide Home Loans, Inc. for their property at 56 Cumberland Avenue, Verona, New Jersey. (Id. at ¶ 29-30). By early 2007, Plaintiffs encountered financial difficulties and were unable to make timely payments. (Id. at ¶ 33). On March 23, 2007, a foreclosure action was filed against Plaintiffs in New Jersey Superior Court. (Id. at ¶ 34). Three days later, March 26, 2007, Plaintiffs filed for Chapter 13 bankruptcy. (Id. at ¶ 35). However, as their financial situation continued to worsen, Plaintiffs were forced to convert their bankruptcy protection to a petition under Chapter 7 in July 2009. (Id. at ¶ 39). Thereafter, Plaintiffs obtained a full discharge of all their debts from Countrywide. (ECF No. 34 at 51).

         On July 9, 2015, Plaintiffs received a "Welcome Letter" from SPS, notifying them that their mortgage obligation would be transferred to SPS for servicing and collection. (Id. at ¶ 42; ECF No. 34 at 54). The letter contains a "Notice of Assignment, Sale or Transfer of Servicing Rights, " which states in pertinent part:

IF YOU HAVE FILED BANKRUPTCY OR HAVE BEEN DISCHARGED IN BANKRUPTCY, PLEASE BE ADVISED THAT THIS STATEMENT DOES NOT REPRESENT AND IS NOT INTENDED TO BE A DEMAND FOR PAYMENT. THIS NOTICE IS FOR INFORMATIONAL PURPOSES ONLY. YOU SHOULD CONTACT LEGAL COUNSEL REGARDING YOUR OBLIGATION, IF ANY, TO PAY ON THE MORTGAGE LOAN.

(ECF No. 34 at 55).

         On July 24, 2015, SPS sent Plaintiffs a "Validation of Debt Notice, " which indicated that Plaintiffs owe $578, 922.50. (ECF No. 34 at 57). The letter also states, "Federal law gives you thirty (30) days after you receive this letter to dispute the validity of the debt, or any part of it. If you don't dispute it within that period, we will assume that it is valid." (Id.) Less than a week later, July 29, 2015, SPS sent Plaintiffs a monthly mortgage statement indicating that an outstanding payment of $195, 862.63 was due by August 1, 2015. (ECF. No 34 at 60). The statement also included a "Notice of Error, " which instructed Plaintiffs on how to correspond with SPS in the event that they believed there was an error with their account. (Id. at 61).

         Plaintiffs, individually and behalf of the putative class, bring this cause of action under the FDCPA. Specifically, under Count One, Plaintiffs maintain that Defendant violated Section l692g of the FDCPA by failing to provide disclosures to Plaintiffs within five days of sending the July 9, 2015 letter. (Id. at ¶ 78-80). Additionally, Plaintiffs claim Defendant committed various misleading and deceptive representations in its "Validation Letter, " contrary to Sections l692e through l692g. (Id. at ¶ 80 (a)-(j)). Under Count Two, Plaintiffs assert, individually, that SPS violated 15 U.S.C. §§ 1692(e), l692e(2) and l692e(lO) by attempting to collect a discharged debt and that Plaintiffs were subsequently deprived of their "fresh start" under the Bankruptcy Code and were furnished with inaccurate information.

         Legal Standard

         Motions for reconsideration are governed by Fed.R.Civ.P. 59(e) and L. Civ. R. 7.l(i). The "extraordinary remedy" of reconsideration is "to be granted sparingly." A.K. Stamping Co., Inc., v. Instrument Specialties Co., Inc., 106 F.Supp.2d 627, 662 (D.N.J. 2000) (quoting NL Indus., Inc., v. Commercial Union Ins. Co., 935 F.Supp. 513, 516 (D.N.J. 1996)). The Rule "does not contemplate a Court looking to matters which were not originally presented." Damiano v. Sony Music Entm 't, Inc., 975 F.Supp. 623, 634 (D.N.J. 1996) (quoting Florham Park Chevron, Inc., v. Chevron U.S.A., Inc., 680 F.Supp. 159, 162 (D.N.J. 1988)).

         The Third Circuit has held that the "purpose of a motion for reconsideration is to correct manifest errors of law or fact or to present newly discovered evidence." Harsco Corp. v. Zlotincki,779 F.2d 906, 909 (3d Cir. 1985). "Reconsideration motions, however, may not be used to relitigate old matters, nor to raise arguments or present evidence that could have been raised prior to the entry of judgment." NL Indus., Inc., 935 F.Supp. at 516. Such motions will only be granted where (1) an intervening change in the law has occurred, (2) new evidence not previously available has emerged, or (3) the need to correct a clear error of law or prevent a manifest injustice arises. See, North River Ins. Co. v. CIGNA Reinsurance Co.,52 F.3d 1194, 1218 (3d Cir. 1995) (internal quotation marks and citations omitted). Because reconsideration of a judgment after its entry is an extraordinary remedy, requests pursuant to these rules are to be granted "sparingly, " Maldonado v. Lucca,636 F.Supp. 621, 630 ...


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